Southern Gold Limited (ASX: SAU) (Southern Gold or the Company) is pleased to provide an update on its exploration activities in South Korea, including the discovery of REE carbonatite and its licence applications over further prospective areas at Jangnam.

Southern Gold Managing Director Robert Smillie said: 'This is an outstanding early result from the team at our Jangnam Project after only recently commencing fieldwork, and it is a significant discovery for the company. To have found a previously undiscovered 700-m long extension of the Hongcheon carbonatite deposit in SAU ground, and some 800 m SW of the deposit itself, clearly indicates the deposit is larger than previously thought. Furthermore, the low Th and U concentrations from the samples are highly favourable for the outlook of the project. We will focus our efforts in the coming weeks in gaining a better understanding of the discovery through mapping and additional sampling to define targets for drill testing as soon as practicable. Given our additional licence applications and large land holding over 170 km2 , the potential for further carbonatite extensions and discoveries with the Jangnam project area is excellent'.

Background

In 2022, Southern Gold commissioned RSC to complete a nationwide critical minerals prospectivity study in South Korea. The RSC study identified several REE targets using a mineral system approach, and after further targeting work of higher-priority targets over winter and preliminary reconnaissance fieldwork, Southern Gold submitted exploration licence applications over areas surrounding the two well-known and unmined REE deposits in South Korea, Eorae San (i.e. SAU Chungju REE Project) and Hongcheon (i.e. SAU Jangnam REE Project)1 . The Jangnam REE Project includes 64 exploration licence applications covering an area of 174 km2 , adjacent to the Hongcheon REE carbonatite deposit held by a third party. This includes 11 new highly prospective licence areas lodged last month by SAU bordering the Hongcheon carbonatite deposit as well as along strike of the Hongcheon Fault.

The area along the Hongcheon Fault is marked by steep hills and outcrop is sparse, and therefore it is likely that concealed mineralisation remains to be discovered. The outline of the outcropping Hongcheon orebodies along the Hongcheon River is well defined and a recent academic study focussed on identifying extensions to the south of the carbonatite system5 . SAU followed up on reported soil, streamsediment and rock-chips anomalies from this study

In addition, wide-scale fenitisation (Na wall-rock alteration and brecciation proximal to carbonatite) as well as ironstone, was mapped along a N-S extension length of 700 m. Carbonatite float is present in the creeks between the steep hills in this area and is indicative of further subcropping REE mineralisation. Furthermore, the carbonatite samples assayed are comparable in mineralogy and texture to the Hongcheon orebody, and collectively the evidence indicates that that this new carbonatite discovery is a southern extension of the Hongcheon carbonatite. The area to the south of the alteration trend is subject to ongoing fieldwork. One expedited breccia sample (KRS511488) was collected from outcrop on a creek 6 km south of Hongcheon along the Hongcheon Fault

Laboratory Results

A total of 21 samples, collected from carbonatite outcrop, ironstone, and/or wall-rock associated with carbonatite alteration (breccias, metasediments) in May 2022, were selected for expedited analyses. Rock-chips from carbonatite and ironstone returned up to 2.7% TREO. Notably, sample KRS511488 contains 2.6% TREO, despite being 5 km south of the alteration trend along the Hongcheon Fault. Remarkably, the samples are not only elevated in REEs but the discovered ironstones and metasomatised rocks returned significant amounts of base and noble metals. Values ranged up to 2.45% Zn, 0.39% Cu, 78 ppm Ag, and 1790 ppm Mo. It is likely that some identified ironstones formed after sulphide mineralisation. Radioactive elements Th and U are known to be associated with many REE mineralisation styles including carbonatites. At Jangnam, their concentration is very low which is beneficial in multiple ways such as environmental concerns and simpler processing

Fieldwork is currently underway to better define the geology of the discovery area through mapping and sampling, as well as locate additional carbonatite outcrop in the immediate vicinity in order to define targets for future drill testing. In addition, regional fieldwork will be conducted along the NNE Hongcheon Fault zone, which likely was a controlling structure for the Hongcheon carbonatite dykes, to search for additional carbonatite mineralisation in both outcrop and under cover. The area has not been explored using modern exploration techniques and no detailed radiometric or aeromagnetic survey has been flown over the area. REE mineralisation and magnetite are cogenetic in the Hongcheon carbonatite, and SAU will consider conducting geophysical surveys to reveal the subsurface extent of the mineralised system and the Hongcheon Fault System. Further results from regional rock-chip and stream sediment samples taken in April and May are pending and are expected within the next month. Stream-sediment anomalies will guide further fieldwork in the area. Petrography studies using RSC's scanning electron microscope (SEM) are under way, which will reveal the mineralogy of the carbonatite, ironstone, and fenite/breccia discovered by SAU.

Contact:

Tel: 08 8368 8888

Competent Person's Statements

The information in this report that relates to Exploration Results is based on information compiled under the supervision of Dr Michael Gazley, a Competent Person who is a Member of The AusIMM and a Member of the AIG. Dr Gazley is employed by RSC as General Manager Geoscience. The full nature of the relationship between Dr Gazley and Southern Gold has been declared, including any issue that could be perceived by investors as a conflict of interest. Dr Gazley has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity he has undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for the Reporting of Mineral Resources and Ore Reserves. Dr Gazley consents to the inclusion in this report of the matters based on his information in the form and context in which it appear

Forward-looking statements

Some statements in this release regarding estimates or future events are forward looking statements. These mayinclude, without limitation: Estimates of future cash flows, the sensitivity of cash flows to metal prices and foreign exchange rate movements. Estimates of future metal production and Estimates of the resource base and statementsregarding future exploration results. Such forward looking statements are based on a number of estimates and assumptions made by the Company and its consultantsin light of experience, current conditions and expectations of future developments which the Company believes are appropriate in the current circumstances. Such statements are expressed in good faith and believed tohave a reasonable basis. However, the estimates are subject to known and unknown risks and uncertaintiesthatcould cause actualresultsto differ materially from estimated results.

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