ASX ANNOUNCEMENT 29 April 2016

QUARTERLY ACTIVITY REPORT MARCH QUARTER 2016

HIGHLIGHTS

The March 2016 Quarter saw assay results for work conducted on the Gawler Craton gold project in the December 2015 Quarter; the company expanded its strategic position in the Gawler Craton around the Challenger gold mine; and preparation for a new drilling program at the 100% owned West Melton copper project.

Gold exploration program assay results

• Assay results from drilling at Widgety [ ASX:MEU 1 Feb 2016 ] and infill calcrete sampling at Westpoint Hill target [ ASX:MEU 17 & 24 Feb 2016 ]

  - see discussion below.

  New Head of Exploration Team [ ASX:MEU 22 March 2016 ]

  • Dr Kevin Wills BSc, Ph.D., ARSM, FAusIMM appointed as Chief Consulting Geologist

  • Dr Wills pioneered a method of rapid reconnaissance calcrete sampling that generated many new gold discoveries, including Challenger.

    Gawler Craton Tenement Expansion

  • Marmota negotiated to acquire from a private party a 100% interest in 3 additional tenements around the Challenger gold mine - EL 5087, 5088 and 5527 - completed in April [ ASX:MEU 14 April 2016 ]

  • The new holdings further expand Marmota's dominant position around the Challenger Gold mine.

    Corporate

  • Benefits of corporate re-structure already evident

    • Reduced Board and admin costs: expenditure on administration has been cut by over 50% compared to the March 2015 quarter

    • Capital position continues to improve: every consecutive quarter since restructure, Marmota's 'Cash at end of quarter' has increased

  • New capital brought in

    • $258,750 placement (before costs) to Southern Cross Capital Pty Ltd

- new cornerstone investor

Exploration Activities during Quarter

GOLD Gawler Craton

Multi-commodity potential (gold, copper, nickel, zinc, uranium)

Figure 1: Marmota's Gawler Craton Gold Project showing the location of the new tenements

Work undertaken during reporting period

Background

• Marmota is searching for Challenger-style gold systems. The Challenger mine has already produced 1 million ounces of gold (over A$1.5 billion of gold, at current prices).

• Marmota has a dominant tenement holding around Challenger. Marmota tenements cover approximately 4,500 km2 of highly prospective area around the Challenger gold mine, in the Woomera Prohibited Defence Area in the Gawler Craton.

• Marmota is adopting the same calcrete sampling methodology that was used to find Challenger -- to highlight areas of gold anomalism with the potential for Challenger- style gold mineralisation.

  The gold program is ongoing and expanding.

  Widgety Prospect [ see ASX:MEU 1 February 2016 ]

  • In December 2015, Marmota completed a RC drilling program with 1,652 metres drilled, testing 3 areas of interest identified at the Widgety Prospect [ see Fig. 2 & 3 ] .

  • The Widgety drilling program consisted of 29 angled RC holes with lengths varying from 50 to 102 metres [ see ASX:MEU 1 February 2016 for details ].

  • 29 angled RC holes were drilled to test 3 separate areas

    • Magnetic anomaly North (5 holes), and magnetic anomaly South (2 holes):

      The program to both the North and South areas did not have the benefit of refinement via gold-in-calcrete testing, as infill calcrete sampling program did not extend to either of these areas.

    • Central zone: This area was the subject of calcrete sampling programs; those programs yielded a number of clusters of gold-in-calcrete anomalies exceeding 20ppb, but no sharply defined 'hot zone'.

Results: In each drillhole, 3 metre composite samples were assayed for 49 elements including gold, with the focus being on the gold occurrences. The highest gold occurrence was 70ppb Au in hole WRC0009 from 30-33 metres downhole. No further follow-up work is warranted.

Figure 2: Marmota gold-in-calcrete sampling Figure 3: Higher-resolution magnetic survey highlighted

additional targets, to both the North and South