ASX ANNOUNCEMENT

04 October 2016

Progressing Exploration Activities Across Priority Targets

Mineral sands developer, Strandline Resources (Strandline or the Company) is pleased to provide a brief update on its current exploration and feasibility program. The Company has continued to deliver on its aggressive exploration and resource building activities through the September quarter.

The current exploration program involves drilling across four priority targets along the central and northern Tanzanian coastline aimed at extending known Resources as well as identifying new titanium and zircon discoveries.

Highlights:

• Fungoni - Resource infill drilling is complete with extensions identified both north and south. Awaiting assay results prior to Resource update. Sub‐parallel geophysical anomalies have also been identified.

• Tanga South, Tajiri Mineralised Corridor - Initial phase of aircore drilling is complete, leading to discovery of new mineralisation and multiple promising extensions of the existing Mineral Resource.

• Tanga South, Tongoni and Pangani - Priority targets have been delineated and preparation is well advanced for the maiden drilling program commencing mid‐October.

Strandline's Managing Director and CEO, Luke Graham commented, "The Company is pleased with the progress of the exploration campaign, with positive signs of success in terms of new discoveries and extensions of high‐value mineralisation at our priority target areas.

The recent airborne data and drill results has validated the Company's strategy of acquiring strategic tenure in Tanzania. The current program will continue through the December quarter and we look forward to progressive news flow as the team further defines the Tanga South Resources and enhances the zircon‐rich Fungoni project in readiness for definitive level engineering work."

About Strandline

Strandline Resources Limited (ASX: STA) is a Tanzanian‐focused mineral sands developer positioned within the world's major zircon and titanium producing corridor in South East Africa. Strandline has a dominant mineral sands position with a series of 100% owned projects spread along 350km of the Tanzanian coastline.

Following the recent placement and Rights Offer by Tembo Capital the Company is financially robust and as at

31 August had A$4.8 million in the bank. This position underwrites an aggressive exploration and development strategy to progress quality "low cost" projects based on high value titanium and zircon products.

For further enquiries, please contact:

Luke Graham

CEO and Managing Director Strandline Resources Limited T: +61 8 9226 3130

E: [email protected]

For media and broker enquiries:

Andrew Rowell Investor Relations Advisor Cannings Purple

T: +61 8 6314 6314

E: [email protected]

www.strandline.com.au Page 1

Summary Exploration Update

Fungoni Project ‐ Resource Extension and Feasibility

he Company continues to

advance

development on its low cost zircon‐rich Fungoni

Mineral Sands Project

located near the port

infrastructure of Dar es Salaam.

he aircore infill and extension drilling campaign

of the existing Fungoni

Indicated

Resource is

complete.

Samples

are currently being

processed in Perth, Western Australia with assay results expected in November. The

Company will update

the Mineral Resource

stimate prior to selecting re

resentative

domains for bulk

metallurgica

testwork

ssential to

optimise

the mining method,

processing flow sheet and product suite suitable for marketing purposes.

Further, the

Fungoni

mineralisation remains

open in the

north‐west where a

continuous

linear radiometric anomaly extends for approximately 2km and two additional nearby sub‐parallel anomalies have also been identified requiring further evaluation by the Company.

anga South Project Corridor

- Tajiri

Mineralised

he Company is advancing efforts

to further

1

define and extend the Tajiri Mineralised Corridor

with the view to improve on

the existing

Figure 1.

Fungoni Project Recent Extensions Dril ing and

Indicated Resource of 59Mt @ 3.7% Total Heavy Minerals (THM) for 2.2Mt contained THM.

Radiometric Anomaly

A systematic aircore (AC) extensio

drill program has recently been completed

along 25km of the Tajiri

Mineralised Corridor within the Tanga South project. A total of 302 holes for 3000m of AC were completed

utilising a 1600m x 200m drill patter

reducing to 400m x 200m over specific targets.

he drilling has identified new zones of mineralisation along strike between Tajiri North and Tajiri ranging from approximately 1000m to 1600m in length and 400m to 600m in width.

e

Additional extensions to both Tajiri and Tajiri North Mineral Resources have also been identified with this recent round of drilling. Visual estimates of the panned samples from Tajiri have shown heavy mineral concentrations extending over 800m to the south of the current Mineral Resource. Further infill drilling is scheduled to firm up the extent and grade of this new zone of mineralisation. Assay results from this phase of xploration drilling are expected to be received during November.

anga South Project ‐ Tongoni and Pangani Discovery Drilling

Priority targets at Tongoni and Pangani were identified through historic surface geochemistry and detailed aeromagnetic/radiometric data resulting in the maiden aircore drill program commencing mid‐October.

Clearing and land access activities h

ve already commenced

on the 30km long mineralised corridor between Pangani and the town of Tanga to the north. A systematic grid‐based drill

program (1600m x 200m) has been designed

to provide

coverage over the majority of the tenure with closer spaced drilling (400m x 200m) targeting priority zones.

Airborne Magnetic and Radiometric Survey

An extensive airborne

magnetic and radiometric survey

comprising

17,520 line‐km over

ten blocks

distributed

between Tanzania's northern border with

Kenya and

southern border with

Mozambique has

now been

completed.

Preliminary

processing of the

data has

highlighted

a number

of significant radiometric and

magnetic anomalies across most of the Company's tenure in anzania.

Integration of this high quality geophysical data with the

Company's

extensive

surface geochemical

database is

proving to be a powerful tool in identifying new zones of

potential heavy mineral mineralisation including the

following:

Figure 1.2

s

trandline Resources' Central and

• Extensions from known Mineral Resources;

  Northern Tanzania Projects and Prospects

• Extensive linear anomalies coincident with anomalous regional geochemical surface sample data or mapped surface indications of heavy mineral accumulations; and

• Anomalism over areas defined as conceptual targets.

he airborne data has validated the Company's strategy of acquiring strategic tenure based on country

knowledge

and understanding of

the mineralisation in Tanzania. A

program of ground truthing these

anomalies will commence following further processing, evaluation and p ioritisation.

he survey was flown by Geotech Pty Ltd using a survey height of 30m above sea level on

line spacing

e

between 100m and 200m depending on ranked prospectivity of the block. Complementary digital elevation data was also obtained during the survey for each block.

Mineral Resource Estimate Data

Table 1 Fungoni Mineral Resource Estimate1 at various HM cut‐off (April 2014)

1 This JORC 2012 compliant Mineral Resource Estimate was prepared by Rod Webster, Tracie Burrows and Kathy Zunica of AMC Consultants Pty Ltd on

29 April 2014 and was published by Jacana in its replacement prospectus dated 6 November 2014. The 2.8% cut‐off figures were taken from the graphs in the AMC report and from TZMI analysis of the AMC block model.

Table 2 Tanga South Project Mineral Resource Estimate (April 2016)

Competent Person's Statements

The information in this report that relates to Exploration Results is based on, and fairly represents, information and supporting documentation prepared by Dr Mark Alvin and Mr Brendan Cummins, employees of Strandline. Dr Alvin is a Member of The Australasian Institute of Mining and Metallurgy and Mr Cummins is a member of the Australian Institute of Geoscientists and they both have sufficient experience which is relevant to the style of mineralisation and type of deposits under consideration and to the activity which has been undertaken to qualify as Competent Persons as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Dr Alvin and Mr Cummins consent to the inclusion in this release of the matters based on the information in the form and context in which they appear. Both Mr Alvin and Mr Cummins are shareholders of Strandline Resources.

The information in this report that relates to mineral resources for Fungoni is based upon information compiled by Mr Tom Eadie, who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Eadie, who is Non‐Executive Director of Strandline Resources, has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Mr Eadie consents to the inclusion in this release of the matters based on the information in the form and context in which they appear.