Matsa Resources Limited ('Matsa' or 'the Company' ASX: MAT) is pleased to provide an update to the Company's proposed construction of a new 600,000tpa (upgradable to 1Mt pa) processing plant for the Lake Carey Gold Project.

Whilst exploration, resource modelling and mine design works remain in progress, it is becoming increasingly likely that sufficient ore stocks to support a new processing plant will be realised in the near future.

To that end, in preparation for this, Matsa has identified a preferred site to locate a new processing plant and is progressing the relevant work activities to lodge and obtain permitting for the construction.

Matsa Executive Chairman Mr Paul Poli commented: 'Our work at the Fortitude mine, Devon and Fortitude North highlights that a mill in this location just makes sense. Over the coming months we'll be advancing the relevant works to obtain the necessary permitting for this cornerstone component of recommencing gold production.'

Fortitude

The Fortitude trend is shaping up to provide the bulk of the base load ore feed for the proposed new processing plant. Whilst more drilling and mining studies are currently progressing, Matsa is confident these projects can provide the impetus to support a business case for a new processing plant. One of the key criteria to permitting a new processing plant, is the management and disposal of tailings. To that end, the preferred approach to tailings management will be to design the processing plant and tailings facility such that the tailings are disposed of within the Fortitude waste dump (IWL TSF - integrated waste landform tailings storage facility).

Precedents using this approach exist in the WA goldfields, which should expedite the permitting process and is considered cost effective and environmentally responsible. Whilst a final layout based on results of the updated Fortitude Resource and impending optimisation works is yet to be confirmed, the existing layout of site infrastructure as outlined in the approved Mining Proposal is not expected to substantially change. A number of work activities are progressing in order to facilitate the permitting process for the new processing plant at Lake Carey.

Centralised Location

Matsa has a number of advanced stage projects at Lake Carey including the Fortitude, Devon Pit and Red October gold mines. Resources have also been established at Hill East, Bindah and Gallant, and further exploration is commencing at Fortitude North and Devon, which are all within close proximity to the proposed location of a new processing plant at Lake Carey. The proposed mill location at the Fortitude mine is well positioned to service Matsa's other projects that are by and large within 20km of the proposed site location.

A new processing plant at this location also opens up opportunities for 3rd party satellite deposits who do not have ready access to a processing plant within short to medium haulage distances.

News Flow

Matsa is expecting to provide an update on exploration, Fortitude optimisation and progress on the permitting of the proposed new processing plant in the coming months as new work is completed.

Contact:

Paul Poli

Tel: 08 9230 3555

Email: reception@matsa.com.au

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