Sheffield Resources Limited - SOUTH ATLANTIC PROJECT - REVISED OPTION AGREEMENT

About this update from Sheffield Resources Limited

Sheffield Resources Limited ('Sheffield' or 'the Company') (ASX: SFX) is pleased to advise that it has entered into a variation agreement (Variation) with Rio Grande Mineracao S/A (RGM), extending the initial option term from August 2024 to August 2025 . On 28 February 2023 , the Company executed a binding investment agreement (Agreement) with Mineracao Santa Elina Industria e Comercio S/A. and Kromus Xi Fundo De Investimento Em ParticipacOes, current owners of Rio Grande Mineracao S/A (RGM), providing Sheffield with an option to acquire a 20% interest in RGM, the 100% owner of the South Atlantic Project in Brazil , via an initial option contribution of US$2.5m , with further staged payments totalling US$12.5m based upon the achievement of key milestones (refer ASX announcement dated 28 February 2023 ). Under the terms of the Variation, in addition to the US$2.5m investment during 2023 and 2024, Sheffield shall provide RGM with a further investment contribution of up to US$1.5m to fund project related activities and assist Sheffield with further project related due diligence. The investment is payable in equal instalments of US$0.5m each, with the first scheduled payment to occur in mid-2025. The total contribution of US$4m grants Sheffield the option to acquire an interest of up to 20% in RGM, which may be exercised via the further investment totaling US$11m ( US$15.0m in total). Under revised Variation terms, the option of acquire a 20% interest in RGM is exercisable within a 30 month period of the Agreement (i.e., August 2025 ), subject to the satisfaction or waiver of various conditions precedent under certain circumstances, including the execution of a formal shareholders agreement and framework agreement for the resultant joint venture. The total cost to acquire 20% of RGM, should Sheffield exercise its option, remains US$15m however the expected timing of investment has been extended over a longer time period. Sheffield expects to fund the US$1.5m investment contribution scheduled from mid-2025 from existing cash reserves. This ASX announcement has been authorised for release by the Company's Board of Directors. Contact: Bruce Griffin Executive Chair Tel: 08 6555 8777 Email: [email protected] Web: www.sheffieldresources.com.au SOUTH ATLANTIC PROJECT The South Atlantic Project is located in south east Brazil . Four main deposits have been identified within the project area: Retiro, Estreito, Capao do Meio and Bujuru with Exploration Targets developed for the Retiro and Bujuru deposits. The combined Exploration Target for Retiro and Bojuru is estimated between 500 and 720 Mt of material at an average grade of 4.0% to 3.2% HM. The tenements are held by RGM. Sheffield entered into an option agreement with RGM in February 2023 with Sheffield to provide US$4.0m to fund project related activities over a 30 month period and earn an option to acquire up to 20% of RGM with the payment of a further US$11.0m ( US$15.0m in total) to acquire a 20% interest. Should Sheffield elect to exercise the option, subject to various conditions being satisfied, including project financing being obtained and all funds required for project construction being secured, Sheffield may exercise a further options to increase its interest in RGM up to 80%. (C) 2024 Electronic News Publishing, source ENP Newswire

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