Sarama Resources Establishes New 100% Owned 600KM2 Exploration Position at its Koumandara Project in Burkina Faso

VANCOUVER, CANADA / TheNewswire / February 2, 2018 - Sarama Resources Ltd. ("Sarama" or the "Company") (TSX-V:SWA) is pleased to announce that it has established a new and significant exploration position at its 100% owned(5) Koumandara Project (the "Project") in south-west Burkina Faso (refer Figure 1).

The new 602km² land positon, located in the Banfora Greenstone Belt (refer Figure 2), was assembled by Sarama entering into agreements to acquire 4 mineral properties which complement Sarama's recently granted Nya-Nou exploration permit.

Sarama considers the Banfora Belt to be highly prospective for gold, yet relatively underexplored. Reviews of historical work conducted by Sarama and previous operators within the Project area indicate regionally extensive gold occurrences. These kilometre-scale trends are marked by drilling, large-scale artisanal mining centres and extensive gold-in-soil anomalism along corridors that coincide with a district-scale litho-structural 'break' interpreted as a regional-scale shear zone. A number of the geological characteristics identified by Sarama are seen in the neighbouring Hounde Belt and are considered important for the formation of economic gold deposits.

Highlights

• 602km2 semi-contiguous project area in the Banfora Belt in south-west Burkina Faso.
• Sarama's interests will be 100%, upon the closing of transactions(5).
• Project area overlies a 45km-long section of a district-scale litho-structural break ("Banfora East Shear Zone") which Sarama considers significant in terms of gold emplacement.
• Gold-in-soil anomalism extending over 43km-long x 10km-wide corridor, with approximately 25km untested by historical geochemical surveys.
• The Banfora Greenstone Belt extends from central Cote d'Ivoire where it hosts Perseus Mining's large Yaoure mine development project.
• Banfora East Shear Zone resembles the Boni Shear Zone of the Hounde Belt which is spatially associated with several significant high-grade gold deposits/projects including Yaramoko, Siou, Bondi and Golden Hill.
• Exploration is targeting multiple styles of mineralisation, but predominantly large, free-milling, gold-quartz systems that are known to be present in Burkina Faso.
• Historical reconnaissance reverse-circulation ("RC") and aircore ("AC") drilling returned significant intersections including:
  • 7m @ 6.86 g/t Au from 53m in BF_18 (RC, 100% Fresh);
  • 13m @ 2.87 g/t Au from 10m in BF_08 (RC, 25% Trans / 75% Fresh);
  • 4m @ 10.59 g/t Au from 30m in BF_08 (RC, 100% Oxide);
  • 3m @ 8.94 g/t Au from 105m in FRC802 (RC, 100% Fresh); and
  • 15m @ 1.80 g/t Au from 85m in FRC799 (RC, 100% Fresh).
• High tenor auger and gold-in-soil results have been returned in historical work programs.
• Sarama has commenced reconnaissance work and data compilation.

Sarama's President and CEO, Andrew Dinning, commented:

"The project has taken some time to pull together and we look forward to applying our extensive knowledge of the geology in Burkina Faso and what we have learned in the more established Hounde Belt where our team made a multi-million ounce discovery in a purely greenfields area.

This is a large 100%(5) owned position situated in a prospective, yet underexplored gold belt. We are very encouraged by regionally extensive gold-in-soil anomalism and also by the tenor of a number of the reconnaissance auger and RC drilling results. We are looking forward to generating our first round of targets and rapidly moving the project forward."

Geological Setting and Historical Work

The Project is located in the north of the Banfora Belt, a regionally extensive belt of Birimian-aged rocks which, elsewhere, are known to host multi-million ounce gold deposits. The properties are generally positioned over the central and eastern portions of the belt and overlie a package of lithologically diverse rocks including meta-sedimentary, volcanic and intrusive rock units of varying composition.

A district-scale, north-east trending litho-structural feature ("Banfora East Shear Zone") that lies close to the eastern margin of the Banfora Belt transects several of the properties, giving the Project exposure to a structurally disrupted corridor extending for approximately 45km along strike.

Historical soil geochemistry surveys on broad-spaced grids indicate elevated gold-in-soil anomalism along three main trends(6) within the Project. Peak values of 10.0g/t Au (mean of 5.9ppb Au) and 2.6g/t Au (mean of 10.3ppb Au) were returned for auger and manually collected soil surveys respectively.

The central trend extends for over 30km in strike and is coincident with fault-bounded sedimentary and mafic volcanic rocks units. The spatially-associated Banfora East Shear Zone further enhances the geological environment and increases the potential for large-scale fluid mobility and gold deposition.

The western anomalous trend extends for over 40km and is spatially associated with the contact zone of a granodioritic intrusion with sedimentary rocks in the outboard Banfora Basin. Detailed auger sampling surveys have delineated a third north-easterly-striking trend extending for approximately 30km along strike in the east.

Reconnaissance drilling by various operators to test anomalous gold-in-soil zones (refer Appendix A) has returned the following significant results:

• Nya-Nou Property (significant Intersections >=10gram.m/t(7) from 4400m RAB, 6600m AC, 4800m RC)
  • 7m @ 6.86 g/t Au from 53m in BF_18 (RC, 100% Fresh)
  • 13m @ 2.87 g/t Au from 10m in BF_08 (RC, 25% Trans / 75% Fresh);
  • 4m @ 10.59 g/t Au from 30m in BF_08 (RC, 100% Oxide);
  • 3m @ 8.94 g/t Au from 105m in FRC802 (RC, 100% Fresh);
  • 15m @ 1.80 g/t Au from 85m in FRC799 (RC, 100% Fresh);
  • 17m @ 1.18 g/t Au from 12m in BF_06 (RC, 6% Oxide / 94% Trans);
  • 2m @ 8.94 g/t Au from 20m in AC1032 (AC, 100% Oxide);
  • 4m @ 2.94 g/t Au from 90m in FRC801 (RC, 100% Fresh);
  • 7m @ 1.66 g/t Au from 19m in FRC799 (RC, 100% Oxide);
  • 20m @ 0.60 g/t Au from 12m in AC995 (AC, 100% Oxide); and
  • 4m @ 2.86 g/t Au from 9m in BF_03 (RC, 100% Trans).

• Kapoguan, Kongoroba & Noumousso Properties (significant intersections >=5gram.m/t(7) from 11600m RC, 200m DDH)
  • 3m @ 4.37g/t Au from 39m in BRC15-042 (RC, material type unknown); and
  • 3m @ 1.73g/t Au from 68m in BRC15-047 (RC, material type unknown).

Much of the Banfora East Shear Zone lacks coverage by base-level, detailed soil geochemistry surveys, and significant areas of the anomalous gold-in-soil trends identified remain untested by reconnaissance drilling. Sarama believes the Project contains several important geological features, the prospectivities of which are enhanced by encouraging results from historical exploration activities. Fieldwork will focus on gaps in the base-level data, in conjunction with ongoing compilation and verification of historical data and desktop targeting.

Sarama is encouraged that its new litho-structural interpretation for the eastern margin of the Banfora Belt, and the recognition that the Banfora East Shear Zone is intimately associated with a corridor of gold-soil anomalism, will lead to the discovery of a new gold belt and new gold discoveries. Sarama is well placed to consolidate its position and build its geological understanding of the region.

Commercial Terms of Transactions

A binding agreement in respect of the Dabokuy Property ("Dabokuy") was entered into with Semafo Inc ("Semafo") on January 31, 2018 (the "Dabokuy Agreement"). The Dabokuy Agreement, subject to novation of a historical agreement, permit transfers and payment of certain government fees and taxes by Sarama, provides for Sarama to acquire a 100% interest in Dabokuy. Semafo will retain a net smelter return royalty of 1.5% in respect of gold produced from Dabokuy in excess of 100koz Au and will have a one-off right to elect to purchase back an interest up to a maximum of 20% in Dabokuy (the "Back-In Right"). In the event Semafo elects to exercise its Back-In Right, Semafo will make a cash payment to Sarama equal to 3 times the exploration expenditures incurred by Sarama on Dabokuy on a pro-rata basis. Semafo's Back-In Right will expire the earlier of: (i) 90 days following the filing of a technical report by Sarama that details combined measured and indicated mineral resources on Dabokuy greater than 1Moz Au; and (ii) 45 days after the declaration by Sarama of its intention to commence commercial mining operations at Dabokuy. In the event that Semafo elects to exercise its Back-In Right, Semafo's right to a net smelter return royalty will be extinguished.

Binding agreements in respect of the Noumousso, Kapoguan and Kongoroba Properties were entered into with two Burkina Faso-based parties on December 15, 2018. The agreements are structured as option agreements and give Sarama the right to acquire a 100% interest in each of the 3 properties subject to Sarama making certain cash instalment payments at various time-based milestones. In the event that Sarama makes these instalments in full, the respective underlying exploration permits will be transferred to Sarama and the respective vendors will receive a net smelter return royalty of 1% in respect of gold production from the properties. Sarama has a right to buy out any or all of the royalties in full by making cash payments of US$1M for each of the royalties.

ABOUT SARAMA RESOURCES LTD

Sarama Resources Ltd (TSX-V: SWA) is a West African focused gold explorer with substantial landholdings in Burkina Faso. Sarama is focused on consolidating under-explored landholdings in Burkina Faso and other established mining jurisdictions.

Sarama's flagship properties are situated within the Company's South Hounde Project area in south-west Burkina Faso. Located within the prolific Hounde Greenstone Belt, Sarama's exploration programs have built on significant early success to deliver an inferred mineral resource estimate of 2.1 Moz gold(2). Acacia Mining plc is earning up to a 70% interest in the South Hounde Project by satisfying certain conditions, including funding earn-in expenditures of up to US$14 million, over a 4-year earn-in period and may acquire an additional 5% interest, for an aggregate 75% interest in the Project, upon declaration of a minimum mineral reserve of 1.6 million ounces of gold. Acacia has satisfied certain milestones and currently holds a 50% interest in the South Hounde Project and is continuing to sole fund exploration activities.

Sarama holds a 31% participating interest in the Karankasso Project Joint Venture ("JV") which is situated adjacent to the Company's South Hounde Project in Burkina Faso and is a JV between Sarama and Savary Gold Corp. ("Savary"). Savary is the operator of the JV and in October 2015, declared a maiden inferred mineral resource estimate of 671,000 ounces of contained gold(3) at the Karankasso Project JV.

Sarama also has a 100% interest in the Bondi Deposit which has a historical estimate of mineral resources of 0.3Moz Au (measured and indicated) and 0.1Moz Au (inferred)(1).

Together, the South Hounde Project, Bondi Deposit and the Karankasso Project form a cluster of advanced gold deposits, within trucking distance of one another, which potentially offers a development option for a multi-source fed central processing facility in the southern Hounde Belt region of Burkina Faso.

Sarama had recently established a new 600km? exploration position in the highly prospective Banfora Belt in south-western Burkina Faso. The Koumandara Project hosts several regional-scale structural features and trends of gold-in-soil anomalism extending for over 40km along strike.

Incorporated in 2010, the Company's Board and management team have a proven track record in Africa and a strong history in the discovery and development of large-scale gold deposits. Sarama is well positioned to build on its current success with a sound exploration strategy across its property portfolio.

FOOTNOTES

1. Bondi Deposit - 4.1Mt @ 2.1g/t Au for 282,000 oz Au (measured and indicated) and 2.5Mt @ 1.8g/t Au for 149,700 oz Au (inferred), reported at a 0.5 g/t Au cut-off.
   1. The historical estimate of the Bondi Deposit reflects a mineral resource estimate compiled by Orezone Gold Corporation ("Orezone") which has an effective date of February 20, 2009. The historical estimate is contained in a technical report titled "Technical Report on the Mineral Resource of the Bondigui Gold Project", dated date of February 20, 2009 (the "Bondi Technical Report") and is available under the profile of Orezone on SEDAR at www.sedar.com.
   2. Sarama believes that the historical estimate is relevant to investors' understanding of the property, as it reflects the most recent technical work undertaken in respect of the Bondi Deposit.
   3. The historical estimate was informed by 886 drillholes, assayed for gold by cyanidation methods, were used to interpret mineralised envelopes and geological zones over the area of the historical estimate. Gold grade interpolation was undertaken using ID? methodology based on input parameters derived from geostatistical and geological analyses assessments. Field measurements and geological logging of drillholes were used to determine weathering boundaries and bulk densities for modelled blocks.
   4. The historical estimate uses the mineral resource reporting categories required under National Instrument 43-101.
   5. No more recent estimates of the mineral resource or other data are available.
   6. Sarama is currently undertaking the necessary verification work in the field and on the desktop that may support the future reclassification of the historical estimate to a mineral resource.
   7. A qualified person engaged by Sarama has not undertaken sufficient work to verify the historical estimate as a current mineral resource and Sarama is therefore not treating the historical estimate as a current mineral resource.
2. South Hounde Project - 43.0 Mt @ 1.5 g/t Au (reported above cut-off grades ranging 0.3-2.2 g/t Au, reflecting the mining methods and processing flowsheets assumed to assess the likelihood of the inferred mineral resources having reasonable prospects for eventual economic extraction). The effective date of the Company's inferred mineral resource estimate is February 4, 2016. For further information regarding the mineral resource estimate please refer to the technical report titled "NI 43-101 Independent Technical Report South Hounde Project Update, Bougouriba and Ioba Provinces, Burkina Faso", dated March 31, 2016. The technical report is available under Sarama Resources Ltd.'s profile on SEDAR at www.sedar.com.
3. Karankasso Project - 9.2 Mt @ 2.3 g/t Au (at a 0.5 g/t Au cut-off). The effective date of the Karankasso Project JV mineral resource estimate is October 7, 2015. For further information regarding the mineral resource estimate please refer to the technical report titled "Technical Report and Resource Estimate on the Karankasso Project, Burkina Faso", dated October 7, 2015. The technical report is available under Savary Gold Corp's profile on SEDAR at www.sedar.com. Sarama has not independently verified Savary's mineral resource estimate and takes no responsibility for its accuracy. Savary is the operator of the Karankasso Project JV and Sarama is relying on their Qualified Persons' assurance of the validity of the mineral resource estimate.
4. Sarama has, or is entitled to have a 100% interest in the Djarkadougou, Botoro, Bamako and Bouni Properties which comprise the ThreeBee Project.
5. Refer to Section of this News Release 'Commercial Terms of Transactions'.
6. Western Trend broadly defined by +5ppb Au (66th percentile of survey population) gold-in-soil anomalism - samples collected manually. Central Trend broadly defined by a combination of +17ppb Au (90th percentile of survey population) for manually collected samples and +18ppb Au (95th percentile of survey population) for auger drilled samples. Eastern Trend broadly defined by a combination of +50ppb Au for auger drilled samples and +12ppb Au for manually collected samples.
7. Measurement unit of gram.m/t refers to intersection grade in grams/tonne multiplied by intersection length.