April 2017: Shareholder Update

To the Shareholders of Golden Reign Resources Ltd.:
It has been quite a busy year, to say the least. With just the month of April left in our current financial year, we wanted to provide an update on our recent activities and what we expect to achieve as we move into fiscal 2018.

Our Strategy
Early in 2013, we charted a strategic course for our company in light of persistent, highly volatile market conditions. This course was a short path towards low cost, small scale production intended to provide cash flow to fund further exploration and organic growth. Steps along this path included our initial NI 43-101 resource estimate at the San Albino Gold Deposit delivered in January 2013, an update of the resource in 2014, and delivery of a preliminary economic assessment (PEA) in March 2015. In July 2014, we signed a gold streaming arrangement for US$15 million with Marlin Gold Mining Ltd. to provide the funding needed to develop San Albino.

Advancing the San Albino Gold Deposit
Over the last twelve months, we drilled:

  • 56 diamond drill holes over 2,175.3 metres as part of our metallurgical/infill drill program – all located within the proposed San Albino open-pit mine;
  • 191 closely spaced, pre-production, grade control Reverse Circulation (RC) holes over 3,239 metres, confirming grade and structural continuity of the mineralization, and extending the mineralization along strike and at depth, resulting in the expansion of the initial pit boundaries;
  • 17 condemnation drill holes over 1,044.5 metres with the goal of ensuring that the proposed mill, waste dump and tailings are sited on barren or uneconomic rock as to not compromise future mining operations;
  • and excavated nine trenches and fourteen exploration pits. This pre-development work confirmed both the high-grade nature and geometry of the mineralization, which correlates strongly with Golden Reign’s existing model developed under its PEA.

Permitting
In mid-August 2016, after much work by our team and with the involvement and assistance of external consultants we submitted our Environmental Impact Assessment (EIA) to the Nicaraguan Ministry of the Environment and Natural Resources (MARENA). This 480 page tome outlines how we propose to develop and mine San Albino and is a critical path item in obtaining an environmental permit. Other key permits required are: forestry permit (obtained); water permit (obtained); and, mining permit (to be issued after the environmental permit is obtained).

Our momentum slowed during the lead up to the Nicaraguan national election held in early November 2016. Post-election we were able to move forward. After its initial review of our EIA MARENA responded in short order, seeking clarification or further information on 17 items. On December 20, 2016, we submitted an addendum to the EIA in response to MARENA’s queries. We were anticipating receipt of our public hearing dates from MARENA in early January 2017. Before the hearing dates could be issued, a new minister and deputy minister were appointed to MARENA, which resulted in further bureaucratic delays. With the 17 items successfully dealt with, MARENA has returned with three further items requiring clarification. We are currently addressing these three items. A second addendum will be submitted to MARENA within the next several weeks.

Other Activities
In September 2016, we launched our new Golden Reign website. It’s been retooled for easier use, particularly on mobile devices. We invite you to take a look and while there encourage you check out the PDAC ’17 Presentation under the Investor’s section. This paper, entitled “San Albino: a high grade, free gold Macraes analogue in Nicaragua” was co-presented by Dr. Rael Lipson, one of our directors, and Zoran Pudar, our VP Exploration, at the New Discoveries and Developments Session of the 2017 Prospectors and Developers Association Conference (PDAC) in Toronto in early March. PDAC is the top conference worldwide for our industry – this year attracting over 24,000 attendees.

Besides attending PDAC 2017, we participated in the 2nd Nicaraguan International Mining Congress in August 2016, the BMO Capital Market’s Annual Global Metals & Mining Conference in February 2017, the New Orleans Investment Conference in October 2016 and the Metals Investor Forum in May 2016. Our goal is to raise Golden Reign’s profile, building both a greater name recognition and following.

We’ve also completed two equity financings, issuing 28,352,725 common shares for aggregate gross proceeds of $6,237,599. Net proceeds will be used for working capital, general corporate purposes and to accelerate exploration targets outside of the 3.5 square kilometre area hosting the San Albino Gold Deposit.

Looking Ahead
Over the course of the last year our stock price has moved from a low of $0.065 in January 2016, reaching as high as $0.355 in September 2016 before settling back to the current range of $0.20 – 0.23. We firmly believe that the receipt of our much anticipated environmental permit will de-risk our San Albino mine project further. It is important to understand that the fundamentals of our business have not changed despite the volatility.

Value in our people and our projects is being unlocked, to the benefit of our shareholders, our employees, and the communities in which we work. We have a talented and dedicated team – all committed to seeing our company thrive and achieve significant growth in the coming years.

As management, we are dedicated to our primary goal of building value for our shareholders. We put a high value on the trust and investment you’ve placed in us. We, too, are shareholders – with insider ownership representing a 15% stake in Golden Reign. Our interests are aligned with yours.

We have accomplished much in the last year but our best days are still ahead of us. With our world-class San Albino project and numerous highly prospective exploration targets, we have the right assets in the right commodity with the capability and culture to build even more momentum and prosper in 2017 and beyond.
Thank you for your continued interest in, commitment to and support of Golden Reign. Please do not hesitate to contact us directly with any questions. We can be reached at info@goldenreign.com.

Sincerely,
Kim Evans, CPA, CGA
President

For further information, or if you know of anyone who would like to receive this newsletter, please direct them to our website at http://www.goldenreignresources.com.

Forward-Looking Statements: Some of the statements contained herein may be forward-looking statements which involve known and unknown risks and uncertainties. Such forward-looking statements are subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward-looking statements, including, without limitation, risks and uncertainties relating to political risks involving the Company’s exploration and development of mineral properties interests, the inherent uncertainty of cost estimates and the potential for unexpected costs and expenses, commodity price fluctuations, the inability or failure to obtain adequate financing on a timely basis and other risks and uncertainties. Such information contained herein represents management’s best judgment as of the date hereof, based on information currently available.

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