ABX GROUP LIMITED — Investor Presentation 2018

May 27, 2018

28 May 2018

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ASX ANNOUNCEMENT

AUSTRALIAN BAUXITE LIMITED ASX: ABX

AlF3 for Aluminium smelters & Lithium ion batteries. Corethane: clean as gas, cheap as coal

ALCORE Limited Seed Capital Presentation to fund ALCORE Stage 1 refining bauxite into Aluminium Fluoride

In accordance with the requirements of Listing Rule 3.1 we submit the attached material being presented to investors to the ALCORE project.

Summary:

• ALCORE Limited will be a wholly-owned subsidiary to fund and manage the ALCORE Project, leading to the construction of an ALCORE Production Plant to produce 50,000 tonnes per year of Aluminium Fluoride (AlF3) and co-products

• ALCORE technology converts raw bauxite worth approximately $50 per tonne into products worth more than $1,000 per tonne of bauxite.

• Preliminary in-house and independent engineering estimates of the operating cost is of the order of $400 to $500 per tonne of bauxite, which leaves an attractive operating margin

• ALCORE project is starting with the commencement of Stage 1 pilot plant at a pre-approved factory site in Berkeley Vale, central coast NSW for the production of AlF3 test samples

• Stage 1 costs reduced to $2.5 million site operations (including contingencies), plus $0.5m pre-IPO costs plus $0.3m working capital and administration cost

• $1 million of funding has been promised, $0.5 million has been provided and $0.2 million has been pledged by parties supportive of this new technology

• It is anticipated that the remaining $1.6 million of seed capital will be fully subscribed to complete the funding of Stage 1

• Once Stage 1 completes the production of AlF3 test samples, it will be modified to test the production of Corethane, which is pure hydrocarbon powder refined from low-value coals

• Corethane will provide heat and electrical power for the ALCORE Production Plant and will also demonstrate its use as a gas-substitute in gas turbine electrical generators or its use as a diesel substitute for fuel security purposes. Corethane has many industrial markets

• Discussions with governments and agencies are progressing at the highest levels

• Companies that showed strong interest in purchasing and/or marketing both the Aluminium Fluoride and the main co-products Corethane and silica fume are being consulted

• ALCORE and ABx are on schedule to complete funding arrangements by 30 June 2018

ABx CEO, Ian Levy Comments:

“After 5 years of hard work and fine-tuning the ALCORE technology with the patent holder, Refined Ore Industries Limited (ROIL), ABx can, subject to a successful IPO or superior funding process, unlock considerable shareholder value that is not reflected in ABx’s current share price. ABx and ROIL will control the destiny of ALCORE so as to maximise shareholder values.

AUSTRALIAN BAUXITE LIMITED

ACN 139 494 885 Level 2 131 Macquarie Street Sydney NSW 2000 p: +61 2 9251 7177 f: +61 2 9251 7500

w: australianbauxite.com.au e: corporate@australianbauxite.com.au

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ASX: ABX

“At current product sale prices, ALCORE has the potential to produce 50,000 tonnes per year of Aluminium Fluoride and deliver a significant annual EBITDA. This is why The ALCORE Project must be pursued without delay to be ready to supply existing Australasian aluminium smelters and new aluminium smelters under construction. Lithium-ion battery demand will be a bonus upside.

“ABx will continue progressing the development of its three core bauxite projects, namely the Tasmanian mine and additional resources, the large Binjour Project in central QLD and the Penrose refractory bauxite project 90km inland of Port Kembla NSW. Separating ALCORE into its own entity with its own management and destiny will unlock considerable value for shareholders in both the short and medium terms. Financing of the ALCORE Production Plant cannot be pre-determined but an IPO during 2019 is one route, should there be no superior offers at the time.”

For further information please contact: Ian Levy, CEO and MD Australian Bauxite Limited Telephone: +61 (0) 2 9251 7177 Mobile: +61 (0) 407 189 122

About Australian Bauxite Limited

ASX Code ABX Web: www.australianbauxite.com.au

Australian Bauxite Limited (ABx) has its first bauxite mine in Tasmania & holds the core of the Eastern Australian Bauxite Province. ABx’s 22 bauxite tenements in Queensland, New South Wales & Tasmania exceed 1,975 km[2] & were selected for (1) good quality bauxite; (2) near infrastructure connected to export ports; & (3) free of socio-environmental constraints. All tenements are 100% owned, unencumbered & free of third-party royalties.

ABx’s discovery rate is increasing as knowledge, technology & expertise grows. The Company’s bauxite is high quality gibbsite trihydrate (THA) bauxite that can be processed into alumina at low temperature.

ABx has committed a large proportion of its expenditure into Research and Development to find ways to capitalise on the main strengths of its bauxite type, mainly highly clean, free of all deleterious elements and partitioned into layers, nodules, particles and grains of different qualities that can be separated into different product streams using physical, chemical and geophysical methods.

ABx has declared large Mineral Resources at Inverell & Guyra in northern NSW, Taralga in southern NSW, Binjour in central QLD & in Tasmania, confirming that ABx has discovered significant bauxite deposits including some of outstandingly high quality.

ABx’s first mine commenced at Bald Hill near Campbell Town, Tasmania in December 2014 – the first new Australian bauxite mine for more than 35 years.

ABx aspires to identify large bauxite resources in the Eastern Australian Bauxite Province, which is a globally significant bauxite province. ABx has created significant bauxite developments in 3 states - Queensland, New South Wales and Tasmania. Its bauxite deposits are favourably located for direct shipping of bauxite to both local and export customers.

ABx endorses best practices on agricultural land, strives to leave land and environment better than we find it. We only operate where welcomed.

Directors & Officers

Paul Lennon Chairman Ken Boundy Director Ian Levy CEO & MD Henry Kinstlinger Company Secretary Leon Hawker Chief Operating Officer Jacob Rebek Chief Geologist Paul Glover Marketing, Logistics & Exploration Manager

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June 2018
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Mine
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developments will almost certainly differ
audited or investigated the accuracy or
contained in this presentation.
and take no responsibility and assume no
presentation.
You should not act or refrain from acting in
order to make an informed assessment of
investigation and perform your own analysis
prospects. You should also conduct your own
satisfy yourself as to the accuracy and
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No agreement to subscribe for
Such forecasts and information are
Actual results and
implied. ALCORE has not
statements and opinions
accuracy, suitability or
material. This overview of
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3 by refining
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• Customers: Major aluminium producer agreed to test with a view to buy 50% of ALCORE production at market prices. Trading house offering finance for ALCORE

• • Capital Raising: A$0.5m already subscribed. ALCORE is raising a further A$2.8m

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Subject to adjustments by brokers/advisers

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•
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ABx
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Seed investors (A$1.8m@35 cents)
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IPO investors (A$26.5m@50 cents)
Assumes $1m raised from 3 [rd]
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•
to process many mineral ores
demand and with fewer
contents of an ore rather than
discarding the remainder as waste
•
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Intellectual Property
and will supply ultra
waste, less energy
can recover all
target commodity and
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Low grade
coal
(black
or brown)
Fluorosilic Acid “FSA”
By-product from
fertiliser plants, used
to fluoridate drinking
water
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3 electrolyte for more
efficient Aluminium
Smelters
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AlF 3

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Grind Bauxite &/or coal
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50,000 tpa AlF3 refinery

Corethane for ALCORE refinery heat &

SiO 2

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a waste
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Fe O
2 3
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TiO 2 AlF 3 TiF 4

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Pigment or TiF
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This Australian CORE technology has operated successfully before 1. In Japan 1981-86 producing 200,000 tonnes of Corethane for US Military tests 2. In Cooma NSW 2001-07 refining graphite & other ores, including bauxite ALCORE Technology is a low-cost, low risk application of the CORE Process

Timing is right: Strong market growth

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AlF3 markets are very strong
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Aluminium Fluoride AlF3 Prices
$2,000
Market prices Prices strong
$1,800
$1,600 AlF3 prices positive
$1,400
ALCORE’s target price trend since 2012.
$1,200
$1,000 Recent price jump
Target Margin
$800 due to Lithium ion
$600 battery demand and
ALCORE’s target cost/t
$400
very strong growth in
$200
aluminium production
$0
Graph data: Asian Metals
Global Aluminium Smelter Production Tonnes: AlF
3 is Aluminium index-linked
70
AlF3 markets expanding
60 into Aluminium Aluminium production is growing at record rates
50 plus hi-tech and many new smelters in construction
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Past: AlF3 demand = 1.5% - 3% of Aluminium tonnes
30
20 Now: AlF3 demand growing faster than aluminium
10 Pre 2012, AlF3 demand linked due to new markets like Lithium ion battery usage
only to aluminium production
0
1990 1995 2000 2005 2010 2015 2020 Graph Data: World Aluminium
Millions tonnes
Price US$/tonne FOB China
3
AlF
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Target economics of full-sized ALCOREproductionplant	Target economics of full-sized ALCOREproductionplant	Target economics of full-sized ALCOREproductionplant	A$million
Capital cost			-$59
Operating costs	Bauxite(t)	Cost A$/t	A$million
Total Operating expenditure	105,000	$266	-$28
Operating revenues	Tonnes Produced	Price A$/t Produced	A$million
Aluminium Fluoride AlF3	50,000	$1,600	$80.0
Silica fume concrete &geopolymer	10,500	$650	$6.8
Iron Oxide Fe2O3 pigment/ochre	22,500	$250	$5.6
Titanium TiO2& TiF4	3500	$1,800	$6.3
Total sales	86,500	$1,142	$99
EBITDA(A$ millions)			$71

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•
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2. Silica Fume
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major & an Australian
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ALCORE can also refine coal to make Corethane hydrocarbon products

1. As a diesel substitute (mixed with 50% water) to increase Fuel Security

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3. Collate the engineering data
4. Turnkey Innovative Engineering (“
5.
6. A recent Turnkey project
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the construction of
construction and
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Tasmania as an example 14

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Former Senior Partner
Simpson Grierson (NZ Lawyers)
Barrie Hill
Minerals Process Engineer
Chemical Process Engineer
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Company Secretary of
ABx & ROIL
Third director
identified
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Budget

Schedule

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Sample Testing

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•
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Later Stage R&D:
the IPO budget
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(R&D) incentive
approved expenditure
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•
The directors of ALCORE
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Minimum investment is
•
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select appropriate
be investors exempt
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OHS&E
R&D Advisors
IPO Management
Lead Brokers
Project Site Contractor
Share Registry
More Information Contact : Ian Levy
CEO
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equipment, analytical laboratory,
ore storage & admin offices
Turnkey are running computer
simulations of the ALCORE
process thermodynamics to
confirm technical factors & issues
Turnkey to carry out engineering,
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Production Cost Estimates 22	Production Cost Estimates 22	Production Cost Estimates 22	Production Cost Estimates 22	Production Cost Estimates 22
	Full-sized 50,000tpa AlF3 Plant Labour Energy Fluorine makeup Capital maintenance 20%contingency &other	A$m A$m A$m A$m A$m	A$ million $2.62 $3.33 $8.85 $3.53 $3.66	Assumptions No cost offsets from sales of co-products No cost offsets from sales
	Subtotal processing Tonnes raw bauxite per year	A$m tonnes	$22.0 105,000	of Corethane All costs attributed to AlF3
	Subtotal bauxite cost Total Operating Cost	A$m A$m	$5.25 $27.2	Construction jobs ~30
	Total Cost / tonne bauxite	A$/t	$259	Plant jobs 25
	Tonnes AlF3 peryear	tonnes	51,790	Transport jobs 8-15
	Production Cost / tonne AlF3	A$/t	$526	Minesite jobs 10-15
	AUD:USD Fx Rate Production Cost / tonne AlF3	US$/t	0.75 $394	Subtotal FTE jobs 40-50
Note: Corethane is additional upside			Forward	looking statement – see disclaimer

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Value adding with no smoke-stack, no emissions, no wastes

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8. Corethane mixed 50% with water creates an inexpensive diesel substitute to increase Fuel Security

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