Alkane Resources — AGM Information 2019

Nov 19, 2019

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AGM Presentation
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November 2019

© 2019 Alkane Resources

Disclaimer

This presentation contains certain forward-looking statements and forecasts, including possible or assumed reserves and resources, production levels and rates, costs, prices, future performance or potential growth of Alkane Resources Ltd, industry growth or other trend projections. Such statements are not a guarantee of future performance and involve unknown risks and uncertainties, as well as other factors which are beyond the control of Alkane Resources Ltd. Actual results and developments may differ materially from those expressed or implied by these forward-looking statements depending on a variety of factors. Nothing in this presentation should be construed as either an offer to sell or a solicitation of an offer to buy or sell securities.

Alkane Resources Ltd cannot and does not give any assurance that the results, performance or achievements expressed or implied by the forwardlooking statements contained in this presentation will occur and investors are cautioned not to place any reliance on these forward-looking statements. Alkane Resources Ltd does not undertake to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future events or any other factors affect the information contained in this presentation, except where required by applicable law and stock exchange listing requirements.

This document has been prepared in accordance with the requirements of Australian securities laws, which may differ from the requirements of United States and other countries’ securities laws. Unless otherwise indicated, all ore reserve and mineral resource estimates included or incorporated by reference in this document have been, and will be, prepared in accordance with the JORC classification system of the Australasian Institute of Mining, and Metallurgy and Australian Institute of Geosciences.

COMPETENT PERSON

Unless otherwise stated, the information in this presentation that relates to mineral exploration, mineral resources and ore reserves is based on information compiled by Mr D I Chalmers, FAusIMM, FAIG, (director of the Company) who has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Ian Chalmers consents to the inclusion in the presentation of the matters based on his information in the form and context in which it appears.

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Corporate Existing Strength Production

• § $74M in cash, bullion and listed securities as at 30 September 2019 (nil debt)

• § Tomingley mill partially utilised for the existing underground; upgraded FY20 guidance of 30,000oz35,000oz

• § Extensive senior

management expertise in the full mining-cycle (exploration, approvals, construction, operation, rehab)

• § Production growth through Tomingley Corridor (San Antonio, Roswell)

• § Well-credentialled and experienced Board

§ Expediting development pathway; underground initially with open pit longer term

• § Potential for strong near term cash flow

Landmark Discovery Growth At Boda Options

• § Extensive porphyry

• § Extensive tenement holding in NSW with strong exploration potential

mineralisation encountered with similar characteristics to Newcrest’s Cadia Project (110km south)

• § 15% of Genesis Minerals (ASX: GMD)

• § Strong indications of large system at Kaiser-Boda

• § 13% of Calidus Resources (ASX: CAI)

• § RC drilling shows extensive low grade from surface, with increase in grade from ~200m

• § 100% of Australian Strategic Materials, including Dubbo Project, with imminent demerger under consideration

• § 502m at 0.48g/t Au and 0.2% Cu; higher than Cadia East reserve grade

• § Q4 drill program will test scale and depth extension; 5 stepout diamond holes & IP

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Corporate Profile

Capital Structure

Ordinary Shares	506 million
Share Price (18 November 2019)	A$0.63
Market capitalisation 12 Month low/high	A$319M A$0.18/$0.86
Cash and Gold Bullion (nil debt)	A$58.4M
Listed Investments (at market, 30.09.2019)	A$15.5M
Interest Bearing Debt Enterprise Value	Nil A$266M

The Board

Ian Gandel Nic Earner Ian Chalmers	Chairman Managing Director Technical Director
Anthony Lethlean	Non-Executive Director
Gavin Smith	Non-Executive Director
Dennis Wilkins	Company Secretary

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Shareholder Ownership (At 30 Sept 2019)

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Domestic Institutions
23.5%
Foreign Institutions
Hedge Funds 66.2%
0.2% 5.8%
Directors & Management 4.3%
Retail & Others
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0.90 Share Price And Volume (4 Months) 18,000,000
Dai ly Volume Traded On-Market
0.80 16,000,000
Dai ly Close Price - ALK
0.70 14,000,000
0.60 12,000,000
0.50 10,000,000
0.40 8,000, 000
0.30 6,000, 000
0.20 4,000, 000
0.10 2,000, 000
0.00 0
Jul-19 Aug-19 Sep-19 Oct-19 Nov-19
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Close Price (A$/share)
Daily VolumeTraded On-Market
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Corporate History – 50 Years of Find. Enhance. Deliver.

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1990s 1996-2005

2001 2006 2006

2014

2018

2019

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Tomingley open pit production (2014-2019) 355,000oz at AISC A$1,192/oz

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Business Overview

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Alkane Gold Business: Positioned For Growth

Tomingley Gold Project

• § 49,000oz in FY19, revised FY20 guidance 30,00035,000oz

• § UG development advanced, stope production expected Q4 19

• § Underground revised modelling underway to extend mine life

Tomingley Boda Discovery Corridor (NMPP)

• § Significant discovery in Q3 2019

• § Multiple gold discoveries in 2018 including San Antonio, Roswell

• § 502m at 0.48g/t Au and 0.2% Cu

• § 60,000m drill out advancing

• § Q4 program to test scale and identify high grade zones

• § Initial resource expected Q4 19

• § Agreements in place for land access

• § Expediting pathway to UG mining to utilise mill capacity

• § Drilling commencing this week

Regional Exploration

• § Extensive landholding in NSW

• § Peak Hill resource

• § NMPP porphyry regional targeting underway following Boda discovery

• § Long track record of discovery in NSW, excellent understanding of permitting regime

ASX Gold Investments

• § Cornerstone investments with strategic alliance

• § 15% Genesis Minerals (ASX: GMD)

• § 13% Calidus Resources (ASX: CAI)

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§ 1.0 mtpa plant (achieved run rate of 1.4mtpa on oxide ore)

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§ Construction completed in 2014 on time and budget

§ Upgraded production guidance for FY20 30,000 – 35,000oz Au

§ Currently treating existing low grade stockpiles

§ Underground development advanced, ahead of budget and schedule

§ Underground mining of ore has commenced

§ Updated underground mine plan modelling underway

§ Current modelling has plant forecast to run at ~50% capacity for calendar 2020

§ Exploration has revitalised the Project – underground and Tomingley Corridor

§ Potential for strong near term cash flow

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Tomingley Corridor: Central West NSW

~10km mineralisation adjacent to established processing infrastructure

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Tomingley Corridor: Exploration in Plan

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• § Three major target areas within 8km of mill; Roswell, San Antonio and El Paso

• § Exploration Target of ~ 15.8-23.8 million tonnes (open pit and underground) at a grade ranging between 1.7-2.2 g/t Au*

• § Infill drilling at 40m spacing of Roswell, San Antonio largely progressed

• § Maiden Resource (Roswell) by December 2019

• § Extent of mineralisation in San Antonio, Roswell alone covers significantly larger area than original Tomingley discoveries

ASX release 9 July 2019

*The potential quantity and grade of the Exploration Target is conceptual in nature and therefore is an approximation. There has been insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in the estimation of a Mineral Resource. The Exploration Target has been prepared and reported in accordance with the 2012 edition of the JORC Code.

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Tomingley Corridor: Cross sections

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San Antonio Roswell
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Tomingley Corridor: Development plan

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Tomingley Corridor: Development plan	Tomingley Corridor: Development plan
Objective:to define the initial resource and develop an underground and subsequently an open pit mine on an accelerated timetable
Resource Delineation	§ 40m space drilling largely complete at Roswell (resource early December) § Drilling ongoing at San Antonio (resource Q1 2020) and El Paso (resource H2 2020)
	§ From existing Wyoming One decline
	§ Drilling positions and bulk samples between Wyoming and Roswell
Exploration Drive	§ Approvals (applications submitted)
	§ Development team (equipment procurement and recruitment underway)
	§ Surface vent fan (land under option)
	§ Utilising exploration drive for production
Underground	§ Environmental approvals process underway
Permitting	§ Resource definition drilling H1 2020
	§ Mine plan after resource drilling
	§ Infrastructure Impact – studies and consultation underway
Open Pit Permitting	§ Approvals – environmental approvals underway § Landholder agreement – land under option or consultation
	11 § Resource definition drilling and mine planning to follow

“A game changing discovery”

• § Significant Gold-Copper Porphyry mineralisation at Boda and Kaiser prospects

• § Boda target identified by geophysics followed by RC drilling (KSRC018 311m @0.28g from surface)

• § Recent diamond hole demonstrates increasing grade at depth*:

• § KSDD003 502m @ 0.48g/t Au, 0.20% Cu from 211m

• § Incl 313m @ 0.62g/t Au, 0.17% Cu from 228m

• § Incl 12m @ 3.28g/t Au, 0.67% Cu from 419m

• § And 35.8m @ 0.21g/t Au, 0.49% Cu from 735m to EOH

• § Numerous other intercepts within 2-3km strike length demonstrating extensive mineralised system

• § Prospect potential akin to Cadia Valley (Newcrest)

• § Regional targeting underway informed by Boda

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Boda Drilling

• § Series of 5 step out holes at ~100m spacing planned along strike and also targeting underneath the discovery hole KSDD003 (which finished in mineralisation)

• § Updated IP survey planned over ~5km prospective corridor

• § IP survey and drilling contracts have been let, drilling to commence this week

• § Landholder and leaseholder (wind farm) access agreements in place.

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• § Stated vision to become a multi-mine Australian gold producer

• § Tomingley well-positioned to anchor strategy

• § Strong regional NSW exploration portfolio

• § Potential growth via strategic investment and future M&A

• § Collaborative approach to investments with board representation agreed

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Alkane owns ~15% of Genesis Minerals, which has a 700,000oz high grade Au resource, excellent exploration potential and is seeking a path to production.

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Alkane owns ~13% of Calidus Resources, which is on track to develop an 80,000oz+ p.a. Au project in WA from its 1,250,000oz resource.

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2019 News Flow and ASX Trading

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Additional $2.16 million
investment in Tomingley Corridor Boda
Price $ Calidus Resources Exploration Target discovery Vol (million)
1.00 High grade intercepts FY20 guidance 20.0
Timeline reported at
San Antonio & Roswell upgrade
(Tomingley Corridor) Upgrade to Cornerstone
FY19 guidance investment in
0.80 Genesis Resources
15.0
0.60
10.0
0.40
5.0
0.20
0.00 -
Oct 18 Jan 19 Apr 19 Jul 19 Oct 19
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Key Work Plan & Milestones – Next 6 Months

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• § Commencement of step-out drilling at Boda (Q4) and results (Q4 / Q1 2020)

• § Inferred Resource for Tomingley Corridor (Roswell early December)

• § Updated Tomingley Underground Mine Plan and Scheduling

• § Acquisition of key land for Tomingley Corridor UG development (under option)

• § Approvals and Commencement of Tomingley Corridor Exploration Drive

• § Update on ASM Demerger Considerations (Q4)

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Business Overview

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Australian Strategic Materials: A Unique Specialty Metals Company

Dubbo Project

• § All major permits in place and piloting completed

• § Construction ready; land and water secured

• § Ongoing offtake discussions

ASM Technology

• § IP developed through Dubbo R&D

• § Investment in RMR Tech, South Korea

• § Pilot plant under construction

• § Global

commercialisation rights for Zirconium, Hafnium

Korean Metals Plant

• § 2020 feasibility to be undertaken

• § Zirconium, Hafnium separation and metalisation

• § Customer discussions commencing

Potential Demerger

• § Demerger and listing of ASM to maximise value under active consideration by Board

• § Consultation with key regulators commenced

• § CEO search for ASM underway

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www.alkane.com.au

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Australian Strategic MaterialsAustralian Strategic Materials

Dubbo ProjectDubbo Project

• § Critical minerals resource

• § Rare earths, zirconium, hafnium and niobium

• § Used in clean energy, electric vehicles and most modern technology

• § Defined resource supports 70+ year open pit operation

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• § 400km northwest of Sydney

• § Extensive piloting at ANSTO since 2008

• § Full FEED with Hatch and further updates

• § All major State and Federal approvals in place

• § Land and resource wholly owned

Korean Metals Plant

• § RMR tech pilot plant under construction

• § Seeking to confirm low cost, low emission process

• § 2020 feasibility on integrated separation and metallisation plant

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Dubbo Project Financials

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20-year Base Case (1Mtpa)

• § 1.0Mtpa (base case)

• § CAPEX: A$1.3B

§ IRR: 17.5%

• § NPV: A$1.24B

Dubbo Project Engineering and Financials Update (4 June 2018)

• § Revenue: A$663M

• § Operating Costs: A$341M

• § EBITDA: A$320M

Modular Advantage

• § Large elements of construction occur offsite

• § Significantly reduces initial start-up capex

• § Reduces construction period

Modular (4 June 2018)

Stage 1

• § 0.5Mtpa

• § CAPEX: A$808M

• § Revenue: A$397M

• § Operating Costs: A$202M

Stage 2

• § 0.5Mtpa

• § CAPEX: A$692M

• § Revenue: A$663M

• § Operating Costs: A$341M

• § Allows the Project to develop and grow with its customers and the target markets for its products

Note: As per ASX announcement of 4 June 2018. The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and that all material assumptions and technical parameters underpinning the estimates in the relevant market announcements continue to apply and have not materially changed. The Company confirms that the form and context in which any Competent Person’s findings are presented have not been materially modified from the original market announcement

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Tomingley (TGO) Resources

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Tomingley Gold Operations Mineral Resources (as at 30 June 2019)

Deposit	Measured Tonnage (Kt)	Grade (g/t Au)	Indicated Tonnage (Kt)	Grade (g/t Au)	Inferred Tonnage (Kt)	Grade (g/t Au)	Total Tonnage (Kt)	Grade (g/t Au)	Total Gold (Koz)
Open Pittable Resources (cut off 0.50g/t Au)
Wyoming One	184	1.5	982	1.7	137	0.7	1,303	1.6	60
Wyoming Three	86	2.0	16	1.3	33	1.4	135	1.7	8
Caloma	895	1.6	1,016	1.2	824	1.2	2,735	1.3	116
Caloma Two	64	2.3	812	2.0	26	1.4	902	2.0	58
Sub Total	1,229	1.6	2,826	1.6	1,020	1.2	5,075	1.5	242
Underground Resources (cut off 2.5g/t Au)
Wyoming One	0	0.0	787	4.0	109	3.2	896	3.9	113
Wyoming Three	10	3.6	6	3.1	4	3.1	20	3.4	2
Caloma	78	3.8	32	3.4	44	3.0	154	3.5	17
Caloma Two	-	0.0	218	3.6	76	3.2	294	3.5	33
Sub Total	88	3.8	1,043	3.98	233	3.2	1,364	3.8	165
Total	1,317	1.8	3,869	2.2	1,253	1.5	6,439	2.0	407

Note: Full details including Competent Person Statements in ASX announcements 23 September 2019 - the Company confirms that all material assumptions and technical parameters underpinning the estimated Mineral Resources and Ore Reserves, and production targets and the forecast financial information as disclosed continue to apply and have not materially changed

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Tomingley (TGO): Reserves

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Tomingley Gold Project Mineral Reserves (as at 30 June 2019)

Deposit	Proved Tonnage (Kt)	Grade (g/t Au)	Probable Tonnage (Kt)	Grade (g/t Au)	Tonnage (Kt)	Grade (g/t Au)	Total Gold (Koz)
Open Pittable Reserves (cut off 0.50g/t Au)
Wyoming One	0	0.0	0	0.0	0	0.0	0
Wyoming Three	0	0.0	0	0.0	0	0.0	0
Caloma	0	0.0	0	0.0	0	0.0	0
Caloma Two	0	0.0	0	0.0	0	0.0	0
Stockpiles	677	0.7	0	0	677	0.7	15
Sub Total	677	0.7	0	1.7	677	0.7	15
Underground Reserves (cut off 2.50g/t Au)
TGO Underground	45	2.7	688	3.2	732	3.1	74
Sub Total	45	2.7	688	3.2	732	3.1	74
Total	722	1.8	688	1.9	1,409	2.0	89

Note: Full details including Competent Person Statements in ASX announcements 23 September 2019 - the Company confirms that all material assumptions and technical parameters underpinning the estimated Mineral Resources and Ore Reserves, and production targets and the forecast financial information as disclosed continue to apply and have not materially changed

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Peak Hill (PHGM): Gold and Copper Resources

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Proprietary Mineral Resource

Project	Resource Category	Cut-Off	Tonnes (Mt)	Gold Grade g/t	Gold Metal (Koz)	Copper Metal (%)
Proprietary Underground	Inferred	2g/t Au	1.02	3.29	108	0.15
Total			1.02	3.29	108	0.15

Note: Full details including Competent Person Statements in ASX announcement 18 October 2018 - the Company confirms that all material assumptions and technical parameters underpinning the estimated Mineral Resources and Ore Reserves, and production targets and the forecast financial information as disclosed continue to apply and have not materially changed

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Dubbo Project: Resources and Reserves

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Dubbo Project – Mineral Resources

Resource Category	Tonnes( Mt)	ZrO2 (%)	HfO2 (%)	Nb2O5 (%)	Ta2O5 (%)	Y2O3 (%)	TREO* (%)
Measured	42.81	1.89	0.04	0.45	0.03	0.14	0.74
Inferred	32.37	1.90	0.04	0.44	0.03	0.14	0.74
Total	75.18	1.89	0.04	0.44	0.03	0.14	0.74

*TREO% is the sum of all rare earth oxides excluding ZrO2, HfO2, Nb2O3, Ta2O5, Y2O3

Dubbo Project – Ore Reserves

Reserve Category	Tonnes (Mt)	ZrO2 (%)	HfO2 (%)	Nb2O5 (%)	Ta2O5 (%)	Y2O3 (%)	TREO* (%)
Proved	18.90	1.85	0.04	0.440	0.029	0.136	0.735
Probable	0
Total	18.90	1.85	0.04	0.440	0.029	0.136	0.735

*TREO% is the sum of all rare earth oxides excluding ZrO2, HfO2, Nb2O3, Ta2O5, Y2O3

Note: Full details including Competent Person statements in ASX announcement 19 September 2017 - the Company confirms that all material assumptions and technical parameters underpinning the estimated Mineral Resources and Ore Reserves, and production targets and the forecast financial information as disclosed continue to apply and have not materially changed

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