ARCHER MATERIALS LIMITED — Capital/Financing Update 2014

May 20, 2014

ASX RELEASE: 21 May 2014

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Archer in conditional agreement to acquire neighbouring Eyre Peninsula graphite project

Proposed purchase of Monax’s Waddikee tenement

Archer Exploration Limited (“ Archer ”) has executed a conditional Sale and Purchase Agreement to acquire from Monax Mining Limited (“ Monax ”) that company’s primarily graphite-focused Waddikee Exploration Licence EL4662 on South Australia’s Eyre Peninsula.

The tenement abuts the northern boundary of Archer’s Sugarloaf graphite project, on the Carrapee Hill exploration tenement, EL4861.

The transaction is conditional on Archer completing due diligence within 30 days, and Ministerial consent under SA’s Mining Act for the transfer of all legal and beneficial interest in Waddikee EL4662 to Archer within 3 months of the date of execution of any final sale agreement.

The Agreement is subject to satisfaction or waiver of the conditions precedent and either party may terminate the Agreement if the conditions are not satisfied or waived by the relevant due date.

Due diligence is expected to be completed by 22nd June 2014.

Waddikee EL4662

Waddikee EL4662 is located between the townships of Cleve and Kimba on central Eyre Peninsula (Figure 1). The 999km[2] tenement is highly prospective for graphite, manganese, iron (magnetite and hematite), gold, base metals (Ag-Pb-Zn-Cu) and uranium.

Waddikee hosts a number of graphite deposits and prospects that have been evaluated using combinations of geophysics (airborne magnetic and electromagnetic surveys), rock chip sampling, detailed petrology and drilling.

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Figure 1. Location of the Waddikee graphite prospects

Wilclo South graphite deposit

In February 2013 Monax completed 77 reverse circulation drill holes for 7,307 metres over 1.4km of the Wilclo South graphite prospect. The drilling identified multiple shallow dipping graphite horizons.

On the 26[th] August 2013 Monax announced a Maiden total combined JORC 2012 Inferred Resource* of 6.38 million tonnes grading 8.8% Cg (approximately 550,000 of contained graphite) at a lower cut-off grade of 5% Cg.

*This information was prepared and first disclosed under the JORC 2012 Code (Monax Mining Limited, ASX Announcement 26th August 2013). It has not been updated since on the basis that the information has not materially changed since it was last reported.

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Other graphite prospects drilled by Monax include the Lacroma and Francis graphite prospects.

The tenement also has known manganese and iron mineralisation.

For further information please contact:

Mr Greg English Mr Gerard Anderson Chairman Managing Director Archer Exploration Limited Archer Exploration Limited Tel: (08) 8272 3288 Tel: (08) 8272 3288

The exploration results reported herein, insofar as they relate to mineralisation, are based on information compiled by Mr. Wade Bollenhagen, Exploration Manager of Archer Exploration Limited. Mr. Bollenhagen is a Member of the Australasian Institute of Mining and Metallurgy who has more than eighteen years experience in the field of activity being reported. Mr Bollenhagen has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity that he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” relating to the reporting of Exploration Results. Mr. Bollenhagen consents to the inclusion in the report of matters based on his information in the form and context in which it appears.

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