ARCHER MATERIALS LIMITED — Capital/Financing Update 2015

Mar 10, 2015

==> picture [595 x 109] intentionally omitted <==

----- Start of picture text -----

ASX Release 11 March 2015
Eyre Peninsula Graphite Project achieves further milestone
----- End of picture text -----

ASX Code: AXE

Long term supply of process water for Sugarloaf secured

Directors Greg English Chairman

Gerard Anderson Managing Director

Tom Phillips AM Director (Non-Executive)

Alice McCleary Director (Non-Executive)

Company Secretary Damien Connor

Archer Exploration Limited (“Archer” or the “Company”) is pleased to announce that it has achieved another milestone in the development of the Company’s Campoona and Sugarloaf graphite projects:

==> picture [11 x 15] intentionally omitted <==

• Three groundwater monitoring bores (piezometers) were installed at the proposed Sugarloaf Processing site (Figure 1) to finalise inputs into the site design.

==> picture [11 x 15] intentionally omitted <==

• No ground water aquifers were intersected during drilling of monitoring bores meaning that approvals for tailing storage facility will be simplified.

==> picture [11 x 14] intentionally omitted <==

• Long term supply of process water for Sugarloaf has been secured.

==> picture [11 x 15] intentionally omitted <==

• Mining Lease Proposal to be lodged in April 2015.

Shares on Issue 84.5 million

Archer’s Managing Director, Gerard Anderson commented, “this is another milestone in the development of our Eyre Peninsula Graphite Project”.

Unlisted Options on Issue 2.3 million Performance Rights

Key focus

Eyre Peninsula Graphite Project (includes Campoona, Sugarloaf and Waddikee) Additional portfolio opportunities: magnesite, manganese, copper and gold

“We look forward to lodging our Mining Lease Proposal next month as momentum builds for the development of the Campoona Mine and Sugarloaf Processing Facility” said Mr Anderson.

“Being able to secure process water and a suitable tailings storage facility site supports our initial mine plans and our longer-term potential to expand the Campoona and Waddikee Projects. The ability to locate the Tailings Storage Facility without interfering with aquifers and the presence of a long term supply of process water are significant advantages for the development of the Campoona project” said Mr Anderson.

==> picture [95 x 35] intentionally omitted <==

Mining Lease Proposal Advances with Tailings Storage Facility Groundwater monitoring in place

Archer Exploration Limited ABN 64 123 993 233 Level 1, 28 Greenhill Road Wayville SA 5034

Three groundwater monitoring bores (piezometers) were installed at the proposed Sugarloaf Processing site (Figure 1) to finalise inputs into the site design.

Telephone +61 8 8272 3288 Facsimile +61 8 8272 3888 www.archerexploration.com.au

1

Eyre Peninsula Graphite Project achieves further milestone

==> picture [415 x 553] intentionally omitted <==

Figure 1. Sugarloaf Graphite Processing Facility site layout

2

Eyre Peninsula Graphite Project achieves further milestone

The proposed Sugarloaf Processing Facility is located on the Company owned Sugarloaf property which hosts the Sugarloaf Graphite Deposit. As a part of the Mining Lease Proposal (MLP) the Company has installed 3 piezometer bores for future tailings storage monitoring.

Figure 2 (below) shows the location of the bores in relation to the Tailings Storage Facility (TSF), two additional holes were drilled to understand the soil profile below the proposed TSF.

==> picture [483 x 316] intentionally omitted <==

Figure 2. Location of bores in SW corner of the Sugarloaf property

No water was encountered in the construction of the bores.

Process Water

Process water for the Sugarloaf graphite processing facility will be sourced from the nearby Pindari aquifer. Previously two holes were drilled to depths of 121 and 91m to test for flow rates and water quality as a source of water for graphite processing at Sugarloaf. The 121m deep hole was established as a future production bore. Pump testing demonstrated that the single production bore provided a sustainable yield of water of 52ML/year over a 20-year period. Water quality is 22,500 TDS which is ideal for process water but too salty, being two thirds as salty as seawater, for agricultural purposes.

3

Eyre Peninsula Graphite Project achieves further milestone

==> picture [367 x 275] intentionally omitted <==

Plate 1. Pindari production water bore (foreground) and monitoring bore

Approximately 100ML/yr of process water will be required to process up to 140,000tpa of Campoona graphite ore. An additional production abstraction bore is to be constructed at the Pindari borefield during March. The second production bore is located 800 metres southwest of the existing bore and is expected to have similar long-term production capacity.

MLP Lodgment

Compilation of the Mine Lease Proposal is well advanced and is currently being finalized with respect to the Mine Plan and the Mine Closure Plan. Archer expects that the Mine Lease Proposal will be lodged during the second quarter of 2015.

For further information please contact:

Mr Greg English Mr Gerard Anderson Chairman Managing Director Archer Exploration Limited Archer Exploration Limited Tel: (08) 8205 3343 Tel: (08) 8272 328

4

==> picture [595 x 109] intentionally omitted <==

----- Start of picture text -----

About Archer
----- End of picture text -----

Archer Exploration Limited is an Australian Stock Exchange listed company with 100% ownership of 17 tenements all in South Australia covering 6,060 km[2] .

Archer plans to submit a Mining Lease Proposal for the Campoona Shaft deposit and Sugarloaf processing facility to the South Australian Government second quarter of 2015.

………………………………………………………………………………………………………………………………………...

==> picture [468 x 282] intentionally omitted <==

==> picture [87 x 32] intentionally omitted <==

Archer Exploration Limited ABN 64 123 993 233 Level 1, 28 Greenhill Road Wayville SA 5034

The exploration results and exploration targets 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.

Telephone +61 8 8272 3288 Facsimile +61 8 8272 3888 www.archerexploration.com.au

5