EMERALD RESOURCES NL — Capital/Financing Update 2018

Nov 11, 2018

ASX Announcement & Media Release

12 November 2018

Fast Facts ASX Code: EMR Capital Structure Shares on issue: 2,528 million Market Cap: ~A$76 million Cash: A$1.3 million (30 Sep 2018) Listed Investments: A$0.3 million (30 Sep 2018)

Board & Management

Simon Lee AO, Non-Exec Chairman Morgan Hart, Managing Director Mick Evans, Executive Director Ross Stanley, Non-Exec Director Ross Williams, Non-Exec Director Mark Clements, Co. Secretary Brett Dunnachie, Chief Financial Officer

Company Highlights

 First mover in an emerging gold province in Cambodia

• Industrial Mining Licence granted over the Okvau Gold Project (100% owned) allowing for the development of the Okvau Deposit

• Okvau Deposit: Indicated and Inferred Mineral Resource Estimate of 1.14Moz at 2.0g/t Au

• DFS completed and demonstrates high grade, low cost, compelling development economics:

• Ore Reserve of 14.3Mt & 2.0g/t Au for 0.9Mozs in a single open pit with waste:ore ratio of 5.8:1

• LOM average annual production of 106,000ozs pa

• AISC US$731/oz over LOM

• Using US$1.250/oz Au gold price:

  • NPV(5%) US$223M pre-tax and US$160M post-tax

  • IRR 48% pa pre-tax and 40% post-tax

  • Payback ~2.2 years pre-tax and 2.5 years post-tax

• Highly credentialed gold project development team

• Significant resource growth potential

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Section 708A Notice

As announced on 1 November 2018, Emerald Resources NL (‘Emerald’) is proposing to undertake a capital raising to raise approximately $31,000,000 (before costs) (“Capital Raising”). The Capital Raising will consist of a two-tranche placement to raise up to $27,000,000 (“Placement”) and a share purchase plan to raise approximately $3,000,000 (“SPP”)

Emerald has issued 416,666,668 fully paid ordinary shares (“Tranche 1 Shares”) following the completion of Tranche 1 of the Placement. 316,687,880 Tranche 1 Shares were issued pursuant to ASX Listing Rule 7.1 and 99,978,788 Tranche 1 Shares were issued pursuant to ASX Listing Rule 7.1A.

As required under section 708A(6) of the Corporations Act 2001 (Cth) (“Corporations Act”) (and paragraph 7(f)(i) of ASIC Class Order [09/425] in relation to the SPP), Emerald gives notice that;

• (a) Emerald issued the Tranche 1 Shares (and will make offers to issue Shares under the SPP) without disclosure under Part 6D.2 of the Corporations Act.

• (b) This notice is being given under paragraph 5(e) of section 708A of the Corporations Act.

• (c) As at the date of this notice, Emerald has complied with the provisions of the Chapter 2M of the Corporations Act (as they apply to Emerald), and section 674 of the Corporations Act.

• (d) As at the date of this notice, there is no excluded information with respect to Emerald for the purposes of sections 708A(7) and (8) of the Corporations Act.

The Company provides the following disclosures under ASX Listing Rules 7.1A.4(b) and 3.10.5A:

(a) The dilutive effect of the Tranche 1 Placement on existing shareholders is set out in the table below:

	Shares	Dilution (%)
Shares on issue prior to the Placement	2,111,252,533
Shares issued under Listing Rule 7.1 capacity	316,687,880	12.53%
Shares issued under Listing Rule 7.1A capacity	99,978,788	3.95%
Total	2,527,919,201	16.48%

(b) The Tranche 1 Placement is being conducted in conjunction with a SPP, with subscribers for Shares under the Tranche 1 Placement not eligible to participate in the SPP. The Company considered this structure (including the issue of Shares under the Tranche 1 Placement) the most efficient and expedient mechanism for raising the funds required to achieve its stated objectives, whilst ensuring that exiting eligible investors are able to participate in the capital raising. As previously advised, eligible shareholders will be able to subscribe for Shares under the SPP at an issue price of $0.03 per Share (being the same price as under the Tranche 1 Placement).

No underwriting agreements were entered into in connection with the Placement.

• (c)

• (d) Euroz was paid a 4.5% fee on Tranche 1 Placement as the Lead Manager and Bookrunner ($562,500).

Registered Office 1110 Hay Street West Perth WA 6005

T: +61 8 9286 6300 F: +61 8 9286 6333 W: www.emeraldresources.com.au

An Appendix 3B reflecting the revised capital structure following the issue of the securities has been released with this announcement.

For further information please contact; Emerald Resources NL Morgan Hart

Managing Director

Rule 2.7, 3.10.3, 3.10.4, 3.10.5

Appendix 3B

New issue announcement, application for quotation of additional securities and agreement

Information or documents not available now must be given to ASX as soon as available. Information and documents given to ASX become ASX’s property and may be made public. Introduced 01/07/96 Origin: Appendix 5 Amended 01/07/98, 01/09/99, 01/07/00, 30/09/01, 11/03/02, 01/01/03, 24/10/05, 01/08/12, 04/03/13

Name of entity

Emerald Resources NL

ABN

72 009 795 046

We (the entity) give ASX the following information.

Part 1 - All issues

You must complete the relevant sections (attach sheets if there is not enough space).

1 +Class of+securities issued or to be issued 2 Number of+securities issued or to be issued (if known) or maximum number which may be issued 3 Principal terms of the+securities (e.g. if options, exercise price and expiry date; if partly paid +securities, the amount outstanding and due dates for payment; if +convertible securities, the conversion price and dates for conversion)	Fully paid ordinary shares
	416,666,668 Fully paid ordinary shares
	Fully paid ordinary shares

• See chapter 19 for defined terms.

Appendix 3B Page 1

04/03/2013

4 Do the+securities rank equally in all respects from the+issue date with an existing+class of quoted +securities? If the additional+securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 5 Issue price or consideration 6 Purpose of the issue (If issued as consideration for the acquisition of assets, clearly identify those assets) 6a Is the entity an+eligible entity that has obtained security holder approval under rule 7.1A? If Yes, complete sections 6b – 6h_in_ relation to the+securities the subject of this Appendix 3B, and comply with section 6i 6b The date the security holder resolution under rule 7.1A was passed 6c Number of +securities issued without security holder approval under rule 7.1 6d Number of+securities issued with security holder approval under rule 7.1A 6e Number of+securities issued with security holder approval under rule 7.3, or another specific security holder approval (specify date of meeting) 6f Number of+securities issued under an exception in rule 7.2	Yes, the shares will rank equally with the fully paid ordinary shares currently on issue.
	$0.03 per share
	Issue of 416,666,668 fully paid ordinary shares pursuant to the placement as announced on 1 November 2018.
	Yes
	23 November 2017
	316,687,880 Fully paid ordinary shares
	99,978,788 Fully paid ordinary shares
	N/A
	N/A

6g If[+] securities issued under rule 99,978,788 Fully paid ordinary shares 7.1A, was issue price at least 75% (issue price $0.030; 15 day VWAP of 15 day VWAP as calculated $0.030:IRESS) under rule 7.1A.3? Include the +issue date and both values. Include the source of the VWAP calculation. 6h If[+] securities were issued under rule N/A 7.1A for non-cash consideration, state date on which valuation of consideration was released to ASX Market Announcements 6i Calculate the entity’s remaining Refer Annexure 1 issue capacity under rule 7.1 and rule 7.1A – complete Annexure 1 and release to ASX Market Announcements 7 +Issue dates 12 November 2018 Note: The issue date may be prescribed by ASX (refer to the definition of issue date in rule 19.12). For example, the issue date for a pro rata entitlement issue must comply with the applicable timetable in Appendix 7A.Cross reference: item 33 of Appendix 3B.

Number +Class 8 Number and[+] class of all[+] securities 2,527,919,201 Fully paid ordinary quoted on ASX ( including the Shares +securities in section 2 if applicable)

• See chapter 19 for defined terms.

Appendix 3B Page 3

04/03/2013

9 Number and+class of all+securities not quoted on ASX (_including_the +securities in section 2 if applicable) 10 Dividend policy (in the case of a trust, distribution policy) on the increased capital (interests) art 2 - Pro rata issue 11 Is security holder approval required? 12 Is the issue renounceable or non- renounceable? 13 Ratio in which the+securities will be offered 14 +Class of+securities to which the offer relates 15 +Record date to determine entitlements	Number	+Class
	17,500,000 21,777,500 2,500,000 1,802,500 3,372,500 2,500,000 15,000,000	Unlisted $0.025 options, expiring 21 January 2020 Unlisted $0.0323 options expiring 30 September 2020 Unlisted $0.052 options expiring 6 January 2022 Unlisted $0.051 options expiring 21 January 2022 Unlisted $0.057 options expiring 9 March 2022 Unlisted $0.049 options expiring 6 July 2022 Unlisted $0.0434 options expiring 5 June 2023
	The Company does not have a dividend policy.
	N/A
	N/A
	N/A
	N/A
	N/A

Part 2 - Pro rata issue

16 Will holdings on different registers (or subregisters) be aggregated for calculating entitlements? 17 Policy for deciding entitlements in relation to fractions 18 Names of countries in which the entity has security holders who will not be sent new offer documents Note: Security holders must be told how their entitlements are to be dealt with. Cross reference: rule 7.7. 19 Closing date for receipt of acceptances or renunciations 20 Names of any underwriters 21 Amount of any underwriting fee or commission 22 Names of any brokers to the issue 23 Fee or commission payable to the broker to the issue 24 Amount of any handling fee payable to brokers who lodge acceptances or renunciations on behalf of security holders 25 If the issue is contingent on security holders’ approval, the date of the meeting 26 Date entitlement and acceptance form and offer documents will be sent to persons entitled 27 If the entity has issued options, and the terms entitle option holders to participate on exercise, the date on which notices will be sent to option holders 28 Date rights trading will begin (if applicable) 29 Date rights trading will end (if applicable)	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A
	N/A

• See chapter 19 for defined terms.

Appendix 3B Page 5

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30 How do security holders sell their entitlements_in full_through a broker? 31 How do security holders sell_part_of their entitlements through a broker and accept for the balance? 32 How do security holders dispose of their entitlements (except by sale through a broker)? 33 +Issue date	N/A
	N/A
	N/A
	N/A

Part 3 - Quotation of securities

You need only complete this section if you are applying for quotation of securities

• 34 Type of[+] securities ( tick one )

• (a) +Securities described in Part 1

• (b)[All other ][+][securities ]

Example: restricted securities at the end of the escrowed period, partly paid securities that become fully paid, employee incentive share securities when restriction ends, securities issued on expiry or conversion of convertible securities

Entities that have ticked box 34(a)

Additional securities forming a new class of securities

Tick to indicate you are providing the information or documents

35 If the[+] securities are[+] equity securities, the names of the 20 largest holders of the additional[+] securities, and the number and percentage of additional[+] securities held by those holders 36 If the[+] securities are[+] equity securities, a distribution schedule of the additional +securities setting out the number of holders in the categories 1 - 1,000 1,001 - 5,000 5,001 - 10,000 10,001 - 100,000 100,001 and over 37 A copy of any trust deed for the additional[+] securities

Entities that have ticked box 34(b)

38 Number of+securities for which +quotation is sought 39 +Class of +securities for which quotation is sought 40 Do the+securities rank equally in all respects from the+issue date with an existing+class of quoted+securities? If the additional+securities do not rank equally, please state: • the date from which they do • the extent to which they participate for the next dividend, (in the case of a trust, distribution) or interest payment • the extent to which they do not rank equally, other than in relation to the next dividend, distribution or interest payment 41 Reason for request for quotation now Example: In the case of restricted securities, end of restriction period (if issued upon conversion of another +security, clearly identify that other +security)	N/A
	N/A
	N/A
	N/A

Number +Class 42 Number and[+] class of all[+] securities N/A quoted on ASX ( including the +securities in clause 38)

Quotation agreement

• 1 +Quotation of our additional +securities is in ASX’s absolute discretion. ASX may quote the[+] securities on any conditions it decides.

• 2 We warrant the following to ASX.

• The issue of the[+] securities to be quoted complies with the law and is not for an illegal purpose.

• There is no reason why those[+] securities should not be granted[+] quotation.

• See chapter 19 for defined terms.

Appendix 3B Page 7

04/03/2013

• An offer of the[+] securities for sale within 12 months after their issue will not require disclosure under section 707(3) or section 1012C(6) of the Corporations Act.

Note: An entity may need to obtain appropriate warranties from subscribers for the securities in order to be able to give this warranty

• Section 724 or section 1016E of the Corporations Act does not apply to any applications received by us in relation to any[+] securities to be quoted and that no-one has any right to return any[+] securities to be quoted under sections 737, 738 or 1016F of the Corporations Act at the time that we request that the +securities be quoted.

• If we are a trust, we warrant that no person has the right to return the +securities to be quoted under section 1019B of the Corporations Act at the time that we request that the[+] securities be quoted.

• 3 We will indemnify ASX to the fullest extent permitted by law in respect of any claim, action or expense arising from or connected with any breach of the warranties in this agreement.

• 4 We give ASX the information and documents required by this form. If any information or document is not available now, we will give it to ASX before +quotation of the +securities begins. We acknowledge that ASX is relying on the information and documents. We warrant that they are (will be) true and complete.

Mark Clements Company Secretary 12 November 2018

Appendix 3B – Annexure 1

Calculation of placement capacity under rule 7.1 and rule 7.1A for eligible entities

Introduced 01/08/12 Amended 04/03/13

Part 1

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Rule 7.1 – Issues exceeding 15% of capital
Step 1: Calculate “A”, the base figure from which the placement
capacity is calculated
Insert number of fully paid [+] ordinary
2,110,477,533
securities on issue 12 months before the
+ issue date or date of agreement to issue
Add the following:
• Number of fully paid [+] ordinary
securities issued in that 12 month
period under an exception in rule 7.2
• Number of fully paid [+] ordinary
securities issued in that 12 month
period with shareholder approval
• Number of partly paid [+] ordinary
securities that became fully paid in that
12 month period
14 November 2017 Issue of shares 775,000
Note:
• Include only ordinary securities here –
other classes of equity securities
cannot be added
• Include here (if applicable) the
securities the subject of the Appendix
3B to which this form is annexed
• It may be useful to set out issues of
securities on different dates as
separate line items
Subtract the number of fully paid
+ ordinary securities cancelled during that
Nil
12 month period
“A” 2,111,252,533
----- End of picture text -----

• See chapter 19 for defined terms.

Appendix 3B Page 9

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Step 2: Calculate 15% of “A”
“B”	0.15 [Note: this value cannot be changed]
Multiply“A” by 0.15	316,687,880
Step 3: Calculate “C”, the amount of placement capacity under rule 7.1 that has already been used
Insertnumber of+equity securities issued or agreed to be issued in that 12 month period_not counting_those issued: • Under an exception in rule 7.2 • Under rule 7.1A • With security holder approval under rule 7.1 or rule 7.4 12 November 2018 Issue of shares Note: • This applies to equity securities, unless specifically excluded – not just ordinary securities • Include here (if applicable) the securities the subject of the Appendix 3B to which this form is annexed • It may be useful to set out issues of securities on different dates as separate line items	316,687,880
“C”	316,687,880
Step 4: Subtract “C” from [“A” x “B”] to calculate remaining placement capacity under rule 7.1
“A” x 0.15 Note: number must be same as shown in Step 2	316,687,880
Subtract“C” Note: number must be same as shown in Step 3	316,687,880
Total[“A” x 0.15] – “C”	Nil [Note: this is the remaining placement capacity under rule 7.1]

Part 2

art 2	art 2
Rule 7.1A – Additional placement capacity for eligible entities
Step 1: Calculate “A”, the base figure from which the placement capacity is calculated
“A” Note: number must be same as shown in Step 1 of Part 1	2,111,252,533
Step 2: Calculate 10% of “A”
“D”	0.10 Note: this value cannot be changed
Multiply“A” by 0.10	211,125,253
Step 3: Calculate “E”, the amount 7.1A that has already been used	of placement capacity under rule
Insertnumber of+equity securities issued or agreed to be issued in that 12 month period under rule 7.1A 12 November 2018 Issue of shares Notes: • This applies to equity securities – not just ordinary securities • Include here – if applicable – the securities the subject of the Appendix 3B to which this form is annexed • Do not include equity securities issued under rule 7.1 (they must be dealt with in Part 1), or for which specific security holder approval has been obtained • It may be useful to set out issues of securities on different dates as separate line items	99,978,788
“E”	99,978,788

• See chapter 19 for defined terms.

Appendix 3B Page 11

04/03/2013

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A

Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A	Step 4: Subtract “E” from [“A” x “D”] to calculate remaining placement capacity under rule 7.1A
“A” x 0.10 Note: number must be same as shown in Step 2	211,125,253
Subtract“E” Note: number must be same as shown in Step 3	99,978,788
Total[“A” x 0.10] – “E”	111,146,465 Note: this is the remaining placement capacity under rule 7.1A