EQ RESOURCES LIMITED — Investor Presentation 2021

Mar 14, 2021

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EQR Investor Presentation March 2021

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Disclaimer

Competent Person's Statement

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• The information in this presentation relating to Mineral Resource summary are extracted from the following report on the Company's website, www.eqresources.com.au/: Mineral Resource & JORC 2012 Compliance Update dated 13 January 2014. The underground resource is under review as announced by the Company on 16 October 2020: “High-grade Structural Zones Extend for 1.2km”. The Company confirms that it is not aware of any new information that materially affects the information included in the original market announcements 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 the Competent Person’s findings are presented have not been materially modified from the original market announcements.

General Disclaimer

• The material contained in this document is a presentation of general information about the Company's activities current as at the date of this presentation. It is provided in summary and does not purport to be complete. You should not rely upon it as advice for investment purposes, as it does not take into account y our investment objectives, financial position or needs. These factors should be considered, with or without professional advice, when deciding if an investment is appropriate.

• This document may contain forward-looking statements with respect to the financial condition, results of operations, and business strategy of the Company. These forward-looking statements are based on estimates, projections and assumptions made by the Company about circumstances and events that have not yet taken place. Although the Company believes the forwardlooking statements to be reasonable, they are not certain. Forward-looking statements involve known and unknown risks, uncertainties and other factors that are in some cases beyond the Company's control, and which may cause actual results, performance or achievements to differ materially from those expressed or implied by the forward-looking statements (and from past results).

• The Company makes no representation or warranty as to the accuracy of any forward-looking statements in this document and undue reliance should not be placed upon such statements.

• Forward-looking statements may be identified by words such as “aim”, “anticipate”, “assume”, “continue”, “could”, “estimate”, “expect”, “intend”, “may”, “plan”, “predict”, “should”, “will”, or “would” or the negative of such terms or other similar expressions that are predictions of or otherwise indicate future events or trends. The forward-looking statements included in this document speak only as of the date of this document. The Company does not intend to update the forward-looking statements in this document in the future.

2

Executive Summary & Value Proposition

Australia’s only primary tungsten producer with near term vision of developing and exploring the Mt Carbine high-grade tungsten mine in Queensland

Critical Minerals Security

Low-Cost Expansion

Australia has a role to play:

Minimal investment since acquisition of mining leases, take over of existing installations

• Critical Minerals Facilitation Office established in 2020, to develop domestic critical minerals potential

XRT sorting operation will allow output expansion of 500%

• 2 largest tungsten resource globally

Lowest specific capex and opex amongst peers

• Mt Carbine is Australia’s only primary tungsten mine in operation

World Class Resource

By-Product Revenue

47.3Mt @ 0.12-0.14% WO3 and 12Mt @ 0.07% WO3 (JORC 2012 resource) Underground operation within two years

Tungsten operations generating waste rock streams for use as aggregates/ road base for own quarry business

Quarry can operate based on tungsten waste rock from active operations or alternative historical stockpiles

Upside potential through further drilling of West Dyke, Iron Duke and Petersen Lode, and collaboration across known tungsten belt in Far North Queensland

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First Class Infrastructure

Highway connecting to Cairns within two hours (Int’l airport, port facilities)

Nearby towns and regions allows local recruitment and sourcing

Previous operators developed mine site and underground decline (total replacement cost A$30m+)

Strong Tungsten Fundamentals

Classified by US, UK, EU, Japan, South Korea & India as critical for its economies

Geopolitical drive to reduce dependency on China (>80% of Global supply)

• 5-year APT price performance tracked between US$170 & US$345 with current pricing at US$260 (COVID low at US$200)

3

Corporate Overview

Highlights

• Australia’s only primary producer of tungsten

• High-grade resource

• Multiple revenue streams

• Low-cost expansion

• Experienced Board & Leadership Team

Board & Leadership Team

Oliver Kleinhempel German Non-executive Chairman Stephen Layton Australian Non-executive Director Zhui Pei Yeo Singaporean Non-executive Director Kevin MacNeill Canadian Chief Executive Officer Tony Bainbridge Australian Chief Geologist

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	as per 01 March 2021
Share Price	A$ 0.041
Issued Shares	1,110m
Market Capitalization	A$ 45,51m
Cash at Bank (Dec 2020)	$1,555
Shareholding: - Top 20 - # of shareholders	57.99% 1,467

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4

Board & Leadership

Diverse and Experienced Board & Leadership Team

Oliver Kleinhempel - Non-executive Chairman

Stephen Layton - Non-executive Director

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• Appointed Non-executive Director 14 November 2017

• Appointed Non-executive Director 12 August 2019 and Chair on 24 April 2020

• +35 years’ experience in equity capital markets in UK and Australia

• Executive management experience in project development, finance and commodity trading sectors

Experience in both principal and director roles with a depth of knowledge in capital raisings, ASX listings and corporate advisory matters

• Corporate experience includes Outotec, Ferrostaal Group and CRONIMET

• Currently an executive director of CRONIMET Holding GmbH

• Currently non-executive director of Mithril Resources Limited, and previously a nonexecutive director on New Age Exploration Limited (both ASX listed)

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Zhui Pei Yeo - Non-executive Director

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• Appointed Non-executive Director 12 August 2019

• Has held executive, management and supervisory roles with a range of experience from project planning to resource management

Has been working at a leading system integrator in the telecommunications industry in South-East Asia

• Currently an executive director of a steel-product manufacturer

Kevin MacNeill - Chief Executive Officer

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• Appointed Interim-CEO & Senior Technical Advisor in May 2019 and permanent CEO in January 2020

• +33-year career dedicated to developing and leading mining projects globally

• Expertise in project development, mineral processing, specialty processing applications & mining waste processing

• Held Executive appointments as President of Etruscan Diamonds (part of TSX-listed Etruscan Resources) & founded Specialized Metallurgical Projects Pty Ltd

• Currently Non-Executive director of Zimbabwe Lithium, a company developing the Kamativi Lithium Tailings Project

Tony Bainbridge - Chief Geologist

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• EQR’s Chief Geologist, focusing on developing Mt Carbine’s underground resource to define & extract ‘King-Vein’ style mineralisation

• Experience in tungsten projects in South Korea & Africa – including building, owning and managing a tungsten mining operation in South Korea

• Expertise include tungsten, gold, resource definition, mine exploration, feasibility studies, mine development, mine production efficiencies, and dayto-day operations

• Currently director of Asia Intercept Mining Ltd and AMB Exploration Pty Ltd

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Why Tungsten?

• Classified as a Critical / Strategic Metal in leading industrialised economies

• Australia - 2[nd] largest resources in the world

• 82% produced in China, Australia has potential to lead Non-Chinese supply base

• Pricing at recent highs, forecast to continue increasing

• EQR currently only primary producer

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Tungsten Industry Overview

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Source: SMR (2020)

Mt Carbine History & Location

Historic mine site acquired by EQR…

• Early operation from 1907 to end of WW1

• Mine restart in 1968 operating through until 1987

• Historic operations used photometric sorters, crushing & gravity separation

 Mining from 1968 onward was open cast mining with historic pit still visible today

…with infrastructure in place.

Power, water, roads & accommodation in place 

Existing 430m decline allowing cost- and time-efficient start of UG works 

International airport at Cairns & Townsville port for concentrate export 

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Far North Queensland Tungsten Cluster
W atershed
Mt Carbine
W olfram Camp
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Mt Carbine Site Overview

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Office, Lab &
1
Core Shed
Tailings Pond /
2
2 3 Retreatment
5
4 Plant
Quarry &
3
OOSR Stock-
pile
6
Potential Pit Extension 4 XRT Sorter
1
LG Ore Stock-
5
pile
Exploration
6
Targets
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Mt Carbine Operations

Australia’s leading primary tungsten producer with significant upside potential

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Tungsten Operation
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Quarry Operation Exploration
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Profitable quarry operation with strong operating history

Opportunity to expand and grow the current resource of 47Mt @ 0,12-0,14% WO3

Production scale-up during 2020, concentrate sold across various jurisdictions

Feedstock originating from ore sorter & gravity plant waste streams

Mt Carbine - open to the North and at depth

Potential for large scale project through expansion

Potential to expand operations to final product range

Targeting restart of UG mine

Identified exploration targets on existing mining & explorations leases:

Project is low on cost curve – benefit of surface stockpiles and sensor-based sorting technology

Benefit from infrastructure spend tailwinds post COVID

• Iron Duke

• • Petersons Lode

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Tungsten Cluster
W atershed
Mt Carbine
W olfram Camp
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Cluster potential - significant deposits defined in region

• Watershed: 2014 DFS by Vital Metals (2012 JORC)

Wolfram Camp: 2015 Technical Report by Almonty Industries (NI 43101)

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Mt Carbine Underground Development

Open

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Exploration Potential

• 100% ownership of mining licences & exploration permits

• Open to the North & at depth

Next steps in developing the underground resource:

• Further investigation of historical workings

• Re-opening of historic decline

• Complete underground survey, sampling & drilling

• Conduct exploration and sampling on Iron Duke & Petersons Lode

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Open
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Mt Carbine Underground – King Veins

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King Vein
Bluff (extension)
Dazzler 3D Geological Model
Johnson
Wayback
Bluff
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Mt Carbine Underground – Cross Section

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Peer Analysis

Industry Cash Cost vs Historic APT Price (in US$)*

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2018 2019 2020
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We assume continuous by-product credits, supporting cost competitiveness at a targeted production cost below US$100/mtu

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Reported Cash Cost & Specific CAPEX of Selected Non-Chinese Producers (in US$)
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Expanding upon existing infrastructure allows industry leading specific-capex (=US$ investment per mtu reported capacity)

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300
200
Cash Cost Reporting
in 2021
100 (estimated by-product credits
approx. 30 US$/mtu)
Avg. Cash Cost Specific CAPEX Selected
Selected Non-Chinese EQR by-product credits Non-Chinese Projects
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*Source: Argus (2019), Company internal

**Non-Chinese Producers/Dev elopers: Almonty Industries, King Island Scheelite, Masan Resources, Ormonde/Saloro, Tungsten Mining, W Resources (inf ormation sourced f rom company presentations and public announcements)

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Development Timeline
UG Secure Funding
Environmental Facilitation & Drawdown
Doc Approval
Approval

Ph 1 Feasibility Ph 2 Feasibility
Complete Complete Full Scale
2020 2021 2022 Operation
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Feasibility – Mineralised Stockpile
Secure Debt Facility 1 MTPA Plant Construction
(METS supported Test work)
Upgrade of Gravity Plant &
Quarry
Facilitation UG Feasibility Start : Decline open & Finalise UG Feasibility and
Document Draft inspection, drilling from pit, mesh drawdown Ph 2 funding for UG UG Restart Execution
& Submit decline, UG drilling & trial mining Development
3,500m Drill Campaign
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Regional Tungsten Cluster

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Watershed
Mt Carbine
Wolfram Camp
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Significant tungsten mineralisation in the region

The Mt Carbine deposit is situated in proximity to two other significant scale tungsten deposits; Geological potential to form a tungsten cluster in Far-North Queensland:

Tungsten Mining NL

Watershed: 2014 DFS by Vital Metals (2012 JORC): Ore Reserves of 21Mt @ 0.15% WO3, Mineral Resources of 49Mt @ 0.14% WO3, Exploration Potential of 49-80Mt @ 0.1-0.19% WO3]

Almonty Industries (former ML holder)

Wolfram Camp: 2015 Technical Report by Almonty Industries (NI 43-101): Ore Reserves of 375kt @ 0.22% WO3, Mineral Resources of 2.3Mt @ 0.29% WO3

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Strong JV Partnership

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Mt Carbine Retreatment Management Joint Venture (unincorporated)

CRONIMET is a multi-national, privately owned business which has 103 branches, subsidiaries & representations at 72 locations on 6 continents with over 5,400 employees worldwide.

• 50% CRONIMET Australia / 50% Mt Carbine Retreatment ( EQR 100% Subsidiary ).

The business has 3 business units focusing on:

• JV relates to surface stockpiles, 12Mt Low Grade Stockpile & 2Mt Tailings Stockpile – excludes UG.

1. Metals Recycling

1. Trade & sales of primary and secondary raw materials

2. CRONIMET provided off-take funding securing right of product off-take at fair market value.

3. Production of ferroalloys and metal powders

CRONIMET maintains long-term, mutually beneficial relationships with clients and partners, leveraging its global network of operations.

• Sharing of operational management & funding responsibility on pro-rata basis.

• CRONIMET introduction of sensor-based sorting plant to site.

www.cronimet.de/en/

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Our Values

Act Safe. Feel Safe.

Act safe at work. Care and respect each other. Feel safe to be yourself.

Embrace Difference

Diversity of thinking, skills and background creates value and drives innovation.

Tread Lightly

Embed resource efficiency to minimise environmental footprint and deliver positive societal impact.

Dig Deep

Go one better. Strive to continuously learn and improve. Challenge the status quo.

Buddy Up

Collaboration is key to realising shared value.

Lead with Integrity

Have courage to do the right thing. Be accountable.

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ESG Implementation

Resource Efficient

…extract from secondary sources … integrate advanced technologies to increase resource, cost and energy efficiencies

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Buddy up

• … collaboration is key to realising shared value

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Tread Lightly

…minimise environmental footprint

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• EQR formerly known as ‘Speciality Metals International’

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Mt Carbine Highlights
Potential for debt funding (NAIF or similar)
47Mt @ 0,12-0,14% WO3
Strong FCF, low CAPEX with high margin
with potential 10yr LOM
Funding Global
First successful deliveries to Resource Refurbished 2020 for 300Ktpa,
leading tungsten manufacturers targeting production of 1Mtpa
in the US, Europe & Asia by 2022
Tungsten
Marketing
Process
Plant
Surface operations permitted,
Low Grade 12Mt Historic waste &
UG permitting underway
Mining
Stockpiles 2Mt Historic Tailings with
Licences
recoverable tungsten
UG Quarry
Development Operations
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Reopening of historic decline in progress for sampling, drilling & bulk test work

Production of 18 quarry products

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THANK YOU

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