FENIX RESOURCES LTD — Capital/Financing Update 2019

May 6, 2019

ASX Announcement

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7 May 2019

Fenix Accelerates Iron Ridge Near Term Production Plan via Strategic Alliance with Key Trucking and Logistics Provider

Summary

• Fenix enters into Strategic Alliance with trucking specialist partner Minehaul Pty Ltd via a Joint Venture

• Fenix secures the significant experience of Mr Craig Mitchell to ensure the Project’s potential future trucking operations are managed effectively

• Potential to result in significant cost savings at the Project

• Minehaul to make an investment in Fenix, as part of a broader $1.25 million Share Placement which will fund a significant portion of Fenix’s expected equity contributions to the Joint Venture to achieve production-ready status

Fenix Resources Limited (ASX: FEX, “ Fenix” or “ Company” ) is pleased to announce that it has formed a strategic alliance with trucking and logistics company, Minehaul Pty Ltd (“ Minehaul” ), which is considered to be a significant step towards the development of Fenix’s Iron Ridge Project (“ Project ”) located in the MidWest region of Western Australia.

Trucking Strategic Alliance via Joint Venture Company

Fenix and Minehaul will form a new 50/50 joint venture company (“ JVC ”) which will be known as Premium Minehaul Pty Ltd (“ PM” ). It is intended that PM will provide all trucking services to the Project and hence the JVC represents a significant step forward in the Company’s aim to commercialise the Project.

Mr Craig Mitchell has been elected as Chairman and CEO of the newly formed JVC. Mr Mitchell was the founder and former owner of Mitchell Corp, a major supplier of transport and logistics services to the Western Australian mining industry. Mitchell Corp was acquired by Toll Group for approximately $110 million in 2011.

Pursuant to the JVC agreement, Fenix has provided an undertaking that it will ensure all iron ore transport it is involved with in the Mid-West region of WA (including relating to the Project) will be conducted through the JVC.

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The terms relating to the provision of these services are to be agreed in the coming months and pursuant to a separate road haulage contract agreement, however the Company expects the JVC arrangements to provide several key benefits to Fenix, including but not limited to:

• Greater transparency in relation to the likely transport costs associated with the Project;

• Significant experience that Mr Craig Mitchell brings to Fenix’s trucking operations;

• Potential for significant cost savings relating to transport costs; and

• Elimination of management role duplication and the sharing of the benefits of innovation throughout the life of the project.

Anticipated Trucking Costs

The Project is located approximately 490km by road from the Geraldton port and therefore it is expected that a significant proportion of the total operating costs associated with the Project will be related to the cost of road transport and logistics. This proportion will be confirmed through ongoing studies relating to the Project.

Consequently, the JVC represents a significant milestone in the management and reduction of the most significant discrete operating cost at the Project.

Managing Director Comment

Commenting on the creation of the JVC, Fenix’s Managing Director, Robert Brierley, commented:

“ The creation of this joint venture company represents a significant step for the company as we strive towards development of the Iron Ridge Project.”

“Significant benefits include reduction and transparency of trucking costs, greater control over the logistics chain, reduction in the initial capital outlay and, most importantly, by introducing Craig Mitchell into the operations the Company stands to benefit significantly from his extensive experience in the industry. We already have a well-developed road transport model with detailed cost estimates for the task at hand and this model will be refined further now that we have created the JVC.”

Concurrent Equity Investment by Minehaul

Demonstrating its support for Fenix and alignment of interests, Minehaul has subscribed for $0.25 million of new shares as part of a larger placement of 22,750,000 shares (“ Placement ”) to raise $1.25 million that the Company has received firm commitments for. The Placement will be completed on the same terms as the capital raising announced on 3 April 2019 (i.e. $0.055 per Share) and is subject to shareholder approval. It is intended the Share Placement will complete following the convening of a general meeting anticipated to be held in June 2019.

On Behalf of Fenix Resources Limited:

Robert Brierley Managing Director Fenix Resources Limited

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