GLOBE METALS & MINING LIMITED — Interim / Quarterly Report 2020

Apr 23, 2020

ASX RELEASE

30 June 2013

ASX RELEASE

24 April 2020

About Globe

• Globe Metals & Mining Limited is a Perth based company listed on Australian Stock Exchange (ASX Code: GBE)

March Quarter 2020 Review of Operations

Summary

Kanyika Niobium Project

• Company continues to work with government, stakeholders, specialist consultants and advisory parties to advance the Kanyika Project.

Investment Summary

• 100% interest held in Kanyika Niobium Project in Malawi (Africa)

Directors and Management

Ms Alice Wong - Non-Executive Chairperson Mr Alistair Stephens - Managing Director Mr William Hayden - Non-executive Director Mr Bo Tan - Non-executive Director Mr Alex Ko - Non-executive Director Mr Michael Fry – CFO/Company Secretary

Capital Structure

Shares on Issue: 465,922,373 Options on Issue: 1,000,000 (exercise price of $0.25 per option; expiry of 30 June 2020)

Substantial Shareholders

Apollo Metals : 52.79% Ao-Zhong International Minerals: 25.36%

Contact

Alistair Stephens Managing Director info@globemm.com T: +61 (0)8 9328 9368

• Work during the quarter was focussed on execution of the Development Agreement and associated agreements, with updated versions of agreements provided to the Government consistent with the newly gazetted Mines and Minerals Act (2018).

• Work also included a specialist review of processing and engineering design to assess options for reducing capital costs and operating costs.

Development Agreement

• Globe personnel have been working closely with the Malawi Government with the aim of execution of the Development Agreement. The Company remains ready, willing and able to execute the Development Agreement which is a precursor to marketing, financing and development.

Impact of Coronavirus

• The impacts of the novel coronavirus pandemic are widereaching and challenging. Globe has a small, nimble and committed team and presently the Company’s work in Australia and Malawi has been unaffected. We remain focussed on execution of a Development Agreement ahead of construction and mining, once financing and offtake are complete.

Corporate & Finance

• Cash at bank and in term deposits at 31 March 2020 of $5.769 million.

Globe Metals & Mining Ltd | 137 Lake Street, Northbridge, WA, 6003 | PO Box 1811 West Perth WA 6872 | P: +61 8 9328 9368 | F: +61 8 6323 0418 web: www.globemm.com | Email: info@globemm.com | ABN 33 114 400 609 | ASX:GBE

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Globe Metals & Mining Limited (ASX Code: GBE) (“ Globe ” or “ the Company ”) provides its activities report for the quarter ended 31 March 2020.

1. Kanyika Niobium Project

1.1 Tenure

The Kanyika Niobium Project is secured by Application for Mining Licence AML0026.

An application for Mining Licence grants the Company security of tenure only, and grants no rights to the Company to market, sell or commit products or commodities, and prevents any development or operational activities, and therefore, grants no rights to relocate or disrupt communities.

Globe has been formally notified that the issue of a Mining Licence is subject to the finalisation and execution of a Development Agreement (refer status at 1.8).

1.2 Mining Development Process

Negotiations with various regulators, stakeholders and other parties are ongoing in regard to developing the Kanyika Niobium Project.

Advancement of the Kanyika Niobium Project is dependent on finalisation and execution of the Development Agreement (refer status at 1.8) which rests with the Government of Malawi.

1.3 Exploration Activities

No exploration activities were undertaken this quarter.

The Company submitted a new application for EPL0421/15, its exploration tenement lying adjacent to AML0026, in compliance with Section 320 in “Part XX - Repeal and Transition Provisions” of the Mines and Minerals Act (2018); granting security of tenure.

1.4 Engineering Studies

The engineering study remains dominantly complete until the development agreement is finalised in the event there are material issues in the agreement that necessitates alteration of these designs.

The Company has undertaken a broad review of processing technology to assess cost reduction and optimisation options.

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1.5 Mineral Resource Estimate

A Mineral Resource Estimate for the Kanyika Niobium Project under the 2012 JORC guidelines was reported to ASX on 11 July 2018, as follows:

Table 1: Mineral Resource Estimate for Kanyika using a 1,500 ppm Nb2O5 lower cut

Category	Million Tonnes	Nb2O5 ppm	Ta2O5 ppm
Measured	5.3	3,790	180
Indicated	47.0	2,860	135
Inferred	16.0	2,430	120
			135
Total	68.3	2,830

Table 2: Mineral Resource Estimate for Kanyika using a 3,000 ppm Nb2O5 lower cut

Category	Million Tonnes	Nb2O5 ppm	Ta2O5 ppm
Measured	3.4	4,790	220
Indicated	16.6	4,120	190
Inferred	2.8	4,110	190
			190
Total	22.8	4,220

1.6 Feasibility Study

Globe has completed (in January 2019) a revision of all studies and plans, such that the technical programs associated with the mineral resource, mining, metallurgical studies, processing, engineering design and infrastructural support have all been completed to a level of technical detail that is satisfactory to engineering classification standards.

In reference to JORC guidelines, the conversion of mineral resources to ore reserves can only be undertaken once modifying factors, specifically (section 29 JORC Reporting or Ore Reserves) “ once there are reasonable grounds that Government approvals will be received ”.

Globe is not yet in a position to publish the study outcomes but will do so upon the Kanyika Development Agreement being executed and the Company’s Application for Mining Licence having been converted into a granted Mining Licence.

1.7 Project Financial Model and Key Metrics

Globe has completed (in January 2019) an update of its financial model for revised capital costs, revenues and operating costs in order to determine key metrics including but not limited to project revenue, profitability and payback.

Globe is not yet in a position to finalise the financial model and release the key outcomes but will do so upon the Kanyika Development Agreement being executed and the Company’s Application for Mining Licence having been converted into a granted Mining Lease.

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1.8 Development Agreement

The execution of a Development Agreement with the Government of Malawi is a condition on the conversion of the Application for Mining Licence into a granted Mining Licence; and will allow the Company to move forward with project funding and marketing arrangements.

Globe has been working with the Government on a Development Agreement in earnest since 2015. Recently, finalisation of the Development Agreement has gained momentum as a consequence of the introduction of a new Mines and Minerals Act (2018) (“Mining Act”), which was gazetted and effective from 1 September 2019. To this end, Globe has in recent weeks and months, made significant changes to the Development Agreement and associated agreements, which include a shareholders’ deed and a community development agreement, to accommodate the requirements of the new Mining Act and based on feedback from Government. It is noted that the current versions of agreements include the Company granting concessions to the government and community, which are additional to the requirements of the new Mining Act, and are provided principally to demonstrate the Company’s commitment to the people of Malawi and its desire to finalise and execute the Development Agreement as soon as possible so that Globe may proceed with the Kanyika Niobium Project.

From Globe’s perspective the Development Agreement and associated agreements are final and require no further change; and Globe remains ready, willing and able to execute.

It is hoped that in light of the Malawi Government’s stated desire to attract investment into the Malawi mining sector and the formal commencement of Malawi’s new Mines and Minerals Act 2018, that the Malawi Government will soon finalise its internal processes to allow for execution of the Kanyika Development Agreement. A process which both parties both acknowledge has been extensive in timeframe.

1.9 New Mining Act

A new Mining Act which is formally referenced as the Mines and Minerals Act (2018) came into effect on 1 September 2019.

At the time the legislation was passed, President Mutharika is on record as stating that government hopes to enhance the development of the mining sector and increase its benefits to the people. President Mutharika said: " In recognition of the huge potential the mining sector has on the country's economic growth and development, government is implementing a number of activities aimed at increasing investments in the sector ."

Globe is preparing a revised application for a mining licence such that it complies with the new Mines Act that should be submitted during the next quarter.

1.10 Malawi Government Elections

On 21 May 2019, Malawi held a general election with President Mutharika initially being returned. Subsequent High Court action resulted in the May 2019 election being annulled.

A new election is set down for 2 July 2020.

It is unclear whether the upcoming election will cause delay in execution of the Development Agreement or other matters related to the progression of the Kanyika Niobium Project.

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1.11 Kanyika Community Court Action

As previously advised in the quarterly report of 31 December 2019, a mediation hearing for the court action by selected Kanyika residents against the Government of Malawi and Globe Metals and Mining (Africa) Limited proceeded as scheduled (from notice to both parties dated May and September 2019) on 17[th] of December 2019. Unfortunately, the Plaintiffs did not present to the court hearing and their legal representative claimed that they were both unprepared and uninformed of the court date. Irrespective, the legal representative refused any offer of compensation.

It is noted that the Company identified and accepts relevant to the matter and pursuant to statute, a liability for uncompensated exploration activities of amount less than US$100. The Company’s letter of offer, agreeing to payment of this amount, to the legal representatives earlier in the year remains without response. The court ruled that without successful mediation the court declared mediation final and that the parties should consider they’re positions.

There have been no further developments in relation to this matter during the quarter ended 31 March 2020.

1.12 Impact of Coronavirus

Recently the world has come under the grip of the novel coronavirus pandemic with seemingly every country affected in some way. The situation is very uncertain with governments, companies and individuals required to adapt quickly to help curb the rate of infection; resulting in circumstances changing almost on a daily basis.

Globe has a small, nimble and committed team who are taking all necessary measures to ensure the safety of our team, the community and the countries in which we operate.

Presently the Company’s work in Australia and Malawi has been unaffected apart from working from home flexibility. This may change and we are prepared for that, but for the time being we remain focussed on execution of a Development Agreement ahead of construction and mining at Kanyika, once financing and offtake are complete. The Company remains optimistic about our ability to progress the Kanyika Niobium Project and believes the outlook for the commodity markets specifically, Niobium, will remain strong.

Alistair Stephens the Managing Director and Chief Executive Officer of Globe said: “We are doing everything necessary to protect our staff and the community, while we continue to maintain essential business activities. We are not alone in feeling the impact of the disruption caused by these restrictions, however, we continue to work on advancing the Kanyika Project with optimism and great energy.”

2. Corporate

2.1 Cash at Bank

Cash at bank for the Company remains robust with A$5.679 million at bank on call or in term deposit.

2.2 Options

As at 31 March 2020, share options remaining on issue are as follows:

Grant Date	Expiry Date	Number	Exercise Price
2 July2013	30 June 2020	1,000,000	$0.25

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3. Schedule of Mineral Tenements as at 31 March 2020

	Project	Status	Tenement	Interest held by Globe
Malawi	Kanyika	Under application	AML0026	100%
Malawi	Kanyika	Granted	EPL0421/15R	100%

AML- Application for Mining Lease. A renewal application was lodged for this tenement and the Company awaits formal feedback on its renewal.

EPL – Exclusive Prospecting Licence (Malawi)

This report has been authorised for release by Alistair Stephens, Globe’s Managing Director and Chief Executive Officer.

For further information contact:

Alistair Stephens Managing Director info@globemm.com T: +61 (0)8 9328 9368

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Rule 5.5

Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Name of entity

Globe Metals & Mining Limited ABN Quarter ended (“current quarter”) 33 114 400 609 31 March 2020

Consolidated statement of cash flows	Current quarter $A’000	Year to date (9 months) $A’000
1. Cash flows from operating activities 1.1 Receipts from customers 1.2 Payments for (a) exploration & evaluation (if expensed) (b) development (c) production (d) staff costs (e) administration and corporate costs 1.3 Dividends received (see note 3) 1.4 Interest received 1.5 Interest and other costs of finance paid 1.6 Income taxes paid 1.7 Government grants and tax incentives 1.8 Other (provide details if material) 1.9 Net cash from / (used in) operating activities	(432) 22	(1,159) 85
	(410)	(1,074)
2. Cash flows from investing activities 2.1 Payments to acquire: (a) entities (b) tenements (c) property, plant and equipment (d) exploration & evaluation (if capitalised) (e) investments (f) other non-current assets	(12) (165)	(18) (556)

ASX Listing Rules Appendix 5B (01/12/19) + See chapter 19 of the ASX Listing Rules for defined terms.

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Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Consolidated statement of cash flows	Current quarter $A’000	Year to date (9 months) $A’000
2.2 Proceeds from the disposal of: (a) entities (b) tenements (c) property, plant and equipment (d) investments (e) other non-current assets 2.3 Cash flows from loans to other entities 2.4 Dividends received (see note 3) 2.5 Other (provide details if material) 2.6 Net cash from / (used in) investing activities
	(177)	(574)
3. Cash flows from financing activities 3.1 Proceeds from issues of equity securities (excluding convertible debt securities) 3.2 Proceeds from issue of convertible debt securities 3.3 Proceeds from exercise of options 3.4 Transaction costs related to issues of equity securities or convertible debt securities 3.5 Proceeds from borrowings 3.6 Repayment of borrowings 3.7 Transaction costs related to loans and borrowings 3.8 Dividends paid 3.9 Other (provide details if material) 3.10 Net cash from / (used in) financing activities
4. Net increase / (decrease) in cash and cash equivalents for the period
4.1 Cash and cash equivalents at beginning of period 4.2 Net cash from / (used in) operating activities (item 1.9 above) 4.3 Net cash from / (used in) investing activities (item 2.6 above) 4.4 Net cash from / (used in) financing activities (item 3.10 above)	6,311 (410) (177)	7,387 (1,074) (574)

ASX Listing Rules Appendix 5B (01/12/19) + See chapter 19 of the ASX Listing Rules for defined terms.

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Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Consolidated statement of cash flows	Current quarter $A’000	Year to date (9 months) $A’000
4.5 Effect of movement in exchange rates on cash held 4.6 Cash and cash equivalents at end of period	45	30
	5,769	5,769
5. Reconciliation of cash and cash equivalents at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts	Current quarter $A’000	Previous quarter $A’000
5.1 Bank balances 5.2 Call deposits 5.3 Bank overdrafts 5.4 Other (provide details) 5.5 Cash and cash equivalents at end of quarter (should equal item 4.6 above)	5,769	6,311
	5,769	6,311
6. Payments to related parties of the entity and their associates 6.1 Aggregate amount of payments to related parties and their associates included in item 1 6.2 Aggregate amount of payments to related parties and their associates included in item 2 Note: if any amounts are shown in items 6.1 or 6.2, your quarterly activity report must and an explanation for, such payments
		Current quarter $A'000
		165
		include a description of,

The payments made to directors of the entity and their associates reported at 6.1 were comprised as follows:

Non-executive Director’s fees Managing Director Fees Superannuation Total	A$’000 62 96 6
	165

ASX Listing Rules Appendix 5B (01/12/19) + See chapter 19 of the ASX Listing Rules for defined terms.

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Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

7. Financing facilities Note: the term “facility’ includes all forms of financing arrangements available to the entity. Add notes as necessary for an understanding of the sources of finance available to the entity. Total facility amount at quarter end $A’000 Amount drawn at quarter end $A’000 7.1 Loan facilities 7.2 Credit standby arrangements 7.3 Other (please specify) 7.4 Total financing facilities - - 7.5 Unused financing facilities available at quarter end - 7.6 Include in the box below a description of each facility above, including the lender, interest rate, maturity date and whether it is secured or unsecured. If any additional financing facilities have been entered into or are proposed to be entered into after quarter end, include a note providing details of those facilities as well.	Total facility amount at quarter end $A’000	Amount drawn at quarter end $A’000
	-	-

8.	Estimated cash available for future operating activities	$A’000
8.1 8.2 8.3 8.4 8.5 8.6 8.7	Net cash from / (used in) operating activities (Item 1.9) Capitalised exploration & evaluation (Item 2.1(d)) Total relevant outgoings (Item 8.1 + Item 8.2) Cash and cash equivalents at quarter end (Item 4.6) Unused finance facilities available at quarter end (Item 7.5) Total available funding (Item 8.4 + Item 8.5) Estimated quarters of funding available (Item 8.6 divided by Item 8.3)	(410) (177) (587) 5,769 - 5,769
		9.8
8.8	If Item 8.7 is less than 2 quarters, please provide answers to the following questions: 1. Does the entity expect that it will continue to have the current level of net operating cash flows for the time being and, if not, why not?
	Answer: N/a
	2. Has the entity taken any steps, or does it propose to take any steps, to raise further cash to fund its operations and, if so, what are those steps and how likely does it believe that they will be successful?
	Answer: N/a

Answer: N/a 3. Does the entity expect to be able to continue its operations and to meet its business objectives and, if so, on what basis? Answer: N/a

ASX Listing Rules Appendix 5B (01/12/19) + See chapter 19 of the ASX Listing Rules for defined terms.

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Appendix 5B

Mining exploration entity or oil and gas exploration entity quarterly cash flow report

Compliance statement

• 1 This statement has been prepared in accordance with accounting standards and policies which comply with Listing Rule 19.11A.

• 2 This statement gives a true and fair view of the matters disclosed.

• 3 This report has been authorised for release by the Company’s Managing Director

24 April 2020

Date:

...................................................................................

Alistair Stephens – Managing Director

Authorised by: ...................................................................................

(Name of body or officer authorising release – see note 4)

Notes

1. This quarterly cash flow report and the accompanying activity report provide a basis for informing the market about the entity’s activities for the past quarter, how they have been financed and the effect this has had on its cash position. An entity that wishes to disclose additional information over and above the minimum required under the Listing Rules is encouraged to do so.

2. If this quarterly cash flow report has been prepared in accordance with Australian Accounting Standards, the definitions in, and provisions of, AASB 6: Exploration for and Evaluation of Mineral Resources and AASB 107: Statement of Cash Flows apply to this report. If this quarterly cash flow report has been prepared in accordance with other accounting standards agreed by ASX pursuant to Listing Rule 19.11A, the corresponding equivalent standards apply to this report.

3. Dividends received may be classified either as cash flows from operating activities or cash flows from investing activities, depending on the accounting policy of the entity.

4. If this report has been authorised for release to the market by your board of directors, you can insert here: “By the board”. If it has been authorised for release to the market by a committee of your board of directors, you can insert here: “By the [ name of board committee – eg Audit and Risk Committee ]”. If it has been authorised for release to the market by a disclosure committee, you can insert here: “By the Disclosure Committee”.

5. If this report has been authorised for release to the market by your board of directors and you wish to hold yourself out as complying with recommendation 4.2 of the ASX Corporate Governance Council’s Corporate Governance Principles and Recommendations , the board should have received a declaration from its CEO and CFO that, in their opinion, the financial records of the entity have been properly maintained, that this report complies with the appropriate accounting standards and gives a true and fair view of the cash flows of the entity, and that their opinion has been formed on the basis of a sound system of risk management and internal control which is operating effectively.

ASX Listing Rules Appendix 5B (01/12/19) + See chapter 19 of the ASX Listing Rules for defined terms.

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