IRON BEAR RESOURCES LTD — Capital/Financing Update 2017

May 21, 2017

ASX Announcement 22 May 2017

Further Strategic Cobalt Acquisition Binding Terms Sheet Signed to Acquire 70% Interest in the Kitwe Cobalt-Copper Tailings Project, Zambia

Cape Lambert Resources Limited (ASX: CFE) is a fully funded mineral development company with exposure to iron ore, copper, gold, uranium, manganese, lithium and lead-silverzinc assets in Australia, Europe, Africa and South America.

HIGHLIGHTS:

• Cape Lambert signs Binding Terms Sheet with Australian Mining Company Zambia Limited to acquire a 70% interest in the Kitwe Cobalt-Copper Tailings Project

• The Kitwe Cobalt-Copper Tailings Project is located in Zambia’s Copperbelt, one of the world’s largest producing regions of high grade cobalt and copper concentrates and LME grade copper metal

• The historic cobalt-copper rich tailings dump operated in the 1960s and extends over an area of 0.5km[2] and is. 15m in height

• Zambian Ministry of Mines and Minerals Development, Geological Survey Department confirm its survey completed on 9 May 2017 estimated the license to contain 17.72 million tonnes of tailings

• Samples taken by Cape Lambert’s technical consultants in May 2017 and assayed through SGS Inspection Services Ltd laboratory in Zambia reported cobalt grades of up to 0.43%

Australian Securities Exchange

Code: CFE

Ordinary shares 720,686,586

Unlisted Options 23,500,000 ($0.05 exp 18 Dec 2018)

Board of Directors

Tony Sage Executive Chairman

Tim Turner Non-executive Director

Jason Brewer Non-executive Director

Melissa Chapman Company Secretary

• Cape Lambert’s management have visited the site and met with senior government officials in order to accelerate its technical and legal due diligence review and joint venture discussions

• Acquisition further strengthens Cape Lambert’s position as an emerging cobalt developer and producer at a time of record high cobalt demand and prices of approx. US$55,000/t

• Acquisition also provides the Company with a number of operating synergies as it looks to establish an operating base in one of the largest cobalt and copper rich geological environment in the world

• This acquisition follows the signing by Cape Lambert on 17 May 2017 of the Joint Venture Agreement with Paragon Mining (SARL) to develop the Kipushi Cobalt Tailings and Kasombo Cobalt Projects in the Democratic Republic of Congo

Cape Lambert Contact

Investor Relations

Phone: +61 8 9380 9555 Email: info@capelam.com.au

Australian Enquiries

Professional Public Relations

David Tasker Phone: +61 8 9388 0944 Mobile: +61 433 112 936 Email: david.tasker@ppr.com.au

www.capelam.com.au

Australian resource and investment company, Cape Lambert Resources Limited ( ASX: CFE ) ( Cape Lambert or the Company ) is pleased to announce that it has executed a binding terms sheet to conditionally acquire 70% of the shares in Zambian entity Australian Mining Company Zambia Limited ( Seller or AMCZL ), which is the holder of exploration licence No 21853-HQ-SEL ( Licence or Project) (Acquisition) . The Licence covers an historic cobalt-copper rich tailings dump located near Kitwe in Zambia.

Cape Lambert Resources Limited ABN 71 095 047 920 Corporate - 32 Harrogate Street, West Leederville WA 6007

ASX Announcement 22 May 2017

Commenting on this Acquisition, Cape Lambert Resources Executive Chairman, Mr Tony Sage, said, “the acquisition of this significant high-grade cobalt-copper tailings dam emphasises the Company’s commitment to becoming a significant player in the cobalt sector. There will be obvious synergies available to us with our recently acquired Kipushi Tailings Project located just over 170 kms away accross border in the Democratic Republic of Congo. The Company looks forward to advancing both ” these projects to production for the benefit of our shareholders and stakeholders in the projects .

Figure 1: Location of the Kitwe Cobalt-Copper Tailings Project

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Figure 2: Location of the Kitwe Cobalt-Copper Tailings Project

The Project is located approximately 3km from the outskirts of Kitwe, in the Copperbelt region of Zambia (refer Figure 2). Kitwe is the second largest city, in terms of size and population, in Zambia and is one of the most developed commercial and industrial areas in the nation, alongside Ndola and Lusaka. The Copperbelt is centreed around the towns of Ndola, Kitwe, Chingola, Luanshya and Mufulira – a string of towns on Zambia's northern border with the Democratic Republic of Congo.

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ASX Announcement 22 May 2017

The Copperbelt is one of the world’s largest producing regions of high grade cobalt and copper concentrates and LME grade copper metal with several of the world’s largest copper producing companies operating in the area.

The tailings dam has a footprint of approximately 750m x 650m and is up to 15m in height.

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Figure 3: The Kitwe Cobalt-Copper Tailings Project

Under the terms of the Binding Terms Sheet, Cape Lambert is to pay US$25,000 on execution of the Terms Sheet. On executing the Terms Sheet, Cape Lambert will have 6 months to decide whether it wishes to exercise an option to expend US$500,000 within 6 months from the date of exercising the option ( Option ).

If Cape Lambert does not exercise the Option, or fails to spend the US$500,000 within the 6 months option period, then the 70% shareholding will be returned to the Seller.

Should Cape Lambert satisfy the requirements of the Option, then the Seller will also be entitled to Milestone Payments as follows:

• a) US$50,000 upon AMCZL receiving environmental approvals in the respect of the Project

• b) US$50,000 upon AMCZL being granted a mining licence in respect of the Project;

• c) US$50,000 upon AMCZL receiving an export licence.

The Acquisition is subject to Cape Lambert completing due diligence on AMCZL and the Project and the execution of a share sale agreement, to be completed by 31 May 2017, or as extended by agreement of the parties.

Upon completion of the Acquisition Cape Lambert will be responsible for managing and funding the development of the Project, with the Seller having a “Free Carry” until a “Decision to Mine” at the Project.

A representative of the Board visited the Project in early May 2017 and the Chairman subsequently met a number of government officials in Lusaka.

Cape Lambert’s technical consultants visited the site in early May 2017 and have collected 7 samples from the tailings dam, refer Figure 3, which were assayed for Copper and Cobalt at the Kalalushi laboratory of SGS Inspection Services Ltd in Zambia.

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ASX Announcement 22 May 2017

The assay results are presented in Table 1.

Table 1: Key Assay Results

Sample ID	Co-Ordinates	Co-Ordinates	Estimated thickness	Co Grade (%)	Cu Grade (%)
	Easting	Northing
Pit 1	28°10’12”” E	12°50’32”” S	1.0m	0.30	0.43
Pit 2	28°10’21”” E	12°50’42”” S	1.0m	0.43	0.56
Pit 3	28°10’10”” E	12°50’51”” S	1.0m	0.25	0.53
Pit 4	28°09’56”” E	12°50’50”” S	1.0m	0.20	0.50
Pit 5	28°10’03”” E	12°50’41”” S	1.0m	0.41	0.75
Pit 6	28°10’05”” E	12°50’37”” S	1.0m	0.20	0.84
Pit7	28°09’57”” E	12°50’34”” S	1.0m	0.22	0.93

Figure 4: Sample locations on Kitwe Tailings Dam

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Yours faithfully Cape Lambert Resources Limited

Tony Sage Executive Chairman

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ASX Announcement 22 May 2017

Competent Persons Statement

The information in this report that relates to Exploration Results is based on information compiled by Mr Olaf Frederickson. Mr Frederickson is a Member of The Australasian Institute of Mining and Metallurgy (AusIMM) and has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are 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 (the “JORC Code”). Mr Frederickson is a consultant to Cape Lambert Resources. Mr Frederickson consents to the inclusion in the report of the Exploration Results in the form and context in which they appear.

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ASX Announcement 22 May 2017

– JORC Code, 2012 Edition Table 1 Kitwe Tailings

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections.)

	Criteria	JORC Code explanation	Commentary
	Sampling	• Nature and quality of sampling (eg cut channels, random chips, or	•A small pit was manually dug to 1m depth
	techniques	specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gamma	•Manual channel samples were taken vertically through the excavated pit wall.
		sondes, or handheld XRF instruments, etc). These examples should	•Samples were collected in zip lock plastics and placed into
		not be taken as limiting the broad meaning of sampling.	calico bags.
		• Include reference to measures taken to ensure sample representivity	•Samples were despatched to an SGS laboratory and
		and the appropriate calibration of any measurement tools or systems	assayed.
		used.
		• Aspects of the determination of mineralisation that are Material to the
		Public Report.
		• In cases where ‘industry standard’ work has been done this would be
		relatively simple (eg ‘reverse circulation drilling was used to obtain 1
		m samples from which 3 kg was pulverised to produce a 30 g charge
		for fire assay’). In other cases more explanation may be required,
		such as where there is coarse gold that has inherent sampling
		problems. Unusual commodities or mineralisation types (eg
		submarine nodules) may warrant disclosure of detailed information.
	Drilling	• Drill type (eg core, reverse circulation, open-hole hammer, rotary air	•No drilling conducted.
	techniques	blast, auger, Bangka, sonic, etc) and details (eg core diameter, triple or standard tube, depth of diamond tails, face-sampling bit or other
		_type, whether core is oriented and if so, by what method, etc). _
	Drill sample	• Method of recording and assessing core and chip sample recoveries	•No drilling conducted.
	recovery	and results assessed. • Measures taken to maximise sample recovery and ensure
		representative nature of the samples.
		• Whether a relationship exists between sample recovery and grade
		and whether sample bias may have occurred due to preferential
		loss/gain of fine/coarse material.

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ASX Announcement 22 May 2017

Criteria	JORC Code explanation	Commentary
Logging	• Whether core and chip samples have been geologically and	•Samples were not logged.
	geotechnically logged to a level of detail to support appropriate
	Mineral Resource estimation, mining studies and metallurgical
	studies.
	• Whether logging is qualitative or quantitative in nature. Core (or
	costean, channel, etc) photography.
	• The total length andpercentage of the relevant intersections logged.
Sub-	• If core, whether cut or sawn and whether quarter, half or all core	•All samples were partially wet but were competent to the
sampling techniques and sample preparation	taken. • If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or dry. • For all sample types, the nature, quality and appropriateness of the sample preparation technique.	touch. The material was in the form of stratigraphically layered non saturated tailings of fairly uniform consistency. • The samples have been sorted & dried. The whole sample has been pulverised in a vibrating disc pulveriser.
	• Quality control procedures adopted for all sub-sampling stages to
	maximise representivity of samples.
	• Measures taken to ensure that the sampling is representative of the in
	situ material collected, including for instance results for field
	duplicate/second-half sampling.
	• Whether sample sizes are appropriate to the grain size of the material
	being sampled.
Quality of	• The nature, quality and appropriateness of the assaying and	•Samples were submitted to the SGS Kalulushi lab in
assay data and laboratory tests	laboratory procedures used and whether the technique is considered partial or total. • For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their	Zambia and analysed using the following method • 3 or 4 acid digest and refluxed with a mixture of Acids including HydrofluoricNitric Hydrochloric and Perchloric Acids. This extended digest approaches a Total digest for many elements however some refractory minerals
	derivation, etc.	are not completely attacked.
	• Nature of quality control procedures adopted (eg standards, blanks,	• Co, Cu determined by Atomic Absorbtion
	duplicates, external laboratory checks) and whether acceptable levels	Spectrometry (AAS) after acid digest.
	of accuracy (ie lack of bias) and precision have been established.	•
Verification	• The verification of significant intersections by either independent or	•Lab standards and repeat samples were carried out as part
of sampling and assaying	alternative company personnel. • The use of twinned holes. • Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols.	of the assay procedure.

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ASX Announcement 22 May 2017

Criteria	JORC Code explanation	Commentary
	• Discuss any adjustment to assay data.
Location of	• Accuracy and quality of surveys used to locate drill holes (collar and	•Samples were located with handheld GPS.
data points	down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation.
	• Specification of the grid system used.
	• Quality and adequacy of topographic control.
Data	• Data spacing for reporting of Exploration Results.	•Samples were taken at random with the intent to generally
spacing and distribution	• Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied.	cover the tailings dam. •The data is not suitable for resource estimation. •Samples were composited as described prior.
	• Whether sample compositing has been applied.
Orientation	• Whether the orientation of sampling achieves unbiased sampling of	•No particular geological structure is evident in the tailings
of data in	possible structures and the extent to which this is known, considering
relation to geological structure	the deposit type. • If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material.
Sample	• The measures taken to ensure sample security.	•Sample chain of custody was maintained by the geologist
security		throughout delivery to their place of storage.
Audits or	• The results of any audits or reviews of sampling techniques and data.	•No audits or reviews have been done.
reviews

Section 2 Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section.)

	Criteria	JORC Code explanation	Commentary
	Mineral	• Type, reference name/number, location and ownership including	•Work was conducted on 21853-HQ-SEL in the Kitwe Cobalt
	tenement and	agreements or material issues with third parties such as joint	Copper Tailings Project near Kitwe in northern Zambia..
	land tenure status	ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings.	•The licence is reportedly held by Australian Mining Company Zambia Limited and is now the subject of an option agreement with Cape Lambert Resources Details of
		• The security of the tenure held at the time of reporting along with any	tenure are to be confirmed as part of the due diligence.

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ASX Announcement 22 May 2017

Criteria	JORC Code explanation	Commentary
	known impediments to obtaining a licence to operate in the area.
Exploration	• Acknowledgment and appraisal of exploration by other parties.	•No known exploration has been conducted on the tailings.
done by other		•Historical plant records are being sought.
parties
Geology	• Deposit type, geological setting and style of mineralisation.	•Post processing tailings.
Drill hole	• A summary of all information material to the understanding of the	•See attached table for sample information.
Information	exploration results including a tabulation of the following information
	for all Material drill holes:
	o easting and northing of the drill hole collar
	o elevation or RL (Reduced Level – elevation above sea level in
	metres) of the drill hole collar
	o dip and azimuth of the hole
	o down hole length and interception depth
	o hole length.
	• If the exclusion of this information is justified on the basis that the
	information is not Material and this exclusion does not detract from
	the understanding of the report, the Competent Person should clearly
	explain why this is the case.
Data	• In reporting Exploration Results, weighting averaging techniques,	•No data aggregation was done. Assays represent individual
aggregation methods	maximum and/or minimum grade truncations (eg cutting of high grades) and cut-off grades are usually Material and should be stated. • Where aggregate intercepts incorporate short lengths of high grade	samples taken.
	results and longer lengths of low grade results, the procedure used
	for such aggregation should be stated and some typical examples of
	such aggregations should be shown in detail.
	• The assumptions used for any reporting of metal equivalent values
	should be clearly stated.
Relationship	• These relationships are particularly important in the reporting of	•Samples were taken vertically down the walls of pit
between	Exploration Results.	excavations.
mineralisation widths and intercept	• If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported. • If it is not known and only the down hole lengths are reported, there should be a clear statement to this effect (eg ‘down hole length, true	•The base of the tailings was not intersected at any time.
lengths	width not known’).

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ASX Announcement 22 May 2017

Criteria	JORC Code explanation	Commentary
Diagrams	• Appropriate maps and sections (with scales) and tabulations of	•See attached location plan.
	intercepts should be included for any significant discovery being
	reported These should include, but not be limited to a plan view of
	drill hole collar locations and appropriate sectional views.
Balanced	• Where comprehensive reporting of all Exploration Results is not	•All results have been reported
reporting	practicable, representative reporting of both low and high grades and/or widths should be practiced to avoid misleading reporting of
	Exploration Results.
Other	• Other exploration data, if meaningful and material, should be reported	•N/A
substantive	including (but not limited to): geological observations; geophysical
exploration data	survey results; geochemical survey results; bulk samples – size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential
	deleterious or contaminating substances.
Further work	• The nature and scale of planned further work (eg tests for lateral	•The tailings are to be drilled on a regular grid to ascertain
	extensions or depth extensions or large-scale step-out drilling).	representative grades and accurate depths of tails.
	• Diagrams clearly highlighting the areas of possible extensions,
	including the main geological interpretations and future drilling areas,
	provided this information is not commercially sensitive.

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