JAMESON RESOURCES LIMITED — Interim / Quarterly Report 2017

Jul 25, 2017

Jameson Resources, ABN 34 225 891| Level 2, 79 Hay Street, Subiaco WA 6005 | info@jamesonresources.com.au |+61

ASX RELEASE

26 July 2017

The Manager Australian Securities Exchange Companies Announcement Centre 20 Bridge Street Sydney NSW 2000

ACTIVITIES REPORT FOR JUNE QUARTER 2017

Highlights

• ❖ The Crown Mountain PFS Update was completed, showing low FOB cost of US$75/tonne, pretax IRR of 40%, and a US$440 million pretax NPV10.

• ❖ An updated version of the Application Information Requirements (“AIR”) was submitted to the province, as the formal document portion of the pre-application phase of the Environmental Assessment process moves toward conclusion.

• ❖ Approximately A$2.6 million was raised via placement in June to continue advancing the Crown Mountain coking coal project.

• ❖ Dillon Consulting was awarded the task of commencing to draft the Application for an Environmental Assessment Certificate for Crown Mountain.

• ❖ SRK Consulting and Enviromin were authorized to begin engineering design of the spoil and refuse disposal strategy at Crown Mountain.

• ❖ Discussions with potential off-take and/or JV partners accelerated during the reporting period as Jameson focuses on funding remaining pre-construction activities.

• ❖ The Company filed a formal objection with the Canadian Revenue Agency regarding their decision to disallow certain amounts of Jameson’s claimed exploration tax credits.

• ❖ As at 30 June 2017 the Top 20 shareholders held approximately 64% of the capital of the Company and the Company held A$4.2 million in cash. Jameson remains debt-free.

www.jamesonresources.com.au

Jameson Resources I ABN 34 225 891 | Suite 5, 62 Ord Street, West Perth WA 6005 | admin@jamesonresources.com.au |+61 8 9200 4473

Overview

Jameson Resources Limited (“Jameson” or “the Company”) continued to progress the pre-application phase of the EA process at the Crown Mountain Coking Coal project (“Crown Mountain or the “Project”). The economic attractiveness of Crown Mountain was highlighted by the results of the PFS Update, released in April.

The PFS Update, a collaborative effort between Norwest, Kiewit, and Sedgman, projects a low US$75/tonne FOB (Port of Vancouver) cash cost. After-tax payback period is just 2.3 years.

Several initiatives were commenced during the quarter to keep Crown Mountain on the development schedule contained in the PFS Update. Numerous environmental field studies are underway, initial drafting of the EA Application has begun, and the Company awarded the first preliminary engineering and design work.

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Figure 1 – Project Location Plan

www.jamesonresources.com.au

Jameson Resources I ABN 34 225 891 | Suite 5, 62 Ord Street, West Perth WA 6005 | admin@jamesonresources.com.au |+61 8 9200 4473

Project Summary

Crown Mountain Project - Elk Valley Coal Field, British Columbia

The PFS Update was completed in April. Norwest Corporation managed the process, with input from Sedgman on coal processing and infrastructure, and Kiewit on construction and mining.

The Update incorporated all material economic and market changes since the original PFS was issued in 2014, along with several potential OPEX and CAPEX reducing measures that were identified by Jameson and others.

Highlights of the Update are:

• The PFS assessed the economics of an operation producing 1.7 million clean tonnes per annum over the project’s 16 year mine life

• Hard coking coal comprises approximately 84% of life-of-mine clean coal output, with the balance a low to mid volatile PCI product

• FOB cash cost averages US$66/t during the first four years of operation; life-of-mine average is US$75/t

• After-tax Payback Period of 2.3 years

• Internal Rate of Return (IRR) is 40% pre-tax (31% after-tax)

• NPV10 US$440 million pre-tax (US$267 million after-tax)

• Start-up Capital of US$281 million (pre contingency) can be reduced by leasing or utilizing lowhour used equipment

• Low life-of-mine clean coal strip ratio (excluding start-up pre-stripping) of 9.8:1 BCM:t supports low cost open pit production, with an average 7.5:1 BCM:t in the first four years of operation

• ROM reserves total 56 million tonnes, of which 50 million tonnes are Proven and 6 million tonnes Probable, excluding the Southern Extension inferred resource of 24 million tonnes that presents additional potential.

Regarding the pre-application stage of the Environmental Assessment process, a revised AIR (Application Information Requirements document) was submitted to the province in early June and will undergo final review by the working group. While the AIR is essentially the blueprint for preparing the Application for an EA Certificate, Jameson has elected to start preparing the Application now: Dillon Consulting has been awarded this work.

Jameson has also authorized the first initial design and engineering work: SRK Consulting and Enviromin have commenced work on the spoil and refuse disposal concept for the Project.

www.jamesonresources.com.au

Jameson Resources I ABN 34 225 891 | Suite 5, 62 Ord Street, West Perth WA 6005 | admin@jamesonresources.com.au |+61 8 9200 4473

Dunlevy Project – North East British Columbia

Jameson did not complete any work on Dunlevy during the quarter. Annual rent on the exploration licenses has been paid and the project remains in good standing.

Corporate

On June 1, approximately A$2.6 million was raised via placement. As at 30 June 2017 the Company had A$4.2 million in cash and equivalents, no debt, and 250,625,018 fully paid ordinary shares on issue.

As previously announced, the Canada Revenue Agency (“CRA”) commenced an audit of the Company’s 2014 and 2015 claims related to the British Columbia Mineral Excise Tax Credit (“BCMETC”), a program in which certain exploration expenses can earn up to a 30 percent refundable tax credit. The result of that audit was a partial denial of the Company’s claims. After reviewing the CRA decision with its tax advisors the Company elected to file an appeal: the formal objection was lodged with CRA in early June. The amount disallowed of C$244,921 has not been paid to the CRA on the basis that an appeal has been lodged.

Promotional activity continued at a high level, with Jameson exhibiting in Canada at the PDAC convention and Mines and Money events in Hong Kong and New York. Discussions with potential offtake or JV partners are ongoing.

The final quarter of fiscal 2017 was an active and successful period for Jameson. Crown Mountain continues to display its economic merit and viability as it moves closer to development.

On Behalf of the Board of Directors,

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Art Palm

Chief Executive Officer and Acting Chairman

www.jamesonresources.com.au

Jameson Resources I ABN 34 225 891 | Suite 5, 62 Ord Street, West Perth WA 6005 | admin@jamesonresources.com.au |+61 8 9200 4473

About Jameson Resources Limited

Jameson Resources Limited (ASX:JAL) is a junior resources company focused on the acquisition, exploration and development of strategic coal projects in western Canada. The Company has a 90% interest in the Crown Mountain coal project, and a 100% interest in the Dunlevy coal project located in British Columbia. Jameson’s tenement portfolio in British Columbia is positioned in coalfields responsible for the majority of Canada’s metallurgical coal exports and are all close to railways connecting to export facilities.

To learn more, please contact the Company at +61 89200 4473, or visit: www.jamesonresources.com.au

Mineral Reserves and Pre-Feasibility Study Results

The information in this ASX announcement relating to the Mineral Reserve Estimate and Pre-feasibility Study Results of the Company’s Crown Mountain Coal Project are extracted from the ASX Release entitled “PFS Update Yields Lower CAPEX and OPEX and Outstanding Financials, Demonstrating the Significant Potential of Crown Mountain” announced on 26 April 2017 and available to view on the Company and ASX website (ASX:JAL). The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and, that all material assumptions and technical parameters underpinning the reserve estimates and Pre-feasibility study results in the relevant market announcement 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 announcement.

Mineral Resource

The information in this ASX Announcement relating to the Mineral Resource estimates on the Company’s Crown Mountain Coal Project is extracted from the ASX Release entitled “Positive Property-Wide Coal Quality, Crown Mountain Coking Coal Project” announced on 14 March 2014 and is available to view on the ASX website (ASX:JAL), and the Company's website. The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and, that all material assumptions and technical parameters underpinning the resource estimates in the relevant market announcement 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 announcement.

www.jamesonresources.com.au

Jameson Resources I ABN 34 225 891 | Suite 5, 62 Ord Street, West Perth WA 6005 | admin@jamesonresources.com.au |+61 8 9200 4473

Forward Looking Statements

This announcement contains “forward-looking statements”. Such forward-looking statements include, without limitation: estimates of future earnings, the sensitivity of earnings to commodity prices and foreign exchange rate movements; estimates of future production and sales; estimates of future cash flows, the sensitivity of cash flows to commodity prices and foreign exchange rate movements; statements regarding future debt repayments; estimates of future capital expenditures; estimates of resources and statements regarding future exploration results; and where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to commodity price volatility, currency fluctuations, increased production costs and variances in resource or reserve rates from those assumed in the company’s plans, as well as political and operational risks in the countries and states in which we operate or sell product to, and governmental regulation and judicial outcomes. For a more detailed discussion of such risks and other factors, see the Company’s Annual Reports, as well as the Company’s other filings. The Company does not undertake any obligation to release publicly any revisions to any “forward looking statement” to reflect events or circumstances after the date of this release, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws.

www.jamesonresources.com.au

Jameson Resources I ABN 34 225 891 | Suite 5, 62 Ord Street, West Perth WA 6005 | admin@jamesonresources.com.au |+61 8 9200 4473