MARVEL GOLD LIMITED — Capital/Financing Update 2016

Sep 19, 2016

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20 September 2016

PROJECT PARTNERS COMPLETE PRODUCT DUE DILIGENCE

Highlights

• Metallurgical testwork marks the conclusion of Chilalo product due diligence by the Project Partners

• Testwork results clear the way for negotiation of binding offtake agreement

Graphex Mining Limited is pleased to confirm that independent, confirmatory testwork with respect to the marketability of Chilalo graphite commissioned by the Project Partners has been completed. The Project Partners consist of CN Docking Joint Investment & Development Co. Ltd, a subsidiary of China National Building Materials and China Gold Group Investment Co. Ltd.

The testwork conducted on a 500kg sample of Chilalo ore included the following:

• Flotation to confirm the coarse flake size distribution for Chilalo graphite; and

• Expandability testwork to confirm the excellent expansion rates achieved previously.

The testwork was carried out by Suzhou Design and Research Institute for the Non-Metallic Minerals Industry and completes the due diligence on Chilalo product allowing the Project Partners to finalise the remaining technical due diligence, which is expected in the near future.

Managing Director, Phil Hoskins, commented, “ Conclusion of product due diligence to the satisfaction of our Project Partners is a critical step forward in the development of our Chilalo project. Our own testwork has demonstrated that Chilalo can produce a high quality product with a substantial percentage of coarse flake material and exceptional expandability. It is pleasing to have this confirmed by Suzhou’s testwork.

We continue to make progress in our negotiations with the Project Partners and with this confirmatory testwork now completed, can advance our negotiations on a binding offtake agreement.”

In parallel with the Suzhou testwork, the Project Partners have been continuing technical due diligence on a range of other project parameters.

In recent meetings held during the past month, significant progress has been made with respect to key commercial terms for both offtake and financing with finalisation expected following completion of the remaining technical due diligence.

The following milestones are to be achieved in progress towards binding agreements:

• Finalisation of technical due diligence, including confirmation of desired project scale and product specifications;

• Finalisation of commercial terms;

• Completion of detailed commercial documentation;

• Approval from the Group boards of CN Docking and China Gold; and

• Securing Chinese regulatory approvals customary for overseas investment.

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PHIL HOSKINS

Managing Director

For further information, please contact: Phil Hoskins – Managing Director Tel: +61 8 9200 4960

Stuart McKenzie – Commercial Manager and Company Secretary Tel: +61 8 9200 4960

Media

Michael Weir and Richard Glass – Citadel-MAGNUS Tel: +61 8 6160 4900

About Graphex

Graphex Mining Limited is an Australian exploration and development company, dedicated to advancing the world class Chilalo Graphite Project, located in south-east Tanzania. Chilalo is host to a high-grade mineral resource and has demonstrated an ability to produce a premium graphite concentrate with a substantial portion of large and jumbo flake material. Chilalo graphite possesses outstanding expandability characteristics, making it ideally suited to the rapidly growing expandable graphite market.

Graphex’s current focus of effort is on securing offtake and financing agreements for the development of Chilalo. In accordance with an existing MOU, Graphex is working closely with CN Docking Joint Investment & Development Co. Ltd, a subsidiary of China National Building Materials and China Gold Group Investment Co. Ltd. on the negotiation of such agreements.

Graphex has an experienced board and management team with specific skills and extensive experience in African based project development, exploration, mining and processing. Tanzania is a stable democracy, with a globally competitive tax and regulatory regime. The Company has had a long and well-established presence in Tanzania.

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