QUANTUM GRAPHITE LIMITED — AGM Information 2019

Nov 26, 2019

Disclaimer

This presentation includes certain statements that may be deemed forward-looking statements. All statements ln these presentation materials (other than statements of historical facts) which address future production, reserve potential, exploration activities and events or developments that the Company expects, are forward-looking statements. Such forward-looking statements may include, without limitation: (i) estimates of future graphite prices, supply, demand and/or production; (ii) estimates of future cash costs; (iii) estimates of future capital expenditures; (iv) estimates regarding timing of future development, construction, production or closure activities; (v) statements regarding future exploration results; (vi) statements regarding cost structure, project economics, or competitive position, and; (vii) statements comparing the Company's properties to other mines, projects or metals.

Although the Company believes that such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance, that the Company expressly disclaims any responsibility for revising or expanding the forward looking statements to reflect actual results or developments, and that actual results or developments may differ materially from those projected, in the forward looking statements. Photographs, maps, charts, diagrams and schematic drawings appearing in this presentation are owned by and have been prepared by or commissioned by

This presentation does not constitute a recommendation regarding the securities of the Company, and should not be construed as legal or financial advice. It has been prepared for information purposes only and contains general summary information and does not take into account the circumstances of any Individual investor. Prospective investors in the Company are encouraged to obtain separate and independent advice with regard to any investment in the Company. By accepting the presentation materials, the recipient agrees to keep permanently confidential the information contained herein.

The Company confirms that it is not aware of any new information or data that materially affects the information included in this announcement and that all material assumptions and technical parameters underpinning the estimates in this announcement continue to apply and have not materially changed.

the Company, unless otherwise stated. Maps and diagrams used in the presentation are illustrative only and may not be drawn to scale. Unless otherwise stated, all data contained in charts, graphs and tables is based on information available at the date of this presentation. By accepting this presentation, the Recipient agrees to be bound by the foregoing statements.

• 1. Formal Business 2. Recap of developments since 2018 AGM (November 2019) – Corporate – Full Metallurgical Results – Updated Mineral Resource Estimate – Updated Mining Study 3. Definitive Feasibility Study Update and Q & A

Meeting Close

Annual Financial Report – 2019 To receive and consider the 2019 Annual Financial Report of the Company and its controlled entities and the reports of the Directors and of the Auditors for the financial year ended 30 June 2019.

			Formal Business
	To receive and consider the 2019 Annual Financial Report of the Company and its controlled entities and thereports of the Directors and of the Auditors for the financial year ended 30 June 2019.
Resolution	Business	For	Against	Abstain	Open
1	Remuneration Report	674,696,394	68,510,509	37,112,819	174,674,935
2	Election of Directors	3,082,856,992	1,819,695	19,584	174,676,919
3	Share Consolidation	3,076,018,963	8,846,267	20,184	611,527,049
4a	Issue of Shares for PastRemuneration to Sal Catalano	1,464,541,648	2,927,164	7,341,904	782,515,426
4b	Issue of Shares for PastRemuneration to Steven Chadwick	2,815,748,064	3,427,164	43,341,904	768,895,331
4c	Issue of Shares for PastRemuneration to Robert Osmetti	2,585,194,796	3,427,164	7,341,904	768,895,331
4d	Issue of Shares for PastRemuneration to Bruno Ruggiero	2,916,748,064	3,427,164	7,341,904	331,856,058
4e	Issue of Shares for PastRemuneration to David Trimboli	2,448,009,120	3,427,164	7,341,904	768,895,331

		Formal Business
Resolution	Business	For	Against	Abstain	Open
5a	Issue of Shares for FutureRemuneration to Sal Catalano	1,410,489,112	64,839,335	12,602,364	769,395,331
5b	Issue of Shares for FutureRemuneration to Steven Chadwick	2,748,575,433	64,839,335	48,602,364	769,395,331
5c	Issue of Shares for FutureRemuneration to Robert Osmetti	2,518,022,165	64,839,335	12,602,364	769,395,331
5d	Issue of Shares for FutureRemuneration to Bruno Ruggiero	2,849,575,433	64,839,335	12,602,364	332,356,058
5e	Issue of Shares for FutureRemuneration to David Trimboli	2,380,836,489	64,781,335	12,602,364	769,453,331
	Adoption of Revised Constitution	2,917,389,507	2,112,062	187,319	776,723,575

Unmarketable Parcels

• Total of 58,233,563 shares sold on behalf of 3,151 shareholders
• Average market price achieved, 0.30 cents per share
• Manageable shareholder number now approx. 1,040

Consolidation

• Issued share capital to be consolidated on the basis of 1 for 35 Shares
• Estimate of post consolidation shares on issue approx. 218,874,237
• Issued options to be consolidated on the same basis

Comprehensive metallurgical test work program completed

• Includes all variations of carbon (C) within Uley 2 over LOM
• At an average grade of approx. 12% graphitic carbon (gC)

Results highlights

• Medium to Extra-Large Flake material supporting 73% of overall production of graphitic gC
• Large and Extra-Large Flake purities of 97.2%gC and 97.8%gC respectively
• Recoveries of 89% gC

		At an average grade of approx. 12% graphitic carbon (gC)
		Medium to Extra-Large Flake material supporting 73% of overall production of graphitic gC
		Large and Extra-Large Flake purities of 97.2%gC and 97.8%gC respectively
Size Fraction
	Size Fraction	Approx. Weight	Graphitic C	LOI (%)
(μm)	(Mesh)	Dist. (%)	Purity (%)
+300	+50	10.5	97.8	0.26
-300+150-150+75	-50+100-100+200	35.427.1	97.296.6	0.340.36
-75	-200	27.0	90.7	0.73

Mineral Resource Estimate

MRE Highlights

• 117% increase in Measured Resources
• 39% increase in Total Resources to 6.31 million tonnes at an average grade of 11.1% total graphitic carbon (TGC)
• 79% or 5.0 million tonnes of Total Resources are classified in the Measured and Indicated categories

Classification and Tonnes

• The respective classification and Resource tonnes are set out in the table below:

graphitic carbon (TGC)		39% increase in Total Resources to 6.31 million tonnes at an average grade of 11.1% total
categories		79% or 5.0 million tonnes of Total Resources are classified in the Measured and Indicated
Classification and Tonnes
		The respective classification and Resource tonnes are set out in the table below:
Classification	Tonnes (mt)	TGC (%)	Density (t/m3)	TGC (kt)
Measured	0.8	15.6	2.1	125
IndicatedInferred	4.21.3	10.410.5	2.12.2	435137

DFS in final stages

• DFS results expected to be announced next month and will provide the Uley 2 base case scope, schedule and budget
• The Mining Study and Ore Reserve Estimate, announced today, was the final of the critical technical studies necessary for completion of the DFS
• The DFS will also identify Uley 2 project opportunities beyond the base case and include recommendations for further work to improve project economics

Q & A

2019 Annual General Meeting

Close of Meeting

Uley 2 Process Plant Layout

At a Glance…

• Shares on Issue (on a fully diluted basis post consolidation) approx. 218.875million
• Top 50 Shareholders their shareholding as a result of investment in the reconstruction
• Board Representation represents >40% shareholding
• Net Assets (30 June 2019) approx. $17 million
• Liabilities No debt, rehab liability of $558,369 matched by security bond of $1.07 million with SA DEM
• 89% of which all but one acquired • JORC 2012 Mineral Resources of 6.3 million tonnes at average grade of graphitic C of 11.1% of which 5.0 million tonnes @ 11.2% constitutes JORC 2012 Ore Reserves
  • Resources and reserves subject to continuous upgrade as part of the long term exploitation of the greater Uley deposit
  • Only permitted graphite mine in Australia (PEPR issued by SA DEM on 24 December 2014)
  • At a global level:
  • product
  • high grade, large flake natural graphite market
  • resource

Structure Key Assets and Permitting

Mining Leases 5561 and 5562	100%
Retention Leases 66 and 67	100%

Uley 2

Geology and Mineral Resources

Geometallurgical Domains

Geodomain code	Description
Fresh	Unweathered mineralisation
Saprock	Moderately weathered mineralisation
Saprolite	Highly weathered mineralisation
Carbonate	Elevated C as $CO3$ (>1%) mineralisation
Clay	Clay mineralisation

Mineralisation

• 5 domains based on mineralogy, weathering and carbonate content
• Used to guide sampling for metallurgical testwork

Exploration Strategy

Targets generated from electromagnetic surveys

• host the Uley 2 Resource)

The Western, Central and Eastern Conductors, all located within the Mining and Retention Lease boundaries, represent large and immediate accessible resources targets many times that of Uley 2

• 3 drill holes intersecting high-grade mineralisation within the eastern conductor

Central and Western Conductor

• Drilling at the central conductor is limited to the Uley 2 Resource and a single drill hole to the south
• High grade mineralisation is interpreted at the southern extension of the Resource and likely to extend south
• limited to three drill holes which support the presence of high-grade mineralisation
• presence of high-grade mineralisation along strike from the current drilling

Uley 2

Metallurgy and Processing

Flyover inserted here…

Uley 2 Hold Flowsheet

Control of Clay Critical

Clay

• Control of clay is critical for optimum flotation and reuse of water
• Represent 3% of LOM ore, but much higher percentage initially at surface
• Mine schedule modified to stockpile clay to waste or blend into feed

Comminution

• Ore is soft and not abrasive; sizer crusher
• Ore is soft and free milling; single stage SAG mill in closed circuit with screens
• Low liner wear rates

Floatation and Polishing

Slimes/clay treatment

Flotation/polishing process

• Graphite floats readily single stage rougher floatation plus 4 stages sequential polishing and cleaning • Consumptions very low
  • o Polishing stages 1 & 2 via conventional horizontal ball mills
  • o Polishing stages 3 & 4 via stirred mills (attrition cells)

Reagents

Other Processes

Filtration & Drying

• Via plate and frame filter, followed by LPG fired rotary dryer

Screening & Bagging

• Via gyratory motion screens into 4 fractions; bagging on dayshift only
• Significant coarse graphite production

Thickening & Tailing Deposition

• Via conventional thickener
• HDPE lined depository

Costs and Opportunities

Major Cost Centres

• • o Labour
  • o Power
  • o Water
  • o LPG
  • o Concentrate bags

Further Opportunities

• Mine scheduling, to avoid current high up front and rehandling cost • Process Optimisation to be undertaken through operations phase
• Increased production; plant design already allows this
• Alternate solutions for water supply, power supply and LPG

Uley 2

Marketing Overview

Refractories/Thermal Applications: Exploit previous customer relationships

• Target early sales to established/major Western European refractory manufacturers previously supplied by the company
• Identify other major refractory manufacturers (outside of China) requiring high grade flake graphite

Develop alternative markets

• Thermal battery initiative with The Sunlands Co.

Process plant optionality

• New process plant optionality ensures the company is prepared for the likely transformation of the graphite market within the next 2 to 5 years

This presentation includes certain statements that may be deemed forward-looking statements. All statements ln these presentation materials (other than statements of historical facts) which address future production, reserve potential, exploration activities & events or developments that the Company expects, are forward-looking statements. Such forward-looking statements include, without limitation: (i) estimates of future graphite prices, supply, demand &/or production; (ii) estimates of future cash costs; (iii) estimates of future capital expenditures; (iv) estimates regarding timing of future development, construction, production or closure activities; (v) statements regarding future exploration results; (vi) statements regarding cost structure, project economics, or competitive position,&; (vii) statements comparing the Company's properties to other mines, projects or metals.

Although the Company believes that such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance & actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, exploitation & exploration successes, continued availability of capital & financing, & general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance, that the Company expressly disclaims any responsibility for revising or expanding the forward looking statements to reflect actual results or developments, & that actual results or developments may differ materially from those projected, in the forward looking statements. investment in the Company. By accepting the presentation materials, the recipient agrees to keep permanently confidential the information contained by the Company, unless otherwise stated. Maps & diagrams used in the presentation are illustrative only & may not be drawn to scale. Unless

This presentation does not constitute a recommendation regarding the securities of the Company, & should not be construed as legal or financial advice. It has been prepared for information purposes only & contains general summary information & does not take into account the circumstances of any Individual investor. Prospective investors in the Company are encouraged to obtain separate & independent advice with regard to any herein.

The Company confirms that it is not aware of any new information or data that materially affects the information included in this announcement and that all material assumptions and technical parameters underpinning the estimates in this announcement continue to apply and have not materially changed.

Photographs, maps, charts, diagrams & schematic drawings appearing in this presentation are owned by & have been prepared by or commissioned otherwise stated, all data contained in charts, graphs & tables is based on information available at the date of this presentation. By accepting this presentation, the Recipient agrees to be bound by the foregoing statements.