QX RESOURCES LIMITED — Capital/Financing Update 2017

Apr 19, 2017

==> picture [222 x 140] intentionally omitted <==

ASX ANNOUNCEMENT

20[th] April 2017

BLACK MOUNTAIN CONFIRMS FIRST SALE TO NORTH AMERICA AND GROWTH IN REPEAT ORDERS

• First order secured for North America, the world’s largest vermiculite market – material dispatched

• Repeat orders to contracted customers in UK, Europe and Japan

• Strong demand coming from Australia

• Strategic stockpiles established in Uganda and Europe with a sales value of AUD$0.9 million

• Higher than expected percentage of large and medium size grade being produced at Namekara

Black Mountain Resources Limited ( ASX: BMZ ) ( Black Mountain or the Company ) is pleased to provide an update on the progress and success of the Marketing, Sales and Logistics program that its 100%-owned subsidiary Namekara Mining Company Limited (NMCL) has implemented.

First North American order secured

Black Mountain is pleased to announce that it has secured its first sale into North America, the world’s largest vermiculite market. This is a very important development for the Company and provides excellent validation of the Namekara product in a very large market. The sale is made up of all four grades of Namekara’s premium product. Black Mountain expects to gain further market share in North America, especially through the supply of large and medium sized grades. The Company is potentially the only vermiculite producer in the world that can significantly expand production and supply of these grades.

Repeat orders from existing customers

NMCL has entered into five supply contracts, which run for 12 months, for supply of material into the UK, Europe and Japan. Customers in all of these markets have placed repeat orders for more material, either for different grades for testing, or for additional material in current grades due to increased demand. Since resuming operations at Namekara in November 2016, the Company has grown its customer base to over 10 customers on five continents.

The sales team plan to meet with as many of these customers at the International Vermiculite Association annual gathering in mid-May to further strengthen the Company’s sales pipeline.

Australian market enquiry is growing

NMCL have received strong enquiry from potential customers in Australia, and the sales team plan to meet the various parties this month to convert these enquiries into firm orders.

Strategic stockpiles established

NMCL is pleased to again confirm that vermiculite stockpiles have been established in Uganda, at the Port of Mombasa, and at a secure warehouse facility in Europe. The total realised sales value of these stockpiles currently stands at $AUD 0.9

Black Mountain Resources Limited ABN 55 147 106 974 www.blackmountainresources.com.au info@blackmountainresources.com.au

Level 2, 34 Colin Street West Perth WA 6005 Tel: +61 8 9321 7277

==> picture [68 x 42] intentionally omitted <==

million. Establishing these stockpiles is an important customer requirement for the industrial minerals market. Additional strategic stockpiles in other regions are being considered and as is various options for stockpile financing.

Increase in percentage of expected large and medium grade being produced at Namekara

Higher than expected production of large and medium grade size vermiculite product has confirmed the potential of the Namekara deposit as the only known and current producing vermiculite operation that can significantly ratchet up supply of large and medium material to meet market demand, and replace declining large and medium grade product from other suppliers.

The budgeted proportional particle size distribution (“PSD”) for Namekara is three quarters large and medium flake size and this proportion is 7% over budget. This is a significant development, allowing for better average prices and marketing flexibility. It is widely recognised that the world has an oversupply of micron super fine material whereas the world supply of medium and large size vermiculite is in deficit.

==> picture [433 x 302] intentionally omitted <==

----- Start of picture text ----- Global Vermiculite Market - (US $'s)4.5Large4 medium3.5fine32.5LegendNamekara Product by Value2superfine1.5 Rest of the Global Market Size by Value1Average Logistics Cost, Mine to Port for four0.5 micron major exporters00 2 4 6 8 10 12 14Average Particle Size (mm)US$/t Product----- End of picture text -----

MANAGEMENT COMMENTARY

Black Mountain’s Chairman and Chief Executive Officer Julian Ford commented: “Black Mountain is establishing a reputation as a reliable supplier of large and medium grade vermiculite, and our product is achieving excellent visibility among a growing customer base and new potential customers.

“The first order into North America is particularly encouraging and it demonstrates that we can deliver product into the world’s largest vermiculite market cost effectively and reliably.

“The solid progress made on sales confirms our belief that the Namekara project has the potential to become the premier vermiculite mine globally, and the value of Namekara continues to grow. We are in a unique position to expand our large and medium supplies without affecting the oversupplied micron and super-fines markets.”

-ENDS-

==> picture [596 x 49] intentionally omitted <==

==> picture [68 x 42] intentionally omitted <==

Further information, please contact:

Julian Ford Chairman & CEO Ph: +61 8 9321 7277

Email: info@blackmountainresources.com.au Web: www.blackmountainresources.com.au

Released through: Ben Jarvis, Six Degrees Investor Relations: +61 (0) 413 150 448

Forward Looking Statements

Information included in this release constitutes forward-looking statements. Often, but not always, forward looking statements can generally be identified by the use of forward looking words such as “may”, “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “continue”, and “guidance”, or other similar words and may include, without limitation, statements regarding plans, strategies and objectives of management, anticipated production or construction commencement dates and expected costs or production outputs.

Forward looking statements inherently involve known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, performance and achievements to differ materially from any future results, performance or achievements. Relevant factors may include, but are not limited to, changes in commodity prices, foreign exchange fluctuations and general economic conditions, increased costs and demand for production inputs, the speculative nature of exploration and project development, including the risks of obtaining necessary licences and permits and diminishing quantities or grades of reserves, political and social risks, changes to the regulatory framework within which the company operates or may in the future operate, environmental conditions including extreme weather conditions, recruitment and retention of personnel, industrial relations issues and litigation.

Forward looking statements are based on the Company and its management’s good faith assumptions relating to the financial, market, regulatory and other relevant environments that will exist and affect the Company’s business and operations in the future. The Company does not give any assurance that the assumptions on which forward looking statements are based will prove to be correct, or that the Company’s business or operations will not be affected in any material manner by these or other factors not foreseen or foreseeable by the Company or management or beyond the Company’s control.

Although the Company attempts and has attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in forward looking statements, there may be other factors that could cause actual results, performance, achievements or events not to be as anticipated, estimated or intended, and many events are beyond the reasonable control of the Company. Accordingly, readers are cautioned not to place undue reliance on forward looking statements. Forward looking statements in these materials speak only at the date of issue. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, in providing this information the company does not undertake any obligation to publicly update or revise any of the forward looking statements or to advise of any change in events, conditions or circumstances on which any such statement is based. e

==> picture [596 x 49] intentionally omitted <==