SARYTOGAN GRAPHITE LIMITED — Management Reports 2022

Dec 5, 2022

6 December 2022

BREAKTHROUGH: 99.87% GRAPHITE PURITY

Sarytogan Graphite Limited (ASX: SGA, "the Company" or "Sarytogan") is pleased to report a breakthrough in the metallurgical test work for the Sarytogan Graphite Deposit in Central Kazakhstan.

Highlights

• Low-temperature alkaline roasting improved to 99.70% Total Graphitic Carbon (TGC)
• Alternative chemical purification process separately achieved 99.70% TGC
• Combining both alkaline roasting and chemical purification achieved 99.87% TGC
• Next Steps for Q1 2023 include further optimisation, spheroidization test-work, Mineral Resource upgrade, and commencement of economic studies.

	low-strip	crystalline	low-temp
GraphitePurity	209 Mt @28.5%TGC	84% TGC	99.70% TGC	99.87% TGC(99.70% withoutalkaline roasting)	target99.95% TGC
NextSteps	Q1 2023upgrade	optimisation	optimisation	optimisation	2023 test workplanned

Table 1 - Current progress of flow sheet development and graphite purity. Refer to Prospectus dated 23 February 2022, published on the ASX 14 July 2022, for full details of the Mineral Resource Estimate.

Sarytogan Managing Director, Sean Gregory commented:

"Sarytogan is thrilled with this breakthrough metallurgical result by our German laboratory partner Pro-Graphite. The graphite purities achieved are a significant step towards battery anode specification. Sarytogan's giant highgrade Mineral Resource is now complimented by its' premium micro-crystalline high-purity product, credentials that now elevate the project to be a potential answer to the world's projected battery anode material shortage."

Metallurgical Results

Our German laboratory partners Pro-Graphite GmbH (Pro-Graphite) has reported metallurgical test work results for the Sarytogan Graphite Project.

A composite sample was blended from samples collected from six diamond drill holes; three from the Northern Graphite Zone and three from the Central Graphite Zone of the Sarytogan Graphite Deposit.

The composite sample was subjected to the same flotation and grinding steps as used by Independent Metallurgical Operations Pty Ltd (IMO) in Perth which achieved a premium microcrystalline sizing of approximately 10 micron (refer ASX Announcement 12 October 2022). The graphite purity achieved at this stage by Pro-Graphite was similar to IMO at 84% TGC, with a slight improvement due to the measurement method only.

The flotation concentrate was then upgraded by alkaline roasting at low-temperature with caustic soda and a weak sulphuric acid wash. A graphite purity of 99.70% TGC was achieved at this step, which is a significant improvement on the 92.1% TGC previously achieved by alkaline roasting (refer ASX Announcement 12 October 2022).

Separately, the flotation concentrate was upgraded by chemical purification (without the alkali roasting step), also to 99.70% TGC.

Despite the identical purity results achieved by alkaline purification and chemical purification separately, the different methods target different diluent minerals more effectively. Combining both methods in series has been even more effective with 99.87% TGC achieved so far.

Battery Anode Product Strategy

These results are another step towards Sarytogan's strategy to target the rapidly growing battery anode materials market.

The product to support this strategy will be Uncoated Spherical Graphite (USpG). USpG presently trades at more than US$3,000/t, which is approximately triple the price of traditional flake graphite products.

To achieve the specification of USpG, the Sarytogan concentrates will require milling to make spherical graphite balls of 5-20 micron in size and further purification to 99.95% TGC.

Next Steps

IMO are continuing to optimise the flotation process, experimenting with different grind methods and sizes, desliming, and alternative reagents all aimed at designing the most economic method to generate flotation concentrate at similar purities to that already achieved.

Pro-Graphite continue to optimise the purification process. The residue from these tests is being assayed to assess its mineralogy and devise further process improvements, such as alternative acids, aimed at achieving even high purities.

Pro-Graphite are also planning initial spheroidization tests to determine the product yield and physical properties of Sarytogan USpG. This will require additional flotation concentrate to be manufactured, a requirement that is expected to grow as the project advances and for future

customer samples. To get ahead of this demand, Sarytogan is in discussions with several laboratories to upscale the production of flotation concentrate.

The HQ drilling program on site has now been efficiently and safely completed. Further drilling results announcements are planned as assays become available. The planned Mineral Resource upgrade targeting Indicated classification is on track for Q1 2023.

This announcement is authorised by the Board of Directors of the Company.

Sean Gregory

Managing Director

About Sarytogan

The Sarytogan Graphite Deposit is located in the Karaganda region of Central Kazakhstan. It is 190km by highway from the industrial city of Karaganda, the 4th largest city in Kazakhstan (Figure 1).

Figure 1 - Sarytogan Graphite Deposit location

The Sarytogan Graphite Deposit was first explored during the Soviet era in the 1980s with sampling by trenching and diamond drilling. Metallurgical test work utilising flotation, sintering, and leaching successfully produced graphite concentrate of up to 98.6% purity (reported in the 23 February 2022 Prospectus). Sarytogan has now achieved 99.9% purity by flotation, alkali roasting, and chemical purification and is pursuing a strategy to supply high-quality anode material for the rapidly growing battery market.

The project hosts an Inferred Mineral Resource of 209Mt @ 28.5% TGC for 60Mt contained graphite estimated by CSA Global (Table 2). Sarytogan has completed significant additional drilling and plans to upgrade the Mineral Resource Estimate in Q1 2023.

Table 2 - Sarytogan Graphite Deposit Inferred Mineral Resource (cut-off grade of 15%). Refer to Prospectus dated 23 February 2022, published on the ASX 14 July 2022, for full details of the Mineral Resource Estimate.

Zone	JORC	In-Situ	Total Graphitic	Contained
	Classification	Tonnage (Mt)	Carbon (TGC %)	Graphite (Mt)
North	Inferred	159	28.8	46
Central	Inferred	49	27.5	14
Total	Inferred	209	28.5	60

Competent Person's Statement

The information in this report that relates to JORC estimates of Mineral Resources and historical Exploration Results was first reported in the Prospectus dated 23 February 2022 and published at www.asx.com.au on 14 July 2022. The Company confirms that it is not aware of any new information or data that materially affects the information included in the relevant market announcement and, in the case of estimates of Mineral Resources, that all material assumptions and technical parameters underpinning the 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 Persons' findings are presented have not been materially modified.

The information in this report that relates to 2022 Exploration Results is based on information compiled by Dr Waldemar Mueller, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy. Dr Mueller is a full-time employee of the Company and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken 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'. Dr Mueller consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The information in this document that relates to metallurgical test work is based on, and fairly represents, information and supporting documentation reviewed by Mr Peter Adamini, BSc (Mineral Science and Chemistry), who is a Member of The Australasian Institute of Mining and Metallurgy (AusIMM). Mr Adamini is a full-time employee of Independent Metallurgical Operations Pty Ltd, who has been engaged by Sarytogan Graphite Ltd to provide metallurgical consulting services. Mr Adamini has approved and consented to the inclusion in this document of the matters based on his information in the form and context in which it appears.

JORC Code, 2012 Edition – Table 1

Section 1 Sampling Techniques and Data

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

Criteria	JORC Code explanation	Commentary
Samplingtechniques	Nature and quality of sampling (e.g., cutchannels, random chips, or specificspecialised industry standardmeasurement tools appropriate to theminerals under investigation, such asdown hole gamma sondes, or handheldXRF instruments, etc). These examples	Quarter HQ diamond core wassampled for metallurgical testing.These tests were completed on acomposite of the following samples:
		ZoneNorth	HoleSt-12	From117.2	To140.2	Grade35.2%
	should not be taken as limiting the broadmeaning of sampling.	North	St-30	11.0	33.0	23.5%
	Include reference to measures taken to	North	St-41	6.0	22.0	33.8%
	ensure sample representivity and theappropriate calibration of any	Cent	St-60	10.0	48.0	30.8%
	measurement tools or systems used.	Cent	St-61	11.0	26.3	36.0%
	Aspects of the determination ofmineralisation that are Material to thePublic Report.	Cent	St-65	11.0	18.1	32.8%
	In cases where 'industry standard' workhas been done this would be relativelysimple (e.g., 'reverse circulation drillingwas used to obtain 1 m samples fromwhich 3 kg was pulverised to produce a30 g charge for fire assay'). In other cases,more explanation may be required, suchas where there is coarse gold that hasinherent sampling problems. Unusualcommodities or mineralisation types (e.g.,submarine nodules) may warrantdisclosure of detailed information.
Drillingtechniques	Drill type (e.g., core, reverse circulation,open-hole hammer, rotary air blast,auger, Bangka, sonic, etc) and details(e.g., core diameter, triple or standardtube, depth of diamond tails, facesampling bit, or other type, whether coreis oriented and if so, by what method,etc).	Core drilling was completed by an XY44Т drill rig mounted on wheel-basedwith a smooth-bore drill with acore tubes.Pre-drilling is completed with carbideto a depth of 2-4 m, followed by				mobile trailed platforms and equippeddetachable core receiver of the BoartLongyear system equipped with doublecrowns with a diameter of 112-132 mm

Criteria	JORC Code explanation	Commentary
		casing. Drilling is carried out using aremovable core receiver and HQdiamond crowns (diameter 96 mm), inrare cases, in complex geologicalconditions, diameter was reduced toNQ size (diameter 76 mm). Water wasused as a washing liquid, and polymersolutions were used at absorption sites.
		All drill holes are vertical. At thecompletion of a drill hole, downholesurvey is carried using a MIR-36inclinometer with measurements every20 m.
Drillsamplerecovery	Method of recording and assessing coreand chip sample recoveries and resultsassessed.Measures taken to maximise samplerecovery and ensure representativenature of the samples.Whether a relationship exists betweensample recovery and grade and whethersample bias may have occurred due topreferential loss/gain of fine/coarsematerial.	To maximise core recovery, doubletube HQ and NQ core drilling was used,with the drilling utilising drillersexperienced in drilling difficult groundconditions. Drill penetration rates andwater pressure were closely monitoredto maximise recovery.During the diamond drilling the lengthof each drill run and the length ofsample recovered was recorded bythe driller (driller's recovery). Therecovered sample length was crosschecked by the geologists logging thedrill core and recorded as the finalrecovery.Average core recoveries are greaterthan 98%.At present, no relationships betweensample recovery and grade bias dueto loss/gain of fines or washing away ofclay material has been identified. It isassumed that the grade of lost materialis similar to the grade of the recoveredcore.
Logging	Whether core and chip samples havebeen geologically and geotechnicallylogged to a level of detail to supportappropriate Mineral Resource estimation,	All logging is completed on paper andlater transferred to a digital media.The core documentation includesinformation on the length of the drill

Criteria	JORC Code explanation	Commentary
	mining studies and metallurgical studies.Whether logging is qualitative orquantitative in nature. Core (or costean,channel, etc) photography.The total length and percentage of therelevant intersections logged.	runs, drilling diameter, core recoveryand sampling intervals. Specialattention was paid to the zones ofgraphitised rocks, lithology, alterationand mineralisation, the orientation ofquartz veins and veinlets were studiedin detail.
		All drill core is digitally photographedand completed in separate room usinga specially designed stand thatprovides a fixed angle. The camerapositioned at the same distance fromthe stand. The core is photographed in2 stages before sawing and then aftersawing. The most interesting samplesare photographed at close distances.
		A collection of representative samplesis used during logging to provideconsistency with descriptions
Sub-samplingtechniquesandsamplepreparation	If core, whether cut or sawn and whetherquarter, half or all core taken.If non-core, whether riffled, tube sampled,rotary split, etc and whether sampled wetor dry.For all sample types, the nature, quality,and appropriateness of the samplepreparation technique.Quality control procedures adopted forall sub-sampling stages to maximiserepresentivity of samples.Measures taken to ensure that thesampling is representative of the in-situmaterial collected, including for instanceresults for field duplicate/second-halfsampling.Whether sample sizes are appropriate tothe grain size of the material being	Quarter HQ diamond drill core wassampled for metallurgical testing.Most core was cut using an electricdiamond saw and some more friableintervals were split manually. All corefor sampling was pre-marked with thecut line, and only one side of the corewas sent for assay to maintainconsistency.The core sampling was generally at a2 m interval, refined to match loggedlithology and geological boundaries.A minimum sample length of 0.5 mwas used.The quality of sampling is checked bycomparing geological documentationand samples.
Qualityof	sampled.The nature, quality and appropriateness	The metallurgical test work was
assaydata	of the assaying and laboratory	conducted at Pro-Graphite laboratory

Criteria	JORC Code explanation	Commentary
andlaboratorytests	procedures used and whether thetechnique is considered partial or total.For geophysical tools, spectrometers,handheld XRF instruments, etc, theparameters used in determining theanalysis including instrument make andmodel, reading times, calibrations factorsapplied and their derivation, etc.Nature of quality control proceduresadopted (e.g., standards, blanks,duplicates, external laboratory checks)and whether acceptable levels ofaccuracy (i.e., lack of bias) and precisionhave been established.	in Germany. A master compositesample was blended from stagecrushed (<3.35 mm) samples collectedfrom quartered HQ diamond drill.Samples of 0.5 to 1kg were subjectedto multiple grinding and flotationstages. The Total Graphitic Carbon(TGC) achieved at this stage wasmeasured by Pro-Graphite as thedifference between the Loss on Ignition(LOI) at 920 degrees and the LOI at 400degrees in a nitrogen atmosphere.Caustic Soda was added to theflotation concentrate which was thenroasted at low temperature. Theresidue was washed with water andleached with weak sulphuric acid.Hydrofluoric acid was not required forthe successful alkali roasting result of99.70% TGC. The TGC grades reportedat this step and in subsequent steps ismeasured as the LOI result at 920degrees. The volatiles at these highpurities are negligible and industrypractice is to report the LOI 920 result.Separately, the flotation concentratewas chemically purified withhydrofluoric acid.The two methods were then applied inseries; alkali roasting, followed bychemical purification.
Verification ofsampling andassaying	The verification of significant intersectionsby either independent or alternativecompany personnel.	Visual validation of mineralisationagainst assay results was undertakenfor several holes.
	The use of twinned holes.Documentation of primary data, dataentry procedures, data verification, datastorage (physical and electronic)protocols.Discuss any adjustment to assay data.	All diamond drill core samples werechecked, measured, and marked upbefore logging in a high level of detail.The diamond drilling, sampling andgeological data were recorded onpaper into standardised templates andtransferred to Microsoft Excel by the

Criteria	JORC Code explanation	Commentary
		logging/sampling geologists.Geological logs and associated datawere cross checked by the supervisingProject Geologist.
		Laboratory assay results wereindividually reviewed by sample batchand the QC results checked beforeuploading. All geological and assaydata were uploaded into Excel. Thisdata was then validated for integrityvisually and by running systematicchecks for any errors in sampleintervals, out of range values and otherimportant variations.
		All drill core was photographed withcorrected depth measurements beforesampling.
		Mineralisation observed was entirelycompatible with reported assays inboth drill core.
		No specific twin holes were drilled;however, some recent drill holes wereplaced and drilled close to thehistorical holes. Similar grades anddistribution were observed in the recentdrill holes.
Locationofdata points	Accuracy and quality of surveys used tolocate drill holes (collar and down-holesurveys), trenches, mine workings andother locations used in Mineral Resourceestimation.Specification of the grid system used.Quality and adequacy of topographiccontrol.	Topographic and geodetic works werecarried out using modern, highprecision, satellite geodetic equipment— a single-frequency 12-channel GPSSokia GRX1, represented by a basestation and mobile receiver with a GPSantenna. The device at themeasurement time has valid calibrationcertificates.
		For this report the holes were set outusing the Sokia instrument and havebeen picked up by handheld GPS inthe interim.
		The grid system used at the deposit isthe WGS84 UTM Zone 43 coordinate

Criteria	JORC Code explanation	Commentary
		system, Baltic elevation system.Downhole survey was carried out witha gyro instrument. Measurements of theangle and azimuth are carried outevery 20 m.Control measurements have notrevealed any inconsistencies anderrors.The accuracy of the Sokia GRX1 resultsin deviations of no more than 10 cm.
Data spacinganddistribution	Data spacing for reporting of ExplorationResults.Whether the data spacing, anddistribution is sufficient to establish thedegree of geological and gradecontinuity appropriate for the MineralResource and Ore Reserve estimationprocedure(s) and classifications applied.Whether sample compositing has beenapplied.	The density of the drill holes within theestimated limits of the proposed openpit mining area is 40-100 m betweenthe drill holes on each section. Thedistances between the sections is 250m, and the depths of the drill holesvaries between 60 and 300 m.The grid is sufficient to tracemineralisation zones.
Orientation ofdatainrelationtogeologicalstructure	Whether the orientation of samplingachieves unbiased sampling of possiblestructures and the extent to which this isknown, considering the deposit type.If the relationship between the drillingorientation and the orientation of keymineralised structures is considered tohave introduced a sampling bias, thisshould be assessed and reported ifmaterial.	The spatial position of the graphitezones is confined structurally to thewestern and southwestern limbs of theShiyozek fold, complicated by the largecurved Sarytoganbai syncline whichtrends in northeast and east directions.The North zone has a strike length of2,300 m, a width of between 110 and500 m, and a depth up to 190 m. Theweighted average TGC for drill holes is32.42% (for 20% cut-off). The averagedepth is 100 m.The Central zone has a strike length of2,900 m, a width of between 86 and114 m on the flanks up to 450 m in thecentre, and a depth up to 80 m, withan average of 40 m. The weightedaverage graphite carbon content is28.12% (for 20% cut-off).

Criteria	JORC Code explanation	Commentary
Samplesecurity	The measures taken to ensure samplesecurity.	Control over the security of samples iscarried out throughout the entireprocess. Each sample is assigned aunique number. The core samplesselected after logging are transferred(with the corresponding orders andsample registers) to the samplepreparation facilities, which is locatedin the Ekibastuz city. In the samplepreparation laboratory, each sampleunderwent the entire processing cyclein compliance with all necessaryrequirements for the preservation ofsamples and the prevention of theircontamination.
Auditsorreviews	The results of any audits or reviews ofsampling techniques and data.	A desktop review of the 2019 samplingtechniques and data was carried outby CSA Global. The Competent Personfrom CSA Global also visited the siteand sample preparation laboratoryduring August 2022. The results of thisaudit are pending and will be appliedto the ongoing drilling and for theplanned Mineral Resource upgrade.Visual validation of the drill hole andmineralised intersections wasundertaken against hard copy drillsections and provided corephotographs.

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	The exploration licence 1139-R-TPI
tenement and	and ownership including agreements or	(1139-Р-ТПИ) was issued to Ushtogan
landtenure	material issues with third parties such as	LLP on 14/08/2018 and confirmed by
status	joint ventures, partnerships, overriding	5406-TPI (5406-ТПИ) contract on
	royalties, native title interests, historical	26/10/2018. The contract was extended
	sites, wilderness or national park and	in June 2022 for a further 3 years to
	environmental settings.	June 2025. The exploration concession
	The security of the tenure held at the time	covers 70 km2.
	of reporting along with any known	There are no other mineral deposits

Criteria	JORC Code explanation	Commentary
	impediments to obtaining a licence tooperate in the area.	and protected natural areas within theconcession area.
Explorationdone by otherparties	Acknowledgment and appraisal ofexploration by other parties.	In the period from 1985 to 1987,geological exploration was carried outby the Graphite party of theKaraganda State Regional geologicalexpedition.
		Since 2019, exploration drilling is beingcarried out by Ushtogan LLP a 100%owned subsidiary of SarytoganGraphite Limited.
Geology	Deposit type, geological setting, and styleof mineralisation.	Structurally, the Sarytogan site isconfined to the western andsouthwestern wing of the Shiyozek fold,complicated by a large curvedSarytoganbai syncline which trends innortheast and east directions.
		In general, the Sarytogan site is a large,over-intrusive zone; the volcanic andsedimentary rocks developed herehave undergone extensive contactmetamorphism; volcanogenic andterrigenous rocks are transformed intoquartz-biotite, quartz-sericite hornfels;carbonaceous rocks are either alteredinto hornfels, or underwent significantgraphitisation, and along contacts withintrusive granite domes, quartztourmaline and tourmalinehydrothermal rocks of the greisen typeare developed.The deposit belongs to the black shaleregional-metamorphic type andrepresents a carbon-bearing
		conglomerate sequence with a greisenzone with a thickness of more than 80m in the over-intrusive zone of thegranite massif that compose theSarytoganbai syncline. Host rocksinclude graphite siltstone and graphiteshale.

Criteria	JORC Code explanation	Commentary
DrillholeInformation	A summary of all information material tothe understanding of the explorationresults including a tabulation of thefollowing information for all Material drillholes:easting and northing of the drillohole collarelevation or RL (Reduced Level –oelevation above sea level inmetres) of the drill hole collardip and azimuth of the holeodown hole length and interceptionodepthohole length.If the exclusion of this information isjustified on the basis that the information isnot Material and this exclusion does notdetract from the understanding of thereport, the Competent Person shouldclearly explain why this is the case.	Refer to the Prospectus dated 23February and published on the ASX on14 July 2022 and ASX Announcementsdated 15 August 2022, 19 September2022, and 8 November 2022 for alldrilling results reported to date.
Dataaggregationmethods	In reporting Exploration Results, weightingaveraging techniques, maximum and/orminimum grade truncations (e.g., cuttingof high grades) and cut-off grades areusually Material and should be stated.Where aggregate intercepts incorporateshort lengths of high-grade results andlonger lengths of low-grade results, theprocedure used for such aggregationshould be stated and some typicalexamples of such aggregations should beshown in detail.The assumptions used for any reporting ofmetal equivalent values should be clearlystated.	Intervals are reported at a 10% TGCcut-off with up to 2m internal dilution.Higher-grade 'inc' zones are reportedat a 35% cut-off at a minimum thicknessof 4m and with up to 6m internaldilution.
Relationshipbetweenmineralisationwidthsandinterceptlengths	These relationships are particularlyimportant in the reporting of ExplorationResults.If the geometry of the mineralisation withrespect to the drill hole angle is known, its	The deposit is hosted in folded metasediments that vary in dip angle. Therelationship between the drillholes andthe meta-sediment dip is shown in thecross sections. Vertical holes areconsidered appropriate to define the

Criteria	JORC Code explanation	Commentary
	nature should be reported.	mineralisation envelope at this stage.
	If it is not known and only the down holelengths are reported, there should be aclear statement to this effect (e.g., 'downhole length, true width not known').
Diagrams	Appropriate maps and sections (withscales) and tabulations of interceptsshould be included for any significantdiscovery being reported These shouldinclude, but not be limited to a plan viewof drill hole collar locations andappropriate sectional views.	Refer to diagrams in the respectivedrilling results announcements.
Balancedreporting	Where comprehensive reporting of allExploration Results is not practicable,representative reporting of both low andhigh grades and/or widths should bepracticed to avoid misleading reportingof Exploration Results.	The metallurgical testwork program hasbeen exploratory in nature, testingseveral different pathways. The resultsof the preferred pathway is presentedhere.
Othersubstantiveexplorationdata	Other exploration data, if meaningful andmaterial, should be reported including(but not limited to): geologicalobservations; geophysical survey results;geochemical survey results; bulk samples– size and method of treatment;metallurgical test results; bulk density,groundwater, geotechnical and rockcharacteristics; potential deleterious orcontaminating substances.	In 2019, drilling, analytical, metallurgicalstudies of small bulk samples andpetrographic studies have beencarried out at the deposit.The Prospectus dated 23 February 2022available at asx.com.au also detailshistorical metallurgical tests on theSarytogan Graphite Deposit.Further metallurgical test work isunderway and ongoing.
Further work	The nature and scale of planned furtherwork (e.g., tests for lateral extensions ordepth extensions or large-scale step-outdrilling).Diagrams clearly highlighting the areas ofpossible extensions, including the maingeological interpretations and futuredrilling areas, provided this information isnot commercially sensitive.	A Mineral Resource Estimate upgrade isplanned for Q1 2023.Metallurgical testwork is ongoing inAustralia and Germany.