STELLAR RESOURCES LIMITED — Investor Presentation 2016

Apr 27, 2016

Heemskirk Tin Project Highest grade undeveloped ASX-listed tin project

ITRI International Tin Conference Peru April 2016

ASX: SRZ

www.stellarresources.com.au

Agenda

Corporate overview

100% owner of the highest grade undeveloped ASX-listed tin project

Company overview

• 100% owner of Heemskirk Tin Project, 150km south of Burnie, Tasmania
• Stand-out high grade resource (1.1% Sn) with vision to be a major Australian tin producer
• Metallurgical optimisation increased recovery by 4.5% to 72.8%
• Optimisation of 2013 PFS increased NPV by 62% to A$99.0m

Financial information

Share price (18-Mar-16)	A$0.020
Number of shares	300.2m
Market capitalisation	A$6.0m
Cash(30-Dec-15)	A$1.9m
Debt (30-Dec-15)	Nodebt
Enterprise value	A$4.1m

42.5m unlisted options (exercise prices A$0.06 to A$0.12, expiring 26-Feb-17 to 20-Nov-19)

Strong institutional ownership

CapetownS.A.	20.8%
BunnenbergFamily	14.9%
Resource Capital Funds	12.0%
Directors & Management	4.2%
Top20 Shareholders	70.2%

Favourable project location

North-west Tasmania is a world-class tin jurisdiction

• Significant mining district
  • Many historical and current operating mines across various commodities
• Supportive local community and skilled workforce
  • Experienced workforce available with other mines in the region winding down
• Established road and rail to port at Burnie, water readily available and power infrastructure in place
• Low political risk
  • Tasmanian government supportive of Heemskirk
• Low environmental risk
  • Issues faced by others in the region unlikely to be encountered

Record of achievement in updates

Operational achievements in 2015 have set the platform for a definitive feasibility study in 2016

February 2015		Environmental Protection Authority guidelines received
		Exploration licence granted to the south of Heemskirk
March2015		Metallurgy optimisation upgrades PFS metrics
		Severn tin recovery increased by 7.4% and average tin recovery increased by 4.5%
		Annual tin in concentrate production increased by 4.5%
July 2015		Geological review flags new northwest trending structures and high grade tin infill zones presentingun-tapped upside to the Heemskirkresource
		St Dizierscoping study completed -potential for development as a source of blending ore
		Tailings storage site secured –low capital cost, life of mine facility
September2015		Optimisation increased PFS NPV by 62% to A$99.0m -through+A$18m recovery increase,+A$16m reduction in pre-production capital and +$4m from accelerated mine development

Simplified plant design

Metallurgical optimisation led to smaller primary grind and elimination of heavy media separation and silica float circuits saving A$5m from capex

St Dizier scoping study completed

Low cost open pit (capital and operating) - source of blending ore for processing in the Heemskirk plant

• Low capital development cost of A$3.8m
• Mining inventory of 424,000 tonnes @ 0.86% tin
• Initial mine life of 30 months
  • Annual ore production of 150kt @ 1.03% tin
  • Annual tin in concentrate production of 700 tonnes
• Low operating cost
  • Delivered cost of ore to the processing plant is A$23/t

Quality tailings dam site secured

Tailings dam site in plan and oblique view

• Capacity 3x initial mine life
• Low capital containment
  • Initial cost A$1.4m wall plus A$3.4m pipeline
  • No observed geological flaws
• Concealed valley
  • Crown land
  • No competing land use
  • No observed flora or fauna values

Optimisation increased NPV by 62%

The 2013 PFS NPV has increased by A$38m to A$99m following an optimisation program that increased recovery and lowered capital cost

• Recovery increase to 72.5% added $18m to NPV
• Lower mining cost offset by higher processing cost
  • Paste fill reduced mining cost by A$4/t
  • Processing cost rose by A$4/t
• Capex reduction added A$16m to NPV
  • 85% of capex reduction due to process plant modifications
• Accelerated development added A$4m to NPV
  • Orebody access reduced from 17 to 12 months

Capital cost lowered to A$110.3m

Pre-production capital cost reduced by 12.9% or A$16.3m

85% of the capital reduction from processing plant and surface infrastructure

• Plant simplification, lower procurement costs, design improvements
• Lower cost tailings dam site secured

15% from faster mine development

• Contract miners achieving in excess of 200m/month in single heading development
• Mine development reduced from 17 months to 12 months at 180m/month

32% capital cost reduction in US$ terms at the spot exchange rate

Capital Item	PFS 2013	Optimised 2015	Change	Comments
	A$m	A$m	%
Mine	37.9	35.5	-6.5	Mine development reduced to 12 months
Process	88.7	74.8	-15.7	Plant simplification and lower cost sourcing
Total A$m	126.6	110.3	-12.9	More productive development
Total US$m	114.0	77.2	-32.3	Weak A$ provides competitive advantage
Total US$/tonne ore	190	129	-32.3	Annual throughput remains at 0.6mt

Operating cost reduced by 8.2%

Total operating cost (C3) reduced to A$21,355/t or US$14,949/t at spot A$

Heemskirk is cash positive (based on C2 costs) at bottom-of-the-cycle tin price

• Moderate 5% reduction in C1 mine-gate cash cost
  • 4.5% increase in recovery accounts for all of the reduction C1 unit cost
  • Mining cost reduced by changing to paste-fill from cemented aggregate fill
  • Processing cost increased due to higher reagent use and higher input prices

Lower pre-production capital cost reduced the D&A expense

	Activity	PFS 2013A$/t Sn	Opt 2015A$/t Sn	Change%	Opt 2015US$/t Sn0.70USD/AUD
C1	mining, processing, admin	15,705	14,927	-5.0	10,449
+	tc/rc, transport,royalties	3,229	3,229	0.0	2,260
	C2 cash operating cost	18,934	18,156	-4.1	12,709
+	depreciation & amortisation	4,335	3,199	-26.2	2,239
C3	total operating cost	23,269	21,355	-8.2	14,949

Competitive cost structure

At 0.70USD/AUD the Heemskirk project has moved down the international tin industry cost curve towards the 40th percentile position

Substantial leverage to tin price

Significant upside for the Heemskirk NPV as the spot tin price increases over the next 3 years (production expected 2018)

What are we doing now?

Fast Start Scoping Study based on the Lower Queen Hill Indicated Resource

Resource
Queen Hill	Tonnes	Sn	Contained Sn	Cu	Pb	Zn	Ag
	millions	%	tonnes	%	%	%	ppm
Upper (above 1100m RL)	0.51	1.19	6,056	0.10	1.20	0.77	46
Lower (below 1100m RL)	1.09	1.36	14,824	0.03	0.16	0.17	7
Total Queen Hill	1.60	1.31	20,880	0.06	0.50	0.36	19
Indicated	1.41	1.26	17,790
Inferred	0.19	1.63	3,090
Total Queen Hill	1.60	1.31	20,880
1. estimates prepared in accordance with 2004 edition of JORC Code

1. block cut-off grade of 0.6% tin

2. tonnes rounded to reflect uncertainty of estimate

3. estimates prepared by Resource and Exploration Geology

Why Lower Queen Hill?

• Closest deposit to the surface first ore access within 6 months – better chance of catching the tin price up-swing
• Already drilled to Indicated status little additional drilling to define an ore reserve
• Much lower mine capex only essential capital to access the deposit rather than full mine development
• Higher grade than resource average improves operating cost in early years
• Smaller scale significant reduction in up-front plant capital with opportunity to expand later

Fast start is an opportunity to explore

Going underground provides an opportunity to better understand deposit geology and define deeper exploration targets below the known deposits

Concluding remarks

Stellar is in a sound position with a high quality tin asset

Significant progress over the last 12 months - project momentum maintained despite difficult market conditions

NPV increased by 62% to A$99m – through a number of positive outcomes from the optimisation program

Scoping of a Fast Start Option underway – study advisers appointed

Considerable valuation upside on a rising tin price

Appendix

Heemskirk PFS mine plan Board of Directors

Heemskirk 2013 PFS mine plan

Board of Directors

Phil Harman Non-Executive Chairman

Geophysicist

• Over 30 years experience in BHP Billiton minerals exploration
• Past and present Director of several ASX listed companies

Peter Blight Managing Director

Geologist

• 30 years experience in exploration, mining and finance sectors
• Previously worked for UBS, UC Rusal and Rio Tinto

Miguel Lopez de Letona Non-Executive Director

Management Consultant

• Experience as a management consultant and banker with leading financial institutions
• Based in Belgium and advises on investment in the mining and oil and gas sectors

Thomas Whiting Non-Executive Director

Geophysicist

• Former manager of BHP Billiton exploration
• Chairman of Deep Exploration Technologies Cooperative Research Centre

Christina Kemp Company Secretary

• Accountant
• Over 30 years experience as an accountant and senior financial manager
• Has experience in the resources, manufacturing, retail and utility industries

Disclaimer

Forward Looking Statement

This presentation was prepared by Stellar Resources Limited ( the "company"). It should not be considered as an offer or invitation to subscribe for or purchase any securities in the company or as an offer or invitation with respect to those securities. It may contain a number of forward-looking statements. Known and unknown risks and uncertainties, and factors outside of Stellar's control, may cause the actual results, performance and achievements of Stellar to differ materially from those expressed or implied in this presentation. To the maximum extent permitted by law and stock exchange listing rules, Stellar does not warrant the accuracy, currency or completeness of the information in this presentation, nor the future performance of Stellar, and will not be responsible for any loss or damage arising from the use of the information.

Competent Persons Statement – Heemskirk and St Dizier Mineral Resources

The information in this report that relates to Heemskirk Tin Mineral Resources was last reported on 24th July 2013 in an ASX release titled "Pre-feasibility Study Advances Heemskirk Tin". The information was prepared in accordance with the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' by Tim Callaghan of Resource and Exploration Geology. The information in this report that relates to the St Dizier Mineral Resource was announced on 12 March 2014 in an ASX release titled "Heemskirk Tin Project: New Open Pittable Resource at St Dizier". The information was prepared in accordance with the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves' (JORC Code) by Tim Callaghan of Resource and Exploration Geology. Tim Callaghan is a Member of The Australasian Institute of Mining and Metallurgy ("AusIMM"), has a minimum of five years experience in the estimation and assessment and evaluation of Mineral Resources of this style and is the Competent Person as defined in the JORC Code. This report accurately summarises and fairly reports his estimations and he has consented to the resource report in the form and context in which it appears.

Competent Persons Statement – Exploration

The drill and exploration results reported herein, insofar as they relate to mineralisation, are based on information compiled by Mr R.K. Hazeldene who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Hazeldene has sufficient experience relevant to the style of mineralisation and type of deposits being considered to qualify as a Competent Person as defined by the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code). Mr Hazeldene consents to the inclusion in the presentation of the matters based on his information in the form and context in which it appears.

Stellar Resources Limited

Level 17, 530 Collins Street Melbourne VIC 3000 Phone +61 3 9618 2540 Fax +61 3 9649 7200 www.stellarresources.com.au

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