OPERATIONAL UPDATE Building a Copper Development Company LUMWANA WEST: Advanced Copper-Cobalt Deposit MURDIE and TORRENS: Massive Copper Targets LINDSAY OWLER, Director/CEO – November 2019 Argonaut Resources NL • ASX:ARE • Level 5, 126 Phillip St, Sydney, 2000 • phone (02) 9299 9690 CORPORATE OVERVIEW ASX Code ARE Capital structure Shares on issue: 1.544 billion Unlisted options: 65 million Market capitalisation: A$8 million Cash A$1.4 million Directors Pat Elliott Non-Executive Chairman Lindsay Owler Director and CEO Andrew Bursill Director and Company Secretary Malcolm Richmond Non-Executive Director OPERATIONAL UPDATE • NOVEMBER 2019 2 COPPER FOCUS South Australian Copper y Murdie Project IOCG y Torrens Project IOCG Massive systems, pedigree geology Zambia Copper Cobalt Lumwana West y Copper Cobalt scoping study New exploration projects y Heart of Zambian gold rush Zambia Copper Cobalt WA Gold Lumwana West Higginsville Higginsville – Gold, WA y Multiple gold and nickel targets Torrens Copper Murdie Copper South Australia OPERATIONAL UPDATE • NOVEMBER 2019 3 LUMWANA WEST, ZAMBIA Large tonnage copper-cobalt sulphide y Low stripping ratio y Saleable concentrate produced y Scoping study progressing y Argonaut 90% OPERATIONAL UPDATE • NOVEMBER 2019 4 LUMWANA WEST, ZAMBIA Project elements Jurisdiction Zambia has a long history of large-scale copper The Nyungu deposit mining. Social and governmental pressures continues to impress favour the development of new mines. with excellent technical Infrastructure Lumwana West is located at major electricity characteristics. and transport corridors. Resource The Nyungu copper-cobalt deposit has predictable geometry and scope for significant growth with continued drilling. Mining Very low stripping ratio of 1.5 tonnes of waste rock from every 1 tonne of ore. Resource drilling to greater depths is warranted. Processing Fast, high copper recovery flotation of both transitional and primary copper ore minerals. Economics Scoping economic study commencing. OPERATIONAL UPDATE • NOVEMBER 2019 5 LUMWANA WEST, ZAMBIA Infrastructure 350,000 mE 400,000 mE Location DEMOCRATIC Mine developments at REPUBLIC OF CONGO ZAMBIA Kansanshi, Lumwana and Sentinel brought essential infrastructure Kansanshi to North Western Zambia. 8,650,000 mN Lumwana Solwezi ZAMBIA Sentinel Road Power transmission Power transmission under construction 22399-HQ-LEL Aircraft facility Processing plant Nyungu Deposit Proposed railway 0 25 Tenement boundary and Targets Mineral deposit kilometres projected to surface Target areas Lumwana12 OPERATIONAL UPDATE • NOVEMBER 2019 6 LUMWANA WEST, ZAMBIA Nyungu Copper-Cobalt Deposit Nyungu 338,000 mE 340,000 mE 342,000 mE 31m at 0.53% Cu & 0.12 Co% from 258m 61m at 0.42% Cu from 184m • NYUNGU CENTRAL: deposit defined 22m at 0.46% Cu from 268m by 48 modern drill holes – significant NYUNGU CENTRAL 20m at 0.53% Cu from 121m mineralised copper-cobalt body. 71m at 0.61% Cu from 30m and 65m at 0.49% Cu from 221m 17m at 0.53% Cu from 92m 47m at 0.57% Cu from 20m 26m at 0.63% & 0.17g/t Au from 227m Demonstrated strike length: 1,700m 14m at 0.73% Cu from 389m 90m at 0.46% Cu from 12m 8,630,000 mN 196m at 0.45% Cu from 69m incl. 38m at 1.00% & 0.11g/t Co from 183m 34m at 0.46% Cu from 26m and * No cut-off grade applied • NYUNGU SOUTH: edge of mineralised body 78m at 0.58% Cu from 217m 176m at 0.55% Cu & intercepted by Argonaut drilling. Vast, 0.043% Co from 51m 14m at 0.65% Cu from 147m undrilled IP anomaly to be tested. 31m at 1.57% Cu from 173m incl. 6m at 5.51% Cu from 174m 24m at 0.54% Cu from 61m • NYUNGU WEST and NYUNGU NORTH: 22m at 0.51% Cu from 143m drilling to date has not accounted for IP anomalies. 8,628,000 mN Major copper-cobalt deposit 24m at 0.62% Cu from 31m NYUNGU SOUTH with potential for large 14m at 0.38% Cu from 107m extensions and repetitions IP chargeability 8,626,000 mN >20ms at -200mRL 0 1000 Drilling OPERATIONAL UPDATE metres Drill hole collar 7 Nyungu_09 LUMWANA WEST, ZAMBIA Nyungu Exploration Target Tonnage Contained Metal Commodity Grade Range Range Range (Mt) (%) (kt) Copper* 130 to 180 0.45 to 0.65 580 to 1,150 Cobalt^ 15 to 20 0.08 to 0.12 12 to 24 * Copper Exploration Target estimation announced to the ASX by Argonaut on 9 April 2013. ^ Cobalt Exploration Target estimation announced to the ASX by Argonaut on 28 March 2017. Exploration Targets have been independently estimated to JORC 2012 standards. The potential quantity and grade of the Exploration Targets are conceptual in nature. There has been insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in the estimation of a Mineral Resource. OPERATIONAL UPDATE • NOVEMBER 2019 8 LUMWANA WEST, ZAMBIA VeryPROJECT Low Stripping SENSITIVITY Ratio TO ECONOMIC FACTORS WhittleWhittle Pits Pits 100% Pit Shell Section A:A A A N North 100% Pit Pit Shell • The pit optimisation has Section B:B y Strippinggenerated a ratiosingle main 1.5:1pit to the to north280m and smaller (whitesatellite pitline) to the south. South 100% Pit • The plan view shows the Pit Shell y Stripping100% Pit shell. ratio • The section views show all B B ofthe 2.3:1 pit shells to >350mfor the North (lightand South blue areas. line) OPERATIONAL UPDATE • NOVEMBER 2019 9 LUMWANA WEST, ZAMBIA Metallurgical testwork 3 Mineralogy Saleable concentrate 3 Comminution produced at 25.6% copper 3 Flotation at 87% recovery. – Leaching – SX/EW y Results indicate that a flotation circuit can achieve high recovery from both: – Transitional zone copper minerals (88% recovery); and – Primary zone copper sulphides (up to 96% recovery). Flotation testwork. OPERATIONAL UPDATE • NOVEMBER 2019 10 LUMWANA WEST, ZAMBIA Next steps Metallurgy y Various oxidation and leaching tests. y Solvent extraction and electro winning (SX/EW). Mining engineering y Mine scheduling scenarios. Scoping economics y Assess processing options for development of process flowsheet. Nyungu deposit concentrates. OPERATIONAL UPDATE • NOVEMBER 2019 11 MWINILUNGA, ZAMBIA New exploration projects 200,000m E 250,000m E 300,000m E 350,000m E 400,000m E Copper Deposits DEMOCRATIC REPUBLIC OF CONGO DEMOCRATIC Cu giant deposit REPUBLIC OF CONGO TANZANIA Cu deposit ANGOLA MALAWI 8,750,000m N Cu occurrence ZAMBIA ZIMBABWE MOZAMBIQUE Major town NAMIBIA ANGOLA Road BOTSWANA SWAZILAND Exploration Licence LESOTHO SOUTH AFRICA Location ZAMBIA 8,700,000m N Mwinilunga Luamata Cheyeza - ARC discovery Kansanshi Solwezi 8,650,000m N Mwinilunga Gold Rush Malundwe Sentinel Kalaba East Kalaba Mine Chimiwungo Kamapanda 23232-HQ-LEL Nyungu 22399-HQ-LEL Lumwana West ZAMBIA 8,600,000m N NORTH WEST PROVINCE MWINILUNGA DISTRICT 0 20 40 Zambian Exploration Licence areas OPERATIONAL kilometresUPDATE • NOVEMBER 2019 19 November 2019 12 Kalaba_East_01 MWINILUNGA, ZAMBIA New exploration projects: Kalaba East 240,000m E 260,000m E 280,000m E 300,000m E Exploration Licence ARC Minerals Licence Newly granted 8,680,000m N Geochemistry - Cu >50ppm Prospect old/new licences adjacent to ARC Minerals’ Cheyeza ZAMBIA discovery. Cheyeza - ARC discovery ARC Minerals Cheyeza West 8,660,000m N West Lunga Kalaba East Lumbeta 0 20 40 kilometres ZAMBIA NORTH WEST PROVINCE MWINILUNGA DISTRICT Kalaba Mine Zambian Exploration 8,640,000m N Kalaba area 19 November 2019 Kalaba_East_02 OPERATIONAL UPDATE • NOVEMBER 2019 13 136° 30' E 137° 00' E 137° 30' E 138° 00' E SOUTH AUSTRALIAN COPPER -30° 00' S Olympic Domain Murdie Project EL 6320 Torrens Project Olympic Dam Andamooka -30° 30' S LAKE TORRENS Roxby Downs 1. The right geological address. Red Dam EL 6320 Acropolis Wirrda Well EL 6407 Torrens Project 2. Massive anomaly with multiple Torrens Island Dam deposit-scale target zones. EL 5945 EL 5937 Murdie 3. Confirmed Iron Oxide-Copper-Gold -31° 00' S Oak Dam West (BHP discovery) West Murdie Project (IOCG) systems. Lake Torrens Khamsin Fremantle Doctor Woomera Carrapateena Gawler Craton EL 6352 -31° 30' S Torrens JV EL Argonaut EL Town Highway Main road Railway Major deposit Significant prospect Prospect SOUTH AUSTRALIA EASTERN GAWLER CRATON -32° 00' S OPERATIONAL UPDATE Location of tenure 0 20 40 14 November 2019 Kilometres Torrens_48 740,000m E 760,000m E Andamooka Island ANDAMOOKA BOSWORTH EL 5614 MURDIE, SOUTH AUSTRALIA Torrens Gravity Targets and T E R 6,580,000m N T I Exploration Domains A R Y A Q U y I Over 50 IOCG gravity targets across three Bosworth F E exploration domains: R Sketching Pile B BOSWORTH White Well » Onshore Murdie Island » Nearshore; and Borehole Well 2 EL 5945 Carrapateena Hill » Offshore 6,560,000m N Sketching Pile A y LAKE TORRENS Priority targets hosted in or on the Carrapateena W margin of Donnington Suite Granite. y Donnington Suite Granite is the host of Sells Bore the nearby Oak Dam and Carrapateena Khamsin Fremantle Doctor IOCG deposits. Smith Hill Carrapateena 6,540,000m N Homestead Lake Torrens National Park Track PERNATTY 0 5 10 Exploration Licence Kilometres Pastoral Lease boundary High Priority Medium Priority Low Priority Noltenius Hill EL 5937 Shore Hill Exploration Domains SOUTH AUSTRALIA OnshoreHorse Well MURDIE PROJECT OPERATIONAL UPDATE Nearshore Exploration Domains Offshore 23 October 2019 Hatch Hill Torrens 44 MURDIE, SOUTH AUSTRALIA Operational Domains and Drilling Techniques DRILLING TECHNIQUES Helicopter Artesian Percussion Supported Groundwater Pre-Collar Onshore No No Yes Nearshore No No Yes Offshore – No Aquifer Yes No No Offshore – Aquifer Yes Yes No Murdie features many excellent IOCG targets plus flexible drilling options. OPERATIONAL UPDATE • NOVEMBER 2019 16 MURDIE, SOUTH AUSTRALIA Permitting Three authorisations are required for nearshore and offshore drilling at Murdie: 1. NATIVE TITLE – granted in 2018. 2. OPERATIONAL – final stage prior to grant. 3. ABORIGINAL HERITAGE – application will be submitted on grant of operational approval.