Updated NI 43-101 Technical Report - Resources for the Tantalus Rare Earth Ionic Clay Project Northern Madagascar Respectfully submitted to: Board of Directors ISR Capital Limited By: SGS Canada Inc. Guy Desharnais, Ph.D., P. Geo Yann Camus, Eng. Claude Bisaillon, Eng SGS Canada – Geostat Effective Date: October 20th, 2014 Issue Date: June 10th, 2016 Updated NI 43-101 Technical Report – Resources for the Tantalus Rare Earth Ionic Clay Project Page II Disclaimer: This document is issued by the SGS Canada Inc. under its General Conditions of Service accessible at http://www.sgs.com/terms_and_conditions.htm. Attention is drawn to the limitation of liability, indemnification and jurisdiction issues defined there in. Any holder of this document is advised that information contained herein reflects the Company’s findings at the time of its intervention only and within the limits of the Client’s instructions, if any. The Company’s sole responsibility is to its Client and this document does not exonerate parties to a transaction from exercising their rights and obligations under the transaction documents. Any unauthorized alteration, forgery or falsification of the content or appearance of this document is unlawful and offenders may be prosecuted to the fullest extent of the law SGS Canada Inc. Updated NI 43-101 Technical Report – Resources for the Tantalus Rare Earth Ionic Clay Project Page IV 1 Executive Summary Tantalus Rare Earths Malagasy SARL (‘TREM’) holds the exploration licences grant PR 6698 in the province of Antsiranana, Madagascar. Tantalus Rare Earths AG (TRE AG) has previously mandated SGS Canada Inc. – Geostat Office (hereafter “SGS Geostat”) to complete a resource estimate technical report for the PR 6698 licenses (“The Project”). 100% of the Tantalus Rare Earth Project is held through Tantalum Rare Earth Malagasy SARL (TREM), which is a 100% owned subsidiary of Tantalum Holding (Mauritius) Ltd, which in turn is 40% owned by Tantalus Rare Earths AG (TRE AG) and 60% owned by REO Magnetic Pte Ltd, a Singapore incorporated company. ISR Capital Limited, a Singapore incorporated company, is presently in discussions with REO Magnetic Pte Ltd for the acquisition of a portion of the TRE project. ISR Capital Limited requested this updated technical report in relation to the contemplated transaction with REO Magnetic Pte Ltd. No new resource estimation was done for this updated report; the effective date of October 20th, 2014 remains. This report presents a technical review of the geology and the mineralization on the property. It includes a summary of previous work, a detailed description of the new geological work carried out by Tantalus, updated resource estimation, and a series of recommendations to advance this project. Site visits of the Property were completed by Claude Bisaillon, Eng, SGS Geological Engineer, between 26 April and May 3, 2013, and September 12 and September 28, 2013. A third site visit was conducted by Guy Desharnais Ph.D., P.Geo. between November 28 and December 8, 2013. License grant PR 6698 is situated approximately 40 km south-west of Ambanja and covers an area of 300 km² in the Antsiranana province. The project is currently held 100% by Tantalum Rare Earth Malagasy SARL (TREM) in Madagascar, a wholly owned subsidiary of Tantalum Holding (Mauritius) Ltd. Access to the Property is by road from Ambanja or by boat from Nosy Be. The TRE property was first recognized for hosting mineralized dykes hosting high grade Rare Earth Elements (REE) in fresh rock. REE hosted within the regolith (or soil profile) was recognized in 2012; and it has become clear that this “ionic clay” style of mineralization has the most significant economic potential. The ionic clays are most important mineralization type for Tantalus due to the relatively simple process required to put the REE into solution and the fact that neither Thorium nor Uranium is concentrated through this process; this is in stark contrast to most REE deposits being developed or promoted in the western world. Additionally, the geological setting of the TRE project is analogous to the source of most of the Heavy REE (HREE) currently produced in China. A massive amount of data has been collected by excavating shafts by hand and sampled along the depth. A total of 4474 test pits have been completed with an average depth of 5.8m with a maximum depth of 10m. The sampling methodology was validated in the field by SGS Geostat and this has produced reliable data that has been integrated into the following resource estimation. The limitations of this method include safety considerations (including a 10m depth limit) and the impossibility of collecting data below the water table. A total of 4412 pits were retained for the resource estimation along with 359 drill holes. SGS Canada Inc. Updated NI 43-101 Technical Report – Resources for the Tantalus Rare Earth Ionic Clay Project Page V The updated resources estimation was constructed solely from the laterite and saprolite layers within the TRE property. REE grades were interpolated separately by ordinary kriging and blocks were cut- off based on their conceptual amenability to in-situ leaching or tank leaching. The base case resource with tonnage and grade is presented in the Table 1-1. Table 1-1: Resource Base Case – COGs of 300 and 500 ppm TREO excluding Ce (TREOnoCe) HREO / Contained Tonnage Volume Area Density Thickness (m) TREO TREOnoCe CREO HREO LREO Classification TREOnoCe TREO * (t) (m3) (m2) (t/m3) Total PED SAP (ppm) (ppm) (ppm) (ppm) (ppm) ratio (t) Measured 40,103,550 35,948,700 6,618,600 1.12 5.4 2.8 2.6 975 660 296 187 788 28% 39,092 Indicated 157,580,640 143,150,400 20,998,800 1.10 6.8 2.6 4.2 878 554 255 166 712 30% 138,292 Measured 197,684,190 179,099,100 27,617,400 1.10 6.5 2.7 3.8 897 575 263 170 727 30% 177,383 + Indicated Inferred 429,999,525 390,900,600 70,396,200 1.10 5.6 2.7 2.9 894 574 247 149 745 26% 384,552 - The cut-off grade is applied to TREOnoCe because it has good correlation with the material value. Ce has high grades but low recovery and market price. - The cut-off grade is 300 ppm TREOnoCe for areas sloping greater than 5 degrees - The cut-off grade is 500 ppm TREOnoCe for flat areas * Contained TREO is presented as in-situ. Values do not account for recovery losses. TREO = LREO+HREO TREOnoCe = TREO-Ce2O3 CREO = Nd2O3+Y2O3+Eu2O3+Tb2O3+Dy2O3 HREO = Y2O3+Eu2O3+Gd2O3+Tb2O3+Dy2O3+Ho2O3+Er2O3+Tm2O3+Yb2O3+Lu2O3 LREO = La2O3+Ce2O3+Pr2O3+Nd2O3+Sm2O3 In the 2011 Critical Materials Report from the U.S. Department of Energy, it was revealed that five of the 16 rare earth elements were found to be critical in terms of supply risk in the short term (present to 2015) and into the medium term (2015 – 2025). These elements are termed “critical” because of their scarcity. As shown in the criticality matrix below, those elements deemed critical are: Dysprosium, Europium, Neodymium, Terbium, and Yttrium. Since publication of this report, we have seen a significant drop in the prices of all REE; however the Critical REE (CREE) have retained their value better than their “non-critical” counterparts. The Tantalus Ionic clay project includes appreciable amounts of critical rare earths Dysprosium, Europium, Neodymium, Terbium, and Yttrium. This, combined with anticipated growth in demand, makes these higher valued elements the ones expected to experience the best price performance over the next decade. Table 1-2 shows the tonnage of the individual oxides contained in the project mineral resources along with the distribution of the tonnages in Figure 1-1. Taking into account the individual REO recoveries and values (detailed in section 14), the distribution of the potential revenues generated by each REO is shown in Figure 1-2. SGS Canada Inc. Updated NI 43-101 Technical Report – Resources for the Tantalus Rare Earth Ionic Clay Project Page VI Table 1-2: Tonnage of the Individual Oxides Contained in the Project Mineral Resources Y O La O Ce O Pr O Nd O Sm O Eu O Gd O Tb O Dy O Ho O Er O Tm O Yb O Lu O TREO Classification 2 3 2 3 2 3 2 3 2 3 2 3 2 3 2 3 2 3 2 3 2 3 2 3 2 3 2 3 2 3 (t) (t) (t) (t) (t) (t) (t) (t) (t) (t) (t) (t) (t) (t) (t) (t) Measured 4,520 9,667 12,620 1,876 6,347 1,084 115 923 133 766 144 415 58 369 55 39,092 Indicated 15,953 30,677 51,031 6,110 20,659 3,661 423 2,837 440 2,630 522 1,507 222 1,409 210 138,292 Measured 20,472 40,344 63,651 7,986 27,006 4,745 538 3,760 573 3,397 666 1,922 280 1,779 265 177,383 + Indicated Inferred 38,745 95,894 137,928 17,960 59,110 9,468 1,038 7,578 1,097 6,384 1,235 3,645 521 3,431 517 384,552 - The cut-off grade is applied to TREOnoCe because it has good correlation with the material value. Ce has high grades but low recovery and market price. - The cut-off grade is 300 ppm TREOnoCe for areas sloping greater than 5 degrees - The cut-off grade is 500 ppm TREOnoCe for flat areas Contained TREO is presented as in-situ. Values do not account for recovery losses.