Neometals: Continued Positive Metallurgical Results From Mt Edwards Nickel Project

HIGHLIGHTS

-          Flotation test-work on diamond core from 132N and Munda deposits confirms potential to generate commercially acceptable nickel concentrates;

-          Munda float program generated high grade concentrate (13% Ni grade) with strong recoveries (83.8% recovery) and displayed Fe:MgO ratios sought by smelters;

-          132N float program (lower feed head grade) also confirms successful sample upgrade (13.5% Ni grade in concentrate) with 62.8% recovery; and

-          Palladium deportment to the 132N concentrate (3.06g/t Pd) supporting further evaluation to quantify the potential for co-product revenue.

July 6, 2021 - Project developer Neometals Ltd (ASX: NMT) (“Neometals” or “the Company”) is pleased to announce further encouraging results from preliminary metallurgical tests carried out at the Mt Edwards Nickel Project (“Mt Edwards”). Specifically, a successful flotation test-work program was carried out on mineralised samples derived from the 132N Deposit (“132N”) Mineral Resource * and the Munda Deposit (“Munda”) Mineral Resource**. The results confirm, ‘in principle’, the ability of the mineralisation from both 132N and Munda to upgrade to commercially acceptable concentrate levels (+12% Ni grade).

Munda and 132N represent excellent near-term mining prospects warranting further studies. With this in mind, flotation test-work was carried out to determine if nickel mineralisation could be upgraded to commercial grade concentrate. This strategy follows on from earlier positive results at the Armstrong Deposit (“Armstrong”) where flotation test-work revealed the presence of potential co-products in addition to the contained nickel (for full details refer to ASX announcement “High grade palladium in nickel concentrate results from Armstrong” released 9th April 2021).

The Munda flotation program yielded excellent recovery (83.8% recovery at 13.0% nickel concentrate grade) with a very favourable iron/magnesium oxide ratio which is highly desirous for smelting customers. Despite a lower sample nickel head grade (1.45% versus Mineral Resource grade 2.0%), the 132N flotation program yielded 62.8% recovery at 13.5% nickel concentrate grade. Importantly, the 132N test-work evidenced palladium in the concentrate (3.06g/t Pd) which supports further evaluation to quantify the potential for co-product revenue.

These metallurgical results, together with those previously announced at Armstrong, provide Neometals with encouragement regarding the potential to establish meaningful co-products from future operations at Mt Edwards. Further float work on the other deposits with near term exploitation prospectivity will be undertaken to close off processing and marketing aspects of the development study which aims to re-establish a viable production centre at Mt Edwards. Future metallurgical work will be undertaken with core from planned exploration drilling to provide fresh materials to test. Importantly, these fresh samples will generate more information on co-products and their deportment.

*Indicated and Inferred Mineral Resource of 460,000 tonnes @ 2.0% nickel for 9,050t of contained nickel, for full details refer to ASX announcement entitled “132N Mineral Resource and Exploration Update- Mt Edwards” released on 6 October 2020

**Inferred Mineral Resource of 320,000t @ 2.2%Ni for 7,140t of contained nickel, for full details refer to ASX announcement entitled “Additional Nickel Mineral Resource- Mt Edwards” released on 13 November 2019

Key points noted from the metallurgical flotation test-work:

-          A blend of source material from both 132N and Munda deposits was mixed in order to achieve a head grade not dissimilar to the overall Mineral Resource grades for each deposit

-          Standard Kambalda Nickel Operations flotation reagent regime implemented

-          In the case of 132N

• with limited source material, resultant test head grade was below the target range

• presence of palladium and platinum were noted with upgrades of a factor of over two into the concentrate from mineralisation grades

• similar recoveries of nickel and copper were noted

• the iron to magnesia ratio (Fe:MgO) was less than ideal indicating the presence of high MgO (ultramafic minerals) suggesting more depressant to suppress rather than liberate MgO is required

-          In the case of Munda

• rapid flotation kinetics were demonstrated

• the concentrate was notably very clean

• a very high Fe:MgO ratio was achieved indicating a premium concentrate

• in light of the above, further improvements in recovery may be possible by easing back on concentrate grade

Test-work on samples from both deposits followed commercial process norms comprising a regime of sequential flotation involving a preliminary rougher product being generated with two subsequent stages of cleaning to generate a final cleaner product.

The samples of mineralised core for testing were sourced from a single diamond drill hole (WD9807W1 drilled by Western Diamond Drillers Pty Ltd in July 2018) at 132N. Diamond drill holes from Munda (EMD001 and EMD002) were drilled in July 2019 by Topdrive Drillers Australia for Estrella Resources from whom Neometals acquired the Munda nickel rights in September 2019.

Forward Work

The Company has commenced a detailed geological and geometallurgical program to ascertain the potential impacts on its eleven separately defined Mineral Resources at Mt Edwards and exploration potential within its > 300 square km tenure.

The components of the geometallurgical program include:

Managing Director Chris Reed commented:

“Further to our earlier test-work at Armstrong these preliminary results confirm the presence and recoverability of palladium at 132N, some 4 km south along strike, and the eminently marketable nature of nickel products able to be generated from both 132N and Munda. Of specific note is the high-quality concentrate made from Munda, a deposit not previously exploited for its nickel endowment. This represents another positive step in the development of the Mt Edwards project”.

Table 1 - 132N Float test results

Table 2 - Munda Float test results

Background

The Mt Edwards nickel project is centred around the small township of Widgiemooltha, located 75 kilometres south of Kalgoorlie in Western Australia. Neometals owns, or holds nickel rights to, 36 mining tenements with a large land holding of more than 300km2 across the Widgiemooltha Dome, a well-recognised nickel sulphide mining province.  The Widgiemooltha Dome is a world class nickel sulphide camp that has hosted 7 historical nickel mines with a new mine, Cassini, currently under development by Mincor Resources Ltd.

Platinum and Palladium at Mt Edwards

The Mount Edwards project database consists of assay and geological data from more than 13,000 drill holes. Platinum (Pt) and Palladium (Pd) have been sparingly assayed in work to date at Mount Edwards. While the majority of samples have been assayed for nickel or lithium, only ~10% (42,468 of 422,129) of the total samples have been assayed for either Pt or Pd. Historically Pt and Pd assays were used as an indicator element in exploration activities helping to vector in on new discoveries.

Nickel mining at the Mt Edwards project was last conducted some 13 years ago. Armstrong and 132N are on granted mining leases (M15/99 & M15/101 respectively) and are currently on ‘care and maintenance’ status with the Department of Mines and Petroleum. Since previous production the price of palladium has increased markedly with a tenfold increase in value since 2008. The significance of the increased market value of palladium and platinum, coupled with a positive result from early-stage sighter metallurgical test work, now warrants further investigation to determine if these precious metals can provide an additional revenue stream for the nickel project.

Figure 1 - Mt Edwards Project tenure relative to Kalgoorlie and the Kambalda Nickel Concentrator.

Figure 2 – Mining Tenements and Mineral Resources of the Mt Edwards Project

20210706Neometals_PRCOM.005

Figure 3 - Location of Drill Holes and Drill Traces with Pt and Pd across the Mt Edwards Project.  Seven of the eleven Neometals nickel deposits are shown over the geology, including the 132N, Armstrong and 26N residual Mineral Resources from previous mining. Samples where Pd and / or Pt has been assayed are shown in green. Drilling samples with Pd or Pt assays returned greater than 0.5 ppm are shown in red. The figure shows a good correlation of elevated Pd grades near the nickel Mineral Resources.

Table 3 - Mt Edwards Mineral Resource Table

Mineral Resources quoted using a 1% Ni block cut-off grade, except Munda at 1.5% Ni. Small discrepancies may occur due to rounding

Note 1. refer announcement on the ASX: NMT 19 April 2018 titled Mt Edwards JORC Code Mineral Resource 48,200 Nickel Tonnes

Note 2. refer announcement on the ASX: NMT 25 June 2018 titled Mt Edwards Project Mineral Resource Over 120,000 Nickel Tonnes

Note 3. refer announcement on the ASX: NMT 13 November 2019 titled Additional Nickel Mineral Resource at Mt Edwards

Note 4. refer announcement on the ASX: NMT 16 April 2020 titled 60% Increase in Armstrong Mineral Resource

Note 5. refer announcement on the ASX: NMT 26 May 2020 titled Increase in Mt Edwards Nickel Mineral Resource

Note 6. refer announcement on the ASX: NMT 5 October 2020 titled 132N Nickel Mineral Resource and exploration update at Mt Edwards

Note 7. refer announcement on the ASX: NMT 23 December 2020 Zabel Nickel Mineral Resource at Mt Edwards

Note 8. refer announcement on the ASX: NMT 29 June 2021 Mt Edwards – McEwen Mineral Resources increase 45%

Note 9. refer announcement on the ASX: NMT 29 June 2021 Mt Edwards – Widgie Townsite Mineral Resource Update

Note 10. refer announcement on the ASX: NMT 30 June 2021 Mt Edwards – 26 North Mineral Resources Update

Authorised on behalf of Neometals by Christopher Reed, Managing Director

ENDS

For further information, please contact:

Chris Reed

Managing Director

Neometals Ltd

T: +61 8 9322 1182

E: [email protected]

Jeremy Mcmanus

General Manager - Commercial and IR

Neometals Ltd

T: +61 8 9322 1182

E: [email protected]

About Neometals Ltd 

Neometals innovatively develops opportunities in minerals and advanced materials essential for a sustainable future. With a focus on the energy storage megatrend, the strategy focuses on de-risking and developing long life projects with strong partners and integrating down the value chain to increase margins and return value to shareholders.

Neometals has four core projects with large partners that support the global transition to clean energy and span the battery value chain:

Recycling and Resource Recovery:

-          Lithium-ion Battery Recycling – a proprietary process for recovering cobalt and other valuable materials from spent and scrap lithium batteries. Pilot plant testing completed with plans well advanced to conduct demonstration scale trials with 50:50 JV partner SMS group, working towards a development decision in early 2022; and

-          Vanadium Recovery – sole funding the evaluation of a potential 50:50 joint venture with Critical Metals Ltd to recover vanadium from processing by-products (“Slag”) from leading Scandinavian Steel maker SSAB. Underpinned by a 10-year Slag supply agreement, a decision to develop sustainable European production of high-purity vanadium pentoxide is targeted for December 2022.

Upstream Industrial Minerals:

-          Barrambie Titanium and Vanadium Project - one of the world's highest-grade hard-rock titanium-vanadium deposits, working towards a development decision in mid-2022 with potential 50:50 JV partner IMUMR.

Competent Person Attribution

The information in this report that relates to Exploration Results is based on information compiled by Gregory Hudson, who is a member of the Australian Institute of Geoscientists.  Gregory Hudson is a full-time employee of Neometals Ltd and has sufficient experience relevant to the styles of mineralisation and type of deposit under consideration and the activity being undertaken, to qualify as a Competent Person as defined in the December 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”.  Gregory Hudson has consented to the inclusion of the matters in this report based on his information in the form and context in which it appears.

Information that relates to metallurgical results is based on work carried out by Auralia Metallurgy and fairly represents, information compiled and / or reviewed by Mr Gavin Beer, who is a Member and Chartered Professional of The Australasian Institute of Mining and Metallurgy. Mr Beer is a full-time employee of Neometals Ltd and has sufficient experience relevant to the activity which he is undertaking to qualify as a Competent Person as defined in the December 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Beer has consented to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The Company confirms that it is not aware of any new information and data that materially affects the information included in the original market announcements and, in the case of the 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 Person’s findings are presented have not been materially modified from the original market announcements.

Compliance Statement

The information in this report that relates to Exploration Results and Mineral Resources for Neometals other than those discussed relevant to the recent metallurgical work at 132N and Munda is extracted from the ASX Announcements listed in the table below, which are also available on the Company’s website at www.neometals.com.au: