BANKABLE FEASIBILITY STUDY COMPLETE

34
www.tungstenwest.com BANKABLE FEASIBILITY STUDY COMPLETE May 2021 CORPORATE PRESENTATION

Transcript of BANKABLE FEASIBILITY STUDY COMPLETE

Page 1: BANKABLE FEASIBILITY STUDY COMPLETE

www.tungstenwest.com

BANKABLE FEASIBILITY STUDY COMPLETEMay 2021CORPORATE PRESENTATION

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DISCLAIMER

The information contained in this document (the “Document”) is for introductory discussion purposes only and is strictly confidential. This Document is furnished to you on a confidential basis solely for thepurpose of evaluating your interest in this opportunity. By its acceptance hereof, each recipient agrees that neither it nor its agents, representatives, directors or employees will copy, reproduce or distributeto others this Document, in whole or in part, at any time without the prior written consent of Tungsten West Limited (“Tungsten West” or the “Company”) and that it will keep confidential this Document orany information otherwise obtained from the Company and will use this Document for the sole purpose of evaluating a possible investment in the Company.

This Document does not constitute an offer or solicitation to buy or sell any securities discussed herein in any jurisdiction where such would be prohibited. The information contained in this Document doesnot and is not intended to constitute a "valuation," "formal valuation," "appraisal," "prior valuation," or a "report, statement or opinion of an expert" for purposes of any securities legislation in the UK orelsewhere. We are not legal, tax or accounting experts and we express no opinion concerning any legal, tax or accounting matters or the sufficiency of this presentation for your purposes.

This Document is incomplete without reference to the discussion and any related written materials that supplement it.

The Document includes certain projections and forward-looking statements provided by the Company with respect to anticipated future performance. Such projections and forward-looking statementsreflect various assumptions of management concerning the future performance of the Company, which assumptions may or may not prove to be correct. The actual results may vary from the anticipatedresults and such variations may be material. Factors that could cause such results to differ include the future price of commodities, results of exploration and development information, future costs,availability of capital and other factors. Interested parties should use caution and consider these factors in evaluating any such forward-looking statements.

No representations or warranties are made as to the accuracy or reasonableness of any of the information contained in these materials including, without limiting the generality of the foregoing, anyassumptions or projections or forward-looking statements. Only those representations and warranties which may be made in a definitive written agreement relating to a transaction, when and if executed,and subject to any limitations and restrictions as may be specified in such definitive agreement, shall have any legal effect.

Certain statements made in this Document, other than statements of historical fact, including, without limitation, those concerning the economic outlook for the mining industry, expectations regardingmetals prices, production, cash costs and other operating results, growth prospects and outlook of the Hemerdon mining project (“Hemerdon” or the “Project”), including the achievement of projectmilestones, the completion and commencement of commercial operations and the completion of acquisitions and dispositions, liquidity and capital resources and capital expenditures and the outcome andconsequence of any potential or pending litigation or regulatory proceedings or environmental issues, are forward-looking statements regarding Tungsten West’s operations, economic performance andfinancial condition. These forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause Tungsten West’s actual results, performance or achievements todiffer materially from the anticipated results, performance or achievements expressed or implied in these forward-looking statements. Although Tungsten West believes that the expectations reflected insuch forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, results could differ materially from those set out in theforward-looking statements as a result of, among other factors, changes in economic, social, political and market conditions, success of business and operating initiatives, changes in the regulatoryenvironment and other government actions including environmental approvals and actions, fluctuations in metals prices and exchange rates, and business and operational risk management.

This Document may contain certain “Non-GAAP” financial measures. In addition, the presentation of these measures may not be comparable to similarly titled measures other companies may use. Norepresentations or warranties are made as to the accuracy or completeness of any of the information contained in these materials including, without limiting the generality of the foregoing, any assumptionsor projections or forward-looking statements. Only those representations and warranties which may be made in a definitive written agreement relating to a transaction, when and if executed, and subject toany limitations and restrictions as may be specified in such definitive agreement, shall have any legal effect.

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 2

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BUILD READY

WORLD CLASS DEPOSIT OF TWO STRATEGIC METALS: TUNGSTEN & TIN

RAISING PROJECT FINANCE

FOR RESTART

>£500M FREE CASH FLOWS

+20 YEAR MINE LIFE

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 3

BFS COMPLETE

PROJECT NPV OF £272mIRR of 33%

STABLE CASH FLOW FROM AGGREGATES PRODUCTION

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BANKABLE FEASIBILITY STUDY COMPLETE

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 4

FIXING A WORLD CLASS TUNGSTEN MINE

>£200m sunk capital

WORLD’S 3rd LARGEST TUNGSTEN RESOURCE

325 Mt @ 0.12% WO3

LOW CAPEX & QUICK PAYBACK

£35m Capexavg. £34m p.a. EBITDA (50% EBITDA margin)

RAISING PROJECT FINANCE

£40m debtMin. of £15m and up to £25m equity

LOW OPEX & 3 REVENUE STREAMS

$108/mtuLoM WO3 OPEX ($112/mtu AISC)

BUILD READY

INTRODUCTION OF XRT-ORE SORTING

Radically Changes Project Economics

3.5ktpa WO3 & 371tpa Sn Prod.

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TIMELINE

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Second commercial exploitation– 85t of WO3

produced

1867 1918-1919 1943-1944 1977-1986 1986 202220212019201820152007

DISCOVERY

First commercial exploitation- 24t of WO3

produced

AMAX Exploration drill out maiden resource and produce a feasibility study.25,400m of drilling

Planning permission granted, but AMAX walk away post the

tin market crash

Wolf Minerals acquires the project

Third commercial exploitation

– 3,735t of WO3

produced

Wolf Minerals enters receivership

Tungsten West acquires the project for £5.6m, with +£200m of sunk costs

TWL deliver Bankable Feasibility Study into a restart

Recommencement of operations

1985 AMAX Decline Portal, driving 70m underground into core of the resource

2021 Hemerdon open-pit today, looking South towards Hemerdon Ball

1945 Photograph showing WW2 open cast excavation at Hemerdon. Looking South towards Hemerdon Ball (British Geological Survey)

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WHY WOLF FAILED

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POOR PLANT AVAILIBILITY LOW RECOVERIES ONEROUS OFFTAKES

Wrong Equipment Selection

(frequent front-end downtime)

Lack of Surge/Stockpile Capacity

(inability to de-couple areas of the plant)

Overgeneration of Fines During Crushing

(associated with the upper portion of the ore body)

Attritional Equipment for A Friable Mineral

(over generation of slimes)

33% WO3 Recovery

(compared to expected 58%WO3 recovery)

Over-promised on Product Specification

(penalties associated with off-spec concentrates)

Failed to Deliver the Agreed Tonnages

(take or pay contracts penalised for late deliveries)

53% Plant Availability

(compared to industry standard of 81%)

A 15% Discount on Concentrate Sold

(equivalent to a payability of 65% APT vs 80% APT)

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FIXING A WORLD CLASS ASSET

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FRONT END CONCENTRATOR CONCENTRATE DRESSING

Old Configuration: Low Plant Availability & Poor Recoveries = 1/3rd of Forecasted WO3 Production

› Primary and Secondary Hybrid Rolls Crushers

› Attrition Scrubber

› Low Frequency Noise Generating Screens › 50% to Fines Circuit‐ Spirals - Tables

› 50% to Coarse Circuit:‐ Primary Dense Media Separator

‐ Secondary Dense Media Separator

› Reduction Roast Kiln and Low Intensity Magnetic Separation of Iron Minerals

› High Intensity Magnetic Separation of Tin and Tungsten Products

› Single WO3 Concentrate Produced

New Configuration:

› Phase1: Mobile Primary Jaw Crusher and Secondary Cone Crusher

› XRT Ore Sorters Rejecting 70% of Feed

› New, Smaller and Quieter Screens › 33% to Fines Circuit

› Phase1: Spirals & Tables

› Phase2: Spirals, Tables & Wet High Intensity Magnetic Separator (WHIMS)

› 67% to Coarse Circuit:‐ Primary Dense Media Separator

‐ Secondary Dense Media Separator

‐ Scavenger Dense Media Separator

› Phase 1: Existing kiln

› Phase 2: Kiln & new Custom Built Hydro-metallurgical Facility for Alkali Leaching

› Medium and High Grade WO3

concentrates produced

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FINANCIAL HIGHLIGHTS FROM THE BFS

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Upside to this Financial Model will come from:» Increasing the mine planning permission boundary adds 14Mt

of reserves

» Expected +10% WO3 head-grade bump in operation

» Increasing metallurgical recoveries from 57% to 65%

» Expanding killas mining reserve

» Building a Sodium Tungstate Plant in Plymouth Free Port Zone

» Expanding aggregate sales to 2Mtpa and beyond

» Reducing G&A assumptions

ASSUMPTIONS FINANCIAL METRICS UPSIDES BEYOND THE BFS

NPV(5%) £272m Post Tax

IRR (Unlevered) 33%

LoM Cash Flow £529m Post Tax

LoM Op-Ex $108 / mtu APT Price

LoM AISC $112 / mtu

WO3 Price Deck: $275 / mtu 2022

$5 / mtu increase p.a.

Sn Price Deck $24,000 /t Flat

WO3 Payability 78% of APT price

Mine Life 20 years

Capex £35m Direct cost

Plant Operating Time 81%

Days Operational 355 days Per year

Avg Granite Grade 0.18% WO3

0.03% Sn

Avg Killas Grade 0.16% WO3

0.02% Sn

Granite Ore Mined 53.7 Mt

Killas Ore Mined 14.3 Mt

Killas Waste Mined 77.2 Mt

Strip Ratio 1.1 : 1

Recovery - Granite 57% WO3

Recovery - Killas 42% WO3

Total WO3 Recovered 69,291 t

Total Sn Recovered 8,118 t

Avg. annual WO3 recovered 3,465 t Per annum

Avg. annual Sn recovered 371 t Per annum

Mining Cost £4.17 per bcm

Processing Cost £5.64 per t

Royalty 2.25%

USD / GBP 1.38

CUMULATIVE CASH FLOWS - LIFE OF MINE

-£200

-£100

£-

£100

£200

£300

£400

£500

£600

-£50

£-

£50

£100

£150

2021 2026 2031 2036 2041

Cu

mu

lati

ve F

ree

Cas

hfl

ow

m)

Op

. & In

v. C

ash

flo

w (

£M

) Operating Cashflow

Investing Cashflow

Cumulative Free Cashflow

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FINANCIAL FORECASTS

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ANNUAL PRODUCTION AND GRADES ANNUAL OPERATING COSTS AND EBITDA

CAPEX QUARTERLY BREAKDOWN (2021-2025) LOM COST BREAKDOWN

-

0.05%

0.10%

0.15%

0.20%

0.25%

0.30%

-

100,000

200,000

300,000

400,000

500,000

600,000

WO3 production (mtu) Sn production (WO3 eq. mtu) WO3 grade (% - LHS) Sn grade (% - LHS)

(60)

(40)

(20)

-

20

40

60

80

100

Annual total Opex (£m) Annual EBITDA (£m)

(12)

(10)

(8)

(6)

(4)

(2)

-

Quarterly initial capex (£m) Quarterly sustaining capex (£m)

Mining Opex, 31%

Processing Opex, 54%

G&A Opex, 13%

Pre-Production Opex, 1%

Purchasing Commitments, 1%

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DIRECTORS & SENIOR MANAGEMENT

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MARK THOMPSONDirector & Executive Chairman

Mark holds a B.A. in Physics from OxfordUniversity. He has 27 years of experience infinancial markets, commodity trading, mineralsexploration and mine development. He has sat onthe boards of several listed mining companies andhas particular expertise in tin, tungsten, copper,and in the South-West of the UK. He consultswidely within the metal derivatives and miningindustries and as an expert witness in metals andmining related commercial litigation. He is adirector of TSX-V listed Meridian Mining.

MAXIMILLIAN DENNINGDirector & CEO

Max holds a B.A. in Economics & Politics and a MScin Accounting & Financial Management. He hasover 10 years experience in the mining sectormainly in commercial & finance, managementconsultancy and project delivery. He is on theInvestment Committee of a private family officethat holds several investments in the miningsector. He was previously GM Commercial &Finance of Pan African Minerals Ltd.

EXECUTIVE DIRECTORS

FRANCIS JOHNSTONENon-Executive Director

Francis trained in corporate finance at Citibank before entering the miningbusiness in 1989 with Cluff Resources where he became Group Projects andOperations Manager. He has also previously held the position of CommercialDirector at Ridge Mining plc. He is currently an investment advisor to LSElisted Baker Steel Resources Trust and is a NED of a number miningcompanies.

STEPHEN FABIANNon-Executive Director

Steve holds as B.E. (Min) from the University of New South Wales, Australia.He has over 25 years' experience in mining industry, as a fund manager andventure capitalist. He is the Founder & Chairman of Brazil Tungsten Holdingsand the CEO of Anglo Saxony Mining.

NON-EXECUTIVE DIRECTORS

RICHARD MAXEYNon-Executive Director

Richard holds a BA in Economics & Management from Oxford University andis a CFA charter holder. He has 20 years of experience in financial markets inboth public and private equity. Having run a specialized resources fund onbehalf of a South African family office he has specific knowledge of andexperience in the natural resources sector investing in public and privatemining businesses worldwide across a range of commodity sectors includingbulks, precious, ferrous and non-ferrous metals.

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PROJECT DELIVERY TEAM

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JAMES MCFARLANETechnical Director

James holds a MSc from the Camborne School of Mines inMining Geology and has worked as both a production andexploration geologist in the UK, Ireland and Australia, and as aprincipal mining consultant across a range of commoditiesglobally. He was formerly Mining Technical Services Managerat Hemerdon under Wolf Minerals.

JON HSUANProject Director

Jon, BSc ARSM FIMMM, has over 40 years' experience in seniormanagement roles covering all aspects of project and miningactivities. His expertise lie in geological studies, operationsmanagement, beneficiation test work and process design, pilotplant programs, plant technical and engineering work, EPCMcontracts and project management. Since 2012, Jon has been asenior consultant of Behre-Dolbear.

COLIN PERKINS Commercial & Contracts Director

Colin holds a BSc. Estates Management. BSc. ConstructionManagement and LLB, specialising in construction law. He carriesover 35 years of major project and consultancy experience inMining, Hydro Electric and Oil sector construction. Havingpreviously held positions as Contract and Construction DirectorRussia, Director for Oil & Gas Africa and Project Director Africa.He has worked with World Bank funding, as well as private sectorinvestment projects.

PAUL NICHOLLS Managing Director - Aggregates

Paul holds a Degree in Accountancy and a Masters in Commercial Management. He is aformer Royal Marine Commando and has 20 years of experience in defence, commercialand project delivery roles at director level. He is a former Commercial Director for nationallysignificant infrastructure projects including +£1bn framework contracts for HS2 and forthe UK National Housing and Communities Agency.

DAVE SKINNER HSEQ Manager, Quarry Manager

Dave holds professional qualifications in Health and Safety, and as a Quarry Manager. He haspreviously worked as a senior member of the management team at African Minerals in SierraLeone and as Health, Safety, Quality and Environmental Manger at Hemerdon under theprevious ownership.

DEREK COLLEY Head of Technology & Finance

Derek holds a BComm in Accounting & Tax, and is a qualified Chartered Accountant (SA). Hehas 30+ years’ experience in Technology and Finance across a diverse range of industries.Derek has implemented ERP systems for multiple FTSE350/S&P500-sized companies, andhas a special interest in systems integration, process automation and robotics.

JOHN LEACH Commercial Manager / Interim Site Manager

John holds a BSc and an MBA, and has previously worked in several other sectors includinghealthcare, global logistics and as a director and CEO for disaster relief operations. Prior tothis he served as an Officer in the Royal Marine Commandos.

PROJECTS & TECHNICAL TEAM OPERATIONS TEAMS

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CAPITAL STRUCTURE AND CAPITAL RAISING

» Fully diluted there would be 101,953,241 shares in issuance

» This consists of 68,661,540 shares, 2,291,701 warrants and £9.3m of convertible loan notes at 30p:

‒ Convertible notes have a 3 year maturity from 29th November 2019 and pay 8% interest PIK

‒ Convertible at holder's option at 30p per share

‒ Callable by TWL at 45p before 25th of May 2021 or at 60p before 25th October 2022

‒ Mandatory conversion upon qualifying IPO raising >£10.0m at +60p

» Capital raised to date: £23.3m with £4.2m in treasury as of March 2021

» The Founding Shareholders will earn 10% additional equity by hitting project milestones:

‒ 3.33% each upon: financial close for mine restart, declaring commercial production, and upon a liquidity event through sale of the Company or IPO

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 12

CORPORATE STRUCTURE TOP 8 SHAREHOLDERS

FULLY DILUTED EFFECTIVE INTEREST:

Baker Steel Resources Trust 24.07%

Henry Maxey 15.41%

Denning Family 14.02%

David Lilley 8.96%

Simon Nixon 7.70%

Ian Hannam 4.95%

Thompson Family 4.17%

Fabian Family 3.70%

CAPITAL RAISING

» TWL is currently raising between £15m and £25m of equity alongside £40m of project finance debt via an IPO on the AIM Market

Use of funds:

Project Finance Contingency Working Capital

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THE PROJECT

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OVERVIEW OF THE HEMERDON TUNGSTEN MINE

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The Hemerdon Tungsten Mine is located 7 miles Northeast of Plymouth» Discovered in 1867

» Mined during WW1, WW2 and then 2015-18 by Wolf Minerals

Drilled by AMAX in the mid 1980’s:» AMAX built and operated a 50 tph pilot plant using fresh ore from 70m below

surface, demonstrating +65% WO3 recoveries

Wolf Minerals invested +£200m into the project between 2007 & 2019» Production commenced in 2015

» Wrong plant design resulted in <50% recoveries & poor plant availability

» Wolf Minerals (UK) Ltd entered receivership in October 2018

Tungsten West acquires Hemerdon assets in December 2019» 2.25% net smelter royalty and £95k p.a. certain rent to Landlords

» 40 years lease term from February 2014

» Includes £13.2m of Restoration Bond cash and £1.8m of Environmental Bond

Planning permission granted in 1986 and Modified in 2010:» Remains in good standing until 2032

» 24/7 working permitted

History

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OVERVIEW OF THE HEMERDON TUNGSTEN MINE (continued)

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 15

RISK

Risks & Mitigations

AREA MITIGATION

» WO3 Ore Grade – Based on new geo-statistical work, estimated reserve grades are now 0.18% WO3 versus 0.17% under Wolf’s operation

» WO3 Ore Grade – Wolf consistently delivered 0.21% WO3 to the mill from zones with reserve grades of 0.17%. A further +10% increase in the TWL ore feed grade is likely

» MINERAL RESOURCES

» Mining Cost – Removal of UK Govt rebate on red diesel could increase mining costs

» MINING» Mining Cost – TWL is lobbying for a 5-year exemption and

seeking savings from a re-tendering of the mining contract

» ESG

» Planning & Permitting – Reserves limited to current planning without additional permitting

» Environmental – Inherent risk to water, air, biodiversity & quality of land

» Supply Chain – Upstream resourcing of materials and downstream supply of tungsten may conflict with TWL policy and stakeholder expectation

» Planning & Permitting – Additional approvals and alternate mining methods can increase the LoM

» Environmental – Implement new policies to protect the environment

» Supply Chain – TWL can market ‘clean’ tungsten and tin from transparent source, investigating blockchain technology

» ECONOMIC» APT & Sn Price, Exchange Rate & OPEX – Reduction in forecast prices

and increase in Op-Ex & Exchange rates negatively effects the project

» Aggregates – Failure to meet forecast quality or sales targets for production

» APT & Sn Price, Exchange Rate & OPEX – If opposite it will have a positive impact on project economics

» Aggregates – develop Hemerdon into low cost ‘super quarry’

» METALLURGY» WO3 & Sn Recoveries – geologically complex deposit and ferberite minerals

alteration impact metallurgical response

» Labour Force – Lack of relevant local skills

» WO3 & Sn Recoveries – Conservative assumptions used in BFS and TWL has investigated alternative recovery technology

» Labour Force – Create a training facility for local workforce

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CHINA CLAY PIT ADJACENT

NORTHERN EXTENSION

HEMERDON PIT

SOUTHERN EXTENSION

MINE WASTE FACILITY

NEW PUBLIC LINK ROAD

PROCESSINGPLANT

AGGREGATES STOCKPILES

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021

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JORC COMPLIANT MINERAL RESOURCE & ORE RESERVE ESTIMATES

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» Tungsten West’s resource stands at 324.8 Mt @ 0.12% WO3 and 0.03% Sn

» 399kt contained WO3

» 88kt contained Tin

» Mining Reserve stands at 63.3 Mt @ 0.18% WO3 and 0.03% Sn

» Potential resource and reserve upside to come from the strong belief that the actual WO3 Grade is under reported by +10%, and the tin grade by up to 30%

‒ This is derived from the "nugget effect" in resource estimation as the Hemerdon deposit is very nuggety

‒ Wolf mined at a reserve grade of 0.17% WO3 but consistently delivered 0.21% WO3

to the mill

December 2020 Hemerdon Deposit

Notes:

› Mineral Resources reported at a cut-off grade of 0.065% WO3 in the granite and 0.079% WO3 in the killas

› Mineral resource calculated basis a WO3 price of $500 per mtu and a pit boundary outside the current permitted area

› Does not include tailings (3.3Mt at 0.19% WO3 and 0.03% Sn)

› Majority of Southern Extension included

Domain Cut-Off

Measured Indicated Inferred Measured, Indicated & Inferred

Tonnes

(Mt)

WO₃

(%)Sn (%)

WO₃ Eq

(%)

Tonnes

(Mt)

WO₃

(%)Sn (%)

WO₃ Eq

(%)

Tonnes

(Mt)

WO₃

(%)

Sn

(%)

WO₃ Eq

(%)

Tonnes(

Mt)

WO₃

(%)

Sn

(%)

WO₃

Eq

(%)

Granite 0.065% 33.7 0.18 0.03 0.19 84.2 0.15 0.02 0.16 41.3 0.11 0.02 0.12 159.1 0.14 0.03 0.15

Killas 0.079% 7.9 0.12 0.04 0.13 39.4 0.1 0.03 0.12 117.4 0.1 0.03 0.11 164.8 0.1 0.03 0.11

Granite

StockpilesN/A 0.9 0.21 0.05 0.23 - - - - - - - - 0.9 0.21 0.05 0.23

Total - 42.5 0.17 0.03 0.18 123.6 0.13 0.03 0.15 158.7 0.1 0.03 0.11 324.8 0.12 0.03 0.13

Ore TypeCut-off WO3

Eq (%)

Proved Ore Reserves Probable Ore Reserves Total Ore Reserves

Tonnes (Mt) WO3 (%) Sn (%) WO3 Eq (%) Tonnes (Mt) WO3 (%) Sn (%) WO3 Eq (%) Tonnes (Mt) WO3 (%) Sn (%)WO3 Eq

(%)

Granite 0.098 30.6 0.18 0.03 0.2 22.8 0.19 0.02 0.2 53.5 0.19 0.03 0.2

Killas 0.134 2.6 0.15 0.04 0.16 6.2 0.15 0.03 0.15 8.9 0.15 0.03 0.15

Stockpiles N/A 0.9 0.21 0.05 0.23 - - - - 0.9 0.21 0.05 0.23

Total - 34.1 0.18 0.03 0.20 29.1 0.18 0.03 0.19 63.3 0.18 0.03 0.19

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TAILINGS INFERRED MINERAL RESOURCE

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 18

December 2020 Mine Waste Facility

Notes:

› High accuracy surveying by aerial drone and hy-drone unmanned surface vehicle

› Contained metal of 5,900t of WO3 and 800t of Sn

› Initial test work indicates up to 50% recoveries (rougher) of WO3 through magnetic separation

Domain Tonnage WO₃ (%) Sn (%) WO₃ MTU's Sn Tonnes

2 278,300 0.21 0.04 58,000 110

3 557,700 0.20 0.02 111,500 120

4 1,887,700 0.18 0.02 341,700 440

5 332,800 0.16 0.03 52,400 90

6 151,300 0.18 0.03 27,200 40

Total Inferred 3,207,800 0.18 0.02 590,800 800

THE MINE WASTE FACILITY AT HEMERDON IS AMONGST THE WORLD’S LARGEST CRIRSCO COMPLIANT TUNGSTEN RESOURCES!

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COMPARABLES

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Mt Carbine (open pit)

Mt Carbine (stockpile)

Dolphin (mine)

O'Callaghans

Northern Dancer

Mactung

Sisson

Sangdong

Barruecopardo

La Parrilla

Hemerdon Mine

Hemerdon Mine (tailings)

-0.10

0.10

0.30

0.50

0.70

0.90

1.10

0 100 200 300 400 500 600 700

WO

3 /

%

Gross (Mt)

Source: TWL and Roskill

FS: 2016CAPEX: $69m

NPV(5): $89m @$370/mtu

BFS 2021: Post TaxCAPEX: $48m

NPV(5): $375m @$300/mtuIRR (unlevered): 33%

PEA 2011: Pre TaxCAPEX: $645m

NPV(8) $1,110m@$300/mtuIRR: 22%

FS 2013: Post TaxCAPEX: $579m

NPV(8) $418m @ $350/mtuIRR: 16.3%

In Production UndergroundPre-Production Open Pit

2021: Measured, Indicated & Inferred Resources of Tungsten Projects

0

50000

100000

150000

200000

250000

AlphaminResources

Tin One Minsur Metals X Kasbah Res. Ltd Euro Tin Aus Tin Mining Tin InternationalLtd

ElementosLimited

VentureMinerals

Strongbow Tungsten WestLtd.

Anglo SaxonyMining

Tin InternationalLtd

Cons. Tin Mines Stellar Res. Ltd

Contained Tin (t) within Measured and Indicated Resources

Hemerdon also contains a Globally significant tin resource

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PROCESS PLANT RE-DESIGN COMPLETE

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Completely new primary and

secondary crushing circuit

Upgrade of concentrator and

refinery in Phase II

Introduction of XRT Ore Sorting

Aggregate Stockpiles to aggregates plant

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LOW CAPEX FOR A 20+ YEAR LIFE OF MINE

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 21

TWL are building redundancy andsurge capacity into the processingplant:

» New Primary Crushers: Duty + StandbyJaw Crushers

» New Secondary Crushers: Duty +Standby Cone Crushers

» New Ore Sorters: 6 x Duty + 1 x Standby

» Tertiary Crusher: Duty + Standby ConeCrushers

» New DMS Feed Bins Capacity: 30hrs

» Upgraded Primary DMS: Duty + Standby

» Result: +1.5 Mtpa of excess processingcapacity to treat third party ores

Area Detail (£)

MINING

Mobilisation 618,979

Enabling Works 297,850

Mine Geology 513,991

Environmental, H&S 995,314

Mining Working Capital 1,048,862

PROCESSING PLANT REBUILD

Front End Rebuild 16,903,732

Ore Sorters 4,030,256

Concentrator Circuit Upgrade 5,647,712

First Fill 243,798

Lab 335,404

PROCESSING PLANT SPARES

Spare Parts & Initial Stockholding 5,000,000

ON SITE INFRASTRUCTURE

Workshop 202,333

Admin Block 1,195,000

IT Infrastructure 662,500

Area Detail (£)

ON SITE INFRASTRUCTURE

Workshop 202,333

Admin Block 1,195,000

IT Infrastructure 662,500

INDIRECT COSTS

Project Management 1,182,319

Design & Drafting 1,119,473

Commissioning 442,576

CORPORATE COMMITMENTS

Restoration Bond 1,000,000

Hargreaves Commencement Fee 1,000,000

Royalty Pre-Payment 1,000,000

Environmental Bond Top-Up 850,000

Purchasing Commitments 342,620

TOTAL 44,632,720

Contingency & Working Capital 10,367,280

TOTAL USES OF PROCEEDS 55,000,000

New Equity 15,000,000

Project Finance Debt 40,000,000

TOTAL SOURCES OF PROCEEDS 55,000,000

BUILT TO LAST

Page 22: BANKABLE FEASIBILITY STUDY COMPLETE

GRADE STREAMING STRATEGY - MWF

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 22

» TWL has completed a redesign of the MWF with consultants SLR tosupport a new mining and processing strategy for the BFS

» MWF capacity increased to 246Mt of tailings and waste rock,whilst preserving access to aggregate and killas ore stockpiles for later re-processing, and for aggregates sales over decades

» The re-design eliminates much of the operating costs previously associatedwith the Wolf MWF

» The study included a comprehensive geochemical assessment thatconcluded that all tailing streams from the future operations are inert

» The study concluded that the waste requirements of the mine plan can beaccommodated within the currently permitted footprint

Materials flowchart used to develop the MWF redesign concept based on the ‘maximum’ mine schedule

Peak landform based on ‘maximum’ scenario illustrating segmentation of the facility to accommodate individual stockpiled materials

Page 23: BANKABLE FEASIBILITY STUDY COMPLETE

OFFTAKE TERM SHEETS AGREED

Tungsten West has agreed offtake heads of terms with two key anchor clients:

» Wolfram Bergbeau und Hutten: 600tpa WO3

» Global Tungsten Powders: 1,700tpa WO3

» 78% Payability for 52% WO3 grade product enables Hemerdonto produce concentrates that compliment the deposit

» Pre-pay negotiations for tin and tungsten concentrate are on-going

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 23

UPSIDE IN CONCENTRATE GRADE & PAYABILITY AS THE MINERALOGY IMPROVES WITH DEPTH

TWL IN DISCUSSIONS WITH COUNTERPARTIES TO BUILD A SODIUM TUNGSTATE PLANT IN THE PLYMOUTH FREEPORT ZONE

Page 24: BANKABLE FEASIBILITY STUDY COMPLETE

ENVIRONMENTALSOCIAL AND

GOVERNANCE

Page 25: BANKABLE FEASIBILITY STUDY COMPLETE

ENVIROMENTAL SOCIAL AND GOVERNANCE

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 25

» Licensing Requirements – The existing mining license requires robust environmental compliance and commitments

» Carbon Neutral Target – TWL has set itself the challenging target of being carbon neutral by 2027

» Operating Efficiencies –Optimizing energy usage and minimizing environmental impacts

» Sustainability – Integrating aggregates production into a sustainability and restoration plan

» Restoration – A fully cash funded commitment to site restoration is in place with a £13.2m Restoration Bond

BUSINESS PLAN FOUNDED ON ESG PRINCIPLES

ENVIRONMENT SOCIAL GOVERNANCE

» Health and Safety – Striving to monitor, assess and mitigate all of the potential risks that could cause harm

» Community Engagement –Commitment to local stakeholder engagement

» Aggregates – Local construction industry benefits from a sustainable long-term supply with a low carbon footprint

» Local Job Creation – Working with specialist recruitment consultants to recruit ex-military personnel

» Skills Training – Actively working with local tertiary education establishments for research projects

» Business Practices – Strong business ethics, corporate responsibility, and codes of conduct in place

» Experienced Management –Extensive track record of financial competence and corporate governance

» Regulatory and Operating Environment – The South West of the UK is a very large current and historic mining landscape regulated by the Mineral Planning Authority and the Environment Agency

» ISO Accreditations - ISO 9001 Quality Management, ISO 14001 Environmental, and ISO 45001 H&S all granted. ISO 50001 Energy Management and ISO 27001 IT Security and Management pending

LOCAL REGION

Sources: Creacombe Solar Farm; Plymouth City Council

Page 26: BANKABLE FEASIBILITY STUDY COMPLETE

TUNGSTEN PRICE FORECAST

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 26

» The current spot price for APT (as of 23rd March 2021) is quoted at US$270-275/mt

» A good guide for long term commodity price outlook can be the cash-cost curve: a plot of production of WO3 versus the cash cost of production - it is rare to see the price of any commodity below the 80th percentile of the cash cost of production for any sustained period of time

» For Western World tungsten mine production this level would be at US$313/mtu (Roskill) but Tungsten West is using a long-term average of US$300/mtu for financial modelling purposes

SUPPLY /DEMAND COMMENTARY

HISTORICAL AND FORECAST APT PRICE 2011-29 (US$/MTU)

US$335/mtuRoskill long term APT pricing forecast

At a project breakeven APT price of $108 per mtu Hemerdon would be a first quartile cash cost producer

CASH COST, TUNGSTEN CONCENTRATES EX-CHINA

100

150

200

250

300

350

400

450

500

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029

AP

T (U

S$/m

tu)

APT - Historical APT - Low

APT - Base APT - High

Page 27: BANKABLE FEASIBILITY STUDY COMPLETE

PLYMOUTH FREE PORT STATUS

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 27

» Tungsten West is uniquely placed to take advantage of Plymouth’s Free Port status due to existing and future business relationships

» Aggregates West is supplying Sherford Housing Development –5,500 new homes + business park under construction

» Tungsten West is in negotiations with South Hams District Council to lease a new-build administration and 50,000 sq ft warehouse facility in Langage Energy Park (1.5 miles from mine site)

» This warehouse will be used as concentrate blending, export point, and potential site of a future sodium tungstate plant

» Aggregates West is negotiating supply contracts into London (where aggregate prices are much higher than local prices) via barge export from Cattedown Wharf

WHAT IS A FREE PORT?

• Free ports are specially designated economic zones where normal tax and customs rules do not apply.

• In such ports, goods can be imported, manufactured, and exported again without facing standard tariffs or requiring normal customs checks.

• Companies which operate within free ports do so with the benefit of paying a lower rate of VAT tax and employment tax

• Plymouth has been awarded 3 zones with Free Port Status. Plymouth Ports, Sherford Housing Development and Langage Energy Park.

Page 28: BANKABLE FEASIBILITY STUDY COMPLETE

ABOUT AGGREGATES

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 28

» Total UK Market Demand – circa 250 Million Tonnes Per Annum

» Local Demand (50 miles radius) – 3 Million Tonnes Per Annum

» Hemerdon formally signed off as a new mineral resource, approved for use in highways projects by the Minerals Planning Authority and Devon County Council Highways Authority

» All materials formally certified as CE Marked, with work underway to transition to UKCA following Brexit

» Fully Operational and Certified Management Systems in place(ISO 9001/14001/45001)

» TWL Working towards ISO 17025 Laboratory Standards to self-certify under UKAS

» Initial aggregates sales have commenced into local major housing developments (Sherford and Cranbrook)

» Estimated sales in next 12 months of 250kt of low value products

» High value single size granite aggregates sales to commence once back in production from coarse rejects of the XRT ore-sorting

Page 29: BANKABLE FEASIBILITY STUDY COMPLETE

AGGREGATES DEFINITIVE FEASIBILITY STUDY

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 29

» Aggregates wash plant design finalized – being fed with 100% of the ore sorter reject and 100% of the thickener underflow

» Products to be produced range from "fill-a-hole" type aggregates (sales have commenced) to single sized granite and killas gravels and different sand qualities

» Year 1 (post mining re-start) aggregate sales prices range between £9 per tonne and £26 per tonne for different products

» Year 1 sales forecast at 500,000 tonnes, ramping up to 1,500,000 tonnes by Year 5

» New planning consents are in place for exports ex-gate of 150 loads per day, equating to a potential tonnage export per year of 1,200,000 tonnes.

» Work underway on a Section 73 Application to upgrade consents to 250 lorry movements per day.

» Pre - Feasibility Study complete for the addition of export via 3 different railway siding options

» Negotiations for export to London and the SE via barge from Plymouth Port complete and pressure tested

» Plymouth City Awarded Free Port Status

Design of the aggregates wash plant: six products to be produced; of 4x single sized aggregates and 2 sands

Page 30: BANKABLE FEASIBILITY STUDY COMPLETE

APPENDIX

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 30

Page 31: BANKABLE FEASIBILITY STUDY COMPLETE

VALUE PROPOSITION

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 31

Previous Owners Wolf Minerals: Market Cap & Enterprise Value

Source: Capital IQ

£19m

£40m£35m

£74m

£78m

£199m

£222m

£164m

£122m

£167m

£186m £185m

-£100m

-£50m

£0m

£50m

£100m

£150m

£200m

£250m

£300m

H1 2012 H2 2012 H1 2013 H2 2013 H1 2014 H2 2014 H1 2015 H2 2015 H1 2016 H2 2016 H1 2017 H2 2017

Tota

l En

terp

rise

Val

ue

(£m

)

Market Capitalization

- Cash & Investments

+ Total Debt

= Total Enterprise Value (TEV)

Peak Enterprise Value: £222m

Pre-Production Mkt Cap: £200m

£145m of Debt Prior to

Receivership

£5.6m Acquisition

Price

Page 32: BANKABLE FEASIBILITY STUDY COMPLETE

ABOUT TUNGSTEN

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 32

» Tungsten is a Transition Metal that has extreme physical characteristics including:‒ Highest tensile strength and melting point of any metal

‒ Hardest material other than diamonds

‒ Density of 19.3 (g/cm3) - comparable to Uranium and Gold

» WO3 Concentrates are an intermediate product‒ Further refined into Ammonium Para-tungstate (”APT”) by metals processors

» Tungsten Concentrates are traded basis the APT price‒ Typically 65% WO3 concentrate trade at 77%-82% of the APT price

» China Dominates the tungsten market‒ China controls over 60% of global tungsten reserves, 72% of resources

‒ Chinese APT production share is between 85% and 90% of World supply

» 63% of Tungsten demand was Chinese in 2020‒ Export then of semi-finished and finished goods

‒ O&G, mining, automotive, machine tools, construction are all industries reliant upon tungsten

‒ Global reliance on Chinese supply and processing

» Tungsten sits high on the EU and US list of critical minerals due to the Chinese domination of supply

59.0%

19.5%

12.8%

8.6%

0%

20%

40%

60%

80%

100%Chemicals & Others

Mill Products

Steel & Alloy

Cemented Carbides

TOTALRESOURCES:

11,273,000(tW)

China: 71.5%

Russia: 11.0%

Canada: 6.0%

Australia: 3.3%

Vietnam: 1.1%

USA: 1.0%

Spain: 0.8%

UK: 0.5%

Others: 4.8%

71.5%

Source: Roskill

30.0%

17.0%

12.7%

11.8%

10.8%6.0%5.0%6.7% Other apllications

Energy

Military / defence

Consumer Goods

Mining & Construction

Other Transposrt

Industrial Applications

Automotive

FIRST USE END USE

BACKGROUND TO TUNGSTEN TUNGSTEN RESOURCES BY COUNTRY 2018

STRATEGIC IMPORTANCE OF TUNGSTEN

GLOBAL TUNGSTEN USES 2018

Page 33: BANKABLE FEASIBILITY STUDY COMPLETE

TotalSupply:

108,387(tW)

TUNGSTEN SUPPLY / DEMAND

BANKABLE FEASIBILITY STUDY COMPLETE - March 2021 33

» Mine Production dropped 7% in 2020 to 80,000t:‒ Existing Chinese and international mines face depleting ore grades and reserves

» Demand growth forecasts remain robust and require additional sources of production

» Pre-development tungsten projects struggle to raise the required capital‒ Very few large deposits – mainly small deposits that are unattractive investments

China: 56.3%

Vietnam: 5.6%

Russia: 2.4%

Bolivia: 1.2%

N. Korea: 1.2%

Austria: 0.9%

UK: 0.9%

Other: 3.1%

Secondary: 28.4%

SUPPLY /DEMAND COMMENTARY GLOBAL TUNGSTEN SUPPLY BY REGION 2018

SUPPLY AND DEMAND FORECAST 2011 TO 2028

GLOBAL TUNGSTEN DEMAND BY REGION

2018Demand

104,400(tW)

48.8%

12.1%

7.2%

13.6%

18.3%

China

Europe

USA

Japan

Others

Page 34: BANKABLE FEASIBILITY STUDY COMPLETE

Contact Details

TUNGSTEN WESTRegistered office address: Shakespeare Martineau Llp6th Floor, 60 Gracechurch Street, London, United Kingdom, EC3V 0HR

[email protected]@tungstenwest.com