Birimian : Pre-Feasibility Commences Following Positive Scoping Study

ASX Announcement

31 January 2017

ASX Code BGS ACN 113 931 105

COMPANY DIRECTORS

Winton Willesee

Chairman

Kevin Joyce

Managing Director

Hugh Bresser

Director

CONTACT DETAILS

Principal & Registered Office Suite 9, 5 Centro Avenue

Subiaco WA 6008

www.birimian.com [e-mail]

T [phone]

F [phone]

Pre-Feasibility Study at Bougouni Lithium Project commences following positive Scoping Study results

Scoping Study Parameters - Cautionary Statements

The Study referred to in this announcement is a preliminary technical and economic study of the potential viability of the Bougouni Lithium Project. It is based on low accuracy technical and economic assessments, and is insufficient to support estimation of Ore Reserves or to provide assurance of an economic development case at this stage; or to provide certainty that the conclusions of the Scoping Study will be realised.

Approximately 40% of the existing Mineral Resource is in the Indicated category, with the remainder in the Inferred category. There is a low level of geological confidence associated with Inferred mineral resources and there is no certainty that further exploration work will result in the determination of Indicated or Measured Mineral Resources. Furthermore, there is no certainty that further exploration work will result in the conversion of Indicated and Measured Mineral Resources to Ore Reserves.

The Scoping Study is based on the material assumptions outlined below. These include assumptions about the availability of funding. While Birimian considers all the material assumptions to be based on reasonable grounds, there is no certainty that they will prove to be accurate or that outcomes indicated by the Study will be achieved. Please refer to Annexures A - E for further details.

To achieve the outcomes indicated in this Study, initial funding in the order of US$ 47M will be required. Investors should note that there is no certainty that Birimian will be able to raise funding when needed. It is also possible that such funding may only be available on terms that may be dilutive to or otherwise affect the value of Birimian's existing shares.

It is also possible that Birimian could pursue other value realisation strategies such as sale, partial sale, or joint venture of the Project. If it does this could materially reduce Birimian's proportionate ownership of the Project.

Given the uncertainties involved, investors should not make any investment decisions based solely on the results of this Scoping Study

HIGHLIGHTS

• Scope to process 1Mtpa of high-grade mineralisation to produce up to 190,000 t of 6%Li2Olithia concentrate per annum
• Potential 13 year Life of Mine (LOM)
• Total estimated capital cost of US$83.4M for a two-stage development.
• Initial estimated start-up capital cost of US$47.2M, includes associated project infrastructure.
• Average indicated LOM open pit strip ratio of 3:1
• Base Case utilising a 1Mtpa DMS processing plant with recoveries estimated to average 75% over LOM
• Scoping Study optimised at US$537 spodumene concentrate selling price
• Potential to further enhance Project economics
• Pre-Feasibility Study commenced

Birimian Limited (ASX:BGS; "Birimian" and "Company") is pleased to announce that the Scoping Study ("Study") for the Bougouni Lithium Project ("Project") in southern Mali has confirmed the outstanding potential of the

Project. As a result, the Board has approved the immediate commencement of the Project Pre‐Feasibility

Study (PFS).

Commenting on the Study, Birimian's Managing Director Mr Kevin Joyce said: "The results of the scoping study confirm the outstanding potential of our Bougouni Lithium Project. This is one of the highest grade hard rock lithium projects globally and we continue to focus on expediting development of this Project and capitalise on the robust demand for high-grade spodumene concentrate as key inputs for the expanding lithium battery and electric vehicle markets.

"We are nearing the completion of our drilling programme to upgrade and increase resources at the Goulamina deposit. Advanced metallurgical test work is also underway with final results expected in the first quarter 2017.

"On the back of these positive scoping study results, we have commenced the Pre-feasibility Study for the project, which we anticipate completing in the June 2017 quarter alongside our maiden reserve statement.

"In the meantime, we are accelerating our search for people with the requisite industry experience and background to help expedite bringing the Project on stream.

"We look forward to updating our shareholders on these milestones as further progress is made."

Scoping study paves path for 1Mtpa open pit mine

The Study evaluated the technical and potential economic viability of an open pit mine development at the Project's Goulamina deposit, where a maiden Mineral Resource of 15.5Mt @ 1.48% Li2O has beendefined.

Various processing options were considered to optimise throughput capacity and recoveries, with consideration given to managing early stage potential cash flow and upfront capital costs. Mining and processingparameters were investigated at a US$537 per tonne selling price (6% Li2Oconcentrate).

The current preferred option is to develop Goulamina as a 1 million tonnes per annum (Mtpa) high grade open pit mine to supply material to a conventional dense media separation (DMS) plant (Stage 1). Scope has been defined to transition the processing plant to treat medium-grained material by DMS and flotation in later years (Stage 2). Subject to further detailed studies, the Project could deliver average annual production of approximately190,000 tonnes of 6% Li2Oconcentrate over an initial 13 year Life of Mine (LOM). The LOM cash cost is estimated to be US$326 per tonne of concentrate.

Capital costs (determined to a nominal accuracy of +/‐30%) for the processing plant and associated project infrastructure are estimated at US$83.4M, including a US$10.9M contingency. The Initial start-up capital cost

for Stage 1 has been estimated at US$ 47.2M. Stage 2 capital cost is US$36.2M, which could potentially be funded by Stage 1 cash flow.

The key operating assumptions and outcomes of the scoping study are shown in Table 1. All costs are in US$

Parameter Value
Potential Mine Life (Years)	13
Indicated Resources (%)	40%
Inferred Resources (%)	60%
Annual throughput (Mtpa)	1.0
Strip ratio (t:t)	3:1
Average feed grade (%Li2O)	1.54
Recovery (%)	75%
Potential Annual Production (tonnes 6% Li2O concentrate)	190,000
Open pit mining costs (US$/t concentrate)	62
Processing cost (US$/t concentrate)	90
Transport Cost (US$/t concentrate)	72
Port & Handling Cost (US$/t concentrate)	89
General and admin (US$/t concentrate)	13
Capital Cost - Stage 1 (incl. contingency, US$M)	47
Capital Cost - Stage 2 (incl. contingency, US$M)	36
Corporate tax and royalty rates	25% and 6%
Average Cash Cost (US$/t concentrate)	326
Concentrate Price (US$/ton)	537

Table 1. Scoping Study Parameters and LOM Operating Assumptions

The PFS has commenced, primarily focusing on improving resource categories and updating mining studies for eventual reserve estimation, consolidating process flow sheet design, and enhancing the logistics plan.

The PFS will also provide additional definition to the Project's infrastructure requirements such as power and water supply.

Birimian believes there is potential to enhance the Project economics by:

• Optimising open pit mine designs

• Improving flowsheet design through the various PFS test work studies

• Further detailed analysis of transport and logistics options

• Expansion and discovery of additional mineralisation

  Infill and exploration drilling programs are in progress. These programs are designed to:

• Expand the project resource base

• Substantially upgrade resource categories in the Maiden Resource to improve confidence

• Confirm geotechnical parameters for open pit mine planning

• Confirm plant, associated infrastructure, waste dump and Tailings Storage Facility locations

The positive results of the Study meets the first of several performance criteria set for the Board by

shareholders and validates the Company's strategy of focusing on near‐term production and generating an early cash flow, and further demonstrates the potential of the Project to deliver significant returns for

shareholders from a substantial, low cost hard-rock lithium operation.