Lincoln Minerals : Annual Report to shareholders

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ANNUAL REPORT

2021

ASX:LML

For personal use only

	CONTENTS
1	DIRECTORS .....................................................................	2
2	PRINCIPAL ACTIVITIES ..................................................	3
3	REVIEW OF OPERATIONS .............................................	5
4	EXPLORATION AND DEVELOPMENT ...........................	7
5	DIRECTORS' REPORT ....................................................	9
6	AUDITOR'S INDEPENDENCE DECLARATION............	18
7	FINANCIAL STATEMENTS 2021 ..................................	19
8	INDEPENDENT AUDITOR'S REPORT..........................	40
9	ASX ADDITIONAL INFORMATION ...............................	43
10	RESOURCES AND RESERVES STATEMENT .............	45

CORPORATE DIRECTORY

Directors

Mr Johnson Zhang, Non-executive Director

Ms Ruiyu Zhang, Managing Director

Ms Tingting Gao, Non-executive Director

Company Secretary

Andrew Metcalfe

Senior Management

Dwayne Povey, Chief Geologist

Registered and Principal Office

353 Burwood Hwy,

Forest Hill, Victoria 3131

Phone [phone]

Website: www.lincolnminerals.com.au

Email: [e-mail]

Share Registry

Computershare Investor Services Pty Ltd

Level 5, 115 Grenfell Street

Adelaide, SA 5000

Phone [phone]

Auditor

Grant Thornton Audit Pty Ltd

Level 3, 170 Frome Road

Adelaide, SA 5000

Stock Exchanges

Quoted on the Australian Securities Exchange

ASX code: LML

ABN 50 050 117 023

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1 DIRECTORS

The Board of Lincoln Minerals has considerable experience in Australian and Chinese investment and financial markets and an unwavering, long-term focus on owning, developing and profitably extracting the multi- commodity mineral wealth of South Australia's richly endowed Eyre Peninsula. Graphite, iron ore and base metals are the main strategic investment targets.

Mr Johnson Zhang, Non-ExecutiveChairman, holds a Bachelor of Business and has strong business experience in Australia in investments and property. Mr Zhang is a strategic and commercially focused professional with a proven track record for driving improvement and business growth.

Ms Ruiyu Zhang, Managing Director and Chief Financial Officer, is a qualified accountant and has an extensive business network in Australia as well as in mainland China. Ms Zhang has also taken on the role of Chief Financial Officer of Lincoln Minerals from Director Kee Saw.

Ms Tingting Gao, Non-ExecutiveDirector, graduated from Monash University with a Master of Accounting and qualified as a certified practice accountant. She has over 8 years of commercial real estate experience involved in the sales and marketing of commercial real estate and is active in the real estate market sharing her knowledge and experience to assist and educate clients.

1.1 Management Team

The senior management team of Lincoln Minerals comprises Mr Andrew Metcalfe, Company Secretary and Mr Dwayne Povey, Chief Geologist. Mr Jaroslaw (Jarek) Kopias, the former company secretary of Lincoln Minerals, resigned in June 2021.

Mr Andrew Metcalfe joined as Company Secretary in June 2021. He is a Certified Practicing Accountant and Chartered Secretary with more than 25 years' experience in a wide range of financial and secretarial roles in the mining and resources industry.

Mr Dwayne Povey is a geologist with more than 20 years' experience in the mining and mineral exploration industry including 7 years as mine geologist at Ernest Henry Copper-Gold Mine and 13 years with Lincoln Minerals. Based in Port Lincoln, he has been responsible for delineating the Kookaburra Gully and Koppio graphite Mineral Resources and previously delineated the Gum Flat iron ore deposits and leads all on ground activity for Lincoln.

2 Lincoln Minerals Limited ANNUAL REPORT 2021

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2 PRINCIPAL ACTIVITIES

Lincoln Minerals Limited entered its fourteenth year of operating on the highly prospective Eyre Peninsula (South Australia) and holds key mineral exploration licences. Within these licences, Lincoln has defined Mineral Resources including graphite, magnetite and hematite resources, copper and gold prospects in a region with a long history of graphite, iron ore, copper and gold mining.

Lincoln Minerals aimed to position itself to develop a sustainable and profitable business structure to enable the development of its flagship graphite project Kookaburra Gully, however corporate restructuring and impacts of Covid-19have severely impacted Lincoln's transformation and development plans.

The Lincoln Minerals Board and management team remain focused on sustainable mining development and developing opportunities and progressing divestment of non-core assets.

Kookaburra Gully Graphite Project

Kookaburra Gully Graphite Project remains on hold while the Company aligns corporate strategy with market conditions and divestment opportunities.

• Over the course of 2020/21, Lincoln continued its stakeholder engagement and environmental monitoring programs at Kookaburra Gully, with the project remaining at the forefront of Lincoln's aspirations.

The project metrics remain unchanged for Kookaburra Gully:

• The Feasibility Study showed the potential for a 10-year mine life with a pre-tax NPV of A$81m and an Internal Rate of Return (IRR) of 33%.
• A Probable Ore Reserve of 1.34Mt at 14.6% Total Graphitic Carbon (TGC) at a cut-off grade of 8.5% TGC was defined for Kookaburra Gully. The Ore Reserve is inclusive of total Measured, Indicated and Inferred Mineral Resources of 2.03Mt at 15.2% TGC at a cut-off grade of 5% TGC (announced 27 November 2017).
• Based on mining rate of 250,000 tonnes per annum (tpa) graphite to produce up to 35,000 tonnes graphite concentrate per annum
• Capital expenditure A$40-50 million including EPCM and 10% contingency
• Life-of-mineoperating expenditure for mining and processing = A$704 per tonne flake graphite concentrate based on 90% recovery
• Extend mine life with satellite deposits at Historic Koppio Graphite Mine/Kookaburra Gully Extended
• Koppio mineralisation grades up to 42.8% TGC with a 1.9Mt at 9.8% TGC (at 5% TGC cut-off) Inferred Mineral Resource (JORC 2012). Mineral Resource estimation for Kookaburra Gully Extended has not been undertaken.
• Combined total Measured, Indicated and Inferred Mineral Resources for Kookaburra Gully and adjoining Koppio graphite deposits total 3.9Mt at 12.6% TGC with 489,930t of contained graphite (within the high-gradecore based on a nominal cut-offgrade of 5% TGC).

Eurilla Multi-Commodity Project - Northern Eyre Peninsula

• Re-mappingand reinterpretation of State wide and company near surface sampling to identify gold anomalies was not progressed during the year; with other companies showing interest in Lincoln's holding.

Minbrie Copper Project - Central Eyre Peninsula

• Negotiations are continuing regarding the potential sale of Lincoln's mineral rights

Gum Flat Iron Ore Project - Southern Eyre Peninsula

• 109Mt Indicated and Inferred Mineral Resources at 24.8% Fe

3 Lincoln Minerals Limited ANNUAL REPORT 2021

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4 Lincoln Minerals Limited ANNUAL REPORT 2021