Celamin NL : 28/04/2017 March 2017 Quarterly Activities and Cashflow Report

ASX Announcement 28 April 2017

ACN 139 255 771

ABN 82 139 255 771

Level 4, 100 Albert Road South Melbourne VIC 3205

Contact:

Phone: [phone]

Fax: [phone]

[e-mail]

Board of Directors:

Martin Broome, Chairman

Nic Clift, Non-Executive Director Sue-Ann Higgins, Non-Exec Director Tim Markwell, Non-Exec Director

Company Secretary

Melanie Leydin

Securities on Issue

CNL: 993,171,986 ordinary shares CNLCA: 14,887,796 partly paid shares

Quarterly Activity & Cashflow Reports for Quarter ending 31 March 2017 Summary:

• Celamin continues to focus on restitution of its interest in Chaketma Phosphates SA
• International Arbitration of the dispute with its joint venture partner, Tunisian Mining Services is progressing
• Legal actions also continue in the Tunisian courts
• Seizure order obtained
• Shares remain suspended from trading on ASX

Phosphate exploration and development company Celamin Holdings NL (ASX: CNL) (Celamin, the Company) presents details of its activities for the Quarter ending 31 March 2017.

Celamin has been focused on the exploration and development of the Chaketma Phosphate Project in Tunisia. The Chaketma Project is a potential large scale phosphate development asset, which comprises six prospects over a total area of 56km2. It hosts a total JORC compliant Inferred Resource of 130Mt @ 20.5% P₂O₅, confirmed from drilling at only two of the project's six prospects.

Results from metallurgical test work conducted to date have confirmed the potential for the project to produce a saleable high-grade phosphate concentrate. The project is also well positioned relative to major infrastructure requirements, such as rail, road and ports.

Joint Venture Dispute

The Chaketma Phosphate Permit is held by Chaketma Phosphates SA ("CPSA"). CPSA is the operating company responsible for development of the Chaketma Project. Celamin's wholly-owned subsidiary, Celamin Limited, remains in dispute with its joint venture partner, Tunisian Mining Services ("TMS"), regarding ownership and control of CPSA and is pursuing various legal processes to resolve this situation.

The dispute is currently subject to International arbitration by a sole arbitrator appointed by the International Court of Arbitration of the International Chamber of Commerce (ICC) in which Celamin is seeking preservation and recognition of Celamin's rights, including restitution of its shares in CPSA and compensation for damages suffered.

On the basis of strong documentary evidence, Celamin disputes the existence of any default on the part of Celamin Limited and considers that there has been a wrongful and ineffective transfer and purported expropriation of Celamin Limited's shares in CPSA. Celamin therefore considers that it remains the rightful owner of its 51% shares in CPSA. Celamin remains committed to pursuing return of its interest in CPSA and the Chaketma Project and believes early resolution of this dispute is in the best interests of all parties and Tunisia and its people. The Chaketma Phosphate Project is a world class asset and Celamin believes it is best placed to manage the Project to ensure that it proceeds to development.

Celamin is also continuing with various other legal actions in Tunisia including the criminal proceedings and debt recovery actions as previously announced.

Arbitration Update:

Subsequent to the end of the quarter, the Company announced on 6 April 2017 that Celamin Limited had obtained a conservatory seizure order from the President of the Tribunal of First Instance of Tunisia against all shares that TMS owns in the capital of CPSA, (being the 49% of CPSA previously held by TMS as well as the 51% of CPSA shares fraudulently taken from Celamin by TMS). This Seizure Order prevents TMS from dealing with any of these shares and subject to determination of an opposition application by TMS, will remain in place until enforcement of the final arbitral award.

TMS have filed an application for cancellation of the Seizure Order, however, the Seizure Order will remain in effect unless TMS' application is eventually successful.

The Seizure Order is another step that Celamin has taken to ensure that its interests in CPSA are preserved until the Arbitration of its dispute is concluded, when Celamin expects to resume control of the project to the benefit of all legitimate stakeholders.

The arbitration of the Dispute by the sole arbitrator appointed by the International Court of Arbitration of the International Chamber of Commerce is continuing. Celamin has completed and filed its statement of claim and supporting documentation for the main dispute and TMS have filed their reply. Further exchanges of documentation are scheduled prior to a final hearing of the dispute which currently set down for June 2017.

Funding:

In the first quarter of FY17, the Company announced it had secured a loan facility from two major shareholders: African Lion 3 Limited (AFL) and Polo Resources Limited (Polo) to provide Celamin with the liquidity to continue arbitration, legal actions in Tunisia and for general working capital purposes.

The facilities are based on commercial terms and have been separately negotiated on an arm's length basis; each for a principle amount of up to US$400,000, for a total of US$800,000 ("Facilities").

During the quarter the remaining US$440,000 was drawn down.

As at 31 March 2017, the balance of the Facilities available to be drawn down was US$Nil and further funding alternatives are being pursued.

Other Activities:

As stated in the previous Quarter, the Board continued to review new project opportunities, including new projects in Tunisia, and potential transactions with a view to identifying projects and/or transactions that have the ability to add shareholder value as well as considering alternative forms of funding for the Company. This review is ongoing.

Celamin has secured an exclusive option on two exploration permits in South-West Tunisia prospective for potash and salt and has also made other applications for base metal exploration permits.

Background to the Arbitration:

Celamin has been the sole funder of the Chaketma Phosphate Project providing US$8.6M of funding to December 2014. Celamin's partner, TMS, has been beneficiary of 50% of this project expenditure, as the largest service provider, using equipment purchased with loans from Celamin.

On 21 October 2014, the Director General of CPSA, without seeking the required approval from the CPSA Board, made a US$3.3M cash call directed to Celamin Limited for funding of the Chaketma feasibility study. CPSA already held an excess of funds above requirements at that time, and, in Celamin Limited's view, no cash call was justified.

Celamin Limited objected to this cash call and, after negotiations, TMS and Celamin Limited entered into an agreement dated 10 December 2014 to reduce the cash call to US$2M and extend the due date for payment until 15 January 2015, in the expectation of agreement being reached in the first quarter of 2015 on the choice of engineering contractor and the terms of their engagement for conducting the feasibility study for the Chaketma Phosphate Project.

Celamin deposited US$2M into CPSA's Tunisian bank account on behalf of Celamin Limited in payment of the cash call, receipt of which was confirmed by both CPSA's bank and the Director General of CPSA on 13 January 2015.

On 19 January 2015 the Director General issued a notice of default to Celamin Limited for failure to pay the US$2M cash call by the due date ("alleged default"), rejecting payment by Celamin on Celamin Limited's behalf despite this payment meeting Tunisian legal requirements and having been made in exactly the same manner as one of the two previous cash calls. Celamin Limited objected to the default notice and the action by the Director General and called a Board meeting scheduled for

9 March 2015 for the purpose of reversing these actions. Due to subsequent events this Board meeting was not held.

Within 24 hours after receipt of the default notice, TMS indicated that it would not be acting on that notice and the Director General and TMS continued working collaboratively with Celamin in progressing the Chaketma Phosphate Project.

On 3 March 2015 the Company was advised by the then Chairman of CPSA, Mr David Regan, that he had received notice from the Director General of CPSA to the effect that Celamin Limited's shares in CPSA had been transferred to TMS on 13 February 2015. Celamin requested a voluntary trading halt on its shares from trading on ASX on 4 March 2015. The shares remain suspended from trading on ASX.

Following initial legal investigations, the Company understands that the Director General (without Celamin's knowledge and without any authority from the CPSA Board) has purported to transfer Celamin Limited's shares to TMS on the basis of the alleged default.

The Company disputes the existence of any default on the part of Celamin Limited and asserts that Celamin Limited's shares in CPSA have been transferred without any legal basis.

The US$2M deposited by Celamin for the cash call, which remained in a Tunisian bank account in CPSA's name for a period of over three months, was received back into Celamin's bank account in Australia on 27 April 2015, transferred from the Tunisian bank of CPSA at the instigation of the DG of CPSA after having declared the "default". Celamin received no communications from TMS or CPSA in relation to the transferred funds.