Tyranna Resources : June 2019 Quarterly Activities Report

26 July 2019

Quarterly Activities Report 30 June 2019

Highlights

PROGRESS AT EUREKA GOLD MINE

• Independent Perth mining consultant Entech completed restart study
• Re-startstudy expected to produce approximate combined total 60,500t of ore grading 2.1g/t for 4,057 ounces of contained gold over a 2-month mine life in 2 stages
• Located on a granted mining lease and close to existing infrastructure
• Assessing suitable processing plants nearby
• Target generation on Eureka mining leases to develop exploration program

GOOSDPRINGS COBALT AND BASE METALS PROJECT

• Drilling program approval in progress

CORPORATE RATIONALISATION

• Cost reduction measures and efficiency improvements implemented

EUREKA GOLD PROJECT (EGP)

During the quarter, the Company announced that independent mining consultants Entech had completed a review of a restart study at the Company's 100% owned Eureka Gold Project located 50km north of the gold mining centre of Kalgoorlie, Western Australia. This is the result of two drilling programs and evaluation work completed in a short time frame since acquisition as follows:

Progress made to date:

The restart study was announced via the ASX on 24 May 2019 and shows, subject to the cautionary statement below, that a viable cash flow positive early mining opportunity exists at the Eureka project. (Refer to the ASX announcement on 24 May 2019 for detailed information on the Restart Study).

Figure 1: Areas of mineralisation extraction. Additional 20m bench and adit development into the

north wall.

Cautionary Statement

The Re-Start Study referred to in this announcement is based on lower-level 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 Re-Start Study will be realised. Further, the Company cautions that there is no certainty that the forecast financial information derived from production targets will be realised. All material assumptions underpinning the production targets and forecast financial information derived from the production targets are set out in this announcement. The estimated mineral resources underpinning the Re-Start Study production targets have been prepared by Competent Persons in accordance with the current JORC Code 2012 Edition and the current ASX Listing Rules. No Inferred Mineral Resource material is included in the life of mine plan (refer Forward Looking and Cautionary Statements). Tyranna has concluded it has reasonable basis for providing the forward-looking statements included in this announcement. The detailed reasons for that conclusion are outlined throughout this announcement and Material Assumptions on page 4-5.

Figure 2: Eureka Project Location.

Ground Floor, 14 Outram Street, WEST PERTH WA 6005 | PO Box 1124, WEST PERTH WA 6872 T [phone] | F [phone] | E [e-mail] | W tyrannaresources.com

ASX TYX | ABN 79 124 990 405

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Key outcomes of the Study

The key Study outcomes for the Eureka Project are included in Table 1 below. The Indicated Mineral Resource, which constitutes 100% of the production target, has been prepared by Competent Persons in accordance with JORC Code 2012.

Table 1: Summary of key outcomes (at an A$1,800/oz gold price)

OPEN PIT MINING

	Total pit volume (kBCM)	26
	Stripping ratio (waste: ore)	3.3
	Mined ore (kt)	21
	Gold grade (g/t)	2.9
	Milling recovery average (%)	95.7
	Recovered gold (ounces) Koz	2
	Upfront pre-production cost estimate (A$M)	0.6
	Stockpiled waste cost estimate to first ore (A$M)	0.05
	Free cash flow over 1-month project life (A$M)	1.6
	ADIT MINING
	Mined ore (kt)		40
	Gold grade (g/t)	1.7
	Milling recovery average (%)	95.7
	Recovered gold (ounces) Koz	2.1
	Free cash flow over 2-month project life (A$M)		1

Ore mined will be delivered to the ROM pad for haulage to the processing facility in batches of 5kt parcels. Ore mining, once commenced, will be continuous for a two-month period. The Study assumes that 100% of the open pit ore mined will be free dig with no drill and blast to the final pit depth of 20 metres below the current pit floor. 100% of the material to be processed is classified as Indicated Resource and no material to be processed is currently classified as an Inferred Mineral Resource.

Cost Estimates and Financial Evaluation

The upfront pre-production operating cost estimate of A$0.6m represents costs for initial site establishment, haul road improvements, and mine dewatering infrastructure installation. Removal and placement in the existing pit of approximately 75k BCM of waste overburden will occur to expose the open pit ore. The operating cost estimate has been developed with inputs from mining contractors and Entech's database.

Ground Floor, 14 Outram Street, WEST PERTH WA 6005 | PO Box 1124, WEST PERTH WA 6872 T [phone] | F [phone] | E [e-mail] | W tyrannaresources.com

ASX TYX | ABN 79 124 990 405

Page | 3

Table 2: Eureka Gold Deposit - Summary of Financials

	Activity		Operating Cost
			(A$M)
	Gold produced (ounces)		4,057
	Gross revenue (at A$1,800 per ounce)		$7.1M
	Free positive cash flow over 2-month mine life		$2.6M
	C1 cash costs		$1,109/oz
	Mine establishment capital costs		$0.10M
	Initial pre-strip cost estimate to first ore		$0.15M
	First gold production from mine commencement		0.5 Months

Notes: All costs and prices are in Australian dollars, A$1,800/oz gold price used

Economic Evaluation & Sensitivity

The financial evaluation is based of A$1,800/oz gold price (see Table 2). Table 3 provides a sensitivity analysis demonstrating the forecast economics under a range of future gold prices scenarios.

Table 3: Economic Evaluation with varying Gold Price

Gold Price / Oz (AUD)	Gross Revenue (A$M)	Positive Cash Flow From Operation
(A$M)
$1,700	$6.7M	$2.2M
$1,750	$6.9M	$2.4M
$1,800	$7.1M	$2.6M
$1,850	$7.3M	$2.8M
$1,900	$7.5M	$3.0M

Further Work

Entech has recommended further work, which the Company is currently undertaking before a Decision to Mine is made which would include the following:

• Further close spaced infill grade control drilling
• Detailed geotechnical and hydrogeological assessment
• Further contract negotiations for mining and haulage
• Review of processing options and final commercial negotiations
• Detailed review of physicals and costs to PFS level
• Completion of Ore Reserve
• Review of funding / financing options if required
• Completion of statutory approvals for mine development

Ground Floor, 14 Outram Street, WEST PERTH WA 6005 | PO Box 1124, WEST PERTH WA 6872 T [phone] | F [phone] | E [e-mail] | W tyrannaresources.com

ASX TYX | ABN 79 124 990 405

Page | 4

GOODSPRINGS BASE METALS PROJECT

Following approval of the Goodsprings acquisition by Tyranna shareholders only ten months ago, the Company has moved quickly to have the project ready for near-term drilling as follows:

Progress made to date:

Tyranna has engaged a contractor based in Nevada to progress a drilling approval application for the program at the Whale area as outlined in Figure 3.

Figure 3: Tyranna's Goodsprings Project (blue) showing deposit locations and anomalous Cobalt

geochemistry

The Goodsprings Cobalt and Base Metals Project comprises 329 mining claims covering 6,580 acres located within the Goodsprings mining district in southern Nevada, 48 kilometres southwest of Las Vegas.

Ground Floor, 14 Outram Street, WEST PERTH WA 6005 | PO Box 1124, WEST PERTH WA 6872 T [phone] | F [phone] | E [e-mail] | W tyrannaresources.com

ASX TYX | ABN 79 124 990 405

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