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Announcement | 21 November 2017 |

21 November 2017

ASX ANNOUNCEMENT

Chair & Managing Director’s Address

Annual General Meeting

ASX: MMI | ACN 117 763 443

Contact: Tel: +61 (0) 7 3009 8000 | Fax: +61 (0) 7 3221 4811

For Further Information: E: [email protected]

Managing Director & Chief Executive Officer: Simon Finnis,

Chief Financial Officer & Company Secretary: Scott Waddell

Electronic copies & more information available at: www.metromining.com.au

Registered Office & Head Office: Level 2, 247 Adelaide Street, Brisbane Q 4000

Postal Address: GPO Box 10955, Brisbane Q 4000

This announcement has been prepared for publication in Australia and may not be released or distributed in the USA. This announcement

does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States or any other jurisdiction. Any securities

described in this announcement have not been, and will not be, registered under the US Securities Act of 1933 (as amended) and may not

be offered or sold in the United States except in transactions exempt from, or not subject to, registration under the US Securities Act and

applicable US state securities laws.

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mailto:[email protected]

http://www.metromining.com.au/

Announcement | 21 November 2017 | Page 1

Metro Mining Limited (ASX: MMI)

My fellow Board Members, Ladies and Gentlemen

I was interested to note that I concluded my remarks at last year’s AGM by saying:

….. “In the coming year I am sure you will be rewarded for your patience.”

Today, it gives your Board, Metro Senior Management and the entire team a great deal of

satisfaction having, I believe, delivered upon that undertaking to you.

What a year it has been. Your company completed the following milestones;

▪ Received all the required environmental approvals for the development of Bauxite hills mine.

▪ Completed all Native Title requirements

▪ Finalised a major offtake agreement with Xinfa

▪ Completed and consolidated the acquisition of Gulf Alumina, doubling our reserve base.

▪ Completed our DFS and raised the required funding for development.

▪ Commenced construction

Let’s look at the most important benchmark first!

On 22 November last year (date of the last AGM) the share price was 0.14 cents and Metro’s market

capitalisation was $73.8M.

Today the share price (last time I looked) is 0. 21 cents and your Company has grown to be valued

at over $270M.

During this period under review, the company has raised $90M through equity raisings and $40M

through new debt facilities which has provided the funding to repay the short-term debt used to

acquire Gulf Alumina, build the Bauxite Hills project and strengthen Metro’s balance sheet.

I would like to say thank you to Argonaut, who were critical to the success of the fundraisings.

Your company has developed from “junior explorer” status to that of a mine developer and is on the

cusp of becoming a producer. Certainly, we are now on track to become the second largest

Bauxite producer within the internationally acclaimed Weipa Bauxite Region.

No doubt you are aware construction at our flagship project, The Bauxite Hills Mine, has been

underway in earnest since July. Of course, detailed planning commenced long before that.

AGM Chairman Address

21 November 2017

ASX ANNOUNCEMENT

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ASX Announcement | 21 November 2017 | Page 2

The construction team have done a tremendous job and the transformation since July has been

nothing short of remarkable.

Metro is on schedule to load our first shipment at the Bauxite Hills Mine in April – that’s in four months’

time!

Just to give you a high-level summary of what has been happening:

▪ Extensive marine works are complete including the installation of new barge loading facility;

▪ The new accommodation camp is well on the way to being completed and some of the

new units are already being used to house construction workers.

▪ Haul roads are taking shape and the first stage of grade control drilling is complete

Our Managing Director, Simon Finnis, will give you further details in his presentation at the end of the

meeting.

Of course, all of that is very important -- and indeed exciting.

However, the development of your company has been and continues to be just as exciting.

As I mentioned, Metro Mining’s market capitalisation today is over $270M. Over the past year we

have attracted the interest, and subsequent investment, of many significant resource focused

institutional investors – both local and international.

Full details of our shareholder base and financial position is, of course, included in the Annual Report.

It is important to note, we continue to enjoy the ongoing support of our long-term key shareholders,

Balanced Property & Greenstone. I feel it is not improper for me to single them out because of their

long association and commitment to the company and the Bauxite Hills Mine.

Likewise, it is important for me to acknowledge the ongoing support of those “not so large”

shareholders. Each, and every shareholder is important to Metro and we particularly acknowledge

those who have remained during what has been quite a long -- and let’s say -- “interesting” journey.

To all of Metro Mining’s shareholders I say, “thank you.” And long may the journey continue!

Throughout the past year Metro has been totally committed to developing the Bauxite Hills project.

It has unashamedly been our key focus and will continue with the aim of achieving our first shipment

in April 2018.

Ladies and Gentlemen, the achievements of the last 12 months are due to the efforts of the entire

Metro team. We have an excellent executive team who have been well supported by a dedicated

team of professionals. Thank you all.

I would like to acknowledge the tremendous support and positive contribution that the Ankamuthi

People, the Traditional Owners, and Old Mapoon Aboriginal Corporation, the Trustee owner of the

land, have made to the progress and achievements to date.

I would also like to acknowledge the stellar effort of my fellow Board members. In the Annual report,

I refer to the 31 board meetings held during the year. The commitment of each, and every board

member has gone well beyond that.

I think it is appropriate that I conclude today with similar comments I made at the end of last year’s

Annual General Meeting.

… “In the coming year I am sure you will be further rewarded as Metro becomes a Bauxite producer

and exporter.”

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Annual General Meeting

ASX : MMI| 21 November 2016

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$0.05

$0.10

$0.15

$0.20

$0.25

$0.30

DADI

Balanced

Property

Institutions

Other

Shareholders Greenstone

6%

32% 20%

16%26%

Corporate Snapshot Share Price

Board of Directors

Chairman Stephen Everett

Managing Director & CEO Simon Finnis

Non-Executive Director Philip Hennessy

Non-Executive Director George Lloyd

Non-Executive Director Lindsay Ward

Non-Executive Director Mark Sawyer

Non-Executive Director Dongping Wang

Non-Executive Director Jijun Liu

Capital Structure (Post-Equity Raising)

Share Price (20-Nov-17) $0.21

Shares on Issue 1,286M

Market Cap $270M

Options Unlisted 41.6M

Cash (30-Sept-2017 Post Equity) $41.5M

Debt Facility (drawn & undrawn) $26.7M

Enterprise Value $255.2M

2 | ASX : MMI | AGM| November 2017

Share Register (Post-Equity Raising)

BUY (Jul-17)

Target Price: $0.44

BUY (Aug-17)

Target Price: $0.42

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Incorporated Gulf Assets

Staged Development

Post tax NPV10 of $601M &

IRR of 81%

Milestone Achievements

Acquired Gulf –

Consolidated Project

✓

✓ ✓

✓

✓Equity Issues & Debt

provide Project Finance

Project Scale Expanded

Project Construction

on-Time & on-Budget

Environmental Approvals

Received

Customer Base Growing

✓

Doubled Reserves

Gained Infrastructure

Equity Raisings for $90M Total

to Strengthen Balance Sheet

& provide Project Finance

Secured Flexible, Low Cost

Debt Facility of $39.4M

BLF Structurally Complete –

Commissioning this week

All other aspects on target

Operational readiness on

track

Binding Sales Agreement

for 7Mt over 4 years &

LOI for 2.5Mt over 3 years

Positive response from customers

across China & internationally

All environmental approvals

received

Approval for up to 10Mtpa

production

1

2

3

4

5

6

▪ Metro has completed several value adding milestones in 2017 to be primed for Q2 2018 production

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Key BFS Statistics 1

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Ownership: Metro (100%)

Location: Cape York, Qld

Commodity Bauxite

Product Type Direct Shipping Ore

Mine Type Surface mining

Contained mineral: Reserves 92.2Mt1 Resources 144.8Mt1

Status EA Granted, MLs Granted

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Construction H2 2017

First Production April 2018

Start-up Production ~2Mtpa2

Steady State Production ~6Mtpa (year 4)2

Pre Production Capex ~$35.8m3

Expansion Capex ~$36.7m

Costs (LOM Avg) Onsite $16.4/t Incl Royalty $23.0/t

Mine Life 17 years

Operations Contract mining & transhipment

Workforce ~185 personnel

1.ASX Release 15 Mar 2017 | 2. Metro confirms all material assumptions underpinning production target & corresponding financial

information continue to apply & have not materially changed 3. Note this Capex & analysis excludes the purchase of Haul Trucks

Bauxite Hills Mine SnapshotLocation


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Pathway to ProductionConstruction underway and

1st production scheduled April 2018

2017 2018

May June July Aug Sept Oct Nov Dec Jan Feb Mar April

Financing

Piles & Steel Fabrication

Camp Refurbishment

Tug & Barge Mobilisation

Civil Works

▪ Barge Loading Facility

▪ Haul Roads

Barge Loading Facility

▪ Marine Installation

▪ Conveyor

▪ Electricals

Material Offloading Facility

Office & Workshop Refurbishment

Grade Control Drilling & Analysis

New Camp Installation

Commissioning

Care & Maintenance (Wet Season)

Mining Fleet Mobilisation

Mine Production

4 months to Production

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Construction Team Brisbane / Mackay / Gladstone

Feasibility & engineering

Owner’s team project construction management

Queensland

Piling works

Marine installation

Marine infrastructure management

Logistics

Cairns fabrication

Conveyor system

Product sampling

Brisbane

Feasibility

Mine planning

Queensland

Civil works

Haul Roads

Townsville

Electrical engineering & design

North Queensland operations

Camp management

Cairns

Fuel and lubricants

Cairns

Marine logistics

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Traditional Owner Engagement Excellent Relationships continue to flourish

Ancillary Native Title & Land Access Agreement in place for mine life

Liaison Committee with Traditional Owner established

Traditional Owner training and employment

Indigenous employment is 42% and is above target.

Business opportunities for Traditional Owner’s being developed

Community engagement meetings and skills-audit workshops held in local communities

Cultural Heritage Management Plan in place to preserve Aboriginal Heritage

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8 | ASX : MMI | Investor Presentation | November 2017

Construction UpdateCivil WorksBauxite Hills Village Barge Load-Out Facility Infrastructure

New camp installation

complete Dec 2017

Existing camp used

during construction

Marine install complete and

team demobilised

BLF structurally complete

Commissioning planned for

next week

Civils at Port Area complete

Sediment catchment dams

complete

Haul roads construction well

progressed

Communications solution

confirmed & ordered

Fuel system designed &

being fabricated

Electricity by generators on

site and operating

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Bauxite Hills Mine Accommodation

Existing Camp area

New Camp Perimeter

Upgraded access & Parking

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New Mine Accommodation

Wet Mess

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Barge Loading FacilityF

or p

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Regional Exploration Metro’s exploration exposure on Cape York covers

>1,800km2 of holdings (including Bauxite Hills)

Close proximity to the coast

Potential to duplicate Bauxite Hills – internal growth

Identify other opportunities on Cape York and in other

prospective locations.

Ongoing exploration work planned for 2018

Reconnaissance sampling

Drilling of priority targets

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Current Bauxite Market Conditions in China

Domestic bauxite shortages have emerged in the north – particularly Henan but also Shanxi (less so), driven

by environmental compliance audits, deteriorating grades and mine closures.

High caustic prices and scarcity of supply have combined to force inland refiners to seek bauxite from

southern China and from overseas.

At least three inland refineries are either using or trialing imported bauxite.

A further three have expressed interest to trial imported bauxite.

Domestic bauxite prices in Henan Province have risen from around RMB350/t a year ago to over RMB500/t

(delivered incl. VAT). Prices in other provinces have increases, although less so.

Potential new alumina refinery projects have also emerged in southern and northern China and are currently

seeking long-term, high volume bauxite supply.

So

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CM

Gro

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A Glimpse into the Future?

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China’s Domestic Bauxite Prices on the Rise

Prices in Henan and Shanxi increased

significantly in response to tightening supply.

Northern refiners drawing down on stockpiles

and processing lower quality bauxite

(A/S ratio 3-4.5) to continue production.

Sourcing bauxite at A/S ratio 4.0 material is

currently difficult in Henan.

Northern refiners sourcing 20-30kt per month

of bauxite from Guizhou, have pushed

traded prices in the south of China higher.

Domestic bauxite tightness forecast to

continue into 2018.

Source: CM Group

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China vs ROW Primary Aluminium Capacity 2000–2017 (Mtpy)

86%84%

81%

76%74% 72%

69%

63% 62%

56%55% 52%

47% 44% 42%41% 40% 40%

25.827.2

28.6

31.233.5 35.3

37.5

41.8 44.2

45.9 49.751.6

56.562.6

67.070.4 75.3 79.4

14%3.5

16%4.2

19%5.4

24%7.4

26%8.8

28%9.7

31%11.7

37%15.4

38%16.8

44%20.0

45%22.4

48%24.6

53%30.1

56%35.3

58%38.7

59%41.7

60%44.9

60%47.9

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Pe

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l Cap

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Wo

rld

To

tal

ROW Al Capacity(MT) World Total Al Capacity(MT) China's Al Capacity(MT)

Source: IAI, CM Analysis

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Global Primary Al Production 2006-2016

Since 2006

Strong domestic downstream demand

driven by construction, transportation,

packaging, consumer goods and

electrical sectors

China’s proportion in world primary Al

production increased from 28% in

2006 to 54% in 2016

2016 China production: 32.4 MTPA

2016 ROW production: 27.2 MTPA

On a full-cost basis, low-cost Chinese

smelters are globally competitive

Source: CM Group

❖ China’s CAGR 2006-2016

is 12.8%, while ROW is 1%

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China Imported Bauxite Demand Forecast

Source: CM Group

Bx imports at CBIX

~$US80/dmt

Additional Bx imports

at CBIX ~US$50/dmt

Chinese refiners better understanding

the ViU value proposition – lower import

prices mean higher import volumes

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Australian Bauxite Production | 2007 – 2016 (Mtpa)

Source: Australian Government

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Summary – A Transformational Year

1 Metro holds significant advantages and is backed by leading partners

2 Strong seaborne bauxite fundamentals in China provide positive outlook

3 Recent achievements have delivered platform for value creation

4 Compelling metrics provides significant share price upside

5 Attracting increased investor awareness and support

6 Exciting period ahead with first production on track for April 2018

7 Strategic appeal from being Australia’s leading independent bauxite producer

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For Further Information

Contact: Simon Finnis – Chief Executive Officer & Managing Director | Company Secretary & CFO – Scott Waddell

Ph: +61 (0) 7 3009 8000 | Head Office: Lvl 2, 247 Adelaide Street, Brisbane Q 4000 | GPO Box 10955, Brisbane Q 4000

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