Austpac Resources N L : Shareholder Update – Newcastle Zinc and Iron Recovery Plant – 22 August 2017

Tuesday 22nd August 2017 SHAREHOLDER UPDATE

AUSTPAC RESOURCES N.L.

ACN 002 264 057

Level 3

62 Pitt Street

SYDNEY NSW 2000

GPO Box 5297

SYDNEY NSW 2001

Telephone: [phone]

Facsimile: ([phone] Email: [e-mail] www.austpacresources.com

Newcastle Zinc & Iron Recovery Plant (NZIRP) First Stage of Test Plant Successfully Commissioned

Austpac (ASX code: APG) is pleased to advise the successful commissioning of the Fluid Bed Evaporation ("EVAP") unit in Newcastle.

The EVAP unit is the critical Stage One of the three-stage program currently underway at the NZIRP. The program aims to produce five tonnes of reduced iron pellets for testing in an Electric Induction Furnace (EIF) at a commercial foundry. The program's objective is to prove the Company's recycling process and produce samples of pig iron and zinc oxide for marketing purposes.

Sequential activities during August 2017 included:

Delivery of ten tonnes of furnace dust and spent pickle liquor (SPL) supplied by an east coast-based steel producer

Commissioning of the solids feed system to deliver furnace dust to the ball mill

Commissioning the ball mill and producing a fine slurry of furnace dust suitable for pumping to the EVAP unit

Final assembly of EVAP gas supply and commissioning the burner train and off-gas ducting to the scrubbing system

Commissioning the fluid delivery system to inject furnace dust slurry and SPL into the EVAP fluid bed

Installing an intermittent solids discharge system to tap the dry mixed chloride-oxide pellets from the fluid bed

Coordinating the start-up and hot commissioning of the entire EVAP system

The production of optimally-sized mixed chloride-oxide pellets during the first day of operations

Minor modifications are being made to the EVAP system to maximise operability. Conversion of ten tonnes of furnace dust to mixed chloride-oxide pellets during a production run is scheduled for September 2017. Stages Two and Three will follow upon completion of the EVAP production stage, and the ensuing pre- reduced iron oxide/zinc oxide will be converted to pig iron and zinc oxide in an EIF.

For further information please contact: Mike Turbott

Managing Director Austpac Resources N.L. Tel [phone]

About Austpac Resources N.L. (ASX code: APG)

Austpac Resources N.L. [www.austpacresources.com] is a minerals technology company currently focused on recycling waste chloride solutions and iron oxides produced by steelmaking to recover hydrochloric acid and iron metal. Austpac's technologies also

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