Quarterly Activities Report & Cashflow

ASX ANNOUNCEMENT

27 October 2021

SEPTEMBER 2021 QUARTERLY ACTIVITIES REPORT

HIGHLIGHTS

• Binding offtake term sheets executed for large flake concentrate
• MOU signed with URBIX, Inc - US based clean tech graphite processing company
• Positive discussions continue with POSCO regarding binding Term Sheet for Offtake & Prepayment
• Discussions progress with Tanzanian Government with respect to the Free Carried Interest agreement
• Project development activities ongoing across engineering, customer qualification work, resettlement, costs assessment, and partner integration
• A$9.3M cash at bank as at 30 September 2021

Tanzanian graphite developer Black Rock Mining Limited (BKT: ASX) (Black Rock or the Company) is pleased to provide an update on activities at its Mahenge Graphite Mine in Tanzania for the quarter ending 30 September 2021.

Binding Offtake Agreements

Black Rock, through its 100% owned Tanzanian subsidiary Mahenge Resources Limited, signed binding Term Sheets for Offtake (refer ASX Announcement 13 August 2021) with two of its existing Offtake customers, Taihe Soar (Dalian) Supply Chain Management (Taihe Soar) and Qingdao Yujinxi New Material Co Ltd (New Materials). Previously, these commitments for allocated product were agreed in the form of Pricing and Volume Agreements (see ASX Announcements 7 January 2019 and 8 May 2019). The binding Term Sheets revise product allocation to separately reserve 100% of fines (estimated at 25 ktpa - 30 ktpa) for POSCO Ltd (POSCO).

Offtake Customer

Key Terms

Tahie Soar

New Materials

Contract Type/Status

Binding

Binding

Concentrate Quantity (tpa)

20,000

10,000

Buyer optional extra

10,000

5,000

uncontracted quantity (tpa)

Term

3 Years

3 Years

Buyer optional term

2 years

2 years

extension

Pricing

Index RefWin & ICC Sino

Index RefWin & ICC Sino

Trading currency

US$

US$

Prepay

US$ 3.0m

US$ 2.0m

Governing Law

Singapore

Singapore

Shipping terms

FCA

FCA

Resale

China Only

China Only

Black Rock Mining Ltd

Australian Office

Tanzanian Office

Directors

ACN 094 551 336

45 Ventnor Avenue

Mahenge Resources Ltd

Richard Crookes - Chairman

ASX: BKT

West Perth, WA 6005

Msasani Towers

John de Vries - Managing Director & CEO

Ph: [phone]

Second floor Wing B

Gabriel Chiappini - Non-Executive Director/Company Secretary

E: [e-mail]

Dar es Salaam

Ian Murray - Non-Executive Director

Ph [phone]

www.blackrockmining.com.au

ASX ANNOUNCEMENT

27 October 2021

Including POSCO's tonnage allocation of 100% of fines, total binding Offtake is 60 ktpa, with an additional 15 ktpa of buyers options over uncontracted tonnage. The conversion to binding status confirms the majority of large flake concentrate from Mahenge Module One is now allocated and provides for a higher level of contractual stability prior to commencing a debt finance process. The remaining 23 ktpa uncontracted tonnage is subject to a qualification process which is underway.

Large Scale Qualification

Operation of a large-scale pilot plant (Qualification Plant) to generate bulk concentrate samples to complete customer qualification for POSCO and selected large flake customers, commenced on 6th August 2021 in Shandong province, China. Stockpiled ore will be processed with milling expected to last around six weeks. The mill is the same as was used in Black Rock's 18 tonne pilot plant operation in 2019 (refer ASX Announcement 3rd April 2019).

The ore parcel being processed is composited from eighteen locations across the entire strike length of the Ulanzi orebody, from the Mahenge Graphite Mine (the Project). Individual samples are extracted from drill hole collars and are designed to support reconciliation between drill and laboratory results to bulk samples to better forecast ultimate plant performance. This supports a whole of orebody qualification, whereby customers and financiers have confidence in the Project's ability to supply qualified product over the long term. This sample strategy has been designed to represent the first ten years of the Ulanzi pit and is representative of the expected feed profile for Modules One and Two.

Operation of the plant was contemplated as part of POSCO's US$7.5m investment which was completed in May 2021 (refer ASX Announcement 1st June 2021).

Large flake concentrate from the Qualification Plant will be placed with interested parties in Europe and Asia. Fines (<#100 mesh) will be used to qualify battery anode precursor products within POSCO's customer supply chain.

Prior to operation of the Qualification Plant, individual bulk samples were sampled and tested by SGS Lakefield Laboratory in Canada in July 2021. Samples were processed to determine sizing at a targeted 95% carbon concentrate grade for commissioning and ramp-up. SGS's test work cycle achieved an average of 96.8% carbon by LOI. Details are outlined in Table 2 below.

Reconciliation between the Definitive Feasibility Study flake profile and the latest SGS round is illustrated in Table 3. While the current round of testing indicates a slight increase in large flake and concentrate grade, in response to continued optimisation, management cautions that some size degradation will occur with plant scale up.

Index pricing has been included in Table 3 as a guide to current market conditions. Prices quoted are China Ex Works basis. Final basket pricing will be provided post qualification.

Black Rock Mining Ltd	Australian Office	Tanzanian Office	Directors
ACN 094 551 336	45 Ventnor Avenue	Mahenge Resources Ltd	Richard Crookes - Chairman
ASX: BKT	West Perth, WA 6005	Msasani Towers	John de Vries - Managing Director & CEO
	Ph: [phone]	Second floor Wing B	Gabriel Chiappini - Non-Executive Director/Company Secretary
	E: [e-mail]	Dar es Salaam	Ian Murray - Non-Executive Director
		Ph [phone]
www.blackrockmining.com.au

ASX ANNOUNCEMENT

27 October 2021

Table 2 - Composite Variability Results Ulanzi - SGS Lakefield July 2021

Test	Size		Weight	Assays, %	Pilot Plant Con
	Mesh*	Microns	%	C(t, g)	(t)
	+32 mesh	500	5.1	96.4	2.1
	+48 mesh	300	27.3	96.0	11.1
	+65 mesh	212	23.2	96.6	9.4
	+80 mesh	180	9.8	97.0	4.0
	+100 mesh	150	9.2	97.4	3.8
Average	+150 mesh	106	11.1	97.7	4.5
	+200 mesh	75	6.2	98.0	2.5
	+325 mesh	44	4.6	97.8	1.9
	+400 mesh	37	1.3	97.2	0.5
	-400 mesh	-37	2.2	95.5	0.9
	Total Concentrate	100.0	96.8	40.7

• Mesh sizes are used to describe flake size and refer to the dimensions of the mesh size opening. ASTM mesh sizing refers to the number of openings per linear inch.

Table 3 - Flake Profile reconciled to 2018 Definitive Feasibility Study

	Product**				Study Stage			Pricing*
	Nominal size and			DFS 2018			SGS 2021			@95%
	grade
-195		32%		26%		100%
+195		9%		9%		128%
+895		36%		33%		179%
+595		18%		27%		263%
+3295		5%		5%		346%

* Average index pricing -195 based on mark to market AsianMetal RefWin & ICCSino Aug 2021 Pricing basis is ex Works

Index pricing -195 ex Works Shandong is USD $520 - $550

** Product is described as mesh size followed by concentrate grade eg -195 = -100 mesh @ 95%

POSCO Offtake Update

Offtake and prepayment negotiations with POSCO for 100% of fines from Mahenge Module One are progressing. Expected volumes of -#100 mesh concentrate attributable to POSCO are expected to be in the range of 25 ktpa to 30 ktpa. Conversion of strong expressions of interest for the remaining 20 ktpa of large flake not subject to contractual rights are subject to completion of qualification.

URBIX Partnership

The Company signed a Memorandum Of Understanding (MoU) with United States of America CleanTech Graphite Processing company Urbix, Inc (Urbix), for an innovative supply chain partnership collaboration on battery anode processing (refer ASX Announcement 1 July 2021).

Black Rock Mining Ltd	Australian Office	Tanzanian Office	Directors
ACN 094 551 336	45 Ventnor Avenue	Mahenge Resources Ltd	Richard Crookes - Chairman
ASX: BKT	West Perth, WA 6005	Msasani Towers	John de Vries - Managing Director & CEO
	Ph: [phone]	Second floor Wing B	Gabriel Chiappini - Non-Executive Director/Company Secretary
	E: [e-mail]	Dar es Salaam	Ian Murray - Non-Executive Director
		Ph [phone]
www.blackrockmining.com.au

ASX ANNOUNCEMENT

27 October 2021

Urbix is an advanced materials technology company specialising in all aspects of the graphite value chain including manufacturing the most environmentally viable graphite and energy storage products in the world. Patented purification techniques deliver lower production costs with a low environmental footprint by avoiding the traditional need for hydrofluoric acid and high power consumption.

The MoU with Urbix is designed as a whole of supply chain collaboration that will drive commercial benefits for Black Rock and its customers. Under the MoU, Black Rock and Urbix will examine the potential to provide current and potential offtakers with an alternative Western supply chain option that is not only competitive, but delivers strongly differentiated environmental and sustainable battery anode materials.

Urbix has produced battery anode material from Mahenge graphite concentrates, with an initial batch submitted to Black Rock's shareholder and development partner, POSCO, for qualification testing. Further samples will be prepared for ongoing testing.

Both parties will also work to validate and verify scaled up performance of the processing technology at a technical and commercial level. Following construction of a dedicated processing facility by Urbix to access US markets, the companies will seek to examine a North Asia opportunity for toll processing or Joint Venture.

Urbix's graphite processing technology has several advantages that has the potential to transform the global processing of natural graphite products for battery and energy storage applications. Urbix graphite processing technology can deliver significant advantages to Black Rock and its customers through:

• Much lower energy consumption;
• Eliminating the need for hydrofluoric acid use;
• Significantly higher product yield (70% to 80% versus current industry standard of 35%); and
• Reduced reliance on co-product credit (re-carburiser sales to monetise waste streams).

Mahenge Project Development Activities

Black Rock continues to progress project development activities in parallel with respect to pre-construction work, which includes:

• Securing binding term sheets with all existing offtake customers;
• Front end loading of the Resettlement Action Plan;
• Operation of a large-scale customer qualification pilot plant in China;
• Integration activities with existing partners POSCO and URBIX;
• Engineering work;
• Updating of capital and operating costs; and
• Preparation with finance groups to support a development financing process.

Black Rock Mining Ltd	Australian Office	Tanzanian Office	Directors
ACN 094 551 336	45 Ventnor Avenue	Mahenge Resources Ltd	Richard Crookes - Chairman
ASX: BKT	West Perth, WA 6005	Msasani Towers	John de Vries - Managing Director & CEO
	Ph: [phone]	Second floor Wing B	Gabriel Chiappini - Non-Executive Director/Company Secretary
	E: [e-mail]	Dar es Salaam	Ian Murray - Non-Executive Director
		Ph [phone]
www.blackrockmining.com.au

ASX ANNOUNCEMENT

27 October 2021

Figure 1 - 500 tonne Mahenge bulk samples arrive for POSCO supply chain qualification test works

Tanzanian Activities

Free Carry Interest Agreement

Black Rock's Managing Director and CEO, John de Vries, along with Chairman, Richard Crookes, travelled to Tanzania in mid-August. Both remain in country and continue to progress discussions on concluding a Framework Agreement with Tanzanian Government.

Community Engagement

Resettlement activities continue on site with development of the Village Land Use Plan (VLUP). The VLUP is a master plan that allocates village land to alternate land uses from residential to light industrial. The process currently underway is focused on establishing suitable land and housing for resettlement, and the required infrastructure to support the new settlement (roads, power, water etc).

Figure 2 - Public meeting to sensitise local	Figure 3 - Field officers assisting with National
communities on resettlement process (RAP)		ID registration (RAP)
Black Rock Mining Ltd	Australian Office	Tanzanian Office	Directors
ACN 094 551 336	45 Ventnor Avenue	Mahenge Resources Ltd	Richard Crookes - Chairman
ASX: BKT	West Perth, WA 6005	Msasani Towers	John de Vries - Managing Director & CEO
	Ph: [phone]	Second floor Wing B	Gabriel Chiappini - Non-Executive Director/Company Secretary
	E: [e-mail]	Dar es Salaam		Ian Murray - Non-Executive Director
		Ph [phone]
www.blackrockmining.com.au