ASX Release (CZI)

28 October 2019

ACTIVITIES REPORT FOR THE

QUARTER ENDED 30 SEPTEMBER 2019

QUARTER HIGHLIGHTS:

Corporate

  • Strengthened relationship with strategic partner and shareholder, Tinci Materials

West Musgrave Project

  • Pre-FeasibilityStudy extended to include detailed evaluation of numerous potential value-add opportunities
  • Further evaluation of opportunities to include:
    • New comminution and float cell technologies
    • Remote Operations Centre and workforce
    • Renewable power opportunities and potential partners
    • Updated Resource and Reserve to inform mine design and schedule
  • PFS delivery in early 2020

Mount Squires Gold Project (CZI 100%)

  • Excellent first-pass results from RC drilling at the Handpump Prospect
  • Confirms a regional-scale, greenfield gold opportunity
  • Follow-upprograms underway

Cassini Resources Limited (ASX:CZI) ("Cassini" or the "Company") is pleased to report achievements at its development and exploration projects during the September 2019 Quarter.

Corporate

The Company remains well funded with A$7.3m in cash and reserves at the end of the Quarter.

During the September quarter, Cassini executives visited key shareholder Guangzhou Tinci Materials Technology Co. Ltd (002709.SHE, market capitalisation of ~A$2.2b) in Guangzhou and Jiujiang, in Jiangxi Province China.

Tinci is is one of the largest battery electrolyte producers in China, with ~2,500 employees in multiple facilities across the country.

They have strong customer relationships with well known lithium-ion battery manufacturers such as CATL, LG and Aviation Industry Corp of China (AVIC).

Tinci have recently acquired a nickel sulphate manufacturing plant in Jiujiang, which they are currently refurbishing and expanding with goal of the facility being operational in early 2021.

It was an opportunity to view Tinci's impressive operations and also to experience first hand the significant progress China has made in the adoption of electric vehicles (EV's).

Cassini Resources Ltd

Quarterly Activities Report

Period ended 30 September 2019

Cassini Directors Richard Bevan and Greg Miles with Tinci Chairman Mr Jin Fu Xu (second from left) and Cassini shareholder Mr Sufan Siauw.

West Musgrave Project (CZI 30%, OZL 70%)

West Musgrave Joint Venture partners Cassini and

OZ Minerals are working together on the West

Musgrave nickel-copper project in Western

Australia

Pre-Feasibility Study Extended

The delivery date for the Pre-Feasibility Study (PFS) was extended due to an expanded scope of work to evaluate a number of additional value-add opportunities that have been recognised in recent months. The PFS is now scheduled for delivery in the first Quarter, 2020. To complete these works, the OZ Minerals Board has approved an additional $10 million to complete the PFS. Cassini continues to be loan-funded through to Decision to Mine with repayment five years after commencement of production.

An update on PFS activities follows.

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Cassini Resources Ltd

Quarterly Activities Report

Period ended 30 September 2019

Resource Update

A Mineral Resource update was released in April 2019 incorporating drilling up to December 2018. In that release Indicated Resources were increased from 40% to 60% of the total Mineral Resource compared to the previous release. Since December 2018 approximately 50,000m of infill drilling has been completed with a focus on increasing the proportion of Indicated Resources sufficiently to underpin an Ore Reserve once the PFS is completed. This drilling was completed during the Quarter and rigs demobilised from site. A Mineral Resource update including drilling from January to August is in preparation to support close out of the pre-feasibility study and completion of a maiden Ore Reserve, with an anticipated improvement in resource classification underpinning both.

Mine Optimisation

A Mining 'Hill of Value' study has been completed to select the optimum processing rate and mining cutoff grade. The PFS has confirmed 10Mtpa as the optimum processing rate as contemplated in the Further Scoping Study, but improving the intial 8 years of mine life to beyond 15 years.

A detailed mine design, stockpiling strategy, operating cut-off grade and waste dump strategy have also been completed.

Metallurgical Flowsheet Development

An alternate flotation flowsheet to the Sequential Separation flowsheet which was the basis for the Further Scoping Study has been tested to sufficient confidence to be included in the Base Case. This alternate Bulk Separation flotation flowsheet is used in the majority of copper-nickel projects worldwide that produce separate copper and nickel concentrates. In the Bulk Separation flowsheet, nickel and copper are floated together into a single cleaned concentrate and then separated into two products.

Bulk separation enables primary grind size to be increased from 75 microns to 165 microns which results in a capital cost and operating cost savings. While the Bulk Separation flowsheet has been tested with sufficient confidence to be included in the Base Case, further de-risking will be undertaken through locked cycle testing and a pilot plant later this year.

Alternative Technologies

The study has identified three alternative processing technologies to that assumed in the Further Scoping Study that are not yet incorporated in the Base Case; the Loesche Mill, Woodgrove Flotation Cell and Hydro-float Cell. All of which are still to be fully tested and proved, but all of which have the potential to further reduce capital costs and operating costs and improve metal recoveries. Work on the Loesche Mill technology is the most advanced of these three. Two pilots of the Loesche Mill have now been completed. This work confirmed the previous finding that a significant reduction in power consumption is possible and the use of expensive grinding media is completely eliminated.

Power Solutions

A 55 MW hybrid diesel-solar-wind solution with 70-80% renewable penetration is the current Base Case. Baseline data collected over the last year has demonstrated a high quality, consistent solar and wind resource is available, with higher wind velocities at night offsetting the lack of solar power.

Power accounts for around 40% of the processing cost at West Musgrave and is a significant value lever on the project. Large-scale solar photovoltaic and wind solutions are currently economically viable and technically mature solutions to reduce the project's reliance on high cost fossil fuels for electricity generation.

A large number of proposals have been received from major utilities, independent power providers, infrastructure funders and equipment manufacturers. Evaluation of the proposals has resulted in

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Cassini Resources Ltd

Quarterly Activities Report

Period ended 30 September 2019

confidence that there will be a reduction in the power cost assumption used in the Further Scoping Study.

Groundwater Drilling

Ten groundwater drill holes have been completed across the site and a number of potential borefield areas identified within 20 km of the proposed mine and immediately surrounding the Nebo pit. Groundwater modelling has confirmed sufficient groundwater is present in these potential borefields to support the current base case scenario and water resources are therefore considered largely de-risked. The groundwater is present in shallow paleochannels 5-10 metres below the surface and is of excellent quality; significantly better than the hypersaline water present in the Western Australian goldfields.

Remote Operations Centre

A preliminary assessment has been completed on the potential for a Remote Operations Centre for West Musgrave with the location and business case to be further developed.

Haulage Study

A preliminary haulage study has been completed, considering autonomous mine haulage as an option for comparison against a traditional contractor mining model. Further assessment is required.

Logistics

A first principles logistics study has been completed which uses super quad road trains for moving concentrates. Further assessment will look at backhauling opportunities.

Exploration

Further drilling was completed at the One Tree Hill Prospect, stepping out from CZD0099 which returned excellent results including 40m @ 1.16% Cu earlier in 2019. Assay results are pending. Infill drilling was also completed on one section at the Succoth Prospect to confirm the geological interpretation. Results for these holes were also pending at the end of the Quarter.

A high-resolution aeromagnetic survey for 3,978 line km's was completed in the One Tree Hill prospect area to assist with geological interpretation and targeting.

Mount Squires Gold Project (100% CZI)

The Mount Squires Gold Project (Mount Squires Project) lies adjacent to the West Musgrave Project Joint Venture and is 100% owned by Cassini. The Mount Squires Project is a natural fit with activities at our West Musgrave Project. Our technical team has extensive geological knowledge, operational capability and established heritage relationships which provides a significant competitive advantage.

Whilst the West Musgrave Project continues to be our primary focus and long-termvalue-driver, our exploration strategy at Mount Squires (and Yarawindah Brook) is geared to provide opportunities for new discoveries in the near term. Our goal is to add value and be exposed to these opportunities through relatively inexpensive exploration programs that do not compromise our funding capacity during the ongoing study phase of the West Musgrave Project.

RC Drilling of Handpump Prospect

During the Quarter, The Company completed it's first drilling program at the Handpump Prospect comprising 10 holes for 1,134m of RC. The program was designed to confirm mineralisation controls and extensions to previous drill intercepts which include a best result of 15m @ 2.30g/t Au from 31m. Cassini's drilling program represents the first drilling at the Handpump Prospect since 2011, prior to Cassini's ownership.

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Cassini Resources Ltd

Quarterly Activities Report

Period ended 30 September 2019

All results from the RC drilling program at the Handpump Prospect, comprising 10 holes for 1, 134m, have now been received. Best results from the program were from holes previously released including 20m @ 1.27g/t Au, including 7m @ 2.54g/t Au from 23m in MSC0003, 27m @ 1.00g/t Au from 31m, including 3m @ 2.59g/t Au from 38m in MSC0004 and 19m @ 0.68g/t Au including 6m @ 1.26g/t Au from 38m in MSC0005. The results have confirmed the potential for economic mineralisation at surface and extending to shallow depths.

Mineralisation is hosted within a hydrothermal breccia at the stratiform contact of a rhyolite and overlying (predominantly barren) volcaniclastic unit. Mineralised lodes, defined by a 0.1g/t Au halo, strike E-W to ESE-WNW and are near vertical to steeply south dipping (Figure 2). Mineralisation is potentially controlled by the intersection of NW-SE and SW-NE trending structures. Interpretation of geology and assay results is continuing.

Figure 1. Drilling operations at the Handpump Prospect, Mount Squires Project.

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Cassini Resources Limited published this content on 28 October 2019 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 October 2019 00:06:04 UTC