Golden Deeps : Quarterly Activities Report

ASX ANNOUNCEMENT

ASX code: GED

18 October 2019

Quarterly Activites Report

For the Quarter Ended 30 September 2019

Highlights:

• Trial operations (Phase 2) commenced under the Joint Venture Agreement with Generous Metals Company Limited (GMC).
• Mintek's detailed metallurgical study is complete and identifies up to a 30x upgrade in vanadium units.
• Engineering tenders have been extended to deliver a Definitive Feasibility Study for the proposed Abenab project crushing and concentrator plant.
• Meetings have been held with Chinese vanadium refiners with many expressing an interest in refining the concentrate to recover the vanadium, lead and zinc.
• Broad areas of surface mineralised material identified around the historic Abenab open pit.
• Shallow RC drilling intersects vanadium mineralisation in the south wall of the open pit.
• Five hole resource definition drill program completed and resource update underway.

Golden Deeps Limited ("Golden Deeps" and "Company") is pleased to provide the following report on the positive progress the Company has made during the quarter on the development of the Abenab vanadium project.

Abenab Project Development

Golden Deeps - GMC Joint Venture

The Golden Deeps/Generous Metals Company Limited (GMC) Joint Venture (JV) continues to develop, and during the quarter the trial phase of operations was initiated. This involved sampling and delivering a bulk sample of ore, tailings and willemite to China for concentrating and downstream refinery testing. The material was loaded in September and is expected to arrive in China in the middle of November. Results from this work are to be shared with all JV participants.

Metallurgical Testing

Mintek, of South Africa, completed the detailed metallurgical test program on the surface ore materials. This work involved the optimisation of the crushing and concentrator process flowsheet and preparation of a bulk concentrate sample for testing downstream with off takers and 3rd party refineries.

Metallurgical testing of the above ground materials confirms that a crushing plant capable of a sub-1mm particle, supported by a water based gravity separation process is suitable. This produced a concentrate with a 30 times upgrade on vanadium units, delivering a grade of 8.9 % V2O5, 30.5% Pb and 8.95% Zn1. Further analysis has

1 Refer to GED:ASX announcement dated 22 August 2019 and titled 'Path to Production - 30x Increase Vanadium Concentrate Grade'. The Company is not aware of any new information or data that materially effects the information included in this announcement.

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identified that improvements in recovery may also be possible through introduction of recycle streams and less stages of separation. Proving the ability to concentrate the above ground material has the potential to add to the pre-mined material which can be utilised during the first 12 months of operation, facilitating a quicker plant start-up whilst the wider mine area is being developed. A final report has been circulated for comment.

Vanadium refining

Many options are available for downstream processing of the concentrate including in situ refining, toll treating through third parties and direct selling of the concentrate. Due to the minerology and high grade of concentrate achieved, indications are that a chemical based process can be employed as an alternative to the traditional salt roast and water leach method, extracting higher value from the resource at a lower capital and operating cost. To facilitate this, a bulk sample of concentrate from the current test program is being prepared for testing by prospective downstream refiners and customers.

To advance this work, meetings have been held with a number of vanadium refineries in relation to third party refining of the high-grade concentrate. Two key parties with whom discussions have been held continue to express their interest as potential offtakers, and believe that they are able to process the vanadium and also extract value from available lead and zinc credits. Further test work on the vanadium concentrate is planned, following completion of the gravity concentrator test work, on a bulk sample from Abenab. This is being conducted by Mintek in South Africa.

Resource Definition and Exploration Programs

In August 2019, the Company completed a Reverse Circulation (RC) and diamond drilling program at the Abenab mine (Figure 1). The drilling program was completed in three parts, being a Surface Mineralised Material Program, a Mine Development Evaluation Program and a Resource Definition Program. Assay results from all three programs are now available.

The Surface Mineralised Material Program targeted surface stockpiles, backfill and tails around the historic open pit and plant. Broad areas of mineralised material were identified primarily to the north and northeast of the open pit. The material is 1-2m thick and is interpreted to be stockpiled broken rock and tails from the historic mining operations. Results include:

ABRC023 2m @ 1.42% V2O5, 3.33% Pb, 1.15% Zn from surface2

ABRC025 3m @ 0.5% V2O5, 1.31% Pb, 1.06% Zn from surface2

The newly identified areas of surface mineralised material could add to the previously reported rock stockpiles and tails that form part of the JV with Generous Metals Company Ltd.

The Company plans to immediately conduct additional sampling to delineate the extent of the surface mineralised material and tails.

2Refer to GED:ASX announcement dated 5 September 2019 and titled 'Shallow Drilling Extends Surface Mineralised Material''. The Company is not aware of any new information or data that materially effects the information included in this announcement.

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Figure 1: Abenab Project - Drill hole locations.

The Mine Development Evaluation Program targeted shallow bedrock vanadium mineralisation around the historic Abenab open pit (blue holes in Figure 1). Thirteen RC holes were drilled in July to test targets along strike from the current resource and between the current resource and the open pit. No previous drilling had been conducted around the pit because historic exploration was conducted via underground drives extending off a shaft on the edge of the pit.

Holes ABRC019 and ABRC020 were drilled at the southern end of the pit into the up dip extension of the Abenab breccia pipe that dips to the northwest. The breccia pipe straddles the Abenab fault at the contact between a laminated limestone and a massive grey dolomite.

Hole ABRC019 intersected seven intervals in the footwall limestone that are in excess of the resource cut-off grade of 0.2% V2O5. The best intersections are:

2m @ 1.76% V2O5, 4.38% Pb, 1.42% Zn from 8m3 2m @ 1.8% V2O5, 5.07% Pb, 2.53% Zn from 64m2

Hole ABRC020 intersected six intervals in the footwall limestone that are in excess of the resource cut-off grade of 0.2% V2O5 (Figure 2). The best intersections are:

3 Refer to GED:ASX announcement dated 9 September 2019 and titled 'Drilling Intersects Previously Unidentified Extension''. The Company is not aware of any new information or data that materially effects the information included in this announcement.

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6m @ 0.63% V2O5, 1.53% Pb, 0.58% Zn from 48m2 3m @ 0.92% V2O5, 2.7% Pb, 0.44% Zn from 77m 2 includes 1m @ 1.81% V2O5, 4.61% Pb, 3.62% Zn from 79m

ABRC020 ended in mineralisation with a 1m intersection of 1m at 1.81% V2O5. Including zones of internal waste greater than 1m the 38m interval from 42m to 80m averages 0.31% V2O5.

Figure 2: Mine Development Evaluation. Cross section showing vanadium mineralisation in RC hole ABRC020

The Company plans to conduct further RC drilling at the south end of the Abenab open pit to follow up vanadium mineralisation intersected in holes ABRC019 and ABRC020. Approximately 10 holes are planned, with the intention being that these will form the basis of a new Inferred JORC 2012 resource estimate for the Abenab project, as well as a pit cutback.

The Resource Definition Program was designed to in-fill and extend the existing Abenab resource. A five hole diamond drilling program was completed at Abenab in July 2019 (red holes in Figure 1) and all assay results are now available for holes ABRCD008 ABRCD011-12, ABRCD016 and ABD015. The results have confirmed the existing resource model and have the potential to increase the resource in some locations.

Hole ABRCD011 intersected multiple zones of brecciated dolomite and limestone with calcite fracture fill containing descloizite. Best intersections are as follows:

23m @ 1.34% V2O5, 3.33% Pb, 1.25% Zn from 167m4 (includes 1m @ 7.84% V2O5, 19.0% Pb, 6.52% Zn from 186m)

4 Refer to GED:ASX announcement dated 17 September 2019 and titled '7.8% V2O5 Intersected At Abenab Project'. The Company is not aware of any new information or data that materially effects the information included in this announcement.

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16m @ 0.56% V2O5, 1.30% Pb, 0.53% Zn from 274m3 15m @ 0.29% V2O5, 0.65% Pb, 0.32% Zn from 292m3

In total, the hole intersected over 80m of V2O5 mineralisation above the cut-off grade of 0.2%. A 1m interval in ABRCD011 from 186m-187m is an exceptionally high grade of 7.84% V2O5, 19.0% Pb and 6.52% Zn. This is the

highest grade result from the Company's drilling program reported thus far.

The vanadium mineralisation at Abenab occurs as descloizite (Pb,Zn(VO4)(OH)), a lead-zinc vanadate, that forms veneers on clasts within breccia (Figure 3). Breccias are best developed in an approximately cylindrical shaped pipe that plunges to the northwest but within the pipe, breccia has preferentially developed along bedding planes.

The five new resource definition diamond holes drilled by the Company will be used to revise the geological model and generate a new resource estimate.

Figure 3: Dolomite breccia with vanadium pentoxide mineralisation in diamond hole at 241m in ABD015

Tenement Status

A renewal application has been lodged with the Namibian Ministry of Mines and Energy for EPL 5496 that expired on 6 April 2019. A renewal application has also been lodged for EPL 3543 which expired on 11 September 2019. Both renewals are currently pending and are expected to be granted soon, following a high level of activity at the Abenab and Abenab West mines.

Renewals of EPL 5232, EPL 5233 and EPL 5234 were granted by the Namibian Ministry of Mines and Energy on 8 August 2019 for a period of three years. The Company did not renew EPL 5509 and EPL 5510 because preliminary exploration indicated that the tenements had low prospectivity.

Corporate

The Company raised a gross amount of $1,075,000 through the placement of 41,346,155 fully paid ordinary shares at $0.026 per share. The funds raised will be used for the advancement of the Company's Abenab vanadium project including advancing a feasibility study, ongoing exploration and pre-production costs, and general working capital.

In conjunction with the placement, Golden Deeps' Chairman Michael Minosora has advised the Company that he has committed to purchasing $75,000 worth of shares at the same price as the placement. This is subject to receiving shareholder approval, which will be sought at the Company's Annual General Meeting to be held in November 2019.

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