Haoma Mining NL : Activities Report for the Quarter Ended December 31, 2016

Haoma Mining NL

A.B.N 12 008 676 177

Registered Office & Head Office:

Level 3, 401 Collins Street, Melbourne, Vic., 3000, GPO Box 2282U, Melbourne, Vic., 3001.

Telephone [phone], Facsimile [phone] Email: [e-mail] Website: www.haoma.com.au

Company Announcements Office January 31, 2017 Australian Stock Exchange

Level 4, North Tower, Rialto 525 Collins Street

MELBOURNE, VIC 3000

Dear Sir,

ACTIVITIES REPORT FOR THE QUARTER ENDED DECEMBER 31, 2016 - HIGHLIGHTS

• Group Consolidated Financial Result:

  Haoma Mining's unaudited consolidated financial result for the three months ended December 31, 2016 was a before tax loss of $0.96 million after interest of $0.44 million, depreciation and amortisation of $0.05 million, and development and test work expenditure of

  $0.45 million.

• Haoma's Test Work at Bamboo Creek Final Gold grades from January 2017 test work on Bamboo Creek Tailings Ore

  In Haoma Mining's 2016 Annual Report to Shareholders (released January 16, 2017) shareholders were advised that Haoma's recent test work at Bamboo Creek has concentrated on recovering physical gold:

• In Solutions 'collected by DIBK' and read on a standard AAS (traditional assay method), and

• In Solids - physical gold percentage measured by XRF (latest gold measured by SEM)

Haoma's latest test work using the Elazac Process was conducted on a 3kg sample of Bamboo Creek Tailings Ore.

The final Bamboo Creek Tailings gold 'head grades' for 2 samples from the 3kg sample of Bamboo Creek Tailings (not concentrate) were:

Assay 1) 359.40g/t gold, and Assay 2) 383.93g/t gold

Gold in the solid fraction was recovered and measured physically (gravimetrically) at the University of Melbourne by SEM. Gold was collected from the acid solution by DIBK and read on a standard AAS.

The Elazac Process used to achieve the above results can be implemented in the Bamboo Creek Plant to process Bamboo Creek Tailings and produce gold using conventional processing methods.

The cost per gram (ounce) of gold produced will be significantly lower than the value of the gold produced.

Optimisation of processing Bamboo Creek Tailings using the existing Bamboo Creek Plant infrastructure should be completed in the current Quarter.

CONTENTS

1. Group Consolidated Result to December 31, 2016

2. Operations at Bamboo Creek Western Australia

3. Exploration Activities in Western Australia

4. Exploration Activities in Queensland

5. Annual General Meeting

1. GROUP CONSOLIDATED RESULT TO DECEMBER 31, 2016

   Haoma Mining NL Consolidated Profit & Loss	2015/16 2nd Qtr ($m)	2015/16 Full Year ($m)	2016/17 1st Qtr ($m)	2016/17 2nd Qtr ($m)	2016/17 YTD ($m)
   Operating Revenue: Gold & Silver Sales Royalties Retail Sales & Misc. Other Income	- 0.03 0.03 -	0.14 0.04 0.11 0.31	- - 0.03 0.35	- 0.02 0.03 0.29	- 0.02 0.06 0.64
   Operating Revenue	0.06	0.60	0.38	0.34	0.72
   Operating profit (loss) before interest, depreciation, amortisation, exploration & development costs: Interest Depreciation & amortization Exploration, development & test work	(0.20) (0.48) (0.04) (0.64)	(0.62) (1.92) (0.16) (2.65)	0.12 (0.46) (0.05) (0.72)	(0.02) (0.44) (0.05) (0.45)	0.10 (0.90) (0.10) (1.17)
   Operating (loss) before tax	(1.36)	(5.35)	(1.11)	(0.96)	(2.07)

2. Haoma's Group Conso lidated Result

   Haoma Mining's unaudited consolidated financial result for the three months ended December 31, 2016 was a before tax loss of $0.96 million after interest of $0.44 million, depreciation and amortisation of $0.05 million, and development and test work expenditure of $0.45 million.

3. Funding of Operations

4. Funding for Haoma's operations is presently being provided by The Roy Morgan Research Centre Pty Ltd, a company owned and controlled by Haoma's Chairman, Gary Morgan. Interest on debt to Roy Morgan Research Centre accrues at the 30 day commercial bill rate plus a facility margin of 1%.

   At December 31, 2016 the principal debt to The Roy Morgan Research Centre Pty Ltd was

   $37.64 million. Interest accrued for the 3 months to December 31, 2016 was $437,923. Total interest accrued and unpaid to December 31, 2016 is $29.10 million.

   The Roy Morgan Research Centre Pty Ltd has advised that that no net debt repayment will be required until Haoma's annualised EDITDA exceeds $15 million per annum and that debt repayments will not exceed 50% of Haoma's EBITDA in any year.

   On October 8, 2015, the District Court in Perth ordered that Haoma's workers compensation insurer pay the judgement amount awarded to a former employee of Haoma Mining in relation to an injury claim. Haoma Mining has provided an amount of $748,420 in its financial statements in respect to this item. The workers compensation insurer has appealed the decision. Haoma has also filed an appeal in relation to the compulsory vehicle injury insurance provider's liability to meet the amount awarded by the Court.

5. OPERATIONS AT BAMBOO CREEK, WESTERN AUSTRALIA

   Figure 1: Location map of Haoma Mining and other Pilbara mining locations.

6. Haoma's Test Work at Bamboo Creek1

   UPDATED Final Gold grades from January 2017 test work on Bamboo Creek Tailings Ore

   In Haoma Mining's 2016 Annual Report to Shareholders (released January 16, 2017) shareholders were advised that Haoma's recent test work at Bamboo Creek has concentrated on recovering physical gold:

7. In Solutions 'collected by DIBK' and read on a standard AAS (traditional assay method), and

8. In Solids - gold percentage measured by XRF (latest gold measured by SEM)

9. Haoma's latest test work using the Elazac Process was conducted on a 3kg sample of Bamboo Creek Tailings Ore.

   The final Bamboo Creek Tailings gold 'head grades' for 2 samples from the 3kg sample of Bamboo Creek Tailings (not concentrate) were:

   Assay 1) 359.40g/t gold, and Assay 2) 383.93g/t gold

   Gold in the solid fraction was recovered and measured physically (gravimetrically) at the University of Melbourne by SEM. Gold was collected from the acid solution by DIBK and read on a standard AAS.

   Haoma shareholders were advised on January 19, 2017 the Bamboo Creek Tailings gold 'head grades' to date on tests still to be completed on a 3 kg sample of Bamboo Creek Tailings Ore were:

   Assay 1) 178.11g/t gold Assay 2) 123.99g/t gold

   The Elazac Process used to achieve the above results can be implemented in the Bamboo Creek Plant to process Bamboo Creek Tailings and produce gold using conventional processing methods.

   The cost per gram (ounce) of gold produced will be significantly lower than the value of the gold produced.

   Optimisation of processing Bamboo Creek Tailings using the existing Bamboo Creek Plant infrastructure should be completed in the current Quarter.

   Note 1: The information & data in Section 2 of this report as it relates to Metallurgical Results is based on information compiled by Mr. Peter Cole who is an expert in regard to this type of metallurgical test work. The results relate to testing the effectiveness of a new method of assaying for gold and other mineral content (the Refined Elazac Assay Method) and a new method for extraction of gold and other minerals from the ore (the Refined Elazac Extraction Method). These methods are together referred to as the Elazac Process. The information reported relates solely to ongoing test work in relation to bringing the Elazac Process to commercial realisation. Mr. Cole has worked in the mining industry for over 30 years and has been associated with the development of the Elazac Process over a long period (approximately 15 years). Mr. Cole is one of only a few people with sufficient relevant knowledge and experience to report results in relation to test work on the Refined Elazac Assay Method and Refined Elazac Extraction Method. Mr. Cole has consented to the inclusion in this report of the information and data in the form and context in which it appears.