High-grade structural zones extend for 1.2km: Mt Carbine historical drilling reinterpretation

ABN: 77 115 009 106 (ASX: SEI)

16 October 2020

Company Announcements Office

ASX Limited

Exchange Centre

20 Bridge Street

SYDNEY NSW 2000

High-grade structural zones extend for 1.2km: Mt Carbine historical drilling reinterpretation

(validated by re-assaying*)

Highlights:

• Speciality Metals' re-assaying of historical drill core, as a basis for reinterpretation of the Mt Carbine underground resource and definition of high-grade corridors
• Mt Carbine High-Grade Zones** include:
• • CB005 - 2m*** @ 7.7% WO3 from 162.01m
  • CB001 - 11.2m @ 2.9% WO3 from 127.86m
  • CB040 - 6.18m @ 1.4% WO3 from 244.86m
  • CB038 - 13.58m @ 0.57% WO3 from 213.93m
• A total of 154 intercepts from 43 historic drill holes outline veining extends for 1.2km strike length with five main veins identified
• Trade-offstudy initiated to evaluate a narrow high-grade mine targeting 'King Vein' style mineralisation against historical considerations
• Consultation commenced with Department of Natural Resources, Mines and Energy and contractors setting out detailed planning for reopening of decline for further underground testing

* See Appendix 2, Table 3 for details regarding re-assayed core sections

• Redefined high-grade zones - see Appendix 1, Table 2 for details
• WO3 grade diluted to a 2m mining width; no uppercut to grade has been applied

Speciality Metals International Limited (Speciality Metals or the Company) is pleased to announce its resource redefinition of high-grade tungsten envelopes at its Mt Carbine project in Queensland, identified over a 1.2km strike length (open along strike in a westerly direction, see Figure 1).

REGISTERED OFFICE: Office 06-110, Level 6 25 King Street, Bowen Hills Queensland 4006

PRINCIPAL PLACE OF BUSINESS: 6888 Mulligan Highway, Mt Carbine Qld 4871

POSTAL ADDRESS: PO Box 1496, Mareeba Qld 4880

T: [phone] F: [phone] W: specialitymetalsintl.com.au

Page 1 of 10

Speciality Metals CEO and Snr.Technical Advisor Kevin MacNeill commented, "These latest results have expanded our understanding of an economically viable underground project at Mt Carbine. What has always been of interest was the historical miner's ability to produce significant quantities of tungsten by mining these high-grade veins. The veins have now been traced through the deposit within the Dyke West extension and provide us with an alternative mining concept currently under review. The mining of such high-grade veins, in combination with the already existing processing infrastructure, has the potential to make Speciality Metals a world class and low-cost tungsten producer."

Based on the total of 154 intercepts from the 43 historical drill holes, the Company is evaluating the underground development potential for a narrow high-grade mine to extract 'King-Vein' style mineralisation which is defined using a minimum mining width and grade of 2m>0.2% WO3. This allows for less dilution when compared to the previously defined sub-level caving methodology proposed by historical owners in 1985 for which a 430m decline was constructed at the time. Upon relogging the historical core and the assaying of certain sections for reinterpretation, it has been revealed that most of the mineralisation is contained in these high-grade veins, leading to the potential of a much higher- grade resource enclosed in less tonnage.

For the purpose of this investigation, the ore body was divided into two zones called the 'Main Pit' and 'Dyke West' reflecting their respective locations relative to the underground location of the historical open pit: the Main Pit Zone is situated beneath the historical pit, while the Dyke West Zone is located in the unmined area extending west of the pit.

Both zones show high-grade intervals, extending for 750m and 450m strike length, respectively. Each zone contains multiple veins and reflect the current opinion that the mineralisation occurs in 0.1-3.0m wide 'King-Veins' which are interpreted as the last liquid phase event of mineralisation at Mt Carbine in comparison to an earlier more pervasive gaseous event that distributed a lower grade mineralisation over a wider area.

By relogging the historical core, the Company has identified the corridors that belong to these intercepts. More than 30 veins have been identified in the core and old workings in this review area alone, including the five (5) major veins named in the section below. These names reflect the historical miners' names for the major lodes mined to 60m depth during the period from 1890 to 1940.

Main Pit Zone

This zone of 750m strike length is the center of the mineralisation and is located immediately below the historical pit. It has the highest grade and width intervals in the currently known vein system at Mt Carbine. Central in this historical pit was the old 'main shaft' which targeted the depth extents of the Bluff Vein. Here the high-grade ore zone reaches true widths of 9m with significant wolframite mineralisation (for example as seen in CB001 from 127.8m - 139m comprising of 11.2m @ 2.9% WO3). The five (5) major veins encountered in the Main Pit Zone are Iolanthe, Bluff, Wayback, Johnson and Dazzler which all contain high-grade shoots above 1% grade and were the focus of the past underground activity by the historical miners. It is now understood that this pattern of high-grade mineralisation has its own structural controls and overprints a more pervasive lower grade style of mineralization.

Dyke West Zone

This area has not been included in previous underground examinations and extends the deposit for a further 450m over the flats to west of the Main Pit Zone. Three (3) main veins were intersected in the 430m decline. These veins were noted for their high-grade and persistent nature and have been

linked to extensions for the Iolanthe, Bluff	and Johnson Veins which host by far most	of
the mineralisation at Mt Carbine (thought to	contain more than 50% of the known tungsten	in
the deposit).

The Dyke West Zone is advantageous for the Company as the veins are accessible from the decline that is already in place.

Page 2 of 10

Open

Figure 1 - Extent of veining traced for 1.2km from 22,000E to 23,200E

Page 3 of 10

Figure 2 - Composite of the 5 major vein sections traced in the historical drilling over a strike of 1.2km

The Company expects to be able to release further information on the underground testing and development plan in the near future. The anticipated next steps will see the submission of the Facility Document to the Department of Natural Resources, Mines & Energy to allow the Company to re-enter the historical decline. Evaluation of the decline would the take place along with sampling underground.

Open at Depth

Figure 3 - 22850E Cross section of Main Zone showing the multiple tungsten lodes and their WO3 % grades, refer to Table 1 for additional details

Page 4 of 10