TNG : Project Development Update

ASX ANNOUNCEMENT

		14 February 2022
only		MOUNT PEAKE PROJECT: DEVELOPMENT UPDATE
	Key Points
•	TNG continues to advance engineering, permitting, development planning and commercial work streams
	for its flagship 100%-owned critical and battery minerals project, the Mount Peake Vanadium-Titanium-
	Iron Project ("Mount Peake Project" or "Project"), in the Northern Territory.
•	Work undertaken by Clough Projects (Clough) is progressing Stage 2 of the design and value engineering
	for the integrated mining and processing operation at the Mount Peake mine site ("Mine Site"), together
use		with TNG's Project Team and SMS group.
•	The value engineering and design stage is progressing on schedule and is expected to be completed by
		Clough by the second quarter of 2022.
	•	SMS is working to complete any outstanding validation testwork that had been delayed last year due the
		global COVID-19 restrictions.
	•	Hydrogen reduction testwork is currently underway as a suitable replacement for the solid reductant in
personal		the current flowsheet. This will further reduce the carbon footprint of the Mount Peake Project and put
	TNG in a strong position to meet the zero emissions target by 2050.
•	Non-process infrastructure requirements for the integration of the Project at the Mine Site are also well
		advanced and potential Build Own Operate and Build Own Operate Transfer ("BOO/BOOT proponents are
		being targeted.
	•	A program of water bore drilling is planned to commence in early April in order to confirm additional water
		supply for the integrated Mount Peake Project mining operation, beneficiation plant and TIVAN®
		processing facility.
	• TNG has progressed discussions with its major contractors, including SMS and Clough, to revise and update
		the project execution model. This includes a detailed review of the contracting strategy for delivery of both
		the processing plants and NPI, early contractor involvement strategies, BOO/BOOT" planning, and the
		project management structure.
	•	The Company is advancing on a number of technical fronts in order to obtain the information required for
		the submission of a revised environmental impact report for the integrated Project, following consultation
		with the Northern Territory Environmental Protection Authority ("NT EPA").
For	•	Commodity Markets: Global demand for titanium dioxide and vanadium pentoxide continue to be strong,
	with market prices expected to increase during the year.

Australian resource and mineral processing technology company TNG Limited (ASX: TNG) ("TNG" or the "Company") is pleased to provide an update on the key workstreams being undertaken for the delivery and development of its

100%-owned Mount Peake Vanadium-Titanium-Iron Project ("Mount Peake Project" or "Project"), located in the Northern Territory.

MOUNT PEAKE PROJECT OVERVIEW

The Mount Peake Project is the Company's flagship project, comprising a world-scale critical and battery minerals deposit located 235km north-west of Alice Springs. The Project is well located close to existing key power and transport infrastructure corridors including the Alice Springs-Darwin Railway and the Stuart Highway.

Mount Peake is a shallow, flat-lying orebody with a JORC Measured, Indicated and Inferred Resource totalling 160 million tonnes grading 0.28% V2O5, 5.3% TiO2 and 23% Fe. The Mount Peake Project is one of the largest undeveloped vanadium-titanium-iron projects in the world.

ASX CODE: TNG	REGISTERED OFFICE	T [phone]	W www.tngltd.com.au
ABN 12 000 817 023	Suite 20, 22 Railway Road	F [phone]	E [e-mail]
	Subiaco, Western Australia 6008

The establishment of a new high-tech, value-addingprocessing industry for titanomagnetite ore of the

world-firstcommercialisation of the TIVAN® Process; and

The potential establishment of green hydrogen production and Vanadium Redox Flow Battery (VRFB) businesses.

TNG has life-of-minebinding off-takeagreements in place for 100% of all products proposed to be produced from the Mount Peake Project with strong off-takecounterparties with a multi-nationalpresence.

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Improvement in trade balances and the generation of various taxes, levies and royalties from development and operations.

Underpinning the potential development of new NT Government infrastructure (e.g., utilities).

Positive flow-oneffects of project construction and operational personnel using the services and/or facilities of local businesses.

Up-skillingof the local workforce and opportunities for Indigenous engagement.

Figure 1. Mount Peake Project Location Plan in the Northern Territory.

The Company's strategy for the Mount Peake Project is to develop a fully-integratedsingle mining and processing operation to produce three high-value, high-purityproducts for export - vanadium pentoxide (V2O5), titanium dioxide pigment (TiO2) and iron oxide (Fe2O3) - through the application of a world-firstprocessing technology, known as the TIVAN® Process, which is owned exclusively by TNG. Vanadium and titanium have been identified by the Australian Government as critical minerals required to make advanced technologies that will support the

global push for decarbonisation. onlyuse

personalThe Mount Peake Project has been awarded Major Project Status from both the Australian Federal Government and the Northern Territory Government due to the significant economic and social benefits it is expected to deliver

to the Northern Territory and Australia, including: For

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This work is expected to be completed by May 2022.

extract mechanical general arrangement and elevation drawings for the integrated Project; and update the water balance for the integrated Project.

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prepare updated drawings detailing the Mine Site, access road, accommodation village and key infrastructure;

prepare an updated Navisworks 3D model;

develop a project implementation schedule;

source pricing for major mechanical and electrical equipment;

update the major electrical equipment list for transformers and sub-stations;

develop single line diagrams;

update the mechanical equipment list;

update water usage and demand;

update power usage and demand;

update overall Beneficiation Plant and TPF layout;

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Figure 2: TNG's new Mount Peake Project integrated operation layout (south-eastview)

Australian engineering and construction company, Clough Projects Australia Pty Ltd ("Clough"), is advancing the Stage 2 design and value engineering works for the integrated Mount Peake Project, which comprises a Beneficiation Plant, TIVAN® processing facility (including a Pigment Plant) ("TPF") and plant utilities located within

onlythe Mining Lease footprint of Mount Peake mine site ("Mine Site").

This phase of works follows the completion of an integrated layout by Clough, which was based on the deliverables prepared under the Front-EndEngineering and Design ("FEED") study completed by SMS group ("SMS").

usepersonalClough has assembled a team of specialists for the Mount Peake Project encompassing Process, Mechanical, Electrical, Procurement, and schedule planning in order to rapidly complete the following scope of work:

For

PROJECT DEVELOPMENT Engineering and Design

Materials handling logistics to and from the Mount Peake Mine Site are being evaluated, capitalising on previously completed logistics studies for transport between the Mine Site and Darwin.

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Value Engineering

Additional communication requirements are being evaluated as a result of the combined mining and processing workforce at the Mine Site.

Downstream processing and production of the three end products will now occur at the Mine Site.

Costs received

The rationalisation and combination of the TIVAN® Processing Facility and Beneficiation Plant will deliver operational synergies which are expected to result in a reduced overall workforce for the Project.

This proposal requires no capital investment by TNG and is a turnkey package.

Value Engineering

An expanded village will be required to support the combined mining and processing workforce, which will require increased catering services at the Mine Site.

Drilling and Water Extraction Licence

Upgraded design requirements under review.

Refer to Water Bore Drilling Program section of this announcement.

Value Engineering

The rationalisation and combination of the TIVAN® Processing Facility and Beneficiation Plant will deliver operational synergies which are expected to result in a reduced overall workforce for the Project.

Haul road will also now be the main access road.

Value Engineering

An expanded village will be required to support the combined mining and processing workforce at the Mine Site.

Current Status

Details

Validation Testwork

Validation testwork that had been delayed due to the global COVID-19 restrictions affecting workforce availability of SMS staff and the procurement of materials to undertake the testwork is underway.

The validation testwork is being carried out in Australia and Austria, with completion expected to occur in the coming months.

onlyHydrogen Reductant

TNG has assessed opportunities within the Project and the processing flowsheet to reduce the overall net carbon footprint. This includes an ongoing technical and commercial assessment of the use of hydrogen reductant in the current flowsheet. Hydrogen reduction testwork is underway, running in parallel to the current engineering and design work as a potential optimisation initiative.

Non-Process Infrastructure ("NPI")

The new integrated mining and processing operation at the Mount Peake mine site has provided the opportunity usefor consolidation of a number of infrastructure items including power generation, gas supply and communications

installations.

The NPI will require upgrading in a number of areas to support a larger operation, including tendering for village accommodation, camp catering and borefield (water supply).

The Company's Project Team is exploring Build Own Operate and Build Own Operate Transfer ("BOO/BOOT") arrangements, having previously engaged, tendered and shortlisted several proponents and reviewing the NPI for

the Project including updated design and tendering processes as required. The key NPI work streams include:

personalItem

Village

Accommodation

Haul Road

Borefield

Camp Catering

ForCommunications

Materials Handling

Logistics

The Project Team is progressing with rationalised power supply at the Mine Site, with a single power station requirement.

Power & Gas	Tendered and	Independent power providers previously tendered for two separate
	shortlisted	Build-Own-Operate contracts for the provision of power supply by
		way of gas fired power stations - for each of the Mine Site and
		Darwin Site.

onlyIn April 2021, TNG's hydrogeological consultants submitted a water extraction licence application ("WELA") for

Water Bore Drilling Program

water supply for the mine site and Beneficiation Plant requirements. This approval is expected imminently.

With the expanded operation, additional water supply will also be required and new program of water bore drilling ("Program") is planned to commence in early April 2022 to establish the availability of additional water supply for the integrated operation. The Program was originally scheduled to start in early March 2022, however it has been

usedelayed due to recent flooding of the areas to be drilled, which has restricted access.

The program, which will be supported by bore pump testing and aquifer modelling and reporting will allow an additional WELA to be submitted. This information will also allow pipeline and water distribution design works and infrastructure to be updated, as well as support and inform the environmental assessment report which is currently in progress.

PROJECT EXECUTION MODEL

The Company has progressed the project execution model to support the delivery of an integrated and mining and

personalprocessing operation at the Mine Site.

TNG is assessing revised proposals from SMS and Clough for the delivery of the Mount Peake Project, while retaining production and product quality guarantees for the downstream processing operation.

The process to update the project execution schedule includes a detailed review of the contracting strategy for delivery of both the processing plants and NPI, early contractor involvement strategies, Build Own Operate and Build Own Operate Transfer ("BOO/BOOT") planning, and project management structure.

The Company expects to finalise a revised project execution model in the coming months.

PERMITTING AND APPROVALS

Environmental

The Northern Territory Environmental Protection Authority ("NT EPA") Referral document for the Mount Peake Processing Project under the Environment Protection Act 2019 indicates that various technical studies require updating as part of the integrated Mount Peake Project, including the following areas:

	•	Biological Surveys
For	• Groundwater and Surface Water Assessments
•	Air Quality Assessment
• Greenhouse Gas Assessment and Management Plan
•	Noise Impact Assessment
•	Waste Characterisation and Landform Design
	•	Traffic Impact Assessment
	•	Stakeholder Engagement Strategy
	•	Mine Closure Plan

Scopes of work for the technical studies were developed following consultation with the NT EPA and work has been progressing on these studies with relevant information from the previous Environmental Impact Statement documents for the Mine Site and the Darwin site being utilised to support the updates, where applicable.

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