Speciality Metals International Limited Annual Report 2020

Speciality Metals International Limited Annual Report 2020 5 The 2020 financial year has been a transformative year for Speciality Metals and its flagship projects at Mt Carbine in Far North Queensland. Highlights The 2020 financial year has been a transformative year for Speciality Metals International Limited ( Speciality Metals or the Company ) and its flagship projects at Mt Carbine in Far North Queensland. The highlights in the year were: − the successful integration of Mt Carbine quarrying operations ( Mt Carbine Quarries ) into the Speciality Metals Group, following the 100% acquisition of Mt Carbine Quarries Pty Ltd on 28 June 2019; − the start of the Company’s transition from a junior explorer to an emerging producer with the commencement of production at the refurbished Mt Carbine Retreatment Plant, operated under an unincorporated joint venture between Speciality Metals and CRONIMET Australia Pty Ltd and various trial shipments to leading tungsten consumers in Asia, Europe and the US; − establishment of a new multi-disciplinary leadership team to allow the Company to seize the opportunities arising from the increasing focus in the resources industry on environmental, social and governance (ESG) performance; − the initiation of major expansion activities at Mt Carbine Quarries to grow the business as a steady source of revenue and secure fulfilment of large orders, such as the $4 million purchase order received from Bama Civil Pty Ltd to provide road base for a major road construction project in Far North Queensland; and − continuation of the detailed geological review and reinterpretation of data at Mt Carbine to identify high- grade veins traced to depth labelled as “King Veins” for next phase, underground mining. A review of the Company’s operating and financial activities for the 2020 financial year up until the date of this report is set out in this section. Mt Carbine Project Timeline The Company has continued to develop the operational and execution strategy for its Mt Carbine assets. The below timeline was prepared to take into account the environmental permitting requirements, setting out major milestones for the Environmental Authority (EA) amendment process to increase production capacity from 300,000tpa to 1,000,000tpa by Q2 2022. The Company’s assessment of EA amendment requirements was commenced in Q2 2020 (refer to ASX announcement Quarterly Activities Report and Cashflow Report released on 29 July 2020). PROJECTS GANT CHART/TARGET SCHEDULE 1 All projects now running at increased capacities under revised EA Q1 Q2 Q3 Q4 Q4 2022 2021 Q1 Q2 2020 Q3 Q3 - Onward Commence Ph1 - Pilot Plant Test Program XRT Pilot Plant Conversion to full time operation @300,000tpa & quarry project pipeline development while the Amendment is completed on the EA to increase to a total of 1,000,000tpa Continued operation of Mt Carbine Retreatment Plant and ongoing development of the quarry project pipeline and marketing development in line with infrastructure targets and specialised products Mt Carbine Project Timeline Operating and Financial Review