Mayur Resources : Quarterly Activities and Cash Flow Report

Quarterly Report

For the quarter ending 30 June 2022

only
mayurresources.com
use
Highlights
Mayur Renewables
personal
• Signed Expression of Interest (EOI) with Santos Limited
	(ASX:STO) to jointly develop Mayur's portfolio of nature-
	based forestry carbon credit projects in PNG with
	negotiations underway to agree binding documentation
• US$3 million financing facility provided by Santos to fund
	ongoing detailed feasibility and landholder consent work
	on the Carbon Projects
• Completed further community visits to the initial carbon
	project areas in Western Province as part of 'free and
	prior informed consent' (FPIC) process
• Progressed the feasibility study for the initial project
	areas to identify the potential carbon credits available
For	and the approach to project design and verification

Ortus Resources

• Completed all pre-IPO activities for proposed IPO of Ortus Resources Limited on the ASX with which to raise capital to bring Orokolo Bay project into production

• IPO on hold due to equity market volatility and renewed interest from parties to fund privately

• Signed binding off take agreement with Shinebest for magnetite product from the Orokolo Bay project

• Site early works progressed at Orokolo Bay under supervision of strategic investor and in-country project delivery partner, HBS

Mayur Cement and Lime

• Completed an enhanced and expanded DFS for Phase 1 of Central Cement & Lime Project (CCL) to produce limestone, quicklime & hydrated lime
• Prioritisation of Phase 1 to reduce the near-term capital needs of CCL and provide a pathway to earlier cashflow
• Phase 1 to focus on high-quality lime products for use in a range of industries including future facing minerals
• Phase 1 DFS outputs include a post-tax NPV (8%) of US$133.5 million and IRR of 24.4%
• Strategic JV equity partner and project financing discussions for CCL are continuing

Corporate

• Cash balance at 30 June 2022 of A$3.1 million.

provide projects of sufficient scale to establish standalone carbon and renewables-basedopportunities directly addressing the race to decarbonize and achieve net-zerotargets by both governments and private industry;

directly assist Mayur's "nation building projects" in PNG by providing a pathway to net zero through the establishment of renewable energy and carbon offsets projects for its proposed lime and cement business; and

align and enhance broader ESG commitments and respond to the needs of future downstream building materials customers.

1 Mayur Resources Quarterly Report 30 June 2022

Mayur Renewables

onlyMayur Renewables was established to :

•

•

use•

Mayur Renewables continues to develop its portfolio of carbon credit projects, involving the reclassification,

protection and preservation of highly biodiverse threatened

personalrainforest with a plan to to generate high-quality nature- based forest carbon offsets.

EOI executed with Santos

An Expression of Interest (EOI) was signed with Santos Limited to jointly develop Mayur's portfolio of nature-based carbon offsets projects in PNG.

The Carbon Projects focus on preserving 1.4 million hectares of pristine and biodiverse rainforest in PNG through avoided deforestation.

Negotiations are underway with Santos to agree binding documentation for the future commercialisation of the Carbon Projects contingent on executing Transaction Documents along with remaining confirmatory due diligence.

In addition to the above, a US$3 million financing facility has been provided by Santos to fund ongoing detailed feasibility

Forand landholder consent work on the Carbon Projects. Santos has a long and active history in PNG with a significant investment in the PNG LNG mega project and the development of the Papua LNG and P'nyang projects.

Nature based Carbon forestry offsets

Solar

Geothermal

Carbon Forestry Permits

As announced on 21 July 2022, Mayur received a notice from the PNG Forest Authority (PNGFA) that timber permit carbon concessions have been cancelled. Mayur has obtained legal advice and will be vigorously challenging the notices through applicable legal processes. Mayur shall continue its carbon offset projects in all the areas covered by its legally binding agreements as it already has Landowner consent, Local Governor written support and Climate Change Development Authority approval.

Mayur is also continuing with its feasibility work to understand the number of credits available in the project areas together with the most appropriate carbon verification methodology that will be subject to independent audit.

Further Community Awareness Trip Completed

As a follow up to the initial trip conducted earlier in the year, Mayur conducted another field trip to the 3 carbon project areas located in Western Province covering approximately 800,000 hectares to conduct community awareness as part of the FPIC (free and prior informed consent) process.

Information was provided on carbon offsets and the benefits this can bring to the community. This included explaining the range of positive outcomes of preserving the forests in their living state (rather than allowing them to be destroyed via logging or clearing) for PNG, the landowners and the forest communities.

Refer to next page for photos of the July 2022 field trip.

2 Mayur Resources Quarterly Report 30 June 2022

Nature based Carbon forestry offsets

Mayur Renewables team conducting community awareness to Mayur's proejct areas in Western Province (July 2022)

onlyuseMayur team travelled via light aircraft to access the remote communities in Westrn Province (July 2022)

personalPhotos of the Wawoi Falls located in Mayur's project areas - home to some of PNGs most pristine rainforest (July 2022) For

3 Mayur Resources Quarterly Report 30 June 2022

Nature based Carbon forestry offsets

Mayur Renewables - carbon credit project development plan:

onlyuse personalMayur Renewables - alignment with ESG principles: For

Above extracted from Mayur Renewables Carbon credits and renewable energy presentation released on 20 June 2022.

4 Mayur Resources Quarterly Report 30 June 2022

Mayur Cement and Lime

Central Cement & Lime Project

onlyThe proposed Central Cement and Lime Project (CCL) is a vertically integrated manufacturing facility with the ability to meet 100% of PNG's cement, clinker and quicklime requirements, displacing imports into PNG, and to penetrate nearby export markets in Australia and the South Pacific. The co-located quarry, plant site and deep draft wharf will enable very low operating costs. CCL is also seeking to become Asia

usePacific's first carbon-neutral Cement and Lime producer. DFS for Quicklime production facilities (CCL Phase 1)

Prioritised and expanded 400ktpa quicklime/hydrated lime plant (doubling the 200ktpa capacity from the 2019 DFS), and additional 500ktpa of raw limestone production with wharf and associated infrastructure. The Updated DFS for CCL Phase

1 demonstrates that project phasing yields:

• A significantly lower upfront capital requirement;
• High economic viability;
• Rapid delivery of quicklime product into an escalating price and demand environment; and
• A swifter pathway to cashflow generation.

personalF r more information refer to ASX release dated 26 July 2022. For

Quicklime DFS - CCL Phase 1 - Key Highlights

• Construction of twin-kiln 1,200 tonne per day combined manufacturing capacity
• Annual production of 400 kt quicklime and hydrated lime plus 500 kt raw limestone
• Planned production from Phase 1 supported by various arrangements with high quality offtake customers
• Scaled infrastructure for Phase 1 includes wharf, power station and access road
• Capital cost estimate of US$91.03 million
• Attractive CCL Phase 1 projected economics:
  o Post-tax revenue US$1,518 million and EBITDA US$771 million over 30-year project life
  o Post-tax NPV (8%) US$133.5 million and IRR of 24.4%
• Special Economic Zone (SEZ) status granted providing a range of tax and fiscal incentives
• Mining Lease and Environment permit granted with support from State and Provincial Government
• Enhanced social attributes with community projects and engagement well advanced
• Dual fuel kiln design adopted to enable lower emissions and mitigate fuel risk exposure
• Hybrid power station - future option to provide up to 40% of electrical load via renewable solar generation
• Access to nature-based carbon offsets (originated from within PNG via Mayur Renewables ) to offset hard-to- avoid emissions and provide customers with net zero products from CCL
• CCL Phase 2 targeting 1.65 Mtpa clinker and 907.5 ktpa cement grinding capacity to proceed subsequently

CCL Phase 1

CCL Phase 2

Central Cement & Lime Project proposed layout. 3D model for indicative purposes only.