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Pebbly Hills Competent Person Report.

Competent Persons Report (“CPR”) compiled for PHP based on historical and new data by Camden Geoserve.

13th March 2017, the CPR was completed by Mr PM Camden-Smith, a Consultant Geologist and Dr NG Powell, a professional Geologist and presented to the Directors. A decision was made to work towards preparing a Bankable Feasibility study (“BFS”) for the mining of Silica Feedstock.

Mining Scenario's Analysed

A simple model that includes the exportation of 150,000 tonnes per annum of raw +6.75 mm mined and screened product at the PHP aggregate quarry to a country in need of FeSi feedstock and/or feedstock for high grade silicon metal feedstock. It is assumed that material could be purchased at the Bluff Harbour FOB for USD 59.60 per tonne (Rogue Resources estimate). Only high confidence Indicated Resources are considered at this stage in Scenario 1.

Envisages a mining rate to cater for the delivery of 300,000 tonnes of +6.75 mm material per year to produce ferrosilicon (FeSi) at a furnace facility in Southland. At steady state, the FeSi produced will be approximately 157,500 tonnes per annum (tpa).

The Canadian Metals Inc. Langis ferrosilicon project operations were deemed an appropriate comparative example to that of PHP. Obvious differences occur, for example hard rock quartzite mining at Langis requires blasting and crushing and mining using conventional mine equipment (i.e. trucks, excavator, graders, drill rigs, bulldozer, service vehicles) while at PHP a free dig with tractor pull scrapers will predominate the mining methodology.

Indicated Resources and a thirty percent proportion of Inferred Resources are assumed in Scenario 2. For Scenario 2 a doubling of the factors (i.e. equipment, costs, rehabilitation, and infrastructure) used for scenario 1 was applied. Clearly this is a conservative approach but was applied based on the strict rule of expansion based on modular repetition. For an example during the Feasibility stage it might be found that the Bluff harbour cannot cater for FeSi production but may be suitable for Scenario 1 raw product output only. Scenario 2 FeSi envisaged production could still be implemented with a FeSi plant being located, say near the harbour at Dunedin, Otago.

Visualises an ‘economies of scale scenario’ that at steady state will be mined at a rate such that 600,000 tonnes per annum of +6.75 mm feedstock that will be delivered to modular furnaces in Southland and Otago. At steady state the FeSi produced will be approximately 315,500 tonnes per annum. The entire +6.75mm product stated in the 2017 resources (i.e. both Indicated and Inferred resources) are included in Scenario 3. A comparable project is that of Polaris Minerals Corporation -a well-established supplier of high quality sand and gravel aggregates to Hawaii and northern California. The source is from the Orca Quarry based on Vancouver Island. Orca Quarry has steadily increased its throughput of screened aggregate product from 0.7 million tonnes in 2008 to 2.1 million tonnes in 2015 to 2.3 million tonnes in 2016. It is a high tonnage producer and as such its ‘economies of scale’ key performance indicators are appropriate to consider in the PHP high volume option -Scenario 3 where total material mined (TMM) per year will exceed 1.1 million tonnes.