Sylvinite resource is 'open' laterally

The Inferred Sylvinite Mineral Resource stands at 340 Mt grading 34.0% KCl, mostly hosted by the Upper and Lower Seam. Additional seismic data would be required to potentially upgrade this material into the Indicated category. Beyond this, the deposit is 'open' laterally to the east, southwest and south.

The potash seams

The Measured and Indicated Mineral Resource is hosted by four seams which are flat to gently dipping (mostly less than 15 degrees). From uppermost these are: The Hangingwall Seam (HWS), Upper Seam (US) and Lower Seam (LS), as shown in Figure 2. The seams are hosted within a thick package of rock-salt. The lower Footwall Seam (FWS) is an Inferred resource restricted to relatively narrow zones and will not be considered for mining. Figures 24 to 27 of Appendix 1 show the distribution of the Sylvinite in plan-view. The bulk of the Measured and Indicated Mineral Resource is hosted by the Upper Seam (representing 64% of the contained potash) which is largely continuous across the deposit and has an average thickness of 4.0 metres. The Sylvinite HWS and LS have an average thickness of 3.3 and 3.7 metres, respectively. The Sylvinite is present in broad zones with a dominant northwest-southeast orientation.

If present, Carnallitite occurs below the Sylvinite, within the seams. Contacts between the Sylvinite and Carnallitite are always abrupt and the two rock types are not inter-mixed, supporting a clear distinction in the resource model and ultimately in the mine plan. A large Carnallitite Mineral Resource estimate was also prepared (Table 9 in Appendix 1) but is not considered for extraction.

The increased data available for the resource update enabled inclusion of 30 Mt of HWS into the Measured and Indicated Mineral Resource. At more than 55% KCl, Sylvinite of the Hangingwall seam (HWS) is a candidate for the world's highest grading potash seam.

Resource model and estimate

The Mineral Resource Estimate was prepared by independent resource industry consultants Met-Chem division of DRA Americas Inc., a subsidiary of the DRA Group - and reported in accordance with The Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the "JORC Code", 2012 edition). Appendix 1 provides the required 'Checklist of Assessment and Reporting Criteria'. Kore undertook interpretation of the potash layers and other stratigraphic units and contacts in conjunction with the MSA Group of Johannesburg.

The deposit modelling took advantage of the high quality of seismic data, acquired by the Company in 2010 and 2011 and subsequently re-processed to a high standard in 2016 by DMT Petrologic GmbH of Germany. The new seam model and classification approach was driven by the drill-hole and re-processed seismic data.

The Sylvinite model was developed by quantitative analysis of seam position relative to the top of the Salt Member and to zones of relative salt disturbance (RDS). The resulting model is illustrated in Figure 2. The small (<5%) reduction in contained potash in the Measured and Indicated Mineral Resource versus the 2012 estimate is primarily a result of a reduction in the extent of the Indicated Mineral Resource envelope and by the application of a dip-correction to the seam model. Structurally anomalous areas have been removed from the resource. Further description of the resource model and estimate is provided in Appendix 1.

Figure 2. Typical Cross section through the Kola deposit showing the potash seams and main stratigraphic units.

Note: the 'S' or 'C' after HWS, US, LS, FWS denotes Sylvinite or Carnallitite.

The Mineral Resource is supported by a large number of cored drill-holes. In total, the Company has drilled 52 holes at Kola, of which 46 reached target depth, and 42 contained significant Sylvinite mineralization, as listed in Table 6 of Appendix 1. Holes EK_46 to EK_52 were drilled after the effective date of the 2012 Mineral Resource estimate.

ADDITIONAL INFORMATION - MATERIAL INFORMATION SUMMARY - LISTING RULE 5.8.1

Geological Interpretation

Recognition and correlation of potash and other important layers or contacts between holes is straightforward and did not require assumptions to be made, due the continuity and unique characteristics of each of the evaporite layers; each being distinct when thickness, grade and grade distribution, and stratigraphic position relative to other layers is considered. Further support is provided by the reliable identification of 'marker' units within and at the base of the evaporite cycles. Correlation is further aided by the downhole geophysical data (Figure 18) clearly shows changes in mineralogy of the evaporite layers and is used to validate or adjust the core logged depths of the important contacts. The abrupt nature of the contacts, particularly between the Rock-salt, Sylvinite and Carnallitite contributes to above.

Between holes the seismic interpretation is the key control in the form and extent of the Sylvinite, in conjunction with the application of the geological model. The controls on the formation of the Sylvinite is well understood and the 'binary' nature of the potash mineralization allows an interpretation with a degree of confidence that relates to the support data spacing, which in turn is reflected in the classification. In this regard geology was relied upon to guide and control the model, as described in detail in Appendix 1, section 3.5. Alternative interpretations were tested as part of the modeling process but generated results that do not honor the drill-hole data as well as the adopted model.

The following features affect the continuity of the Sylvinite or Carnallitite seams, all of which are described further in Appendix 1, Section 3.5. By using the seismic data and the drill-hole data, the Mineral Resource model captures the discontinuities with a level of confidence reflected in the classification.

•           where the seams are truncated by the anhydrite

•           where the Sylvinite pinches out becoming Carnallitite or vice versa

•           areas where the seams are leached within zones of subsidence

Outside of these features, grade continuity is high reflecting the small range in variation of grade of each seam, within each domain. Further description of grade variation is provided in Appendix 1.

Sampling Techniques

Sampling was carried out according to a strict quality control protocol beginning at the drill rig. Holes were drilled to PQ size (85 mm core diameter) core, with a small number of holes drilled HQ size (63.5 mm core diameter). Sample intervals were between 0.1 and 2.0 metres and sampled to lithological boundaries. All were sampled as half-core except very recent holes (EK_49 to EK_51) which were sampled as quarter core. Core was cut using an Almonte© core cutter without water and blade and core holder cleaned down between samples. Sampling and preparation were carried out by trained geological and technical employees. Samples were individually bagged and sealed.

A small number of historic holes were used in the Mineral Resource model; K6, K18, K19, K20, K21. K6 and K18 were the original holes twinned by the Company in 2010. The grade data for these holes was not used for the Mineral Resource estimate but they were used to guide the seam model. The 2010 twin hole drilling exercise validated the reliability of the geological data for these holes (see Appendix 1, section 1.7).

Sub-sampling techniques and sample preparation

Excluding QA-QC samples 2368 samples were analysed at two labs in 44 batches, each batch comprising between 20 and 250 samples. Samples were submitted in 46 batches and are from 41 of the 47 holes drilled at Kola. The other 6 drill-holes (EK03, EK_21, EK_25, EK_30, EK_34, EK_37) were either stopped short of the evaporite rocks or did not intersect potash layers. Sample numbers were in sequence, starting with KO-DH-0001 to KO-DH-2650 (EK_01 to EK_44) then KO-DH-2741 to KO-DH-2845 (EK_46 and EK_47).

The initial 298 samples (EK_01 to EK_05) were analysed at K-UTEC in Sondershausen, Germany and thereon samples were sent to Intertek- Genalysis in Perth. Samples were crushed to nominal 2 mm then riffle split to derive a 100 g sample for analysis. K, Na, Ca, Mg, Li and S were determined by ICP-OES. Cl is determined volumetrically. Insolubles (INSOL) were determined by filtration of the residual solution and slurry on 0.45 micron membrane filter, washing to remove residual salts, drying and weighing. Loss on drying by Gravimetric Determination (LOD/GR) was also competed as a check on the mass balance. Density was measured (along with other methods described in section 3.11) using a gas displacement Pycnometer.

Drilling Techniques

Holes were drilled by 12- and 8-inch diameter rotary Percussion through the 'cover sequence', stopping in the Anhydrite Member and cased and grouted to this depth. Holes were then advanced using diamond coring with the use of tri-salt (K, Na, Mg) mud to ensure excellent recovery. Coring was PQ (85 mm core diameter) as standard and HQ (64.5 mm core diameter) in a small number of the holes.

Classification

Drill-hole and seismic data are relied upon in the geological modelling and grade estimation. Across the deposit the reliability of the geological and grade data is high. Grade continuity is less reliant on data spacing as within each domain grade variation is small reflecting the continuity of the depositional environment and 'all or nothing' style of Sylvinite formation.

It is the data spacing that is the principal consideration as it determines the confidence in the interpretation of the seam continuity and therefore confidence and classification; the further away from seismic and drill-hole data the lower the confidence in the Mineral Resource classification, as summarized in Table 2. In the assigning confidence category, all relevant factors were considered, and the final assignment reflects the Competent Persons view of the deposit.

Table 2. Description of requirements for the maximum extent of the

Measured, Indicated and Inferred classifications

Sample Analysis Method

Quality of Assay Data and Laboratory Tests

For drill-holes EK_01 to EK_47, a total of 412 QAQC samples were inserted into the batches comprising 115 field duplicate samples, 84 blank samples and 213 certified reference material (CRM) samples. Duplicate samples are the other half of the core for the exact same interval as the original sample, after it is cut into two. CRMs were obtained from the Bureau of Reference (BCR), the reference material programme of the European Commission. Either river sand or later barren Rock-salt was used for blank samples. These QA-QC samples make up 17% of the total number of samples submitted which is in line with industry norms. Sample chain of custody was secure from point of sampling to point of reporting.

As confirmation of the accuracy of the API-derived KCl grades for EK_49 to EK_51, samples for the intervals that were not taken for geotechnical sampling, were sent to Intertek-Genalysis for analysis. The results are within 5% of the API-derived KCl and thickness, and so the latter was used.

Verification of Sampling and Assaying

As described in Appendix 1, section 1.6, 40 samples of a variety of grades and drill-holes were sent for umpire analysis and as described, these support the validity of the original analysis. Other validation comes from the routine geophysical logging of the holes. Gamma data provides a very useful check on the geology and grade of the potash and for all holes a visual comparison is made in log form. API data for a selection of holes (EK_05, EK_13, EK_14, EK_24) were formally converted to KCl grades, an extract of which is shown in Figure 3. In all cases the API derived KCl supports the reported intersections.

Figure 3. Example of KCl % from laboratory analysis (bars) compared with KCl grades from API data.

Validation of historic drilling data

As mentioned above; K6, K18, K19, K20, K21 were used in the geological modelling but not for the grade estimate. K6 and K18 were twinned in 2010 and the comparison of the geological data is excellent, providing validation that the geological information for the aforementioned holes could be used with a high degree of confidence.

Estimation and Modelling Techniques

Table 4 and Table 5 provide the Mineral Resource for Sylvinite and Carnallitite at Kola. This Mineral Resource replaces that dated 21 August 2012, prepared by CSA Global Pty Ltd. This update incorporates reprocessed seismic data and additional drilling data. Table 10 and Table 11 provide the Sylvinite and Carnallitite Mineral Resource from 2012. The updated Measured and Indicated Mineral Resource categories are not materially different from the 2012 estimate and is of slightly higher grade. The Inferred category has reduced due to the reduction in the FWSS tonnage, following the updated interpretation of it being present within relatively narrow lenses that are more constrained than in the previous interpretation. There is no current plan to consider the FWSS as a mining target and so the reduction in FWSS tonnage is of no consequence to the project's viability.

Table 4. June 2017 Kola Mineral Resources for Sylvinite,

reported under JORC code 2012 edition, using a 10% KCl cut-off grade.

Notes: Tonnes are rounded to the nearest hundred thousand. The average density of the Sylvinite is 2.10. Structural anomaly zones have been excluded. Mineral Resources which are not Ore Reserves do not have demonstrated economic viability. The estimate of Mineral Resources may be materially affected by environmental, permitting, legal, marketing, or other relevant issues.

Table 5. July 2017 Kola Mineral Resources for Carnallitite,

reported under JORC code 2012 edition, using a 10% KCl cut-off grade.

Notes: Tonnes are rounded to the nearest hundred thousand. The average density of the Sylvinite is 1.73. Structural anomaly zones have been excluded. Mineral Resources which are not Ore Reserves do not have demonstrated economic viability. The estimate of Mineral Resources may be materially affected by environmental, permitting, legal, marketing, or other relevant issues.

Cut-off parameters

For Sylvinite, a cut-off grade (COG) of 10% was determined by an analysis of the Pre-feasibility and 'Phased Implementation study' operating costs analysis and a review of current potash pricing. The following operating costs were determined from previous studies per activity per tonne of MoP (95% KCl) produced from a 33% KCl ore, with a recovery of 89.5%:

•           Mining US$30/t

•           Process US$20/t

•           Infrastructure US$20/t

•           Sustaining Capex US$15/t

•           Royalties US$10/t

•           Shipping US$15/t

For the purpose of the COG calculation, it was assumed that infrastructure, sustaining capex, royalty and shipping do not change with grade (i.e. are fixed) and that mining and processing costs vary linearly with grade. Using these assumptions of fixed costs (US$60/t) and variable costs at 33% (US$50/t) and a potash price of US$250/t, we can calculate a cut-off grade where the expected cost of operations equals the revenue. This is at a grade of 8.6% KCl. To allow some margin of safety, a COG of 10% is therefore proposed. For Carnallitite, reference was made to the Scoping Study for Dougou which determined similar operating costs for solution mining of Carnallitite and with the application of a US$250/t potash price a COG of 10% KCl is determined.

Mining Factors and assumptions

For the Kola MRE, it was assumed that all sylvinite greater with grade above the cut-off grade except, for that within the delineated geological anomalies, has reasonable expectation of eventual economic extraction, by conventional underground mining. Geological anomalies were delineated from process 2D seismic data.

The Kola Project has been the subject of scoping and feasibility studies which found that economic extraction of 2 to 5m thick seams with conventional underground mining machines is viable and that mining thickness as low as 1.8m can be supported. Globally, potash is mined in similar deposits with seams of similar geometry and form. The majority of the deposit has seam thickness well above 1.8m; the average for the sylvinite HWS, US, LS and FWS is 3.3, 4.0, 3.7 and 6.6m respectively.

For the Mineral Resource Estimate a cut-off grade of 10% KCl was used for sylvinite. The average grade of the deposit is considered of similar grade or higher than the average grade of several operating potash mines. It is assumed that dilution of 20 cm or as much as 10-15% of the seam thickness would not impact the deposit viability significantly. The thin barren rock-salt layers within the seams were included in the estimate as internal dilution

Metallurgical Factors and assumptions

The Kola Sylvinite ore represents a simple mineralogy, containing only sylvite, halite and minor fragments of other insoluble materials. Sylvinite of this nature is well understood globally and can be readily processed. Separation of the halite from sylvite by means of flotation has been proven in potash mining districts in Russia and Canada.

Furthermore, metallurgical testwork was performed on all Sylvinite seams (HWSS, USS, LSS and FWSS) at the Saskatchewan Research Council (SRC) which confirmed the viability of processing the Kola ore by conventional flotation.

- ENDS -

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Forward-Looking Statements

This news release contains statements that are "forward-looking". Generally, the words "expect," "potential", "intend," "estimate," "will" and similar expressions identify forward-looking statements. By their very nature and whilst there is a reasonable basis for making such statements regarding the proposed placement described herein; forward-looking statements are subject to known and unknown risks and uncertainties that may cause our actual results, performance or achievements, to differ materially from those expressed or implied in any of our forward-looking statements, which are not guarantees of future performance. Statements in this news release regarding the Company's business or proposed business, which are not historical facts, are "forward looking" statements that involve risks and uncertainties, such as resource estimates and statements that describe the Company's future plans, objectives or goals, including words to the effect that the Company or management expects a stated condition or result to occur. Since forward-looking statements address future events and conditions, by their very nature, they involve inherent risks and uncertainties. Actual results in each case could differ materially from those currently anticipated in such statements.

Investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date they are made.

Competent Person Statement

The information in this announcement that relates to Mineral Resources is based on information compiled or reviewed by, Garth Kirkham, P.Geo., who has read and understood the requirements of the JORC Code, 2012 Edition. Mr. Kirkham is a Competent Person as defined by the JORC Code, 2012 Edition, having a minimum of five years of experience that is relevant to the style of mineralization and type of deposit described in this announcement, and to the activity for which he is accepting responsibility. Mr. Kirkham is member in good standing of Engineers and Geoscientists of British Columbia (Registration Number 30043) which is an ASX-Recognized Professional Organization (RPO). Mr. Kirkham is a consultant engaged by Kore Potash Plc to review the documentation for Kola Deposit, on which this announcement is based, for the period ended 29 October 2018. Mr. Kirkham has verified that this announcement is based on and fairly and accurately reflects in the form and context in which it appears, the information in the supporting documentation relating to preparation of the review of the Mineral Resources.