Traka Resources Limited ABN 63 103 323 173

13 July 2015

ASX Shareholders Report

Enquiries regarding this announcement and company business may be directed to:

Patrick Verbeek

Managing Director
Ground Floor
43 Ventnor Avenue
West Perth 6005
Western Australia
Tel: (+61) 8 9322 1655
Fax: (+61) 8 9322 9144
www.trakaresources.com.au
Investor enquiries:
[email protected]

ASX Code: "TKL"

Company Announcements
ASX Limited
Level 10, 20 Bond Street
Sydney NSW 2000

Traka secures JV rights to rich antimony discovery

The Company is pleased to announce that an agreement has been reached for Traka to participate in the newly discovered Yallalong Antimony Project located 220 kilometres north-east of Geraldton (Figure 1).
Traka has been attracted to the project by the presence of very high grade antimony mineralisation in rock-chip samples of quartz veins (Table 1). The antimony mineralisation is visible in hand specimen as stibnite, the principal form of antimony sulphide, and antimony oxide minerals and, in these instances, the assay results return grades between 2% and 61% Antimony ("Sb").

Figure 1. Aeromagnetic image showing location of the Yallalong Project

Traka Resources Limited ABN 63 103 323 173

The mineralised quartz veins are hosted within sedimentary and mafic rocks in an exposed part of a large shear zone which extends past the 15 kilometre length of the project and is part of the regional scale Darling Fault system. The shear is largely blanketed by regolith and a thin ferricrete cap-rock layer with a few areas of exposure including that of the discovery site. The discovery site is an exposed area roughly measuring 600 metres in length and 100 metres in width.
Reconnaissance level and widely spaced soil geochemical samples about 1.5 kilometres north of the discovery are early positive signs of additional mineralisation along the shear (Figure 2).

The association of antimony mineralisation with major fault systems and sedimentary host rocks is the typical geological setting for the important antimony deposits of the world. Despite this and the relative proximity to established infrastructure, there is no history of systematic exploration in the Yallalong district.

Figure 2. Aeromagnetic image showing location of rock chip and soil samples

Traka Resources Limited ABN 63 103 323 173

Drill testing of the discovery area will dominate the first round of follow up exploration work, but follow up geochemical and geological surveys will also begin to investigate the northern anomaly and other opportunities along the shear zone.
Heritage clearance surveys and permitting for drilling is already underway and therefore the follow up work is expected to be feasible within the next few months.

Table 1. Rock-chip samples in the discovery area with antimony (Sb) assay grades above 2% Sb.

(Refer Annexure for JORC Table 1 information)

The Yallalong Antimony Project agreement is made with a prospecting syndicate ("The

Syndicate") that made the original discovery. The agreement with the Syndicate provides Traka

Traka Resources Limited ABN 63 103 323 173

with the opportunity to earn a minimum of 80% equity in the project under the following key terms:
1. Payment of a $50,000 Option Fee (paid in cash and/or Traka shares at Traka's election) and undertaking geochemistry and a minimum of 600 metres of reverse circulation ("RC") drilling following the completion of Heritage Surveys.
2. Within 60 days of drilling, Traka may elect to withdraw with no retained interest or proceed to earn equity in several stages.
3. Traka may initially elect to earn 51% equity by payment of $100,000 cash and the issue of $100,000 worth of Traka shares, plus committing to an additional $500,000 of expenditure within the following 2 year period.
4. Upon earning 51% equity, Traka may withdraw with no retained interest or elect to earn an additional 29% equity by the additional expenditure of $2 million by the fifth anniversary date of this agreement.
5. Upon Traka electing to earn an additional 29% equity, the Syndicate may also elect to sell its remaining 49% equity to Traka for 20 million Traka shares. In this eventuality, Traka would have 100% equity in the project and the joint venture would be dissolved.
6. Should Traka earn its 80% equity, the Syndicate can elect to continue to expend pro-rata to its
20% equity, or dilute to 10% by having Traka contribute the next $5 million of expenditure.
7. Should Traka earn its 90% equity level, the Syndicate may continue to expend pro-rata to its
10% equity, or further dilute to 5%, at which point the Syndicate's equity would revert to a 2% Net Smelter Royalty.
The Company's entry into the Yallalong Project allows for early progress to drilling programs on a new project with a commodity which appears to have good economic prospects for the future.

Information on Antimony ("Sb")

The following information has been compiled by P. Verbeek from numerous public domain sources to provide a summary and broad perspective of the antimony industry as a whole. However, not all the sources of information could be verified and individual statements in the text may be inaccurate. Sole reliance on this information should not be made.

Antimony ("Sb") is a relatively rare metal used in industrial and technology products. It occurs in hydrothermal ore systems and is conventionally mined and treated to produce a sulphide concentrate which in turn is converted to antimony trioxide white powder ("ATP") and metal ingots.
Approximately 80% of all antimony production is converted to ATP, the principal uses of which are:

• approximately 70% as a fire retardant agent for textiles, plastic, building material and rubber;

• as a catalyst for production of polyethylene terephthalate (PRT ) bottles;

• as a compound for various chemicals, ceramics and glass. In its metal form, antimony has the following uses:

Traka Resources Limited ABN 63 103 323 173

• as an alloy of iron, copper, leads zinc to impart hardness, strength and anticorrosion properties;

• as an alloy with lead for use in batteries;

• for the manufacture of solders, ammunition, corrosion resistant pipes and cable sheathing;

• in emerging applications in micro electrics, including new generation high data storage devices.

The main economic form of antimony in nature is a sulphide mineral called Stibnite (Sb2S3). Established and conventional crushing and flotation treatment plants, like that used for nickel sulphide, are used to produce an antimony concentrate.
Antimony occurs as veins and disseminations associated with carbonate rocks such as limestone and sedimentary rocks adjacent to large fault zones. The fault zones act as conduits for the mineralising fluids. Antimony deposits are exploited by both open pit and underground operations and the richer deposits are mined to depths of more than 1,000 metres. Gold and other metals, such as lead and zinc, are often associated with the antimony and, in some instances, like gold for instance, they can
be the key economic component of the mining operation.
Antimony is not traded or recognised in any financial exchange and therefore sales between the producer and the buyer are privately negotiated usually with the involvement of specialty traders.
Existing world antimony ore reserves are about 1.8 million tonnes and current world consumption is about 180,000 tonnes per annum (Figure 2). In the period between 2000 and 2010 demand growth averaged 3.1% per annum. Forecast growth into the future is generally estimated to be higher than this as world-wide demand remains strong, but factors like the GFC have depressed prices and demand for periods of time. The current price is approximately US$8,600 per tonne and this has reduced since its peak in 2010 and 2011 (Figure 3). The upside pressure for higher prices into the future is considered to come from continued world growth, particularly from the emerging markets, but more particularly from decreasing Chinese supply.

Figure 2. World historic antimony production

Traka Resources Limited ABN 63 103 323 173

China has always been the dominant source of antimony (70% to 85% over time) and most of China's reserves and production comes from the Hunan Province near the city of Lengshuijiang. In recent decades the single largest antimony mine in the world, the Hsikwangshan Twinkling Star Mine (found in 1541) has produced about 25% of global supply. This mine is owned by Hunan Non Ferrous (HNC) which is a subsidiary of China Metals. In recent years this mine and others have depleted their high grade antimony reserves and faced increased mining costs. In other cases Central Government actions to impose higher environmental standards have resulted in mine shutdowns. Although overall production is increasing, China is now importing close to 40% of its raw material from other countries including Russia, Tajikistan, Myanmar and South America. China's current contribution to world production, from both internal and external sources of ore, is currently about 80%.
In consideration of China's diminishing reserves, China's strong market leverage position and ongoing world demand, the United States Geological Survey (USGS), the British Geological Survey (BGS) and Geoscience Australia (GA) rate antimony future supply as being at risk.

Price Comparison of Copper, Nickel & Antimony

over the last 11 years

40,000

38,000

36,000

34,000

32,000

30,000

28,000

26,000

24,000

22,000

20,000

18,000

16,000

14,000

12,000

10,000

8,000

6,000

4,000

2,000

-

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Copper Nickel Antimony

Figure 3. Comparison of Antimony price with that of copper and nickel since 2005

Copper and nickel operations and economics can be used as a rough measure to the scale and grade necessary for successful antimony operations. Antimony has been worth more than copper for some time now. In this scenario and with the presence of high grades even small deposits can be keenly priced and lucrative.

COMPLIANCE STATEMENT

The information in this report that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr P Verbeek, a Competent Person who is a Member of the Australasian Institute of Mining and Metallurgy and is engaged full time as the Managing Director of the Company. Mr Verbeek has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaking to qualify as a Competent Person as defined in the 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. Mr Verbeek consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Traka Resources Limited ABN 63 103 323 173

Annexure: JORC Table 1

Section 1: Sampling Techniques and Data for the Yallalong Antimony Project

Traka Resources Limited ABN 63 103 323 173

Section 2 - Reporting of Exploration Results for the Yallalong Antimony Project

Traka Resources Limited ABN 63 103 323 173

Traka Resources Limited ABN 63 103 323 173