Summary

TRAKA RESOURCES LIMITED

ABN 63 103 323 173

Quarterly Activities Report

for the three months ended 30 June 2016

• Extensions and repetitions of flat lying lithium bearing pegmatite dykes from the abutting Mt Cattlin Lithium Mine lease into Traka's joint venture tenements bode well for the Company's participation in future development.

• High grade drilling intersections have been returned for the first drill program completed at the Yallalong Antimony Project. Additional targets have also been highlighted suggestive of other bodies of mineralisation.

• Drilling at the Mt Short Base Metal Project has intersected low grade lead, zinc and copper mineralisation interpreted to be peripheral to a zone of higher grade mineralisation.

• New ground to the immediate north of Mt Short overlies the extensions of the Mt Short base metal project and in addition will be explored for its lithum potential.

• The evaluation of other exploration projects is continuing.

Figure 1. Location plan of Traka's Projects

The Ravensthorpe Project

Traka's interest in the Ravensthorpe Project comprises three parts (Figure 2); a 20% free carried interest with Galaxy Resources Limited ("Galaxy") in abutting tenements to the Mt Cattlin Lithium Mine, the 100% owned Mt Short Base Metal Project and a 20% free carried interest on the Bandalup Joint Venture area with ACH Minerals Pty Ltd ("ACH").

Figure 2. Location plan of the Ravensthorpe Project

The Galaxy Joint Venture Mt Cattlin

Traka has a 20% free carried interest through to production on any lithium and tantalum mined and a 20% free carried interest through to completion of a feasibility on any other commodities such as gold that occur on the joint venture tenements.

No joint venture activity has been formally reported this quarter, however General Mining Corporation Limited ("GMM"), manager of the neighbouring Mt Cattlin Mine, is reviewing the lithium and gold prospectivity of the joint venture tenement and is currently planning exploration drilling and other activities. GMM is currently deep Diamond drilling the lease immediately south with some success encountering significant widths of spodumene-bearing pegmatite in a repetition at depth below the current resource (1). This drilling is considered stratigraphic in nature, and is attempting to unlock the geology and structure of the surrounding area.

GMM confirms the scope of large flat lying pegmatites open in all directions and that they can roll and swell in thickness along dip and strike. GMM has recently indicated to Traka that it

considers the best prospectivity lies to the north and east of the current mine resource into the joint venture tenements. GMM is currently planning two Diamond holes into this area for completion this year.

Historic exploration work by Traka and Galaxy highlighted the presence of pegmatite dykes with peak values between 1.67% and 2.04% Li2O (Figure 3). Subsequent shallow RC drilling of the outcropping north-western pegmatite in 2009 downgraded the immediate potential of the surface zones. However, GMM and Traka consider that these dykes may represent offshoots of larger pegmatite bodies intruding the peripheral zone around a large granitic body east of Mt Cattlin and the Traka joint venture tenement (Figure 4). This late stage intrusive body is postulated to have been the heat, pressure and fluid source for the lithium and tantalum bearing pegmatite mineralisation.

Figure 3. The Mt Cattlin Lithium Mine within the Galaxy/GMM mine tenements plus Traka's 20% joint venture tenement in the north-east quarter.

In addition to lithium potential recognised on Traka's joint venture tenement there remains very good scope for delineation of a number of high grade gold shoots which GMM intends to target as a secondary outcome to its lithium hosted pegmatite exploration. These shoots, last worked by prospectors in the 1930's, commonly occur in immediate juxtaposition with the lithium and tantalum bearing pegmatites. This concurrence of gold and lithium mineralisation is often observed in other locations within the neighboring Forrestania (2) and Lake Johnstone (3) Greenstone Belts.

Traka demonstrated the continuity at depth of a number of these high grade gold shoots with peak intersections being 15 metres @ 5.31g/t (grams per tonne) and 1 metre @ 131g/t (Figure 4) (4).

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Figure 4. Geological setting of the Mt Cattlin Mine area showing historic lithium and gold exploration results.

The Mt Short Base Metal Project

A Diamond drilling program was completed at the Mt Short Base Metal Project and was reported on 2 May 2016 (5). The work completed on this project highlights the presence of lead, zinc and copper mineralised in stratigraphic sequence which extends for over 8 kilometres in length (Figure 5). Drillhole intersections of barren massive sulphides with high electrical conductance accounted for the electromagnetic ("EM") anomalies but appear to have missed the main prospective zones of low conductance zinc and lead mineralisation. Lead and zinc sulphide mineralisation have a relatively poor electrical conductance and produce weak EM responses. It is therefore possible the better mineralised zones are being masked by the strong electromagnetic response emanating from the nearby massive sulphides bodies.

At the MS5 target area, where we have the benefit of some historic drill data, the main target for mineralisation lies within a 600 metre zone directly north of the drilled MS5 conductor (Figure 6). This zone is underneath a large supergene blanket previously highlighted in aircore drilling. Follow-up drilling of the MS5 target is merited and the next obvious step in project evaluation.

In the course of drilling the base metal targets a number of pegmatite dykes were intersected. Given the known potential for pegmatites to host lithium and tantalum mineralisation in the Ravensthorpe region, the pegmatites on the holes recently drilled and those from previous programs were inspected and sampled. Weakly anomalous levels of lithium up to 0.06% Li2O were detected in some of the pegmatites, attesting to the potential of the region as a whole, but did not give enough encouragement to warrant further testing at this locality.