Summary

TRAKA RESOURCES LIMITED

ABN 63 103 323 173

Quarterly Activities Report

for the three months ended 31 March 2016

• The Company's Ravensthorpe tenements are increasingly valued for their lithium potential. Commencement of mining by General Mining and Galaxy on the abutting Mt Cattlin Lithium Mine and exploration by other parties in the Ravensthorpe region is highlighting their prospectivity.

  
  

• Traka holds a 20% free carried joint venture interest in a tenement adjacent to the Mt Cattlin Lithium Mine with known lithium mineralisation in pegmatite dykes. Also, the large mineralised flat lying pegmatite dykes being mined at Mt Cattlin may extend into this tenement.

  
  

• A number of pegmatite dykes were intersected while drilling on the Mt Short Base Metal Project and these have been sampled for lithium and tantalum mineralisation.

  
  

• Drilling has been completed and the results awaited from the Mt Short Base Metal and Yallalong Antimony Projects.

  
  

• 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): the 20% free carried to production interest with Galaxy Resources Limited ("Galaxy") in an abutting tenement to the Mt Cattlin Lithium Mine (Figure 3), 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 Free Carried to production 20%)

No joint venture activity has been reported this quarter but it is encouraging to see General Mining Corporation Ltd ("GMM") and Galaxy Resources Ltd ("Galaxy") move rapidly to restart mining operations on the abutting Mt Cattlin Lithium and Tantalum Mine (1)

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.

There are mineralised lithium and tantalum pegmatite dykes in the joint venture tenements (peak values between 1.67% and 2.04% Lithium) highlighted by historic exploration work programs (Figure 3). Previous geological mapping and drilling by Traka on gold prospects also highlighted the presence of other pegmatite bodies that have not been investigated for their lithium and tantalum content. The shared geological setting and the proximity of the Mt Cattlin Mine (Figure 4) underline the potential value of this project to the Company.

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.

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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 three hole Diamond drilling program comprising of 800.4 metres was completed at the Mt Short Base Metal Project on 21st March testing three electromagnetic targets (MS1, MS2 and MS5) as planned (Figure 5). The assay results for this program are awaited and compilation is still underway but the following preliminary observations were made:

• The MS1 conductor is a rich sulphidic contact zone on the contact between mafic and granite intrusive rocks. There is some scope for associated gold (Au) mineralisation.

  
  

• The MS2 conductor was not accounted for although minor levels of copper mineralisation were observed in the target position. It is possible the conductor is below the copper position as the hole was designed to hit the top and shallowest part of the modelled conductor body.

  
  

• The MS5 conductor was intersected as modelled and is associated with massive sulphide, comprising mostly pyrrhotite and pyrite. Broad low levels of lead (Pb), zinc (Zn) and copper (Cu) mineralisation were observed in the hanging wall sequences above the massive sulphides.

  
  

• A number of pegmatite dykes were intersected in this drilling and are being sampled and petrologically examined for lithium and tantalum mineralisation.

Aside from the lithium potential, the preliminary observations relating to the base metals mineralisation (i.e. lead, zinc and copper), indicates the presence of a mineralised system with analogies to Volcanogenic Massive Sulphide (VMS) or Sedimentary Exhalative (SEDEX) ore