This Prospectus provides important information about the Company. You should read the entire document including the Entitlement and Acceptance Form. If you have any questions about New Shares being offered under this Prospectus, or any other matter relating to an investment in the Company, you should consult your professional adviser. An investment in the New Shares offered under this Prospectus is highly speculative.

This Prospectus is not for publication or distribution, directly or indirectly, in or into the United States of America (including its territories and possessions, any state of the US and the District of Columbia). This Prospectus is not an offer of securities for sale into the United States or to, or for the account or benefit of, US Persons. The securities referred to herein have not been and will not be registered under the US Securities Act of 1933, as amended, and may not be offered or sold in the United States or to, or for the account or benefit of, US Persons. No public offering of securities is being made in the United States.

Important Notice: This Prospectus is dated 8 July 2016 and was lodged with ASIC on that date. Application will be made to ASX for quotation of the New Shares offered under this Prospectus within 7 days of this date.

Neither ASIC, ASX nor any of their respective officers take any responsibility for the contents of this Prospectus or the merits of the investment to which this Prospectus relates. No securities will be issued on the basis of this Prospectus later than 13 months after the date of this Prospectus.

Nature of this Prospectus: The New Shares offered under this Prospectus are in the same class of Shares that have been quoted on the official list of the ASX during the 12 months prior to the issue of this Prospectus.

This Prospectus is a 'transaction specific prospectus' to which the special content rules under section 713 of the Corporations Act apply. That provision allows the issue of a more concise prospectus in relation to an offer of securities (or options to acquire securities) in a class which has been continuously quoted by ASX in the 3 months prior to the date of the prospectus. In general terms 'transaction specific prospectuses' are only required to contain information in relation to the effect of the offer on the company and the rights and liabilities attaching to the securities offered. It is not necessary to include general information in relation to all of the assets and liabilities, financial position, profits and losses or prospects of the issuing company.

This Prospectus contains information only to the extent to which it is reasonable for investors and their professional advisers to expect to find the information in it. It does not include all of the information that would be included in a prospectus for an initial public offer.

Prospectus availability: Eligible Shareholders can obtain a copy of this Prospectus at any time prior to the Closing Date on the Company's website at www.alararesources.com or by contacting the Company. If you access an electronic copy of this Prospectus, you should ensure that you download and read the entire Prospectus.

The electronic copy of this Prospectus available from the Company's website will not include a personalised Entitlement and Acceptance Form. Eligible Shareholders and others will only be able to accept the Offer, or apply under the Shortfall Offer (as the case may be), by completing the personalised Entitlement and Acceptance Form which accompanies this Prospectus or by making payment using BPAY® (refer to section 7.8 of this Prospectus for further information).

Foreign jurisdictions: The distribution of this Prospectus in jurisdictions outside Australia and New Zealand may be restricted by law and persons who come into possession of this Prospectus should seek advice on and observe any of these restrictions. Failure to comply with these restrictions may violate securities laws. Applicants who are residents in countries other than Australia should consult their professional advisers as to whether any governmental or other consents are required or whether any other formalities need to be considered and followed. This Prospectus does not constitute an offer in any place in which, or to any person to whom, it would not be lawful to make such an offer.

Disclaimer of representations: No person is authorised to provide any information or make any representation in connection with the Offer which is not contained in this Prospectus.

Forward looking statements: This Prospectus contains forward looking statements that, despite being based on the Company's current expectations about future events, are subject to known and unknown risks, uncertainties and assumptions, many of which are outside the control of the Company and the Directors. These known and unknown risks, uncertainties and assumptions, could cause actual results, performance or achievements to materially differ from future results, performance or achievements expressed or implied by forward-looking statements in this Prospectus. These risks, uncertainties and assumptions include, but are not limited to, the risks outlined in section 6 of this Prospectus. Forward-looking statements include those containing such words as 'anticipate', 'estimate', 'believe', 'should', 'will', 'may' and similar expressions.

Privacy: Eligible Shareholders should read the privacy information located in section 8.17 of this Prospectus. By submitting an Entitlement and Acceptance Form, you consent to the matters outlined in that section.

Definitions: Certain terms and abbreviations used in this Prospectus have defined meanings which are explained in section 12.

Enquiries: If you have any questions please call the Company Secretary on +61 8 9481 0389 at any time between 9:00am and 5:00pm (WST time) Monday to Friday until the Closing Date. Alternatively, consult your broker, accountant or other professional adviser.

Table of Contents

1. TIMETABLE 4

2. KEY OFFER TERMS AND CAPITAL STRUCTURE 4

3. CHAIRMAN'S LETTER 5

4. INVESTMENT OVERVIEW AND KEY RISKS 7

5. PURPOSE AND EFFECT OF THE OFFER 11

6. RISK FACTORS 14

7. ACTIONS REQUIRED BY ELIGIBLE SHAREHOLDERS 23

8. DETAILS OF THE OFFER 28

9. RIGHTS AND LIABILITIES ATTACHING TO SECURITIES 36

10. ADDITIONAL INFORMATION 39

11. DIRECTORS' RESPONSIBILITY AND CONSENT 47

12. GLOSSARY 48

13. UNAUDITED CONSOLIDATED STATEMENT OF FINANCIAL POSITION 51

Corporate Directory

1. TIMETABLE

   Prospectus lodged with ASIC and ASX	8 July 2016
   Ex Date - Shares trade ex Entitlement	13 July 2016
   Rights trading commences	13 July 2016
   Record date to determine Entitlement (Record Date)	14 July 2016
   Prospectus with Entitlement and Acceptance Form dispatched	15 July 2016
   Offer opens for receipt of Applications	15 July 2016
   Rights trading ends	26 July 2016
   Closing date for acceptances (Closing Date)	2 August 2016
   Notify ASX of Shortfall	5 August 2016
   Issue of New Securities	9 August 2016
   Deferred settlement trading ends	9 August 2016
   Dispatch of shareholding statements	9 August 2016
   Normal trading of New Securities expected to commence	10 August 2016

   The Directors may extend the Closing Date by giving at least 3 Business Days' notice to ASX prior to the Closing Date, subject to such date being no later than 3 months after the date of this Prospectus. As such the date the New Securities are expected to commence trading on ASX may vary.

2. KEY OFFER TERMS AND CAPITAL STRUCTURE

1 This assumes no further Shares are issued (including by way of exercise of Options) prior to the Record Date.

2 See section 5.4 for a list of the Company's Options on issue.