DECEMBER 2015 QUARTERLY ACTIVITIES REPORT

ASX ANNOUNCEMENT 28 JANUARY 2016

Mantle Mining Corporation Limited (ASX: MNM, MNMOB and MNMOC) is pleased to provide the following update on its activities for the quarter ended 31 December 2015 and thereafter.

Scheme of Arrangement with IBML:

Post the end of the Quarter, in January 2016, the Company announced an agreement for a 'merger of equals' with International Base Metals Limited (IBML) via a Scheme of Arrangement. IBML is an unlisted public company in a strong financial position with approximately $16.5 million in cash and a suite of complementary resource assets. The merger will see Mantle and its management team funded to develop the Company's exciting gold projects at Morning Star and Norton.

Morning Star Gold Acquisition:

On 30 November 2015 Mantle announced that it had secured funding to apply to the acquisition of interests in Morning Star Gold NL (formerly MCO, now delisted from ASX). Key highlights from that announcement include:

• Approximately $800,000 raised (before costs) in tranche one,

• Balance of approximately $1,700,000 (before costs) to be completed on the successful acquisition of Morning Star Gold NL or its assets,

• Management team appointed to facilitate restart program,

• Shareholder approval meetings to be held in February / March 2016

Morning Star Gold Mine Operations:

In anticipation for the Company's acquisition of the Morning Star, Mantle's management team undertook site visits to review site management systems and ensure regulatory compliance, and carried out initial site team interviews.

Mantle's geological team also undertook geological and stope modelling, targeting 2012 compliant Resource calculation and carried out a preliminary review of process plant bottleneck solutions.

Norton Gold Mine Development:

Post the end of the Quarter, in January 2016, in the context of the access to capital available from the merger with IBML, the Company announced it would not pursue the previously announced arrangement with China

Success to fund the development of its Norton Mine, but would instead develop the assets from its existing resources.

Latrobe Valley Coal Projects:

On 3 November 2015 the Company announced that it planned to develop a Solar-Pumped Hydro Energy Storage project (SPHES):

• Victorian University research units consulted re initiation of collaborative research,

• Decision made to appoint Federation University, Gippsland Campus as lead research unit,

• Community and stakeholder groups consultation commenced,

• Discussions commenced with existing tenement holders within S7 exempt area for project site,

• R & D funding options examined,

• Early partial relinquishment applications lodged for high competing use areas within EL5336, EL5428 and EL5429, as a result of community consultation.

  
  

  Victorian Coal Resources Upgrade to JORC 2012:

  As a result of tenement obligations and the need to upgrade the coal resources according to JORC 2012:

• EL5294 Bacchus Marsh Brown Coal Resource was upgraded to comply with JORC 2012,

• New drilling plan designed to enable possible re-calculation of EL5294 Brown Coal Resource to Indicated Resource status,

• EL5210 Yalungah Brown Coal Resource was upgraded to comply with JORC 2012.

Corporate Activity:

During the quarter, the Company held a general meeting of shareholders on 19 October 2015 and its annual general meeting on 26 November 2015 at which all resolutions were passed by shareholders.

A further general meeting of shareholders will be held in Perth on 19 February 2016 as per the Notice of Meeting dated 7 January 2016.

Capital Raising Initiatives:

On 30 November 2015 Mantle announced it had secured commitments from sophisticated and professional investors for a placement of 250 million shares at $0.01 per share (along with 125 million new options - 3c, Nov 2018) to raise $2,500,000 before costs. The Placement is to be completed in two tranches with 1/3rd completed during the quarter and the balance subject to the successful acquisition of Morning Star Gold NL or its assets.

During the quarter the Company also raised $157,947 under a pro-rata non-renounceable priority entitlement issue under which the Company issued 78,973,425 new options, on the basis of 1 new option for every 1 expired option held by qualifying option holders at an issue price of 0.2 cents per new option ("Priority Offer"). The Priority Offer was approved by Shareholders at the general meeting held on 19 October 2015 and subsequently closed on 21 October 2015.

In addition to the above, the Company issued a convertible note with a face value of $185,000. The Convertible Note is convertible at the election of the noteholder at any time during the 12 month term with the conversion price of 1 cent, together with one free- attaching MNMOC option for every share issued upon conversion.

The Company also repaid cash loans from Directors totalling $150,000 by way of the issue of 12,499,500 Shares and 9,375,000 MNMOB Options as approved by shareholders at the meeting held on 19 October 2015.

As at 31 December 2015, the Company held approximately $549,000 in cash.

For further information please contact:

Ian Kraemer

Managing Director, Mantle Mining Corporation Limited [email protected]

P: +61 7 3310 8932

Competent Persons Statement:

The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr Mark Maxwell and Mr Stuart Moore, both Employees of Mantle Mining Corporation Ltd. Mr Maxwell and Mr Moore are both Members of the Australasian Institute of Mining and Metallurgy and both have sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which they are 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 Maxwell (for Coal) and Mr Moore (for Minerals) consent to the inclusion in the report of the matters based on their information in the form and context in which it appears.

Mantle's Projects and Tenements

Figure 1: Mantle's Project Locations.

Table 1: Mantle's Tenement Schedule.

1. Remaining 10% interest under application to transfer to Joint Venture partner Avanti Mining and Contracting Pty Ltd.

2. Remaining 50% interest held by Joint Venture partner Exergen Pty Ltd.