Axiom Mining Limited

ARBN 119 698 770

6/76 Doggett Street Newstead QLD 4006

Australia

T + 61 7 3319 4100

contact@axiom-mining.com www.axiom-mining.com

ASX Announcement

29 December 2015

JORC Resource upgrade: Isabel Nickel Project defines first 5 years of production

Highlights

• High grade saprolite total Mineral Resource tonnage doubled to 3.9 million dry tonnes (Mt) @ 1.7% Ni

• Limonite total Mineral Resource tonnage increased to 8.4 Mt @ 1.0% Ni and 0.11% Co

• Drilling and upgraded Resource estimate validates historical data and highlights high grade extensions of saprolite

• Axiom will continue to upgrade the Resource estimate when drilling recommences in early 2016; site infrastructure development is progressing and sets Axiom on track to meet customer requirements for first shipment of ore by the end of Q1, 2016

  
  

  Axiom Mining Limited ('Axiom' or 'the Company') is pleased to announce an update to the independent JORC (2012) Mineral Resource estimate for Prospecting Licence 74/11 area (Kolosori tenement) of the Isabel Nickel Project, Solomon Islands.

  
  

  Axiom CEO Mr Ryan Mount said, "We have now successfully defined a minimum of the first five years of production, and the significant tonnage increase in this Resource estimate demonstrates the potential of this world class asset.

  
  

  "Global nickel demand continues to grow, especially for good quality laterite ore in the Pacific yet few new projects are 'development ready'-this estimate is another milestone that progresses the Isabel Nickel Project closer towards meeting that demand."

  
  

  Development work on site continues and Axiom has adjusted project timelines to ensure the first shipment of ore aligns with requirements of its commercial partner Gunvor, due by the end of Q1, 2016.

  
  

  This JORC Mineral Resource upgrade follows the addition of 527 drill holes from the Phase 2 drilling completed since the previous Mineral Resource announcement on 30 September 2015.

  
  

  The drilling is predominantly 50 m and 100 m regional drilling extending the existing Mineral Resources areas at Suma, Kolosori and Havihua and also defining additional Mineral Resources at Upper Havihua, Lower Kolosori, Upper Kolosori, Upper Suma and new prospects at Suma West and Suma North.

  
  

  The broad spaced drilling undertaken in Phase 2 tends to increase estimation smoothing, which means higher grade zones will be better defined with further infill drilling.

  Continues on page 2

  
  

  
  

  Modelling parameters and assumptions remain largely unchanged since the previous estimate.

  Phase 1 drilling concentrated on tight 25 m spaced grid drilling so as to define a higher degree of confidence Mineral Resources to initiate mining studies and allow early production planning.

  Phase 2 drilling and assaying is complete and provides coverage at a broader 50 m and 100 m spacing of both deposit extensions and regional exploration targets mineralisation indicated by historical sampling.

  Drill spacing at the new prospects of Suma North and Suma West are on an initial 200 m spacing.

  
  

  Resource statement details

  The Mineral Resource effective date is 29 December 2015, which includes drilling up to drill hole SU-1323, and is based on 1069 Axiom drill holes with 12,719 m of core samples and 14,014 assayed intervals.

  The total saprolite (magnesium silicate) Mineral Resource at a:

  
  

  o Total 7.7 Mt @ 1.5% Ni, 0.03% Co

  o Total 3.9 Mt @ 1.7% Ni, 0.03% Co

  • 1.0% Ni cut-off is:

    • Measured 1.0 Mt @ 1.7% Ni, 0.03% Co

    • Indicated 3.4 Mt @ 1.5% Ni, 0.03% Co

    • Inferred 3.3 Mt @ 1.4% Ni, 0.03% Co

  • 1.4% Ni cut-off is:

    • Measured 0.8 Mt @ 1.8% Ni, 0.03% Co

    • Indicated 1.8 Mt @ 1.7% Ni, 0.03% Co

    • Inferred 1.3 Mt @ 1.6% Ni, 0.03% Co

  
  

  The total limonite (iron oxide) Mineral Resource at a 0.7% Ni cut-off is:

  • Measured 0.9 Mt @ 1.1% Ni, 0.11% Co

  • Indicated 3.5 Mt @ 1.1% Ni, 0.10% Co

  • Inferred 3.9 Mt @ 1.0% Ni, 0.11% Co

 Total 8.4 Mt @ 1.0% Ni, 0.11% Co

The Mineral Resource is classified in accordance with the JORC (2012) guidelines with relevant details provided in this announcement and against the JORC (2012) Table 1 criteria (Sections 1 to 3) provided in Appendix A.

Location

Santa Isabel Island is situated 135 km north-west of the capital Honiara and accessible by air or sea (Figure 1). Axiom's Kolosori tenement is located with 12 degrees off the equator and more than 1500 km from the nearest continent.

Solomon Islands experiences a tropical environment, characterised by high and relatively uniform temperatures and humidity throughout the year and relatively high annual rainfall.

Figure 1 Isabel Nickel Project location

Tenure

Axiom holds Prospecting Licence PL 74/11 (Kolosori tenement) on Santa Isabel Island (Figure 1), which is 80% owned by Axiom with the remaining 20% held by local landowners-the same ownership structure applies to the Prospecting Licence PL01/15 (South San Jorge tenement) on nearby San Jorge Island.

The deposits drilled and defined by Axiom so far are wholly contained within the Kolosori tenement on Santa Isabel Island.

Both areas at Santa Isabel and San Jorge were explored extensively by INCO in the 1960s and 1970s using test pitting, drilling and auger sampling methods to define nickel laterite deposits of potential economic interest.

INCO completed some feasibility studies, and in the 1990s Kaiser Engineering completed further feasibility studies and metallurgical test work.

Geology

The Solomon Islands archipelago is located at the boundary of the Australian and Pacific continental plates, with Santa Isabel and San Jorge Islands part of a linear NW-SE trending chain of islands within the New Georgia Group and adjacent to an active volcanic forearc region.

Continental collision has resulted in the uplift and obduction of sea floor sediments including some limestone and mostly volcaniclastic sediments-this has included overthrusting of ultramafic rocks that now form elongate pods of more or less serpentinised harzburgite and dunite, cut by pyroxenite veins.

The nickel laterite deposits of Solomon Islands have developed under tropical conditions over ultramafic rocks (Figure 2). Their formation is largely by weathering and decomposition of the ultramafic host rocks which leads to residual and supergene enrichment of nickel within the laterite profile.

The laterite formation comprises two principal zones overlying fresh and weathered rock that include:

• the saprolite zone where weathered silicate minerals remain. This zone can include weathered to fresh remnant rocks and silicate clay minerals from the initial decomposition and weathering of the host ultramafic rocks. Residual enrichment is limited and nickel is generally enriched within the saprolite by supergene processes.

• the limonite zone where silicate minerals are largely destroyed and removed leaving dominantly the iron rich oxides such as limonite (goethite) that can grade into higher alumina oxide mineral towards surface. Residual enrichment of iron, aluminium, manganese, cobalt and nickel occur from the compaction of the profile from the intense leaching from tropical rainfall over time.

Figure 2 Local geology-map derived from government geological mapping