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1 Industrial Minerals Tellus Group Storage Industrial and Edible Salt Storage / Isolation Renewable Energy Salt Mine Tourism Chandler Project (NT) Complementary Sandy Ridge Project (WA) Kaolin Industrial Minerals Tellus Holdings Limited www.tellusholdings.com Storage / Isolation Storage Chandler Salt Mine Update – Adding Value to Salt Group MD Duncan van der Merwe Mining the Territory Conference 21 August 2014

Duncan van der Merwe - Tellus Holdings - Chandler Salt Mine Project

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Duncan van der Merwe delivered the presentation at the 2014 Mining the Territory Conference. With record year on year investment in mining developments and exploration in the Northern Territory, the 8th Annual Mining the Territory Conference is perfectly placed to hear latest information on this booming region. For more information about the event, please visit: http://bit.ly/MiningtheNT2014

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Page 1: Duncan van der Merwe - Tellus Holdings - Chandler Salt Mine Project

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Industrial Minerals

Tellus Group

Storage

Industrial and Edible Salt Storage / IsolationRenewable EnergySalt Mine Tourism

Chandler Project (NT)

Complementary

Sandy Ridge Project (WA)

Kaolin

Industrial Minerals

Tellus Holdings Limited

www.tellusholdings.com

Storage / Isolation

Storage

Chandler Salt Mine Update – Adding Value to Salt

Group MD Duncan van der MerweMining the Territory Conference21 August 2014

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Important Notice and Disclaimer

Summary information

This presentation (Presentation) has been prepared by Tellus Holdings Ltd (ABN 97 138 119 829) (‘Tellus’) and is for information purposes only. This Presentation contains summary information

about Tellus and its subsidiaries and their activities current as at the date of this Presentation. The information in this Presentation is of general background and does not purport to be complete.

It should be read in conjunction with other periodic announcements on www.tellusholdings.com.au. The key information on detailed exploration target statements, mineral resource estimates, and

feasibility results can be found in Tellus’ publically released media announcements. Exploration target statements and mineral resources estimations are appended to comply with ASX guidelines

but investors are urged to read supporting information in full available on the company’s website, and available in their data room.

Future performance

This Presentation contains certain “forward-looking statements”. Forward looking words such as, “expect”, “should”, “could ”, “may”, “plan”, “will”, “forecast”, “estimate”, “target” and other similar

expressions are intended to identify forward-looking statements within the meaning of securities laws of applicable jurisdictions. Indications of, and guidance on, future earnings and financial

position and performance are also forward-looking statements. Forward-looking statements, opinions and estimates provided in this Presentation are based on assumptions and contingencies

which are subject to change without notice, as are statements about market and industry trends, which are based on interpretations of current market conditions, and independent third party

expertise. Such forward-looking statements, opinions, and estimates are not guarantees of future performance.

Not an offer

This presentation does not constitute an offer, invitation, or recommendation to subscribe for or purchase any security and neither this presentation nor anything contained in it shall form the

basis of any contract or commitment.

Competent Person Statement – Chandler Project

The information in this presentation that relates to Mineral Resources - Chandler Project - is based on information compiled by ERCOSPLAN Ingenieurgesellschaft Geotechnik und Bergbau mbH

(‘ERCOSPLAN’). Jana Neubert is a senior geologist and employee of ERCOSPLAN and a member in good standing of the European Federation of Geologists registered as “European Geologist”

(Registration Number 1033). Ms Neubert has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which she has

undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for the Reporting of Mineral Resources and Ore Reserves.

Dr Henry AM Rauche is a senior geologist and Managing Director & C.E.O. of ERCOSPLAN and a member in good standing of the European Federation of Geologists registered as "European

Geologist" (Registration Number 729). Dr Rauche has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he has

undertaken to qualify as a Competent Person as defined in the 2012 edition of the Australasian Code for the Reporting of Mineral Resources and Ore Reserves.

Competent Person Statement – Sandy Ridge Project

The information in this presentation that relates to Mineral Resources - Sandy Ridge Project - is based on information compiled by Terra Search Pty Ltd. Mr Jenkins is Principal Geologist of Terra

Search and a Member of the Australian Institute of Geoscientists. Mr Jenkins has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and

to the activity which he has undertaken to qualify as a Competent Person as defined in the 2012 edition of the Australasian Code for the Reporting of Mineral Resources and Ore Reserves.

The information in this presentation that relates to exploration targets is based on information reviewed by Dr. Simon D. Beams, a full time employee of Terra Search Pty Ltd, geological

consultants employed by Tellus. Dr. Beams has BSc Honours and PhD degrees in geology. He is a Member of the Australasian Institute of Mining and Metallurgy (Member #107121) and a

Member of the Australian Institute of Geoscientists (Member #2689). Dr Beams has sufficient relevant experience in respect of the style of mineralisation, the type of deposit under consideration,

and the activity being undertaken to qualify as a Competent Person within the definition of the 2004 edition of the AusIMM’s “Australasian Code for Reporting of Exploration Results, Mineral

Resources, and Ore Reserves”.

Exploration Target

Any statement contained in this document as to exploration results or exploration targets has been made consistent with the requirements of the Australasian code for reporting of exploration

results, mineral resources, and ore reserves (‘JORC Code’). All statements as to exploration targets of Tellus salt and kaolin, and statements as to potential quality and grade are conceptual in

nature. There has been insufficient exploration undertaken to date to estimate a resource and identification of a resource will be totally dependent on the outcome of further exploration.

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Contents

Summary

Team

Strategy

Chandler Project (NT, Australia)

Opportunities for the NT

Sandy Ridge Project (WA, Australia)

1

2

3

4

5

6

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Summary

309 M t JORC Measured1 Resource

Chandler Salt Mine Project (100%, 4+25 year LOM)

Ave 508k tpa salt & minerals sales

Storage sales 2

41 M t JORC Inferred1 Resource

Sandy Ridge Kaolin Project (100%, 1+25 year LOM)

Ave 28k tpa kaolin clay sales

Storage sales 2

Tellus strategy Project developer – mineral / backfill business

Dual revenue business

Mine salt and kaolin (creates voids) and backfill with waste (fills voids) – proven global model

Portfolio World class assets - regulated, long life business

Chandler status JORC, MLA pending, EIS/ DFS (S2- FEL3) commencing

Sandy Ridge status JORC, MLA pending, PER / PFS commencing

ClayVault status WA Gov. IWDF proj. mg’t contract (5 year term 50/50JV)

AdvantagesFirst to market in Asia, high barriers to entry, strong industry dynamics

1 Refer to Sandy Ridge JORC ( 20 June ’14) and Chandler – JORC (1 July 14) media releases2 Photo of German salt/backfill mine, photo of West Australian clay backfill project

1

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Experienced Board Experienced commodity team Experienced waste team

40 years experience in mine projects engineer BHP, Rio, Xstrata, Anglo Coal

Ex Bus. Dev. Coffey Environmental, IBM, Unilever, Aust Defence Forces.

Ex Global Head of Infrastructure AMP Capital, CEO TenixInfrastructure, CEO Lend Lease Capital

Philip GarlingGroup Non Executive Chairman

Ron SiftonGroup Non Executive

Duncan van der MerweGroup Managing Director

Brett BoyntonGroup Finance Director

Joe LuxfordChandler Underground Advisor

Mining (Ex Gencor/Billiton, Blue Energy), waste & infrastructure, Ex Bank of Scotland, Noble Group

Ex UBS, FBR Capital, Credit Suisse, investment banking, M&A, Director Signature Gold

Ex CFO Newalta, Canada’s largest salt cavern waste storage operator – 30 years direct experience

Project Manager EPMS, Ex Technical Director WA Kaolin Holdings, HBH Consultants, GMA Garnet

Ex GM Dampier Salt, Ex CEO of Albany Port, Wesfarmers, Rio Tinto, Hamersley Iron

Mark ShepherdTellus RockVault NED

John CookTellus RockVault Chairman

Mike IngramSandy Ridge PM / Technical Advisor

Bob EmeryTellus Salt Chairman

Ex NSW Chief Mining Engineer (Minerals –NSW), Ex MD Waste Services NSW, Founder WMAA

Ex MD Coffey WA, Manager Mt Walton IWDF -Australia’s only Class V waste facility

Highly experienced board and management team with key individuals having a direct and proven track record in developing salt and kaolin mines, and heavily regulated waste projects

Ex Wiltshire Geological Services, Schlumberger Information, Terra Search

Jaime LiveseySenior Geologist

Steve ReeceChandler PM / Technical Advisor

Reg. Manager Golders. Ex Mine Manager (15 yrs) at Winsford UK’s largest under ground salt/ backfill mine

Team - Organisational Structure2

MD MichelsWarren Munday, 35 years in media, com. engagement & communications in VIC & NT

Jane MundayCommunication Advisor

Fmr CEO Aust. Coal Assoc & NSW Minerals Council, Trustee AusCoal Super, Snr Mngr Shell Oil and Gas

Dr Nikki WillamsGroup Non Executive

Company Secretary, CFO for a number of ASX listed & pre-IPO companies

Anne AdaleyCompany Secretary/ CFO

Robert CharterMarketing

Corporate/ Advisory

Ex WA Environmental Regulator, Managed only Class V waste facility

Noel DaviesTellus RockVault NED

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1 Compilation and evaluation of bedded salt deposits - SMRI -KBB: Table 3,4 & 5, 20064 GRS report for UNEP – Options for environmentally sound management of surplus mercury, 2011

Clay

Strategy - In Line With International Best Practice3

Proven and profitable global business model

Region Underground Salt Caverns & Mines 1

North America >100 projects (incl. 400 solution mined salt caverns)

Europe 49 Projects (Germany leader - 30 salt/backfill mines)

Asia 13 projects (China 6)

Russia 9 projects

Africa 1 project in Morocco

South America 1 project in Brazil

Total > 150 projects

Region Near Surface Clay Storage Facilities 4

North America Canada

Europe France, Spain, Switzerland

Asia Australia (NSW closed 1M ton facility, WA open IWDF)

Regions with salt caverns/ mines and clay storage projects

Underground salt caverns and mines

Near surface clay storage facilities

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Strategy – Pit to Port3

Vast asset, easy to mine, scalable, technically / commercially sound business, dual revenue

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Strategy - Salt Products3

Salt - Tellus’ competitive advantage

▪ Strong position to meet Asian demand by providing a guaranteed volume and quality

▪ Darwin – closest port to Asian buyers▪ Large scale resource – easily scalable▪ Reliable supplier - not influenced by climate▪ Associated minerals – e.g. fertilisers▪ Cross selling storage solutions (domestic)

Cyclone map

World: Forecast demand for salt by region, 2012 and 2018 (Mt) 1 World: Forecast demand for salt by end-use, 2012 and 2018 (Mt) 1

Tellus opportunity

Drilling salts used in the oil and gas

industry, salt fluxes used in the smelting and mining industry

To Shanghai : Darwin is ~4,100 km closer than Indian ports, ~5,900km closer than Mexican ports~13,300 km closer than Chilean ports

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Strategy – Oil & Gas Industry Service Provider3

On shore liability Off shore liability

Every up-, mid-, and downstream operation produces waste 15 salt cavern facilities servicing the Gulf’s O&G industry

Tightening regulation and limited cost effective solutions Government & industry want best practice facilities

2 http://www.eia.gov/todayinenergy/detail.cfm?id=3190, GRS UNEP Mercury report1 http://naturalgas.org/naturalgas/storage/

Map- Based on Australian Gov. Dept of Resources, Energy and Tourism 2008 report

Chandler has the potential to connect Central Australia to the booming on and offshore O&G industry

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Waste Acceptance Criteria Chandler

Liquid waste in barrels, lined & bunded

Dry waste multiple lined and bagged

Nuclear waste (Defence, Energy)

Uranium mining waste

Infectious (Medical) Waste

Uncertified waste

Tellus is bringing “worlds best practice” solutions and recognized high development standards

Industry Waste Sources

Oil & Gas

Mining

Heavy Industry / Power Generation

Manufacturing

Agricultural

Government/SES

X

X1

X

Strategy – Tellus Service Offering

X

Best Practice Systems

Certified Management System

Strict acceptance criteria

Packaging and transport criteria

Safety case – man made engineering

Safety case – natural engineering (geology)

Insurance, bonds, Permanent Isolation Certificates

3

1 Tellus plans to accept NORM’s (naturally occurring radioactive material as found in oil and gas, mining, and heavy industry processed waste etc)

Tellus’ certifications and values

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Strategy - Rediscovering the Chandler Salt

Source: McGraw HillImage: Victoria Museum, Source: Colorado Plateau GeosystemsSource: Colorado Plateau Geosystems

Cambrian -580myo lifeless land teeming ocean Salt trap for oil and gasGillen 700myo-Chandler 500myo-Late Cambrian

Tellus drilling - 98% pure halite at 795mFlat thick salt bed ~ 18km wide (CH003 ~ 300m)145km seismic, 6.6km core

3

Potentially Australia’s largest commercially viable salt bed

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Project location

Drilled 1,937m

Field work Grade Analysis Expert analysis

370 samples Dual business

FEL 2

Engineering DFS/ EIS Commercial

Site investigations Customer visits

Chandler - Progress4

Study categories: 17 DFS /15 EIS Study contributors: 22 companiesCountry of study contributors: 5

Site visits to other salt mines:Trade trips

Project technically feasible, commercially viable, no fatal flaws

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Chandler - Resource Estimate4

1 Refer to Tellus Media Release ‘2014 Chandler – JORC Estimation’ 1 July for further details, JORC Table 1, Proximate and Competent Person Statement 2. JORC statement prepared by Ercosplan (Germany)

Flat Salt Bed ~ 18km wide (hole CH003 ~ 300m thick salt bed), sedimentary rock suitable for low cost decline

309 Mt Measured Resource = 525 year mine life.Mineral resource covers 8% of EL 29018

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Chandler - Design4

*Not to scale – underground workings not directly under surface plant

Salt dry processing plantStorage processing plant

Wet processing ponds (evaporation, crystallization, bittern ponds)

2 MW solar plant

Vertical ventilation shafts

Portal and decline

Traffic management – blue line salt traffic, orange line – waste traffic

Ventilation management –intake (2nd egress) and exhaust air

Isolation management –store like with like

Room dimensions – 240m L, 15m W 4.5m H,11 rooms pa

Water management –decline stops above salt bed, with sump

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Chandler - Summary

Mine life – 29 years (4 + 25 years), rolling terms

Production -salt0.5 M tpa salt and associated minerals, Scale up on demand

Mining method Underground, room and pillar design, Continuous miner

Room dimensions240mL x 15mW x 4.5mH, 15m support pillar

Processing – Dry (crush, bag, ship), some wet, backfill

ManagementCore business - owner operator, Non core - contractor

Jobs Build (280-350), operational (180), indirect (>540-720)

Historic spend: General area 41.5km (>$18.5M)Project area: 6.6km, 15 lines seismic (145km) – (A$6.5M)

Capex – A$464 M

Opex – Labour, transport, utilities, services

Taxes – Corporate tax, GST, levies, royalties

Could potentially be Australia’s longest life mine Could potentially be one of central Australia’s largest employers

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Chandler – Power requirements

2 MW solar plant

Could potentially be Central Australia’s largest solar power station

4

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General - archives

Licensed - disposal

Licensed - storage

K+S-German salt Mine

Compass Minerals – Deep Storage

4 Chandler - Underground design

Salt mining

K+S-German salt Mine

K+S-German salt Mine

Tellus is planning to develop the safest mine in Australia

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Opportunities for the Alice Springs region and NT

Category Pre mine Mine build Mine operations

Jobs Limited Mine & plant build Mine & plant operations

Training Limited work experience

Apprenticeships, traineeships, work experience

Apprenticeships, traineeships, work experience

Investment Studies, approvals, team & internal & customer processes

Capex (civils, plant &equip), team & internal & customer processes

Investment (sustaining capex & opex) team & internal & customer processes

Business opportunities

Contractor labour, drilling, studies, equip. & supplies

Mine contractor services,equipment & supplies

Mine contractor services Equipment & suppliesSalt related spin off businesses

Sponsorships & trust

Sponsorships Sponsorships SponsorshipCommunity benefits trust

Environmental Work exp. (rangers) Work exp. (rangers) Offset program (ranger programs)

Infrastructure Industrial shed/ office

Improved roads, bridges, power, comm’s

Improved roads, bridges, power, comm’s, training & visitor centre

RoyaltiesTaxes & rates

Exploration Agreement CLC

Exploration Agreement CLCFederal, NT , Local taxes/ rates

Royalties - MineralFederal, NT , Local taxes and rates

Tellus has a commitment to local employment, training and supply of equipment and services

5

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Opportunities – Local contracts awarded during DFS 1Category Service / equipment provided Local

Industrial real estate Shed/ office rental & utilities

Studies - environmental contractors & TO’s Field surveys

Station / Landholder Earthworks machinery, accommodation

Mining service providers Camp and equipment supply

Wholesale fuel distributor Diesel supply

Vehicle rental supplier Vehicle rental

Freight provider Freight service

Geotechnical contractors Personnel

Camping & safety equipment supplier Field equipment supply

Helicopter charter service Charter flights

Accommodation & food and beverage Hotels, taxis, catering, room hire

5

How to engage with TellusInitial engagement is via registration with: Industry Capability Network (ICN) www.chandlersaltmine.icn.org.au or contact ICNNT 08 8922 9422ICNmatches projects with potential suppliersTier I Primary contract –overarching contractTier II Secondary/ sub contracts

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Chandler - Community and Stakeholder Engagement

Community consultation

Supporting jobs (WA TO’s)

Supporting jobs (NT TO’s)

Pot. buyers (pit-to port visits)Community sponsorship

NT Gov. & Regulator (site visits) TO meetings & site visits

Supporting local business (20+)

Over 30 months - 118 face to face meetings

5

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Chandler – Next steps

Category Detail

Approvals - next steps Next round of community engagement Lodge Mineral Lease Application Complete Environmental Impact Study (EIS) and lodge (Federal and NT)Complete all regulatory approvals, licences and agreements

Project - next steps Complete stage 2 drilling and seismicComplete dry/wet salt processing pilot, geotechnical tests and analysisComplete definitive feasibility study (FEL3)Complete off take, supply, and finance agreementsExpand team and appoint Tellus consortium partners

5

Dry / wet salt processing pilotDrilling (mine planning) Planning for build / S1 operationsRegulatory approvals & offtake

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Drilled 1,864 m

Field work Grade analysis Expert analysis

915 samples (1,700kg) Dual business

FEL 1

Engineering DFS/EIS Commercial

Site investigations Trade trips

Sandy Ridge - Project Update6

Country of study contributors:

Site visits to other kaolin mines:

Project technically feasible, commercially viable, no fatal flaws

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Sandy Ridge – Next steps6

15 ton kaolin pilot and analysis40 tonne bulk sample collection Stage 1 buildRegulatory approvals & offtake

Detail

Next round of community engagement Lodge Mineral Lease Application Complete PER and lodge (Federal and WA)Complete all regulatory approvals, licences and agreements

Complete stage 2 drilling Complete pilot, geotechnical tests and analysisComplete definitive feasibility study (FEL3)Complete off take, supply, and finance agreementsExpand team and appoint Tellus consortium partners

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Any questions?

Duncan van der Merwe

Group Managing DirectorE: [email protected]: +61 2 9241 7678

www.tellusholdings.com