AuKing Mining Limited Prospectus

A U K ING M INING L IMITED I NDEPENDENT T ECHNICAL A SSESSMENT R EPORT – W ESTERN A USTRALIAN M INERAL A SSETS CSA Global Report Nº R278.2020 38 5 Proposed Exploration Budget and Use of Funds AuKing provided CSA Global with a copy of their planned expenditure for its projects for an initial two‐year period following the planned capital raising. This was based on the exploration strategy and is discussed in Section 3. A proposed exploration budget for a two‐year period is presented in Table 6. Table 6: Proposed two-year exploration activity summary Exploration activity Item Year 1 (A$) Year 2 (A$) TOTAL (A$) Salaries and wages 100,000 100,000 200,000 Contract labour 25,000 25,000 50,000 Travel and accommodation 40,000 30,000 70,000 Communications 4,000 4,000 8,000 Freight 10,000 5,000 15,000 Tenure rents 47,000 47,000 94,000 Tenure rates 44,000 44,000 88,000 Contractors/consultants 55,000 55,000 110,000 Tenement administration 35,000 35,000 70,000 Geophysical surveys 130,000 20,000 150,000 Site preparation 10,000 10,000 20,000 Environmental monitoring 2,500 2,500 5,000 Project studies 25,000 100,000 125,000 Drilling (RC) ‐ 150,000 150,000 Drilling (diamond) 375,000 225,000 600,000 Assays 25,000 25,000 50,000 Native Title/Land compensation 10,000 10,000 20,000 Metallurgical testwork (Phase Ia) 70,000 ‐ 70,000 Metallurgical testwork (Phase Ib) ‐ 80,000 80,000 Vehicles 20,000 20,000 40,000 Total expenditure 1,027,500 987,500 2,015,000 The proposed budgets are considered consistent with the exploration potential of AuKing’s projects and considered adequate to cover the costs of the proposed programs. The budgeted expenditure is also sufficient to meet the minimum statutory expenditure on the tenements. The mineral properties held by AuKing are considered to be “exploration projects” that are intrinsically speculative in nature. The Onedin and Sandiego deposits are at the “advanced exploration” stage where Mineral Resources have been defined, while the remainder of the Koongie Park project area is at the “exploration” stage but with a number of prospects with significant mineralisation intersected in multiple drillholes. CSA Global considers the projects to have sound technical merit and to be sufficiently prospective, subject to varying degrees of exploration risk, to warrant further exploration and assessment of their economic potential, consistent with the proposed programs. At least half of the liquid assets held, or funds proposed to be raised by AuKing, are understood to be committed to the exploration, development and administration of the mineral properties, satisfying the requirements of ASX Listing Rules 1.3.2(b) and 1.3.3(b). CSA Global also understands that AuKing has sufficient working capital; to carry out its stated objectives, satisfying the requirements of ASX Listing Rule 1.3.3(a). AuKing has prepared staged exploration and evaluation programs, specific to the potential of the projects, which are consistent with the budget allocations, and warranted by the exploration potential of the projects. CSA Global considers that the relevant areas have sufficient technical merit to justify the proposed programs and associated expenditure, satisfying the requirements of ASX Listing Rule 1.3.3(a). AuKing Mining Limited | PROSPECTUS 113