Market Update

General -

Good afternoon

We would like to invite you to our yearly Australian Resources Conference in Zurich, 24th of February, Hotel Baur au Lac. As always, the attending companies are inviting all interested investors and other interested followers. Please pass on the information to your colleagues as well!

Please register by using this link: ( if you have already done so, no need to do it again! )

Australian Resources Investment Conference

This year, following companies will attend:

Evolution Mining / Perseus Mining / Panoramic Resources / Prairie Mining / Genex Power / Graphex Mining / Breaker Resources / Peak Resources / Finders Resources / Energia Minerals

Market Update

Legendary investor Stan Druckenmiller bought back into gold....Gold ETF-holdings continue to rise....last but not least, the gold price also continues rising!

Escondida looks almost certain as going on strike by Thursday morning, Chilean time. The supply/demand balance for copper is finely balanced this year - Escondida is producing something like 1.2 millt p.a.. Any strike lasting as long as the last one at the world´s largest mine ( 25 days that was! ) would put a rocket under the copper price ( well, some of it should be in the price already ). Copper is dragging all metals higher today, despite some open questions regarding the closure of mines in the Phillippines, which mainly affects nickel - which is still up to a new , recent high.

Macquarie is talking about cobalt, potentially being the lithium of 2017. They can see substantial upside from the current 17 US$/lb - but they stop just short of giving a new price target.. To be on the bullish side, a price of 25 US$ for cobalt vs 14.30 US$/lb used in the feasibility study by Panoramic for Savannah North, would almost make a re-opening of the mine a certainty with nickel at the current 10.500 US$t, as it would add 20 mill A$ in revenue p.a.. Peter Harold is too good an MD to be waisted in a company, which is playing the waiting game - so I dearly hope for some price action in nickel, copper and cobalt to help them going with a 10+year mine life!

RIO out with a good result today, and expressing confidence via a strong dividend + a 500 mill$ buy-back. No surprise - iron ore is back to 84$/t, and all large producers are just printing money! The stock ( along with all other large mining stocks in London ) was very strong initially - but sold off later. I guess investors are scared off by the potential strike....but there is also a general tendency to take profits in resources stocks today.

Potash - some talk here, that very strong demand from Brazil, alongside production cuts by the large North American miners, has cleared the deck for a 10-15% price increase with Chinese consumers. Talks apparently starting very soon. This would make sense to me, as nobody in North America is really making a buck at current prices, and some mines are actually loosing after sustaining costs etc. Highfield are slowly but surely progressing the approval process...slow and winding road! I am pretty sure, that they will need equity again, once approval has been received during the first half. An increase in the potash price would make an equity raising very much sexier! Some large funds have quietly been building positions, and I am sure, that they are very aware of the need for some more equity at some stage. But before that happens, they will need the mining permit - which itself should be very positive for the stock. I am still a large holder...being patient - and I hate that!

Have a nice evening

Schröder Equities GmbH

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80538 München

Tel. +49-89-4613440-0

Fax +49-89-4613440-10

email: wschroeder@schroeder-equities.com

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eingetragen im HR München, HRB 166985

Geschäftsführer: Wilhelm Schröder

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General - Cardinal - Perseus

Good afternoon

great Factory Orders for Germany out yesterday - bad Industrial Production numbers today - I guess the future is more important, hence I regard the Orders as being more important. I think it´s fair to say, that manufacturing around the world is still looking strong.

The small tightening in China late last week scared investors off a little as a possible precursor of more to come - but the small correction of steel rebar and iron ore reverted somewhat today.

The big story in metal markets I guess is gold, though. It´s now not only the Germans buying gold - the US Gold ETF has also attracted some fresh money over the last few days. Perhaps Trump is scaring even some Americans these days...Gold has broken resistance at around 1220 US the other day, and finally, it´s also looking stronger in A$, following a 6-week sideway move. Australian gold stocks have corrected over the last few weeks, and generally spoken, I think we need a rising A$ gold price now for any significant price action from here. The only one still in the doldrums is probably Perseus - I think there got to be a realistic chance, that they will fall out of the big US-Index soon, for having a much smaller market cap, which might not qualify anymore. Fundamentally, the move is probably overdone - unless they need more money shortly, which should not be the case, if things go according to plan.

Cardinal Resources - announced some nice extensional drilling results today - most of them better than their reserve grade so far, and indicating, that the expectation of some, that the current resource of 4 mill oz could ultimately be as as large as 5-6 mill oz. The metallurgical results last week went some way to alleviated the fears of very low recoveries from the slightly complex ore. The stock has had a nice move, and I would probably want to see some more clarity to these issues, before I commited any money to the stock. Let´s not forget, that the events of the last few month have taught investors once again, that good management is an integral part of a good development story!

Otherwise, it´s not much to report these days - all companies have issued their Quarterlies until last week, and the financials have not started as yet.

Have a good evening

General - Phillipines on nickel etc - Trumbull on energy - uranium - Panoramic - Graphex - Beadell - Cardinal

Good afternoon

Please register by clicking this link:

Australian Resources Investment Conference

This year, following companies will attend:

Evolution Mining / Perseus Mining / Panoramic Resources / Prairie Mining / Genex Power / Graphex Mining / Breaker Resources / Peak Resources / Finders Resources / Energia Minerals

Market Update

I have copied this from my friends at Investec - interesting:

¢ Canadian exploration budgets fall. Exploration budgets allocated to Canada in 2016 totalled US$971m, which was US$214m less than in 2015 and a fall of 18% YoY. However, the decline was less than the global average decline of 21%. The 2016 total budget was a 12-year low for the country, down 70% from the 2012 high of US$3.24bn. There were 400 companies budgeting for exploration in Canada in 2016, which was 14% less than the 464 companies with budgets in the previous year. Source: SNL

And the following is interesting for companies like Strike, and certainly Genex: These are the key words from PM´s speeach last night in Australia ( after having had a big fight with Trump on the phone re refugees ):

And without gas, or substantial new forms of energy storage, where will the firming power come from to support intermittent renewables like wind and solar?

We are willing to sit down with the states to determine the right incentives to enable desperately needed sustainable onshore gas development.

Energy storage - long neglected in Australia -will also be a priority this year.

Last week, at my request, ARENA and the Clean Energy Finance Corporation (CEFC) agreed to work together on a new funding round for large scale storage and other flexible capacity projects, including pumped hydro.

I have also written to Alan Finkel asking him to advise on the role of storage and pumped hydro in stabilising the grid.

Large scale storage will support variable renewables like wind and solar, it will get more value out of existing baseload generation and it will enhance grid stability. And we are getting on with it.

Thank you, Mr.Trumbull! Get on with it, please!

Delicate meetings today...German Foreign Minister Gabriel meets his US counterpart Rex Tillerson, who might be the most sensible member of Trump´s autocracy. Could be good to bring some calm into European/US-relationship. And Merkel visits Erdogan today.....

The A$ is strengthening aginst the US - might test the top of the recent trading range at about 77.50 against the US soon, based on strong resources prices across the board. Against the Euro, trading also at recent highs and probably testing 1.37 to the Euro soon. I think against the US, as well as against the Euro, the Aussie will have problems to break through those levels. Aussie exports looking great - but the Aussie economy is not that strong overall.

The big story in metals today is the Phillippino action: They are closing down 23 mines, and suspending a further 6 mines. As to their words, 50% of Phillippino nickel capacity is affected - that is 10-12% of the world´s nickel....can´t be bad for Australian nickel! But unfortunately, very bad for Oceana...their Didipio copper/gold mine has been suspended - might take 3-6 month to have it re-opened - but then who knows - they have to deal with a pretty crazy government. OGC have got a price from the Phillipines last year for doing everything right...mad, and I am sure, that it´s doing unjustice to them! Nevertheless - big problem - stock is down 14% today, as Didipio is their lowest cost producer and an excellent asset. The news broke at about 5 am our time, one hour before markets closed in Australia. Western Areas were up by 10% last night, and the nickel price is up by 10% over the last 4 trading days - according to Deutsche Bank, quite a few shorts have been bought here recently.

The other big story was the declaration of force majeur by Tepco, on a 1.3 bill US$, long term uranium offtake agreement with Cameco. Potentially, this could put a dampener on future prices for uranium ( which has risen from 18 US$ in early Dec to 25 US$/lb as at yesterday).

Panoramic - very timely release of their feasibility study for Savannah today! The study is excellent, and the company is VERY happy with it - whether it will be good enough, will be decided by the nickel market! Project clearly needs slightly better prices - but not far from todays level. The details:

10 year mine life / annual production of 9.700t Ni - 5.000t of copper - 670t of cobalt / whereby first 5 years average production of 10.900t of nickel. Sustaining acsh costs are 4.40 US$/lb or 6A$/lb. Todayx, the nickel price is about 6.15 A$. Pre-production capital would be 30 mill A$, cash demand incl working capital 30 mill A$. PAN are VERY confident of getting this done without bank finance, not to talk fresh equity, as smelters around the world are screeming for nickel concentrate, which is in short supply vs nickel pig iron. The company has used a copper price of 2,57 US$lb ( vs 2,72 US$ spot ), and a cobal price of 14.50 US$/lb , also just below todays price. If the company would use say 3.00$/copper and 20$/cobalt, which is a distinct possibility, this would add 15 Mill$ in income per year. The sensitivity of the proejct is very substantial between 5 - and 6 US$lb nickel, trippling the NPV at current exchange rates.

The company has noted numerous possibilities to reduce operating costs - one of the largest opportunities would be to produce a higher grade concentrate, which would increase income potentially by approx 10 mill$ p.a., and would cost an additional, limited amount front up of say 15 Mill A$ ( my guess ).

Overall - the feasibility study is in line with positive expectations - but the company would need better nickel prices to give the go-ahead, unless we see better prices for copper/cobalt. An additional 10% from todays A$-nickel price might be enough - I would rather want to see 15% higher prices ( that would obviously reduce, if copper/cobalt would be higher ).

The result is no surprise for holders, I guess - the company remains a great call on the nickel price. I have seen todays price forecasts from UBS and Macquarie - 6,25 US$lb in 2018 and 7.50 US$ in 2019 and 6.00 US$ in 2018/2019 or 6.60 US$ in 2019/2020 resp - under both scenarios PAN would be VERY profitable. If you want further info - the feasibility study is in todays announcement in great detail . I guess it´s needless to declare my interest as a shareholder here....

Beadell - announced more good results from just about any part of the project they have been drilling, without having some stunning numbers like recently.

Graphex - the company has done a new resource calculation following exploration success, which resulted in a doubling of the last resource form 2015. The proejct ios far from finishd - it´s more important, that massive upside has been demonstrated for the potential Chinese JV-partners, who are meant to finance this project. I think this announcement could be instrumental in speeding up the Chinese decision making - their market has huge appetite for especially the type of graphite coming out of GPX´s project. This is gettimng a bit boring, as the financing announcement has been taking longer than hoped for - but all ingredients are there, incl very detailed, Chinese studies ( tehy have effectively done their own feasibility study ) , for this to happen say within the enxt 3 month. A positive announcement would put a rocket under the share price, which would theoretically double it - and that´s without any expanded project, which might well be on the cards, given the large resource increase announced today. I am a holder of GPX, and a rather happy one.

Cardinal - have published further metallurgical studies today, which are looking much better. Using a slightly different processing route, costs could be kept quite low, and recoveries could be increased to above 80% - perhaps 85%. This has been a very important announcement! Remember the stock fell out of bed, when some metallurgical concerns have been published...Stated resources in Ghana are around 4 mill oz, with further, good upside...and the company is still sitting on 18 mill A$ in cash, EV of about 82 mill A$ + options. I wouild definitely buy the stock today on it´s valuation - but a major negative is the management, which has shown itself of let´s call it being tricky...I have no doubt, though, that CDV would attract corporate interest, as soon as they have a mining title!

Have a nice evening

Schröder Equities GmbH

Seitzstr.7a

80538 München

Tel. +49-89-4613440-0

Fax +49-89-4613440-10

email: wschroeder@schroeder-equities.com

website: www.schroeder-equities.com

eingetragen im HR München, HRB 166985

Geschäftsführer: Wilhelm Schröder

General - Crusader - Peak - Prairie - Genex

Good afternoon

Please register by clicking this link:

Australian Resources Investment Conference

This year, following companies will attend:

Evolution Mining / Perseus Mining / Panoramic Resources / Prairie Mining / Genex Power / Graphex Mining / Breaker Resources / Peak Resources / Finders Resources / Energia Minerals

Market Update

if the French continue to have candidates like Mr.Fillon, who looks like having employed his entire family in lucrative assistant-jobs, paid for by the French state, Le Pen will win that election easily...and we would have another nightmare!

English factories saw a record increase of input prices - highest since series bagan in 1992 - not a big surprise, I guess, considered weak Sterling. Yet another strong inflation number from around the world...it´s bulding!!! English manufacturing numbers were also strong...their economy is going well, so far....

US manufacturing numbers very strong today, as are ADP Employment numbers.

Generally, base metals are having another good day, even though copper is down a touch as I am writing...there is strong resístance for copper to go above 6.000 US$...I guess strike/no strike at Escondida will decide on it´s fate in the short term. Workers have voted 99% for strike, and while some government mediation is now on for 5 days, the chances for a strike next week got to be very strong. Even nickel is strong today, moving swiflty through psychological resistance at 100.000 US$/t again.

Very strong equity markets today are helping investor confidence today, despite weak bonds worldwide, and I guess are the main reason for a weaker gold price. it seems to me, that gold is still very sensitive to bonds - even though I believe that in the medium term, real interest rates are much more important for gold, than nominal yields. And when you have people like this guy Bannon in the driving seat in the US, the world will continue to be full of negative surprises! I am just wondering, whether we might still be in for some short term pain, given my expectation, that Yeleln will become hawkish rather sooner than later.

Prairie Mining - announced their first resource estimate for the Debiensko coking coal asset. 310 mill t incl 93 millt of indicated of high quality coal - that´s a very sizeable resource, and larger than I would have expected - right at existing infrastructure, close to European steel mills, which import the vast majority of their coal from overseas...the patient investor will have fun here! More to learn at our Resources Conference in Zurich, 24th of Feb!

Peak Resources - announced some interesting exploration results from their rare earth asset in Tanzania, where they discovered a new area of mineralisation, consisting of high grade fluorite, a mineral, which contains rare earth, barite, niobium and phosphate. The company is now evaluating the economic significance of it. I have to admit, that it might offer some longer term upside - but the really important announcement will be in April, when they will announce the results of their bankable feasibility study.

Crusader - spoke to them today...and it might be looking better than I thought. The "scoping"study to be announced within the next month or so has to be called as such under stock exchange rules, but is actually much more than that. It will be used as a document to get financing for the small project, which is planned as a small 100.000t p.a. start-up operation, to produce 25.000oz or so due to the very high grade of the deposit. The company is working on an initial open pit, followed by some underground production. The pay-back of such a small operation might only be 12 month. Anyway - I am looking forward to see the announcement. As announced earlier, the company also believes, that a mining permit for Borborema might be recived shortly - but you ahve to atke this with a pinch of salt, as companies have been thinking that before, just to become victims of the Brazlian bureaucracy. But there might actually be an end to this long and winding road....

Genex - that has been the major disappointment today!!! Ther company has to do another capital raising, as interest rates have been on the move, and banks are now demanding 0,6% or so more in interest, than they were just 6 weeks ago, when the company did the last raising. In hindsight, they would have been better off ( and perhaps not only in hindsight! ) to raise a bit more, than the essential! Anyway - the increase in interest rates also limits the total amount they can finance, and they are now in need of another 2.5 mill$ in equity. They are raising 7.5 mill$ in a placement, and through a 1:14 rights issue to all shareholders, which includes a nice buffer. The price for this problem is very high - the company is raising the equity at the appaling price of 16ct. I am just so p...ed off with their broker, who is taking advantage of them being in this situation! I fear, that the market in the stock will come down to close to this level, as many retail investors will try to sell a few at 18ct, top take up new shares at 16ct...we will see. I am still a very strong believer in Genex, and have applied for a substantial number of shares. And if I could, I would pile in with my own money....absolute ripp-off price!

Newsflow over the next few weeks/month will be: Closing of the financing / final feasibility study for Solar Stage II / further information on cost studies for the hydro plant, and for the additional transmission line. The Solar Stage I project is on target for production by the end of this year, Stage II could be in production by early 2019 ( once the transmission line has been built ), and the big price, the hydro-pump power station , should be producing by then end of 2019/early 2020. Malcolm Turnbull, Australia´s premier, held a big speach today about the power situation in Australia and the very important role hydro-pump would play in future plans, indicating good chances to me, that GNX are right on target to receive the hoped-for 50 mill$ government grant to develope it. I still believe, that GNX will ultimately be worth a multiple of todays price - but in the short term, we are going through some pain here!!!

Enough for today - have a nice evning!

Schröder Equities GmbH

Seitzstr.7a

80538 München

Tel. +49-89-4613440-0

Fax +49-89-4613440-10

email: wschroeder@schroeder-equities.com

website: www.schroeder-equities.com

eingetragen im HR München, HRB 166985

Geschäftsführer: Wilhelm Schröder

General - Crusader - Panoramic - Kingsgate - Breaker - Finders - Paringa - Fortescue

Good afternoon

Please register by clicking this link:

Australian Resources Investment Conference

This year, following companies will attend:

Evolution Mining / Perseus Mining / Panoramic Resources / Prairie Mining / Genex Power / Graphex Mining / Breaker Resources / Peak Resources / Finders Resources / Energia Minerals

Market Update

Housing prices in the US are looking good, and growth in France is strengthening...Europe is digging itself out of the crisis? Way too early to say, as Italy and the peripheral countries are still looking bad...but generally, economies around the world are looking very reasonable! And inflation is rising as well, as are tensions surrounding King Donald I !! Later in teh day, US consumer confidence fell a little from a 11 year high, and the Chicago PMI was lower tha expected. The US is waiting for Trump to deliver on his economic promises, while equity markets are having the jitters from his erratic and autocratic style...

So gold and base metals are having a great day...gold at 1215 US$, base metals are up between 2% for copper and 3,5% for zinc...

Fortescue - very interesting comments from their chief marketing director, who said, that China is closing electric arc furnaces for energy-consumption and enviromental reasons, which produce about 100 millt of steel p.a. These things are using steel scrap, and if all of them would be closed, 50-60 Millt of additional iron ore would be needed for China to hold 800 mt of yearly steel production. He is also reporting on good demand and enquiries from China...Is this the answer to the question, why iron ore prices are still at these lofty levels? Perhaps we are underestimating the strengt of iron ore...which in turn would mean, that we are also underestimating the A$....Fortescue came out with yet another stunning Quarterly, cutting cash costs of production by a further 7%...Their total operating costs for iron ore at port in China are now around 25-26 US$t!!!! The company also received more for it´s iron ore, which is of lesser quality than the official contract in the Quarter, and expect 85-90% of the contract price for the full financial year ( current price is 83,50 US$/t , so the company will currently receive about 73 US$/t - not a bad margin!!!). At current prices, the company would be debt free this year!! The cash generation of the top iron ore producers is absolutely amazing ( FMG are producing 165-170 mt p.a. ) , and they are all keeping themselves happy by not increasing production!!

Paringa - Quarterly without much new info. The US project is going to plan, the feasibility study should be finished this Quarter. More important is, that it´s largest competitor, Alliance Resource Partners, is reporting about increasing demand for it´s coal, and rising prices. PNL need just about 50 Mill US$ incl working capital to bring 1.7 millt of annual coal production on stream, while producing an estimated 39 Mill US$ in EBITDA p.a.. That should not be hard to finance...and this does not include the additional No 11 coal seam, which should improve economics from the currently expected NPV of 172 Mill US$. Like all mining companies not in production, the development is not without it´s risks - but I see PNL as relatively low risk, and as having substantial upside from developing their second mine from cash flow.

Breaker - one of the most frugal, Australian exploration companies is delivering again...excellent drilling results, and the market is starting to get seriously excited about them. 7m at 62g; 7,m at 7.7g; 12m at 3.14g and several other intercepts are - once again - increasing the foot print of the resource. The company has got 12 mill$ in cash, and is spending just 800.000$ this year on admin and salaries....and is spending 1.6 mill$ this Quarter on drilling. If Tom Sanders can also prove underground potential, this asset could become very sizeable. The EV of BRB is now 53 Mill A$, and while this might be appropriate for the current state of the project, it also leaves a lot of upside, if Tom can continue to deliver here.

Panoramic - notmuch to report from their Quarterly...for a change, they did not surprise us with promising exploration results, which is slightly disappointing. The main news will be the final feasibility study, which should be announced very soon this week or next.

Finders - the detailed Quarterly did not contain many surprises - production numbers had been announced earlier. The new plant produced 6150t of copper last Quarter, and reached name plate of 25.000t p.a.. Cash costs of 1.08 US$/lb were slightly higher than expected ( but are expected at the planned 1.05$/lb this Quarter ), mined copper has been 2% higher than expected from the reserve-calculation. It´s now all about fine tuning, and I ahve little doubt, that production in 2017 will be higher than 25.000t. The small, 3.000 pilot plant did not perform well and is undergoing some refurbishment. It will be in full production again in the June Quarter. The company has started to pay down debt last Quarter - net debt is now at approx 88 Mill US$. FND have now started exploration in earnest, and that has potential to add further reserves over the coming year or so.

The stock has started to move with good turnover, and will be going higher!

Kingsgate - will finish the month at 38 Mill A$ in net cash and no debt. The plant has been moothballed, as Thailand did not renew the necessary licenses...but certainly, KCN do own the plant and a lot of ground - without a valid mining permit. What is this worth???? God knows - anything between 20 mill and 100 mill A$...and tehy own the promising silver/gold proejct in Chile, which has a NPV of 150 Mill US at silver price of 19 US$... Company has a market cap of 62 Mill A$ and is certainly cheap - question is, though, how long it will take and how the company can realise value from Chatree.

Crusader - they are certainly not impressing me by moving fast! Very little happening at Borborema, very little cash generation from Posse iron ore, and tehy are still working on the scoping study for the first step to bring Juruena into production. Grades at Juruena are fantstic - the project now has 260.000oz of resources at average grade of 1/2 ounce - but cash is coming down and will be gone again in 3-4 month. The only good news is, that the company is debt free now.

I have no doubt, that the value of thes assets is higher than the markt cap - and potentially, a lot higher. But good old CAS are trying my patience....

have a nice evening

Schröder Equities GmbH

Seitzstr.7a

80538 München

Tel. +49-89-4613440-0

Fax +49-89-4613440-10

email: wschroeder@schroeder-equities.com

website: www.schroeder-equities.com

eingetragen im HR München, HRB 166985

Geschäftsführer: Wilhelm Schröder