Market Update

General - Perseus - Berkeley

Good afternoon

Chinese PMI continiues to be strong, at the highest for 5 years. German labor market is very strong - 600.000 more people imployed than a year ago...will be good for tax receipts, lower social security payments, and consumption!

Zuma is escalating South Africa´s problems by sacking his well-regarded finance minister...what a nightmare this president is! His action could have serious repercussions for the country incl a rating-downgrade. Having said, this, the many strange sagas going on in Washington are probably not that much better!

Base metals are weak, I guess not helped by weaker sentiment following an end to strikes at Escondida, and Cerro Verde - copper dragging the others with it.

Cobalt is making new highs, about to move through 55.000US$/t. Even if I assume, that PAN receives only 50% of the value of cobalt as part of their concentrate, the difference of their BFS-study and reality amounts to 10 US$lb, being an additional 10 mill A$in revenue - very meaningful for a 120 mill$ market cap-company.

Perseus - the Life-Of-Mine Plan for their second mine, Sissingue, ahs been announced. The mine is fully financed, and about 40% complete, with first production expected 1st of March 2018. The resturn on investment is not fantastic at the assumed gold price of 1200 US$, as indicated by the pay-back of 39 month. The After-tax cashflow is 104 Mill US$ ( against 107 Mill US$ capex ), the IRR is 28%. One can see, why the company has very carefully thought about bringing it into production. PRU have some 70.000 ounces sold forward at average price of 1300 US$, which helps. Clearly, there are some benefits from having a second operation, in a second country - and tehre is considerable upside from exploration. The all-on-site costs ( incl sustaining capital ) of 625 US$ are excellent, but the total estimated production of 358.000t is only providing for a 5 year mine life. Any additional 1 year or 70.000 oz, even if I assume higehr costs of say 800 US$, would add another 35 mill A$, which is a lot for a company with only 320 mill A$ market cap. Overall - not a massive story as yet, just a little positive. Exploration can turn this into a very profitable and benficial contributor to the company. Overall, I think the stock is cheap here. You might remember, that they already announced a very positive production update to the 10th of March, and indications are, that production has continued on this high level. Another Quarter like this, and the company will gain back some lost confidence in the market!

Berkeley Energia - the aspiring spanish uranium producer has come under considerable pressure over the last few weeks. General sentiment towards uranium has been sinking, and the Westinghouse/Toshiba problems have not helped, either. Also, since having published the feasibility study, there is a dirth of new news now - the market is waiting for the final financing incl off-take, strategic investor/partner etc - and possibly another placement? Fundamentally, the stock is coming back to a very-good-.value level now - the large, substantially oversubscribed placement took place at 45p, just under today´s price, and that level ( = 70ct in A$ ) is providing good chart support as well. Stock is worth a good look again here - but at the same time, there probably is no urgency to buy right now.

Have a nice weekend! 22 degrees in Munich - spring is here!

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

The information contained in this communication is confidential and is intended only for the use of the addressee. Unauthorised use, disclosure or copying is strictly prohibited. If you have received this communication in error, please delete it and notify us by telephone at +49-89-4613440-0, by fax at +49-89-4613440-10 or by e-mail at wschroeder@schroeder-equities.com immediately. Please note that this communication does not constitute and may not be construed as investment advice and / or referral to buy or sell financial instruments. Unless specified otherwise, the views expressed in this communication are solely subjective notions of the individual sender and / or the entity or individual stated as the author of any information submitted. Performance in the past may in no case be considered as an indication for future performance. Please also note that Schröder Equities GmbH and / or its officers or employees may have interests in financial instruments referred to this communication. A current list of shareholdings can be emailed on request. Furthermore, our clients are hereby informed that Schröder Equities GmbH renders advisory services to Nestor Australien Fonds, an investment fund administered by Nestor Investment Management S.A. Luxemburg. Please also note that e-mails can be intercepted by unauthorized persons.

General - Cyclone - West African Resources

Good afternoon

CPI in Germany fell strongly last month, from 2.1% to 1.5%....Business confidence in Europe slightly lower, but still close to 6-year high. US economic number neitehr here not there today. Hence, liitle action again...markets are a bit unsure about where they want to go to next....metals going sideways at a high level ( except for nickel ), gold not strong enough to go through resistance as yet, bonds not really giving any direction as well....Only equities are looking as they could struggle higher in the short run - but also without any great conviction! Having said this, metals See getting stronger late in the day!

The English believe, that they can get a cheap deal from the EU - but I think politicians here are as p...ed of with them as much as I am, and they will not take any prisoners the way it looks. This could end up being quite nasty for the UK - but it will do us some harm as well. In the end, everybody hopes, that rational thinking prevails to keep a good friendship intact.The economy as well as confidence are holding up so far very well in Europe, despite BREXIT and Trump-uncertainties - must be testimony to some underlying strength.

All the commentry in Bloomberg about a terrible fall of iron ore prices etc etc...what a lot of bulls..t....this was very overdue, price is holding just above 80$/t, which is a fantastic price, and much better than anyone would have thought! Relevant companies are making a killing...and will continue to do at 70$ as well as at 60$!!

Cyclone Debby - the worst is over...but it´s still raining in many places at the East Coast. Gold mining operations of Evolution and Resolutre have started operations again - for some of the large coal producers, the situation is more difficult, as millions of t or material have to be transported, and some rail ways/ highways have some damage ebcause of the flooding. General commentary seems to be , that the impact will not be large enough to have a meaningful impact on coal prices, though.

West African Resourecs - incredible results out today...I am amazed, that there have been sellers of 3 mill shares today! The results are not a game changer on their own, but getting very close to that. Underneath their existing open pittable resource M5 tehy hit 42m with 3,89g ( incl 14m with 5.4g ) from 176 m; and 77m at 5.3g gold ( incl 27m with 12.26g ). Also excellent intersections from M1 deep drilling, with visible gold in 3 holes from between 280m and 365 m...assay results pending. And all of this ore is "good" ore - no metallurgical issues at all, recovery rates of around 90%.This is getting better and better...there should be VERY little doubt, that we will see a very viable underground operation here on top of the open pittable stuff, for which a bankable feasibility study had been published recently. The only caveat: it will be another say 4-5 month, before we see another resource being done. Drilling activity will be increased again very shortly, from 2 company-owned rigs + 2 contractor rigs, to a total of 6 rigs. As an interesting comment on the side: The company had problems initially to get the additional rigs...at least the good drilling companies are currently working at close to 100% utilisation rate in Western Africa. WAF have 15 mill$ cash left - much more than enough for what they need to do.

Have a nice evening

Prairie Mining - Heron Resources - West African Resources

Good afternoon

not much to report from the economic front today!

Daimler planning to speed up their involvement in EV, going to spend 10 Bill Euro´s to bring at least 10 new electrical cars to the market by 2022.

Not much action in base metals as well today, while gold is rebounding a little from yesterday´s late fall to 1253 US$ as at mid-afternoon.

Prairie Mining - placing 5 mill A$ worth of stock at around 45ct to London-based institutions, bringing their cash position to approx 15 Mill A$, after having spent an estimated 3 mill in the current Quarter. This should be sufficient to finish the feasibility study for the Jan Karski thermal coal mine in the summer, and to accelerate development of the Debiensko hard coking coal project. The placement price is a touch disappointing to me - but Berkeley has shown us, that it can be good news to have a few of these guys on the register as ongoing supporters. For a larger insto, it´s more or less impossible to buy stock of such a minnow in the open market, but that´s made a lot easier for them, once they have a halfway meaningful investment at a preferential price. These things are never looking good for small shareholders, but I think the longer term value far outweighs this. As you know, I am big fan of the company, and am holding a sizeable position.

Heron Resources - are taking a bit too much time for my taste to come up with progress for their zinc development, Woodlawn. The company today announced a new agreement with Veolia about the joint use of the project side. Veolia is using the area as a large landfill project for Sydney waste. They also announced, that they are in the process of documenting a debt and equity structure with financiers, as well as an offtake agreement. Sounds like finally, something is happening here. I would think, that the proejct is highly profitable at the current price level for zinc, lead and copper. Shareholders of Heron recently received a 1:10 free entitlement to Ardea, which have a nickel/cobalt resource, and which trades at 54ct. So there has been at least some fun on the way, increasing the value of a Heron shareholding by a meaningful 5,4ct/share

West African - Broker Argonaut took up coverage, valuing the stock at 40ct, with an upside scenario of 67ct. Being a holder of it, I completely agree - I think the current exploration program will continue to deliver, enabling them to announce an expanded feasibility study in the 3rd Quarter, which will incorporate the planned underground mine.

Have a nice evening

General - Paringa

Good afternoon

Consumer Confidence and Housing Prices in the US very strong...

Base meatls are finding a floor today, as the gold price is toying again with key-resistance at 1260 US$. I would be surprised, if we went through that straight away...but any break would be pretty bullish, especially in the short term.

Cyclone Debbie in Queensland has been pretty bad, but we will need at least another day to assess the damage. For the mining operations in the area ( mainly coal, some gold ), the amount of rain might be even more important.

A few interesting deals today: Tencent buying 5% of Tesla for 1.8 bill US$ / Agnico Eagle placing more than 200 mill US$ with a single fund / Goldcorp getting in bed with barrick to develope resource in Chile

Paringa - came out with a very strong feasibility study today for their Poplar Grove coal mine in Illinois. 2.8 millt at 29.24 US$/t Opex to barge, average annual EBITDA of 67 Mill US$, NPV 310 mill US$ and only 44.7 mill US$ capex - I guess all in all about 53-55 mill US$ incl working capital needed. That´s less than 1 year´s EBITDA...for a mine with 25 years mine life! The mine will go into production by mid-2018, followed by the second mine close by, called Cypress, which should be in production by early 2012. The combined NPV8 for both mines is 655 Mill A$ or 850 mill A$...

I am assuming a capital raising of approx 40 mill A$, followed by a bank financing of approx 25 mill US$...hopefully, the placement will happen soon, because all institutional investors will just wait for that to happen - rather than bidding up a reasonable illiquid stock.

The risk of this development is quite small for a mining venture, as teh coal seam is very very cloase to surface. All infrastructure is in place...all approvals are in place.

By doing some numbers, I arrive at a valuation of at least 1.80 A$/share ....that´s 3x upside. By the time both mines are producing, numbers could be larger, esepcially, as the discount rate should come down...4x EBITDA are very close to the NPV8 of 850 mill A$...and assuming another 50 mill shares on issue, the valuation would be closer to 3$ than 2 $....In my opinion, this is a no-brainer. I declare my substantial interest in PNL.

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 - Breaker - Lucapa - St Barbara - Gleneagle ( well, a bit of a joke ) - Marindi

Good afternoon

It looks like Escondida will start work again tomorrow. Workers will go back to the old contract, buit without receiving a bonus. the same negotiation as we have just - unsuccesfully - finished, will start again on 1.6.2018 - probably not a good outcome for BHP and RIO, as the copper market will have tightened up by then, making the companies more vulnerable. The mine will have lost 160.000t of production by now, and probably some more to come, as the ramp-up to full production will take a few weeks, I guess.

Today is a clear risk-off day in the markets. Equities weak, metals weak, US$ weak , bonds stronger on the back of Trump´s failure to get his own party to vote through the healthcare vote on Friday. Strong durable goods orders in the States on Friday, and a stronger than expected IFO-institute number for business confidence in Germany today( indicating strong manufacturinga s well as services sectors ), fail to make an impact. Merkel´s party, the Christian Democrats, whin a provincial election by a strong margin over Social Democrats, while Germany´s new right-wing party AFD gets only 6%.

A$ gold price hits 1650 - that´s the highest since Nov 20 of last year

Many Queensland-based mining operations have been closed down today in anticipation of Cyclone Debby hitting the coast tomorrow close to Ayr, which is about 80 km North of Evolution´s Mt Carlton Mone ( which is about 60-70 km from the coast ). Debby is the worst cyclone since 2011, and is expected to hit the coast wind wind of up to 250 km/h. The bad news for mining might not be so much the wind, rather the accompanying, heavy rains. Some thermal coal operations, mainly from Glencore, are likely to be impacted.

Gleneagle Gold - a few of you might have been caught with this stock, which represented one of my worst recommendations ever, many years ago. You will be glad to hear, that this failed gold miner has turned into a cannabis stock, and has more than trippled recently - new name is Zelda Therapeutics. Now the bad news...we have had multiple share consolidations, and if you held 1.000.000 shares originally, you are now only holding only 3636 shares....In other words: your holding is still just about worthless...

Marindi - bad news here...the company followed up on it´s great drill hole for lithium...and the excellent results could not be confirmed. There does not seem to be continuity of the resource. They have to start from scratch now - or be successfull in their court case against Kidman. I hate to be dependant on a court case - that´s even worse than to be investing on politics!

St Barbara - have made the decision to invest 100 mill A$, mainly in additional ventilation, to drive their Gwalia Mine down to 2.000m, and potentially deeper. An additional 200m depth would require another an additional 30-35 Mill A$. This orebody is very rich, so the company can and should invest here...Still - amazing - when I started working back in 1985, Sons Of Gwalia was the first, halfway sizeable mine to go into production, on the forefront of the 1985/1986 gold mining boom in Australia. Back then, it had a 5 year mine life - today, 32 years later, I think they have a mine life of 7 years!

Lucapa Diamonds - announced an infererd resource for their alluvial diamond operations In Angola. The market was a little disappointed with the grade - but to be honest, I am surprised, that it´s possible at all to put a resource to an alluvial operation. In my experience, this is more an exercise of trial-and-error - and this is the erason, why the stock is tarding on such a low multiple. All good, in my opinion - the stock will only get re-rated, if they get a sniff for the kimberlite, which hosts all these wonderful stones.

Breaker Resources - the company is continuing to close the gap between good drilling results, and a resource....more good drilling results from 20x40m infill drilling, and some extensional as well. A lot of mineable intersections at good width between 1-2 g, but also some very nice stuff up to 8g. BRB have not mentioned as yet, when tehy will have their fisr resource ready to go - but my feeling is anyway, that this might be premature, as the resource has not been closed off as yet - not at depth, and not at strike - so potential is still here for a large resource. 2.2 km are a very nice strike length anyway - but it could still double, as the anomaly is 6km long. Ample funds left to keep on drilling - so no need as yet to have something definite !

Have a nice evening