TG6 General Discussion, page-2

The gold story is now unfolding.

TG6 entered into discussions with Montague Resources Australia Pty Ltd about acquiring the 80% of Van Uden that Montague held with Van Uden being a deposit near Mt Holland in the Forrestania belt region. The other 20% is held by Barto. Montague is now a wholly owned subsidiary of the huge Wesfarmers operation that includes a JV over Mt Holland and in the non-mining space the retail operations of Bunnings and KMart (among other things). Previously Montague was a subsidiary of the now delisted company Kidman. The exact start of these discussions is unclear but TG6 indicated that the acquisition price of Van Uden was agreed in later 2024, a point when gold prices were near A$4,000/t. An agreement was reached and announced on 6 March 2025. This involved TG6 paying $2.5m upfront, issuing 5.714m shares to Montague and also paying $0.5m, which became payable when TG6 did its August CR. The 6 March 2025 release also contains a substantial release of historical drilling.

The original $2.5m purchase price was paid with existing cash but TG6 have recently done two CR's that collectively raised $6.6m before costs - $0.5m of which was on-paid to Montague to complete the purchase. These CR's have taken TG6's shares on issue to 120.5m but mean it has acceptable cash balances for its current needs.

The Van Uden purchase has 3 primary areas - The mining leases that contain the Tasman and Diemen pits, the Gold City tenements that contain historical workings and some lightly explored tenements to the north and along-strike from Mt Holland. There was a JORC resource on the Van Uden deposit that was no longer compliant with the current code of 5.378Mt @ 1.38g/t for 238k oz of contained gold.

TG6 has reworked the JORC so that it is now compliant with the current code and released this update on 5 June 2025 (6.353Mt @ 1.1g/t for 227.14k oz of contained gold). This reworking was done purely on pre-purchase drill results. TG6 is now undertaking a series of infill and extension drilling at Van Uden with the intention of releasing an updated JORC in Q1 of 2026. Satellite images show significant progression towards this objective although comparatively few reported drill results have come through so far.

While its not on-average a high grade, an important part of that JORC could be the 759kt of surface Laterite @ 0.7g/t for 18,740oz. This laterite is typically thin and at surface with depths of 3-6m, depending on location. In many areas there is no overburden above the laterite, or at worst 1-2m so it has a strip ratio well under 1:1 and probably below 0.5:1. At current gold prices of around A$6,500/oz and with an assumed 90% recovery rate the 100% measurement basis has the laterite containing A$110m of gold. The question is, if toll processing capacity is found, how much does it cost to dig, transport and process that gold. If it were $100/t or less then at current prices the Laterite costs $76m (or less) to process but would yield $110m of revenue for a $34m profit (100% basis calc's). That profit potential is increased by focusing on areas of laterite with higher grade. Other areas like east of Tasman involve more overburden removal but also involve higher grade ore and would have strong profit potential if a toll processing agreement can be signed.

TG6 is working through the processes like approvals to be able to toll process ore. They already have some of the permits needed, including those for the original ore piles of ~60kt of ore. TG6 have looked to increase the size of that the initial parcel they are shopping around to 100kt with Tasman bottom of pit material and some high grade Laterite.

The critical issue about all this toll processing discussion is that as at the time I'm writing this, TG6 hasn't secured a toll processing agreement. If they had its likely the share price would be a lot higher - based on guesses as the likely profitability and cash inflow toll processing would bring at current prices.

Recovery rates are always important in mining. The are acceptable to very good for Van Uden. For example, a 336kg sample of bulk Laterite was tested around 25 years ago by crushing it to 75um and undertaking a 48hr bottle roll test. The sample had a recovery of 1.42g/t and only 0.06g/t was not recovered for a 96% recovery rate within the test. The confusing aspect of the test is that assay's before they stated indicated the laterite was 1.22g/t material. You can't recover 1.42g/t from 1.22g/t material so the starting assay grade must have been wrong. This feature met test recovery work confirming the material from Van Uden had a higher grade than expected keeps on repeating in test after test involving crushing to fine sizes like 106um (used by TG6) or 75um (used in year 2000 tests). The met test results released so far by TG6 were around or just under 90%, but also sometimes more than 100% of the grade believed to exist before the test work started.

It may mean that default recovery estimate calculations like taking 90% of the JORC estimate is an under-statement but this won't really be known until either TG6 starts doing met test results based on proton assay samples that don't destroy the sample as part of the test process, or when TG6 starts shipping ore and the actual gold recoveries start being reported.