General Mining : 1 April 2016 - Production commences at Mt Cattlin

Microsoft Word - GMM250 2016-04-01 Production Commences at Mt Cattlin PRODUCTION COMMENCES AT MT CATTLIN

ASX ANNOUNCEMENT

1 April 2016

General Mining Corporation ABN: 95 125 721 075

ASX Code: GMM

Issued Capital: 311,702,853 shares

22,700,000 unlisted options

Share Price:

$0.40 per share

Market Capitalisation:

AUD$124.7M

Board of Directors Mr Michael Fotios Executive Chairman

Mr Alan Still

Non‐executive Director

Mr Michael Kitney

Non‐executive Director

Company Secretary

Ms Karen Brown

www.generalmining.com Address:

89 Burswood Road Burswood WA 6100

Telephone:

08 9227 1186

Facsimile:

08 9227 8178

• GMM issued Production Notice to GXY 31 March 2016
• Mining and processing underway
• Transfer of GMM's equity and profit interests to occur in April
• GMM now part owner and operator of ASX's only producing hard rock lithium asset globally
• Spodumene continues to play a critical role in feeding the growing lithium sector in China

Executive Summary

General Mining Corporation Ltd (ASX: GMM) ("General Mining", "GMM" or "the Company") is pleased to announce it has issued a Production Notice to Galaxy Resources Limited (ASX: GXY) in accordance with its earn in obligations at the Mt Cattlin Project, and mining and processing operations are now underway.

Under the terms of the formal Mt Cattlin Acquisition and Development Agreement, signed between GMM and GXY in September 2015, GMM agreed to commit the first $7m of capital required to restart production at Mt Cattlin (forming the first $7m of its $25m total consideration) by 31 December 2015, and recommence production at the Project on or before 31 March 2016. Upon completion of both of these milestones, now achieved, GMM has qualified for its initial 14% equity interest in the Project, and 50% operating profit interest. The formal transfer of these interests is scheduled to occur later in April 2016.

General Mining's Executive Chairman Michael Fotios:

"The recommencement of production at Mt Cattlin represents another major achievement by General Mining in not only meeting its obligations to Galaxy Resources, but also in becoming a reliable, independent and growing supplier of spodumene concentrate to the global lithium market.

The Project team has delivered against a very tight commissioning timeline in order to take advantage of market demand, and I'm confident in our ability to continue to meet our ramp up schedule over the coming months."

Production Overview

Production has commenced with both mining and processing operations. An initial 5‐week program will sequentially recover and stockpile spodumene and tantalum concentrates from the fines circuit ahead of crusher and HMS circuit (coarse circuit) commissioning later in the June quarter (as announced 29 February 2016).

Given the quantities of ore already mined and available for processing, the immediate focus at restart (through to early May 2016) is on the processing circuit, including progressive commissioning of the primary and secondary feed preparation circuits, thickener, fine and coarse circuit screens, mica removal screens, tantalum spirals and tables, fines reflux classifiers and filter belt.

Recovery of previously blasted ore in the Dowling Pit has also commenced, and this ore is being stockpiled for processing later in the June quarter. Recovery of fines material from the TSF for processing in the fines circuit is scheduled to begin during the quarter. Initial plant feed will be sourced from the existing crushed fine ore stockpile adjacent to the plant.

Upcoming News Flow

General Mining will provide regular operational updates to the market as the Mt Cattlin processing facility works through its 3‐month ramp up to a base case throughput rate of 800,000tpa by the end of June. A second optimisation phase will continue through the second half of the calendar year to improve yields to a targeted 70‐75%, based off the ongoing 800,000tpa throughput rate.

First delivery of concentrate remains on target for July/August 2016, and GMM and GXY are continuing to work through the formal documentation process with their China based offtakers. Further updates on execution of formal offtake agreements and ongoing exploration drilling at Mt Cattlin are scheduled for release to the market in the coming weeks.

‐END‐

Further inquiries:

Michael Jardine

Business Development Manager Tel: +61 8 6241 1832 or

+61 424 615 047

michael.jardine@deltaman.com.au

Jon Snowball FTI Consulting

Tel: +61 2 8298 6100 or

+61 477 946 068

jon.snowball@fticonsulting.com

Forward‐looking statements

This announcement includes forward‐looking statements. Forward‐looking statements are only predictions and are subject to risks, uncertainties and assumptions which are, or may be, outside the control of General Mining Corporation Limited. Actual values, results or events may be materially different to those expressed or implied in this announcement. Although General Mining Corporation Limited believes that the expectations reflected in such forward‐ looking statements are reasonable, such expectations are only predictions and are subject to inherent risks and uncertainties which could cause actual values, results, performance or achievements to differ materially from those expressed, implied or projected in any forward looking statements and no assurance can be given that such expectations will prove to have been correct. Accordingly, results could differ materially from those set out in the forward‐ looking statements as a result of, among other factors, changes in economic and market conditions, delays or changes in project development, success of business and operating initiatives, changes in the regulatory environment and other government actions, fluctuations in metals prices and exchange rates and business and operational risk management. Except for statutory liability which cannot be excluded, each of General Mining Corporation Limited, its officers, employees and advisors expressly disclaim any responsibility for the accuracy or completeness of the material contained in this statement and excludes all liability whatsoever (including in negligence) for any loss or damage which may be suffered by any person as a consequence of any information in this statement or any error or omission. General Mining Corporation Limited undertakes no obligation to update publicly or release any revisions to these forward‐looking statements to reflect events or circumstances after today's date or to reflect the occurrence of unanticipated events other than required by the Corporations Act and ASX Listing Rules. Accordingly you should not place undue reliance on any forward looking statement.