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QUARTERLY ACTIVITIES REPORT

For period ending 31 December 2019

ABOUT MALI LITHIUM

Mali Lithium Limited (ASX:MLL) is developing

the world class Goulamina Lithium Project in

Mali, West Africa.

The Project is the largest uncommitted hard rock

lithium ore reserve in the world being 31mt at

1.56%Li2O.

The Project is fully permitted, with the Company

having received its’ Environmental Permit

approval in March 2019, and its Exploitation

(Mining) Permit approval in August 2019.

Mali Lithium is in the final stages of completing

the Definitive Feasibility Study for Goulamina as

well as a Resource expansion drilling program.

Key metrics as at 31/12/2019:

Shares on issue: 317,348,112

Listed options on issue: 29,418,937

Unlisted Options on issue: 2,000,000

Cash: A$3.8M

Share price: 28 Jan 2020 $0.095

Listed option price: 28 Jan 2020 $0.032

Market capitalisation: 28 Jan 2020 A$31.1M

Mali Lithium Limited

ACN: 113 931 105

Unit 18, Spectrum Building 100 – 104 Railway

Road Subiaco WA 6008

T: +61 8 6149 6100

Highlights

Goulamina Lithium Project

• Outstanding metallurgical test results showing improved lithium

recovery >87%

• Process design and modelling completed

• Excellent new mineralised pegmatites encountered during

Goulamina drilling

• Tenders for mining services received and assessed

Corporate

• Increased interest in project with a number of enquiries from

interested external parties

• MoU for cooperation with Kodal Minerals signed (post quarter)

• Attendance and presentations at China Mining Indaba in

October 2019, including meetings with potential strategic

partners

• Presentations to a number of potential Investment funds in

Dubai and Abu Dhabi in November 2019

Gold Drilling

• Drilling program completed at Koting

• Excellent mineralised intersections encountered up to 34g/T

gold

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Mali Lithium Limited (ASX:MLL) (“Mali Lithium”, “the Company”) is pleased to present its Quarterly Activities Report for

the period ended December 31, 2019, during which the Company continued to progress its flagship Goulamina Lithium

Project in southern Mali. Various activities were undertaken that will inform the Goulamina Definitive Feasibility Study,

now due for completion in May 2020, while numerous informal inbound expressions of interest were received in regards

to participating in the Project in either a project funding, investment or joint venture capacity.

During the quarter, Mali Lithium also commenced work on a scoping study investigating potential downstream

processing of lithium oxide (Li2O) from Goulamina, completed an RC drilling program on the Company’s Koting gold

deposit, also in southern Mali and commenced a drill program at Goulamina to increase confidence in and extend the

existing Mineral Resource. Post quarter, this drilling program began yielding excellent results with the discovery of new,

thick high grade mineralised pegmatites.

HEALTH, SAFETY AND ENVIRONMENT

Mali Lithium recorded no Lost Time Injury (LTI) incidents at the Company’s operations during the fourth quarter. A review of safety and operating procedures was completed in advance of the drilling campaign commencing. There were two minor vehicle incidents during the quarter however these did not result in any injury to personnel.

GOULAMINA LITHIUM PROJECT

During the Quarter the primary areas of focus were metallurgical testwork and design of the process plant based on the outstanding metallurgical testwork results achieved. Additionally, further progress has been made on transport and power solutions and mining tender submissions have been received and evaluated. Evaluation of existing information and anticipation of the results of the drilling program have led to the decision to include the upcoming revised ore reserve in the Definitive Feasibility Study (DFS), which will mean a revised pit optimisation and production schedule being developed once all the assays have been completed. This is expected to result in to push back the completion of the DFS tol May.

Mineral Resources and Ore Reserves

Following work on the Company’s gold tenements in Mali, a drilling program commenced at Goulamina in November. The main objective is to expand on and increase the confidence in the Mineral Resource, as well as testing geophysical and structural hydrological targets within Goulamina and aiding in the completion of geotechnical testwork relating to the construction of the process plant and tailings storage facility. Drilling is expected to be complete in mid-February 2020. Further information on the drilling program appears later in this report.

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Metallurgical Testwork

Highlights during the quarter from the Metallurgical Testwork program include:

• Achieved target of 6% Li₂O concentrate grade on a consistent basis and overall lithium recovery of 87%

• Iron content in concentrates of less than 0.7% Fe2O3 achieved after completion of magnetic separation

testwork (in cooperation with CRIMM in China)

• Mica content in flotation product less than 1% (measured by XRD)

• Bulk flotation tests using site water completed, achieving repeatable and improved results compared with

bench flotation tests

• Locked cycle testwork completed successfully

• Settling and filtration testwork completed with results meeting expectations

The definitive flotation testwork was completed in the December quarter. This work provided fundamental information for design purposes and increased confidence in process design. Grind size was optimised to suit liberation and recovery simultaneously: Testwork was done to establish the grind size at which slimes losses could be minimised and at which sufficient liberation could be achieved to sustain best possible flotation recoveries. This included optimising the grind at which iron containing minerals are sufficiently liberated for efficient removal by separation processes. The flotation regime is now well established and optimised, and a range of suitable reagents tested. Flotation reagents from different vendors were successfully tested to enable flexibility and choice, thereby reducing supply risk. The flotation regime in terms of reagents, operating and design parameters has been well tested to the extent where repetitive results provide confidence in the robustness of the beneficiation process. Data obtained from metallurgical testwork flowed into the final process design for the DFS, enabling finalisation of flowsheet design as well as process equipment specifications. During October magnetic separation testwork was completed at CRIMM. This enabled finalisation of design criteria and equipment specification for this important processing component. Efficient removal of iron bearing minerals, which float easily and can therefore contaminate the flotation product, is of vital importance. Even more critical is preventing losses of spodumene, and the testwork has proven that with correct flowsheet design and equipment selection, recovery of iron can be optimised while losses can be minimised. Finally, results of settling tests on slimes as well as filtration tests on flotation concentrate have been produced, establishing design parameters for selection of dewatering equipment in the DFS. In the case of filtration, results have confirmed suitability of conventional belt filter equipment with acceptable moisture content of the final concentrate, thereby de-risking the final process by ensuring production at acceptable product moistures. Settling testwork was completed with excellent results, confirming design parameters for the DFS design.

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Figure 1 – Completed 3D model of the Goulamina Lithium Plant

Mining

Five (5) tender submissions were received for the mining services contract. Four of the five tenders were issued clarifications, and an evaluation was completed. Costings for the DFS will be derived from the information gathered.

DFS Process Plant Engineering

Lycopodium have finalised and issued the process design criteria, process flow diagrams, mass balance and mechanical equipment list deliverables. Requests for pricing were issued for 30 major equipment items, with the majority received back prior to the end of the quarter. A plant layout was finalised, and a 3D model developed, which was reviewed with MLL representatives. The design of the tailings storage facility (TSF) was finalised and the location of the plant on the Torakoro tenement determined. Work continues detailing the major structures and estimation of the mechanical and electrical services for the plant which will feed into the capital and operating costs. This work should be complete by mid-February.

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Non-Process Infrastructure

Power Discussions are continuing with a number of power providers, all of which provide Build Own Operate (BOO) packages, including some renewable energy options. Of most interest is a proposal received for a single cycle gas turbine power station fuelled by LPG trucked in from Ghana. This option presents a saving on the cost per kWh used in the PFS. General Discussions were held with AIM-listed Kodal Minerals, which also has a lithium resource in southern Mali, regarding potential synergies relating to project development. This may include establishment of common facilities to provide construction, maintenance and operational services to both Projects which will include vehicle workshops, spares storage, mobile plant hire, construction materials supply, laboratories, catering services etc. A joint approach to a community development program, such as a focus on creating local businesses to support both operations, could also potentially be pursued. An access agreement relating to the Mafele and Nkemene, tenements currently owned by Kodal, which will allow Mali Lithium to construct infrastructure, such as roads, which will help to reduce the risks associated with interactions between the local villages and mining operations. An appropriate compensation package will be negotiated in relation to this.

Logistics

Mali Lithium representatives visited both Abidjan and San Pedro ports in November. Further discussions were held concerning port infrastructure, stevedoring and road transport. An additional proposal for transport and ship loading was received from ACC and provided options for transport, storage and ship loading for Abidjan, San Pedro and Dakar. Additionally, further information and costings were received regarding the customs procedures at the border crossings between Mali and Côte d'Ivoire. Bulk transport of zinc concentrate from the Perkoa mine in Burkina Faso has enabled the logistics provider to refine customs procedures for entry into Côte d'Ivoire for increased efficiency and reduced cost. Building on previous discussions, it was agreed to develop an MoU with an organisation that can potentially provide backloading options for product from the mine to Abidjan port. This MoU is expected to be signed in Q1 2020.

DOWNSTREAM SCOPING STUDY

The Company, with assistance from global engineering firm Hatch, commenced a Scoping Study into the downstream processing of 6% Li2O product from its Goulamina Project. This is a stand alone study that aims to add additional value by producing ‘intermediate’ lithium products such as lithium sulphate or lithium oxide that can then undergo final conversion to lithium carbonate or hydroxide at existing conversion plants or new facilities in, say Europe.

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Hatch completed the technical component of the study in December however the financial component, which will ultimately determine the viability of the project, can only be effectively determined using the final outcomes of the DFS. To provide the most accurate results, the final publication of the scoping study will occur around the time of the DFS, expected in May 2020.

GOLD DRILLING

Twelve RC drill holes for a total of 1600m were completed at the Koting deposit during the quarter. Assay results from the RC drilling program were highly encouraging and the high-grade nature of some of the intersections reflects the tenor of mineralisation that may be discovered proximal to the Koting deposit (K2, K3) where additional drilling is planned for the future. Significant intersections included:

• 4m @ 11.10 g/t gold from 100 metres, including 1m @34.1g/t gold

• 12m @ 8.92 g/t gold from 63 metres, including 6m @ 16.53g/t gold

• 1m @ 13.80 g/t gold from 140 metres. Two sub-parallel steeply east dipping, north-south striking mineralised zones, hosted by a sequence of greywackes, black shales, and siltstones are interpreted. Mali Lithium recognises the potential for discovering gold mineralisation close to Barrick’s Morilla plant that will add value to the Company’s bottom line.

LITHIUM EXPLORATION RESOURCE DEVELOPMENT

Mali Lithium is currently engaged in a drilling program at the Goulamina Lithium deposit. The objectives of

the current phase of drilling are to:

• Convert Inferred Mineral Resources to Indicated Mineral Resources at depth of the widest portion

of Sangar 1. In this region the pit shells bottom out on the resource model and there is potential to

add additional mineralisation to the mineral Ore reserve, over a 600m Strike length

• Test for northern extensions to Sangar l, Sangar ll, West l and West ll zones

• Drill infill holes in the wide portion of Danaya Zone between 1253450 mN and 1253650mN to confirm

interpretation and convert Inferred resources to Indicated Resources.

• Test geophysical and structural hydrological water targets.

• Geotechnical test work of the planned tailings storage facility (TSF) wall location

• Geotechnical test work of the planned process plant foundations

The following work has been completed as at 20 January 2020:

• 27 reverse circulation (RC) holes have been completed in the quarter for 5145 metres.

• 440 assays received of 2622 submitted to date.

• The dip of Sangar 1 and Sangar 2 pegmatite zones at depth is less than previously interpreted

increasing the potential tonnes per vertical metre. Assays awaited.

• A further 36 holes remain to be drilled including

o 9 RC holes at Danaya

o 5 exploration holes at Bara (Southern extension to Goulamina)

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o 8 x exploratory water bores (640m)

o 3 x diamond tails (270m)

o 11 x short HQ3 diamond geotech holes (165m)

Drilling is expected to be complete in mid-February 2020, leading to an update in the Mineral Resource and

ore reserve.

Below is a map showing the drill program at Goulamina:

Figure 2 – Goulamina Drill plan

Significant intersections drilled during the quarter (reported post quarter) include:

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CASH POSITION

The company had $3.79 million in cash at 31 December 2019, following successful completion of a Renounceable Rights Issue which closed on 10 October 2019, raising A$4.23 million before costs. The Company elected not to place the remaining shortfall of approximately A$1M and announced this intention in December 2019. The capital structure of the Company post the Entitlement offer (10 October 2019) is set out below.

Listed Fully Paid Shares Number of shares on issue

Share on issue at 30 September 2019 264,510,116

Share allotted on close of the entitlement offer 52,837,996

Share on issue on completion of Entitlement offer and at 31 December 2019 317,348,112

Listed 15 cent Options with an expiry date of 17 October 2021 Number of Options on issue

Listed Options on issue at 30 September 2019 Nil

Listed Options allotted on close of the entitlement offer 29,418,937 Listed Options on issue on completion of Entitlement offer and at 31 December 2019 29,418,937

The company had on issue 9,500,000 unlisted options at 1 October 2019. 7,500,000 of these options expired on 19 October 2019 and notification of the cancellation of these options was issued to ASX on 21 October 2019. Cash Movements for the quarter are tabulated below

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A$ millions

Opening cash (1October 2019) 1.6 Renounceable Rights Issue (net of fees) 3.8

Exploration and evaluation (1.0)

Staff costs (0.2)

Administration and corporate (0.4)

Closing Cash (31 December 2019) 3.8

CORPORATE

Corporate activity during the Quarter was focused on completion of the Renounceable Rights Issue and promoting the Company through the development of relationships with potential investors and stakeholders in the lead up to completion of the DFS early in 2020. During the Quarter the Company received inbound interest in participating in the Goulamina Project in a project funding, investment, or joint venture capacity. The Company will keep the market informed with respect to any material developments that may occur regarding these opportunities Post quarter, a Memorandum of Understanding (MoU) was signed with Kodal Minerals, an AIM listed exploration company with a Lithium deposit also in Southern Mali. The MoU will seek will investigate cooperation opportunities in the following areas:

• Pre-development, sharing facilities in the closest town of Bouguoni, where both companies currently have separate facilities to support exploration and fieldwork;

• Establishment of common workshop, servicing, storage and catering facilities;

• Establishment of common supply chains for spares, reagents, fuel and other consumables;

• Joint strategy for transport and shipping;

• Joint approach to community development; and

• An access agreement relating to N’Kemene and Mafele exploration tenements, currently owned by Kodal. The terms of this access agreement will be negotiated separately.

In addition to exploring operating synergies, the companies intend to negotiate an access agreement for the N’Kemene Ouest and Mafele Ouest concessions (“Bougouni West Project”) that are owned by Kodal Minerals via the Bamabara option agreement.

An MoU with major Chinese contractor China Henan International Cooperation Group Co (CHICO) was signed for Early Contractor Involvement at the Goulamina Lithium Project. As part of the MOU, CHICO will provide – at its own expense – Capital Expenditure and Operational Expenditure estimates by the time the DFS is issued that the Company can use to complement the DFS. CHICO is a vastly experienced contractor in West Africa and will also provide a range of advice on early works at Goulamina. A number of marketing trips were undertaken in the Quarter. These include:

• A three-day investment tour of Dubai and Abu Dhabi hosted by an experienced advisory company based in Dubai. This resulted in a follow up visit to Dubai post Quarter

• Attendance and presentations to potential Chinese investors at the ‘Chinese Mining Indaba’ in Beijing and Shanghai.

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• https://www.miningindaba.com/Page/investing-in-african-mining-indaba---china-ro

• Attendance and presentations at the JMP Mining Conference in Bamako, Mali. This is the premier mining conference in West Africa and the Mining Minister for Mali referred to Mali Lithium on a number of occasions during her opening presentation. This indicates the level of importance and support that the Malian Government assigns to the Company.

PERMIT STATUS

All tenements are in good standing and a new application was made, and subsequently granted, during the quarter at Finkola Nord, which is adjacent to the other highly prospective gold tenements held by Mali Lithium in the ‘Massigui’ area and from where in excess of $4.5M in Royalties was received from Barrick gold during 2018 / 2019.

Torokoro PE 19/25 Torokoro Exploitation Permit (100 km2) has been granted and creation of a Malian company to exploit the Goulamina

Lithium pegmatite resource is underway. The boundaries of the exploitation permit are presently being delineated in

conjunction with the DGNM.

Finkola: PR 13/640 2BIS The Ministry of Mines and Petroleum has issued the correction Arrêté No2019-4874/MMP-SG dated 20th December 2019 for the Permit of Finkola, replacing previously issued Arrêté No2018-4577/MMP-SG dated 31st December 2018, and extending Permit validity until the 31st July 2020. N’Tiola: PR 14-715 2BIS The Ministry of Mines and Petroleum has issued the Arrêté No2019-3836/MMP-SG dated 29th October 2019 for the Permit of N’Tiola, extending Permit validity until the 17th June 2021. Finkola Sud: PR 13-672 2BIS The Ministry of Mines and Petroleum has issued the Arrêté #2019-3799/MMP-SG dated 28th October 2019 for the Permit of Finkola Nord, extending Permit validity until the 4th August 2021. Sanankoroni: PR 16-805 1BIS The Ministry of Mines and Petroleum has issued the Arrêté #2019-4873/MMP-SG dated 20th December 2019 for the Permit of Sanankoroni, extending Permit validity until the 11th October 2021. Finkola Nord: New Application Following an application for the Research Permit of Finkola Nord during October 2019, the Company signed a Mining Convention with the Ministry of Mines and Petroleum on the 10th January 2020. The Ministry is currently processing the issuance of the Arrêté which would be the official authorization to proceed with exploration works on the Permit. Further Information: Chris Evans Managing Director Mali Lithium +61 419 853 904

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Permit Holdings and Location Southern Mali

Tenement Status Permit Holder

Project Permit

Designation Area KM2

Permit Number

Update

Birimian

Gold Mali

SARL

Massigui Finkola

88 PR 13/640

Second renewal:

Status: Pending issue of renewal

Permit valid/up to date.

Massigui N’tiola

64 PR 14/715

Second renewal:

Status: Pending issue of renewal

Permit valid/up to date.

Massigui Diokelebougou

100 PR 13/639

Second renewal: effective from 31st

July 2018.

Permit valid/up to date.

Dankassa Makono

32 PR 13/637

Second renewal: effective from 31st

July 2018.

Permit valid/up to date.

Timbuktu

Ressources

SARL

Massigui Finkola-Sud

98 PR 13/672

Second renewal:

Status: Renewal issued

Permit valid/up to date.

Bougouni Torakoro 100 PR 16/840

Exploitation Permit now granted 2019,

Permit valid/up to date.

Boundary currently being delineated.

Massigui Batouba Sud 80 Application Permit not yet granted

Dankassa Sanakoroni 80 PR 16/805

First renewal:

Status: Renewal issued (Order

returned to the DNGM by the Ministry

for Mines for correction

Permit valid/up to date.

Sudquest

SARL Bougouni Finkola Nord 50 Application

Permit not yet granted. Ministry asked

Timbuktu to sign the mining convention

prior to issue (Process ongoing)

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Forward looking and cautionary statements;

This announcement contains “forward-looking information” that is based on the Company’s expectations, estimates and projections as of the date on which the statements were made. This forward-looking information includes, among other things, statements with respect to the pre-feasibility and feasibility studies, the Company’s business strategy, plan, development, objectives, performance, outlook, growth, cash flow, projections, targets and expectations, mineral resources, results of exploration and relations expenses. Generally, this forward-looking information can be identified by the use of forward-looking terminology such as ‘outlook’, ‘anticipate’, ‘project’, ‘target’, ‘likely’,’ believe’, ’estimate’, ‘expect’, ’intend’, ’may’, ’would’, ’could’, ’should’, ’scheduled’, ’will’, ’plan’, ’forecast’, ’evolve’ and similar expressions. Persons reading this announcement are cautioned that such statements are only predictions and that the Company’s actual future results or performance may be materially different Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the Company’s actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking information. Forward-looking information is developed based on assumptions about such risks, uncertainties and other factors set out herein, including but not limited to general business, economic, competitive, political and social uncertainties; the actual results of current exploration activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future prices of lithium and other metals; possible variations of ore grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accident, labour disputes and other risks of the mining industry; and delays in obtaining governmental approvals or financing or in the completion of development or construction activities. This list is not exhaustive of the factors that may affect our forward-looking information. These and other factors should be considered carefully, and readers should not place undue reliance on such forward-looking information. The Company disclaims any intent or obligations to or revise any forward-looking statements whether as a result of new information, estimates, or options, future events or results or otherwise, unless required to do so by law. Statements regarding plans with respect to the Company’s mineral properties may contain forward-looking statements in relation to future matters that can be only made where the Company has a reasonable basis for making those statements. Competent Person Statements regarding plans with respect to the Company’s mineral properties are forward looking statements. There can be no assurance that the Company’s plans for development of its mineral properties will proceed as expected. There can be no assurance that the Company will be able to confirm the presence of mineral deposits, that any mineralisation will prove to be economic or that a mine will successfully be developed on any of the Company’s mineral properties.

Previously reported information

In accordance with Listing Rule 5.23, references to exploration results, estimates of mineral resources or ore reserves

have previously been announced, including the information required under Listing Rule 5.22, in the following

announcements:

• "18.06.29 Danaya Mineral Resource Upgrade" dated 29 June 2018

• "High Grade Maiden Ore reserve for Goulamina" dated 4 July 2018

• “Update on Koting Gold Exploration Activities” dated 12 September 2018

• “Update on Airborne Magnetic and Radiometric Results” dated 28 September 2018

The Company confirms that it is not aware of any other new information or data that materially affects the information included in the original market announcements, and that all material assumptions and technical parameters have not materially changed. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcements.

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In accordance with Listing Rule 5.19, information relating to production targets or forecast financial information have been previously disclosed on 4 July 2018 in the announcement entitled ‘Goulamina Updated PFS Delivers Strong Project Outcomes.’’ The Company confirms that all the material assumptions underpinning the Production Target and the forecast financial information derived from the Production Target in the original announcement continue to apply and have not materially changed.