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Review the provided excerpts from the 2015 Annual Report for Kibo Mining PLC (in particular the discussion of the mining component of the MCPP).

1.Based on the payback period and net present value (NPV) analyses, does this seem to be an attractive investment opportunity?

2.Thinking about a recent large purchase you have made (or plan to make), what pertinent information would you need to have to perform a capital investment analysis? Specifically for your recent or planned purchase, what capital investment analysis techniques might be helpful?

investigating in detail four mining options modelled from this earlier report. These options comprised dillerent combinations of free dig mining, use of Surface Miner, crushing, no crushing, owner cperated and contract mining. The results demonstrated further improved techinical and financial parameters across all options as follows: - Modified terrace mining method applicable with cverburden stripping by free dig and coal seam mining using continuous surface miner eliminating the need for explosives; - Processing fimited to de-stoning of raw cosl product with no washing required which significantly reduses emironmental impoct of run-off and assoclated environmental mitigation costs; - River diversion shown not to be required with consequent lesser environmental impact on site area: - Anmual estimatiod coal revenues of approximately S48 milion at all in cost mergins of 4986 to 626 generating profit margin of between US\$24 million* to USS 27 mililion; - Cepleal imucstment of US\$38 million* to 573 millian, NPVs of US\$211* m illon to US\$244 mallion (discount rate of 5.5% ) and payback period of 2.6 to 3.65 years and; - IRR of $4% for preferred option. forn the fos consodered hn the ifs. Foliowing the positive outcomes of the Mining PF5, the Company immediately commenced the frost phase of the Mining DFS. The majer part of this comprised a gectechnical drill progranume primarily deslgnod to test ground conditions within and around the planned open pit locetion. The drill programme alsa doublod as a misins to ebtain cost samples for metallurijkal testing to further characterise the coal properties to ensure they are approprlate to the power station design. The results from the geotechnical drilling were announced in January 2016 and corifirmed that the final pit slope angles modelled for the mine design are well within safety requilrements and in fact provided a further opportunily to optimize pit design. The results of the metallurgical testing were also extremely positive and confirmed that the coal quality was well within technical speclifations required by the power plant design, and sultable as a long-term fuel source to power the Mbeya Power Plant. Signilicantly the test results showed that the coal's ash and sulphur content was at similar levels to cosal used for thermal power generation in Southern Alrica, and suitable for trestment to keep sulphur dioxide emissions well within international emission standards. The drilling also provided additional data to assist with a restatement of the Mbera Coal Resource, and this restatement has recently been published (April 2016). Thls has seen increase in total Minent Resaurce from 109.23 million tonnes (M) to 120.793Mt representing a 10.42% increase over the perious Miaeral Resource with 91% of the resource now in the Indicated and Measured categorles. Based on an integration of all leasibility study reports available to the end of the third quarter 2015, Kibo anesunced the results of a finencial opatimisation study on the mining component of the MCPP in October 2015. This work was completed in collaboration with its appointed mining DFS consukant Mirsecon Projects. The followine updated finandal metrics besed on the preferred surface miner contractor eption with optimal searias [70% debU 30 s equity), mine lile of 28 years and lending rote of La0R+5% for the project weie obtained: - Arnual estimated coal sale revenues of USS484 miltion based on an anstal coval production of 1.48 million torines: - All-in cost margin ranges from 47.9x to 48.1%. Applying the aforementoned all-in cost margin. Kibo interprets that annual earnings belote interest and tax ("EBIT") of between US\$23.5 million to US\$ 23.6 million will be generated; - Applying a real discount rate of 5.51%, the best estimated Net Present Value [NPV] of free cash fiow to equity ranges between USS 214 million and USS 219 milfion: - Equity IRR (leveraged) range between 131% and 146%, with a Project inh of 54%; - Cash return on capital Invested ranging between 726% and 732%; and - Project Payback. Period belore loan of 2.6 vears The financial profile of the mining component of the MCPP ummarised above shows improvement over prevlous estimates, and makes it an attractive option ior project ievel loan financine at competitive rates, particularly given the high IRR and short payback period. In April 2015 the Company announced a Joint Develapment Agreement ("IDA") with China based EPC. contractor, SEPCO II, a major international power plant construction contractor, Under the terms of the IOA, SEPCO III will co-fund completion of the DFS during 2015 and have the option to participate as a minority equity bolder and sole EPC coatractor to the project during the follow-on construction phase which is scheduled to be completed by the end of 2019. This J0A which was finallsed in July 2015 represents a strong independent endorsement of the MCPP as an attractive energy imvestment by a major global player in the therrnal coal plant construction field. In conjunction with advancling the mining corr ponent of the MCPP DFS, the Company has atse made signiticant progess on the power plant component doring 2015 following the completion of a power pis study in tate 2014, In late 2015, Kibe annouinced the appointment of Tractehel finplineering (Troctabel"). a Europe based international engineering services compary (part of Engie Groep) to conduct the power pFs following a tender procens. The commercial arrengernent negotiated with Tractebel allows Kibo to defer the majority of fees to a staged schedule starting when the PFS is complete and ending when the MCPP reaches financlal close. Anether important preparatory work stream for inpent to the MCPP BHS dering 2015 has been on-going negotiacions with relevant Tanzanlan Government Departments and Utilites on the framework and terms of reference under which a Power Purchase Akreement and Grid Connection Agreement wal be concluded. A noteworthy development in this regrd was the announcement of a Memorandum of Understandirg ("MOU") between the Compary and IANFSCO (Tenzania's state owned electricily supply cornpany) In Ianuary 2016. This MOU lors out the mutually agreed principles within which a fower Runchase Agreement ("PPA") for the MOPs will be negotited, The mutualiv agreed PAA will form a kry hput for both the power DFS and the final lePS in determining the commercial framework under which the linked mine and power plant will operate. This MoU was followed by a recent meeting between Nbo mansesment and Tanuanba's Minister of Energy 8 Ninersis which senlor representathes from ky parasutal stukcholders (LANESCO, Nebional Develoganent Corporation and State Mining Corporation) in the proiect dho attended. The Minister reitrerated lls support for the MCPP as an Importaot part of the Governement's atiatery to abidress the country's power delkit and incteuded ail attendees to wark pro-active) with koo to atvance the propect

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