Aura Egy Regulatory News (AURA)

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AURA ENERGY LIMITED

("Aura" or the "Company")

Half-Year for Financial Period Ended 31 December 2017

Aura Energy Limited (ASX: AEE/AIM: AURA) is pleased to inform the market that its Half-Year Report for the six months ended 31 December 2017 is now available at www.aurenergy.com. An abridged version of the Half-Year Report is attached for shareholders and investors to review.

During the Half-Year, the Company continued to progress the Tiris project feasibility study and resolved to pursue a separate listing by way of an IPO for its vast Haggan polymetallic property which contains significant quantities of Battery Metals including vanadium, cobalt and nickel.

Whilst the uranium price has shown modest recovery during the Half-Year, following cutbacks by large producers, the Tiris project remains the Company's best near-term cashflow project with C1 cash costs of US$19.40/pound U3O8. This estimated cash cost per pound is below both spot and contract prices at this time.

The key milestone achieved during the Half-Year for the development of the Tiris project was the approval by Mauritanian authorities of the Environmental Permit. The company has discussed the delay to the grant of gold tenement with the government. During the most recent meetings with the government, in regards to this delay, the Company was informed that the tenement will be granted soon. A key diversification strategy for the Company is gold and base metals and the ground subject to the tenement applications is highly prospective.

The Haggan Battery Metals strategy has evolved from the Company's desire to maximise the output of the vast polymetallic resource. The board of directors resolved towards the end of the Half-Year to list the Haggan Battery Metals project as a separate vehicle and therefore, provide this separate vehicle with management, funding and technical drive to ensure that outcome. The rapid development of the battery sector and the significant vanadium content of the Haggan Battery Metals project have created significant opportunities for Aura. The Company completed a small working capital raising of AU$1.1 million during the Half-Year.

For more information please visit www.auraenergy.com.au or contact the following:

CONDENSED CONSOLIDATED INTERIM STATEMENT OF PROFIT OR LOSS

AND OTHER COMPREHENSIVE INCOME

FOR THE HALF YEAR ENDED 31 DECEMBER 2017

The condensed notes on pages 6 to 13 are an integral part of these consolidated interim financial statements

CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION

AS AT 31 DECEMBER 2017

The condensed notes on pages 6 to 13 are an integral part of these consolidated interim financial statements

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

FOR THE HALF YEAR ENDED 31 DECEMBER 2017

The condensed notes on pages 6 to 13 are an integral part of these consolidated interim financial statements

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS

FOR THE HALF YEAR ENDED 31 DECEMBER 2017

The condensed notes on pages 6 to 13 are an integral part of these consolidated interim financial statements

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

FOR THE HALF YEAR ENDED 31 DECEMBER 2017

NOTE 1. REPORTING ENTITY

Aura Energy Limited (the "Company") is a Company incorporated and the laws and regulations of the Commonwealth of Australia.

The address of the Company's registered office is Level 1, 34-36 Punt Road, Windsor. The consolidated interim financial statements as at and for the six-month period ended 31 December 2017 comprises the Company and its controlled entities (together referred to as the "Group" and individually as "Group entities"). The Group undertakes the exploration for and evaluation of uranium and gold opportunities in Mauritania and Battery Metals in Sweden.

The consolidated annual financial statements of the Group as at and for the year ended 30 June 2017 are available upon request from the Company's registered office or at www.auraenergy.com.

NOTE 2. STATEMENT OF COMPLIANCE

The consolidated interim financial statements have been prepared in accordance with Australian Accounting Standards, AASB 134 Interim Financial Reporting, and the Corporations Act 2001.

Selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in financial position and performance of the Group since the last annual consolidated financial statements as at and for the year ended 30 June 2017. The consolidated interim financial statements do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated annual financial statements of the Group as at and for the year ended 30 June 2017.

These consolidated interim financial statements were approved by the Board of Directors on 15 March 2017.

NOTE 3. SIGNIFICANT ACCOUNTING POLICIES

The accounting policies applied by the Group in preparing the condensed consolidated interim financial statements are the same as those applied by the Group in its consolidated annual financial statements as at and for the year ended 30 June 2017.

NOTE 4. ESTIMATES AND JUDGEMENTS

The preparation of the consolidated interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates.

In preparing these consolidated interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those applied to the condensed consolidated financial statements as at and for the year ended 30 June 2017.

KEY JUDGEMENT-EXPLORATION AND EVALUATION EXPENDITURE

Exploration and evaluation expenditure is carried forward where right of tenure of the area of interest is current. These expenditures are carried forward in respect of areas that have not, at the reporting date, reached a stage that permits reasonable assessment of the existence of economically recoverable reserves. The carrying value of capitalised exploration and evaluation expenditure at the reporting date is $16,907,457.

For the six-month period to the 31 December 2017, the Group completed an assessment of its tenement assets and decided that there was no need to recognise any impairment of its exploration and evaluation expenditure carried forward.

NOTE 5. GOING CONCERN

The consolidated interim financial statements have been prepared on a going concern basis, which envisages the continuity of normal business activity and the realisation of assets and the settlement of liabilities in the ordinary course of business.

The group incurred a loss after tax for the six-month period ended 31 December 2017 of $931,680 (2016: loss after tax $1,514,366) and net cash outflows from operating and investing activities of $3,141,164 (2016: $1,806,254 ). As at 31 December 2017, the Group had working capital of $413,673 (June 2017: $2,026,388).

The Company has also raised $190,917 since balance date with holders of options over ordinary shares exercising their rights.

The ability of the Company to continue as a going concern is principally dependent upon the ability of the Company to secure funds by raising capital from equity markets and managing cashflow in line with available funds. These conditions indicate a material uncertainty that may cast significant doubt about the ability of the Company to continue as a going concern.

In the event the above matters are not achieved, the Company will be required to raise funds for working capital from debt or equity sources.

The directors have prepared a cash flow forecast, which indicates that the Company will have sufficient cash flows to meet all commitments and working capital requirements for the 12 month period from the date of signing this financial report.

Based on the cash flow forecasts and other factors referred to above, the directors are satisfied that the going concern basis of preparation is appropriate. In particular, given the Company's history of raising capital to date, the directors are confident of the Company's ability to raise additional funds as and when they are required.

Should the Company be unable to continue as a going concern it may be required to realise its assets and extinguish its liabilities other than in the normal course of business and at amounts different to those stated in the financial statements.

The financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or to the amount and classification of liabilities that might result should the Company be unable to continue as a going concern and meet its debts as and when they fall due.

NOTE 6. NEW AND AMENDED ACCOUNTING STANDARDS ADOPTED BY THE GROUP THAT ARE APPLICABLE TO THE PRESENT HALF-YEAR REPORTING PERIOD

The Group has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (the AASB) that are relevant to their operations and effective for the current half-year.

There was no material impact.

NOTE 7. OPERATING SEGMENTS

The Group conducts mineral exploration in two geographical segments being Mauritania and Sweden and operates in one industry mineral exploration and mining. Non-reportable segment financial information is reported as Corporate.

NOTE 7. OPERATING SEGMENTS (CONTINUED)

NOTE 8. CASH AND CASH EQUIVALENTS

NOTE 9. TRADE AND OTHER RECEIVABLES

Value-added taxes receivable is a generic term for broad-based consumption taxes that the Group is exposed to in the various countries in which it conducts its exploration activities - Australia (goods-and-service tax, Mauritania (value-added tax) and Sweden (value-added taxes).

NOTE 10. OTHER CURRENT ASSETS

NOTE 11. EXPLORATION AND EVALUATION EXPENDITURE

The recoverability of the carrying amounts of exploration and evaluation assets is dependent on the continuation of the Group's right to tenure, future exploration and successful development and commercial exploitation of the respective area of interest or alternatively by their sale.

NOTE 12. TRADE AND OTHER PAYABLES

Trade and other payables are unsecured and non-interest bearing obligations of the Company which arise from the business activities. Trade payables and other accruals, with the exception of amounts due to directors of the Company, are settled within the lower of terms or 30 days.

NOTE 13. SHORT-TERM PROVISIONS

NOTE 14. ISSUED CAPITAL AND RESERVES

(I) MOVEMENT IN SHARES ON ISSUE

The Company has shares on issue of 854,318,646 (30 June 2017: 792,808,124) and paid-up capital of $40,751,161 (30 June 2017: $39,558,943). All shares on issue are fully paid ordinary shares at no par value.

NOTE 14. ISSUED CAPITAL AND RESERVES (CONTINUED)

(II) MOVEMENT IN SHARES ON ISSUE

The Company has options over ordinary shares granted on issue of 64,664,924 (30 June 2017: 89,553,189 options over ordinary shares).

18,608,333 options over ordinary shares were granted to shareholders or employees for the six-month period ended 31 December 2017 (31 December 2016: nil options over ordinary shares were granted).

On 30 November 2017, shareholders approved the awarding of 35,000,000 performance rights to Mr PD Reeve, the Executive Chairman/Managing Director of the Company, with 20,000,000 vesting on 30 November 2018 and 15,000,000 vesting on 30 November 2019.

NOTE 15. FINANCIAL INSTRUMENTS

The Group's financial instruments consist of financial assets and liabilities which are measured at amortised cost including trade and other receivables and trade and other payables and convertible notes.

The carrying amount of the financial assets and liabilities included in these condensed consolidated interim financial statements approximate their fair value.

NOTE 16. CONTINGENT LIABILITIES

On 15 October 2010, the Company and Global Coal Management plc entered into a Share Sale and Purchase Agreement which resulted in the Company acquiring all the shares on issue in GCM Africa Uranium, the entity which held the beneficial interest of GCM in the above-mentioned research permits in Mauritania.

The Company paid GCM US$100,000 on execution of the Share Sale and Purchase Agreement; US$472,183 in cash plus 2,000,000 fully paid ordinary shares in the Company on completion (due diligence); and, US$500,000 on the first anniversary of completion. The Company also agreed to pay a contingent consideration:

· US$2,000,000 (in cash and shares as determine by the Company) on the delineation of 75 million pounds or more Initial Resource (not defined in the Letter Agreement) under the Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves; and

· US$400,000 in cash and 400,000 fully paid ordinary shares in the Company for each Subsequent Resource of 6,500,000 pounds up to a maximum of US$4,000,000 in cash and 4,000,000 in fully paid ordinary shares.

The obligations to make the contingent consideration payments are held by the Company and the contingent consideration is only payable if the Initial Resource and Subsequent Resource are achieved within 10 years of the date of the Share Sale and Purchase Agreement. Accordingly, the obligation to pay the contingent consideration expires on 15 October 2020.

There are no other contingent liabilities as at 31 December 2017.

NOTE 17. EVENTS SUBSEQUENT TO REPORTING DATE

Shareholders exercised 8,045,833 options over ordinary shares during the course of February 2017 with an exercise price of between 2.0 and 2.5 cents per option over ordinary share. The proceeds from the exercise of options over ordinary shares total $190,917 and will be dedicated to the advancement of the Company's gold projects in Mauritanian.

ADDITIONAL INFORMATION

TENEMENT REPORT

RESERVES

TIRIS RESOURCE - MAURITANIA

HÄGGÅN RESOURCE

Uranium 803 Million/pounds

Nickel 1,640 Million/pounds

Zinc 2,230 Million/pounds

Molybdenum 1,070 Million/pounds