AUSTRALIA DLE.AX 0,02 AU$ 266,67%

DRAGON ENERGY CLOSES CAPITAL RAISING - HEAVILY OVERSUBSCRIBED

Funds to be applied to pre-drilling activities and a drilling program for the Tabac Cobalt Gold Project

Dragon Energy Limited (the "Company") ASX code: DLE is pleased to announce that it has received applications and firm placement commitments from sophisticated and institutional investors to raise A$1.0 million at $0.012 per share ("Placement"). The book build was two times oversubscribed and introduces new investors to the Company including a prominent resources fund and a significant family office.

The Placement comprises 83,333,333 fully paid ordinary shares at an issue price of

$0.012 per share under the provisions of ASX Listing Rules 7.1 and 7.1A. 21,405,421 shares will be issued in accordance with the Company's placement capacity under Listing Rule 7.1A.

Settlement of the $1.0 million Placement funds and issue of shares is expected to be completed by 17 October 2016.

Funds raised through the Placement will go towards pre-drilling activities and a scheduled maiden drilling program at the Tabac Cobalt Gold Project.

Resignation of Mr Joel Fishlock

The Company also wishes to advise that Mr Joel Fishlock has resigned as a non- executive director of the Company effectively immediately.

Mr. Fishlock commented:

"As the Company has now identified the Tabac Cobalt Gold Project and raised sufficient funds to see the Company through its maiden drilling program, I have tendered my resignation in recognition of this transition. I will continue to strongly support the Company as it moves forward and towards the next phase of its development."

Managing Director, Jonathan King commented on the Mr Fishlock's resignation and the Placement:

"Joel has been instrumental to the identification and subsequent acquisition of the Tabac Project. The Company extends its sincerest gratitude to Joel and whilst he will not serve the Company in an official capacity, we look forward to continuing to receive the strong support he provides through his extensive networks in the investment community.

We also welcome the introduction of our new investors into the ownership of the Company and appreciate the strong support garnered from the market as evidenced by the high level of interest in the Placement. The prospect of drilling success at Tabac is an exciting phase in the Company's development which may result in the discovery of a globally significant cobalt-gold project."

Information required under ASX Listing Rule 3.10.5A

The Company provides the information as required under ASX Listing Rule 3.10.5A as follows:

1. Dilution to existing shareholders as a result of the Placement under Listing Rule

   7.1 and 7.1A is 15% and 5.2% respectively.

   Further details of the approximate percentage of the issued capital post 7.1A placement held by the pre-placement security holders and new security holders are as follows:

   Pre-placement security holders who did not participate in the placement	99.4%
   Pre-placement security holders who did participate in the placement	0.6%
   Participants in the placement who were not previously security holders	86.0%

2. The Company will issue shares to sophisticated investors as it is considered to be a more efficient and expedient method for raising funds to achieve its stated objectives. The Placement allows the Company to introduce and increase the number of sophisticated and institutional investors on its register.

3. No underwriting agreements were in place for the Placement.

4. A fee of 6% (plus GST) will be incurred in connection with the shares issued under Listing Rule 7.1A

Information under section 708(5)(e) of the Corporations Act

The Company gives this notice pursuant to section 708A(5)(e) of the Corporations Act 2001 (Cth) ("Act") and advises that the Shares were issued without disclosure to investors under Part 6D.2 of the Act. The Company, as at the date of this notice, has complied with:

1. the provisions of Chapter 2M of the Act as they apply to the Company; and

2. section 674 of the Act.

As at the date of this notice there is no information that is excluded information for the purposes of sections 708A(7) and (8) of the Act.

For Further enquiries, please contact:

Jonathan King Managing Director

+61 8 9322 6009

[email protected]

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