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1 4 March 2014 ASX Market Announcements ASX Limited Exchange Centre 20 Bridge Street Sydney NSW 2000 ASX Code: EXG KALGOORLIE NORTH GOLD PROJECT POSITIVE PRE-FEASIBILITY STUDY RESULTS PFS Ore Reserves (optimised at A$1,450/oz Au) Total Gold Production Mine Life Average Annual Gold Production Average C2 Cash Operating Cost 1 Average Cash Margin 2 Cash Flow from Production Pre-Production Capital 3 (new equipment) 7.64 million 2.00g/t Au for 491,600ozs Au 456,200ozs Au ~7.5 years 60,800ozs Au A$1,029/oz Au A$385/oz Au A$ million A$76.73 million 1 C2 costs include operating costs plus Government and project specific royalties 2 Based on gold sell price net of royalties of A$1,413 minus C2 production cost 3 Includes plant, infrastructure, open pit and underground mine capital; excludes deferred infrastructure relocation capital Significant potential for underground Ore Reserve expansion at Zoroastrian Additional open pit Mineral Resources to be incorporated into future studies to extend life of mine Excelsior Gold Limited ( Excelsior or the Company ) is pleased to present a positive result of the Pre-Feasibility Study ( PFS ) into the development of the Kalgoorlie North Gold Project ( KNGP or the Project ). The PFS is based on the development of a multiple open pit and underground mining operation centred on the Zoroastrian gold system located 45 kilometres north of Kalgoorlie in Western Australia. The results of the PFS demonstrate a solid base case gold operation which the Company now expects to be able to enhance through further underground and open pit Ore Reserve conversion and expansion and refinement of capital and operating cost estimates. 1

2 Figure 1: Kalgoorlie North Gold Project Gold Ore Reserve and Resource Location Plan with Geology, Tenements and Neighbouring Significant Gold Deposits. Showing gold ore reserve ounces (red) and resource 0.6g/t and 3.0g/t Au lower cut-offs (black) 2

3 The Company s PFS incorporates the construction of a new standalone 1.0 million tonne per annum conventional carbon in leach ( CIL ) gold treatment plant to process ore sourced from large open pits at the Zoroastrian and Excelsior deposits and seven smaller satellite pits as well as underground ore from mechanised stope designs on a portion of the large Zoroastrian gold system. The final mining phase of the PFS was recast at an increased gold price of A$1,450 per ounce to reflect the current gold price (A$1,507/oz at 2 March 2014), an apparent improving market sentiment and gold price and currency exchange rate forecasts for a potential production term from 2016 to Ore Reserves The PFS Ore Reserves of 7.64 million 2.00g/t Au for 491,600ozs Au are derived from total Project Measured and Indicated gold Mineral Resources of 15.6 million 1.80g/t Au for 899,800ozs Au. The PFS results include the addition of another Mineral Resource at El Dorado, into the Ore Reserves as well as a reduction in processing costs that were previously excluded from the interim PFS Ore Reserves (ASX announcement 19 February 2014). Table 1. Kalgoorlie North Gold Project Ore Reserve Inventory (March 2014) Notes: 1. Numbers may not sum due to rounding. 2. The Zoroastrian Undergrounds consist of the Zoroastrian South and Zoroastrian Central designs. 3. Diluting material in open pits set at 0g/t, and 0.5g/t for underground. 4. Ore Reserves calculated under the 2012 JORC code. 3

4 The new Ore Reserve represents a refinement and extension of the prior interim PFS Ore Reserve open pit and underground mine designs as part of the detailed second pass process to provide optimal results. In the case of Zoroastrian, previously economic material, based on a gold price of A$1,375 per ounce, was omitted due to the selection of the suboptimal revenue factor ( RF ) 0.78 Whittle shell. The new Zoroastrian open pit Ore Reserve has utilised the RF 1.0 shell at a A$1,450/oz gold price, resulting in a larger open pit (refer Figure 2) and subsequent increase of almost 500,000 tonnes of ore and approximately 38,000 ounces of gold. Reserve Expansion Program While the current Ore Reserve position demonstrates a potential 7.5 year life of mine, production scheduling indicates that significant improvements in Project economics can be achieved by the inclusion of additional higher grade underground ore feed into the milling schedule. Current underground mine designs at Zoroastrian South and Zoroastrian Central are based on Ore Reserves of 981, g/t Au. The underground operations contribute in the vicinity of 20,000ozs per annum to the production profile in Years 2 to 5 of the current production schedule. Extension of the underground operations, at least through Years 5 to 8 when the more modest grade Excelsior open pit ore forms the base load for the mill, would have a significant positive impact on gold production towards the back end of the operations. Deeper Inferred Mineral Resources at a 3.0g/t Au cut-off which are outside the Zoroastrian Ore Reserves total 505, g/t Au for 94,300ozs and conversion of this Inferred resource, hence extension of the underground operations, is a priority target for further targeted drilling programs. Figure 2: Zoroastrian Conceptual Mining Plan Long Section showing Resource Block Model at 3.0g/t Au lower cut-off (colour graded), Open Pit Designs (red), Underground Design with Mechanised Stoping (grey) and Gold Ore Reserves contained within the Designs 4

5 Total KNGP Measured, Indicated and Inferred gold Mineral Resource are currently 23.6 million 1.80g/t Au for 1.37 million ounces at 0.6 and 3.0g/t Au cut-offs, and includes Inferred Mineral Resources of 8.09 million 1.80g/t Au (467,700ozs Au). These Inferred Mineral Resources are contained partially within the PFS deposits and in an additional 13 gold Mineral Resources which have not been subject to the current open pit and underground studies. These Inferred Mineral Resources and numerous advanced exploration targets offer immediate scope to increase the Ore Reserves and extend the life of mine. Operating Cost Estimates Open pit and underground mine designs were completed by Auralia Mining Consulting Pty Ltd ( Auralia ) and are based on Measured and Indicated Mineral Resources for the Excelsior deposit and Indicated Mineral Resources at the Zoroastrian and satellite mining projects. Optimisation runs were conducted in Whittle using independently tendered mining operating costs, vendor-sourced mining capital costs, an independent Pre-Feasibility Study covering processing operating and capital costs by Mintrex Pty Ltd ( Mintrex ), independent metallurgical studies, environmental studies, government quoted capital costs and an independent geotechnical review. Studies were carried out on fleet mining operation costs to assess the most cost-effective method (hourly dry hire rates versus full contract volume rates). A detailed pricing submission process carried out with reputable operating fleet hire/contract companies, showed a cost advantage in applying full contract volume rates to the two large open pits of Zoroastrian and Excelsior, while displaying a minimal advantage in applying full contract volume rates to the satellite deposits. As a result the cost model build process was based on the selection of an all-inclusive full contract volume rate mine operating cost, covering site establishment, mobilisation/demobilisation, personnel, maintenance and drill blast operations. This cost model provided the mining costs for the optimisations along with customised mining cost adjustment factors for each operation. A flat 1.0Mtpa mill constraint was applied during the optimisation process and during initial mine scheduling however it is noted that the Excelsior ore can potentially be processed at up to 1.3Mtpa rate due to is metallurgical characteristics. Whittle applied the appropriate economic cut-off grade as required per run (refer Table 2). The final economic cut-off varies depending upon the distance to the treatment location and final processing cost applied which was inclusive of haulage costs. A 5% mining dilution factor, at a grade of 0g/t Au, and a 97% mining recovery factor was applied within Whittle to account for dilution during the course of mining due to the mixing of ore and waste to account for the amount of ore that is lost due to spillage and re-handling. 5

6 Open Pit Economic Cut-Offs (g/t) Deposit Oxide Transitional Fresh Excelsior Zoroastrian Pits Lochinvar N/A Jackorite 0.70 N/A 0.71 Castlereagh N/A Nerrin Nerrin Big Blow South 0.73 N/A 0.74 El Dorado Bulletin Table 2: KNGP Open Pit Economic Cut-off Grades Process plant design and cost estimates by Mintrex were based on metallurgical testwork results from programs formulated by Daniel Schwann Consulting Pty Ltd and carried out by ALS Ammtec. Metallurgical characterisation testwork was conducted using dedicated diamond drill core samples with various ore sources tested separately by weathering type (Oxide, Transitional or Fresh). The comprehensive testwork program included detailed elemental analysis, mineralogy, comminution, gravity gold recovery, leach extraction recovery, leach optimisation, gold deportment and rheology analysis and this information provided the inputs for the process facility design criteria. The metallurgical testwork demonstrated relatively rapid leach extraction rates, low grind size sensitivity and high gold recoveries on all of the individual ore sources and their respective weathering states and that all KNGP ores tested were readily amenable to conventional CIL processing. The test predicted varying overall plant gold recoveries, dependent upon deposit type with an average overall recovery of 92.6% for the Zoroastrian base case blend of 54% oxide/transitional and 46% fresh, at a grind size 80% passing 180 microns for a 24 hour leach residence time, at 44% solids in the leach and soluble gold level of 0.01 g/t in the CIL tail. Individual deposit mill recoveries, as applied during this study, are summarised in Table 3. The processing facility design, engineering, capital cost and operating cost estimation developed by Mintrex included supporting studies by Aquaterra (water supply) Cardno-BEC (electrical) and Western Power (power supply assessment). Process operating costs incorporate a fixed component which ranged from 29% to 34% (32% base case) of total operating cost and consist of labour, laboratory, ROM loader and light vehicle costs. The variable process operating costs range from 66% to 71% (68% base case) and include power, consumables and maintenance costs. The processing facility proposed is a 1.0Mtpa CIL plant specifically designed for the KNGP mineralisation and consists of primary crusher, secondary crusher, ball mill, gravity gold 6

7 recovery, CIL, carbon elution, electrowinning and smelting circuits to produce gold doré. The planned process is robust and conventional utilising established technology suitable for the mineralisation in all the Project deposits tested to date and demonstrated by successful similar historical operations at the site and within the region. ITEM ZOROASTRIAN EXCELSIOR SATELLITES Oxide/Trans Fresh Oxide/Trans Fresh Oxide/Trans Fresh Gold Price A$1,450 State Govt. Royalty 2.5% Milling Rate (Mtpa) Met. Recovery 1 (%) Unit Processing Costs ($/tonne) to to to Pit Wall Angle 45º West 43º; East 44º 55º to Unit Mining Cost to to to to to to 6.85 ($/tonne) Table 3: KNGP Operating Cost Parameters Notes: 1. Satellite deposit recoveries based on limited testwork at 75 to 106 micron grind with 92-96% recovery for 24 hour leach, 93% recovery selected for all satellites at grind size 80% passing 180 microns. 2. Processing costs inclusive of deposit specific royalties and haulage where applicable. 3. Unit Mining Costs inclusive of drill & blast and vary with depth and mining fleet size utilised Zoroastrian and Excelsior 90 tonne fleet Satellites 40 tonne fleet. Underground stope design was undertaken for Zoroastrian using an iterative approach. An initial estimate for the cut-off grade for this project was used to determine the limits of the potential underground stopes both along strike and down dip. Second and third pass stope design/selection was then undertaken using incremental cut-off grades (ore drive development, stoping and processing costs for second pass, stoping and processing costs for third pass). At the conclusion of the stope design/selection, each stoping level was costed to ensure all stopes made a positive contribution to the project economics. UG Costs included Variable costs: o Lateral development- $2600-$3700 per metre o Vertical development- $4000 per metre o Stoping costs- $30-$40 per tonne o Processing costs- $26.04 per tonne Fixed Costs: o Contractor- $650,000 per month o Excelsior UG Mining- $110,000 per month o Power- $132,000 per month o General and Administration- $102,500 per month (33.3% of total G&A costs) 7

8 The C2 cash costs for each deposit are summarised in Table 4 below. Table 4. Kalgoorlie North Gold Project PFS C2 Cash Costs (March 2014) Notes: 1. The above C2 cash costs are displayed on an individual project basis, prior to any pre-strip, stockpile building or other capitalisation that may occur during the scheduling process that may further reduce C2 cash costs by shifting operating costs into capital costs. Capital Cost Estimates The total Project capital cost estimates (refer Table 5) are based on an all-new 1.0Mtpa treatment facility and associated milling and open pit and underground mining infrastructure as well as capital to relocate infrastructure impeding the development of the Excelsior open pit. Current mine scheduling is focussed on the mining of the higher grade Zoroastrian and selected satellite deposits ahead of the large Excelsior open pit which requires relocation of the Kalgoorlie to Leonora rail line and the Goldfields Highway prior to mining. The Excelsior pit does not figure into the base case mining schedule until Year 4 and capital expenditure for the road and rail component of the infrastructure relocation program, totalling approximately $16.06 million, is not required until Year 3. Initial start-up capital for the Project is therefore A$76.73 million with a further $16.06 million in deferred capital. 8

9 Description Estimate Source Process Plant $49.86M Mintrex Processing Infrastructure including tailings, borefield, etc. $12.61M Mintrex/Schwann Other Costs including power $6.23M WPL/BEC Total Processing Capital $68.70M Open Pit Infrastructure $1.33M Auralia/EXG Underground Mine Infrastructure $3.70M Auralia/EXG Total Mine Capital $5.03M Road/Rail Relocation $14.50M SMEC Power/Pipeline/Cable Relocation $4.56M WPL, APA Total Infrastructure Relocation Capital $19.06M TOTAL $92.79M Table 5: KNGP Capital Cost Summary Development Program The PFS Ore Reserve, operating and capital cost estimate is a solid base from which the Company now expects to significantly expand open pit and underground gold Ore Reserves and focus on cost reductions to enhance the project economics. At a time of apparent improving gold price, depreciating exchange rate and more positive investor sentiment, the Company intends to devote its resources to improving the economics of the Project. Subject to available capital the Company will initiate further dedicated drilling programs to expand the Ore Reserves to in excess of 600,000 ounces of gold during 2014 in order to extend the potential mine life and drive improved return on capital investment. Further, the optimisation process for the PFS is restricted to a flat 1.0Mtpa mill constraint. In the subsequent study, the Company will incorporate the potential significant increases in the milling rate of ore sourced from the Excelsior deposit given its favourable metallurgical characteristics and additional mining cost reductions due to the broad ore zones and low waste to ore ratio. These elements have the potential to significantly bring forward the cash flow and also reduce the unit cost of production at Excelsior. The Company continues dialogue with a number of third parties to review alternate development strategies, including with existing mill owners in the region to evaluate toll treatment and joint venture options which could accelerate Project development and lower required capital costs. 9

10 Competent Person Statement Exploration Results and Mineral Resources: Information in this announcement that relates to Mineral Resources and exploration results is based on information compiled by Mr. David Potter who is the Technical Director of Excelsior Gold Limited. Mr. Potter is a Member of The Australian Institute of Geoscientists and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking, to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr. Potter consents to the inclusion in the document of the information in the form and context in which it appears. Competent Persons Statements Ore Reserves The information in this Report which relates to Ore Reserve estimates accurately reflects information prepared by competent persons (as defined by the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves). The information in this public statement that relates to the Ore Reserves at the Excelsior Gold Kalgoorlie North Gold Project is based on information resulting from Pre-Feasibility works carried out by Auralia Mining Consulting. Both Mr. Daniel Tuffin (Open Pits) and Mr Anthony Keers (Underground Workings) completed the Ore Reserve estimate. Mr Daniel Tuffin and Mr Anthony Keers are Members and Chartered Professionals (Mining) of the Australasian Institute of Mining and Metallurgy and have sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity that they are undertaking to qualify them as Competent Persons as defined in accordance with the Australasian Joint Ore Reserves Committee (JORC). Qualifying Statement This release may include forward-looking statements. These forward-looking statements are based on a number of assumptions made by the Company and its consultants in light of experience, current conditions and expectations concerning future events which the Company believes are appropriate in the present circumstances. Forward-looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of Excelsior Gold, which could cause actual results to differ materially from such statements. The Company makes no undertaking to subsequently update or revise the forward-looking statements made in this release to reflect the circumstances or events after the date of this release. For further information visit or contact Excelsior Gold Limited David Hamlyn David Potter Managing Director Technical Director T: T: E: dhamlyn@excelsiorgold.com.au E: admin@excelsiorgold.com.au 10

11 JORC Code, 2012 Edition Table 1 Section 1 Sampling Techniques and Data refer ASX announcement 19 February 2014 Section 2 Reporting of Exploration Results refer ASX announcement 19 February 2014 Section 3 Estimation and Reporting of Mineral Resources refer ASX announcement 19 February 2014 Section 4 Estimation and Reporting of Ore Reserves (All Deposits) (Criteria listed in section 1, and where relevant in sections 2 and 3 for Zoroastrian, Excelsior and Satellite Resources (above), also apply to this section.) Criteria JORC Code Explanation Commentary Mineral Resource estimate for conversion to Ore Reserves Description of the Mineral Resource estimate used as a basis for the conversion to an Ore Reserve. Clear statement as to whether the Mineral Resources are reported additional to, or inclusive of, the Ore Reserves. MINERAL RESOURCES (December 2013) The Mineral Resources of the Kalgoorlie North Gold Project were estimated by Mr David Potter of Excelsior Gold Limited during the 2013/2014 financial year. The following table comprises the Mineral Resources: The Mineral Resources are reported as wholly inclusive of the Ore Reserves. 11

12 Criteria JORC Code Explanation Commentary ORE RESERVES (March 2014) 1. Numbers may not sum due to rounding. 2. The Zoroastrian Undergrounds consist of the Zoroastrian South and Zoroastrian Central designs. 3. Diluting material in open pits set at 0g/t, and 0.5g/t for underground. 4. Ore Reserves calculated under the 2012 JORC code. Site visits Comment on any site visits undertaken by the Competent Person and the outcome of those visits. Multiple prior site visits have been carried out by both of the competent Persons, Mr Daniel Tuffin and Mr Anthony Keers. If no site visits have been undertaken indicate why this is the case Study status The type and level of study undertaken to enable Mineral Resources to be converted to Ore Reserves. This is a Pre-Feasibility study, and all works relating to this study must be assessed with the appropriate relevant level of accuracy. The Code requires that a study to at least Pre-Feasibility Study level has been undertaken to convert Mineral Resources to Ore Reserves. Such studies will have been carried out and will have determined a mine plan that is technically achievable and economically viable, and that material Modifying Factors have been considered. A mine plan has been scheduled that is technically achievable, and is economically viable to the expected detail of Pre-Feasibility levels. Although individual deposit discounting and global capital costs have been applied to these works, as yet no comprehensive, detailed global project financial review has been carried out as part of these works. Where appropriate and possible, suitable modifying factors have been applied to these Pre-Feasibility works. These modifying factors include, but are not limited to, independently tendered mining operating costs, vendor-sourced mining capital costs, an independent Pre-Feasibility study covering processing and capital costs, independent metallurgical studies, environmental studies, government quoted capital costs and an independent geotechnical review. Cut-off parameters The basis of the cut-off grade(s) or quality parameters applied. Any material classified as an Inferred Mineral Resource was not included for consideration in as an economic driver during any of the optimisation processes and does not influence the final Ore Reserves calculations. Due to ore haulage transit costs (deposit-to-mill) and weathering factors (varying the mill recoveries), multiple economic cut-offs exist per deposit. These economic cut offs are displayed, per weathering zone, in the tables below: 12

13 Criteria JORC Code Explanation Commentary Economic Cut-Offs (g/t), Kalgoorlie North Project (Truncated to 2dp) Deposit Economic Cut-Off Oxide Material Economic Cut-Off Transitional Material Economic Cut-Off Fresh Material Big Blow South 0.73 N/A 0.74 Bulletin Castlereagh N/A El Dorado Excelsior Jackorite 0.70 N/A 0.71 Lochinvar N/A Nerrin Nerrin Zoroastrian Pits Deposit Economic Cut Off Stoping Only (g/t) Economic Cut Off Ore Drives & Stoping (g/t) Economic Cut Off Capital, Ore Drives & Stoping (g/t) Zoroastrian UG Tails material exist in-situ. Air core and reverse circulation in-pit drilling works have displayed grade being carried within the tails material. However, studies to date are not accurate to allow for inclusion in the Pre-Feasibility works as part of the final Ore Reserve, and thus the tails has been treated as waste, with no economic cut-off viable. 2 Displayed incremental cut-offs are back calculated. First pass stope designs were based on an initial estimated economic cut-off of 3.4g/t with subsequent second and third pass stope designs using lower incremental cut-offs. Mining factors or assumptions The method and assumptions used as reported in the Pre-Feasibility or Feasibility Study to convert the Mineral Resource to an Ore Reserve (i.e. either by application of appropriate factors by optimisation or by preliminary or detailed design). Where appropriate and possible, suitable modifying factors have been applied to these Pre-Feasibility works. These modifying factors include, but are not limited to, independently tendered mining operating costs, vendor-sourced mining capital costs, an independent Pre-Feasibility study covering processing and capital costs, independent metallurgical studies, environmental studies, government quoted capital costs and an independent geotechnical review. The choice, nature and appropriateness of the selected mining method(s) and other mining parameters including associated design issues such as pre-strip, access, etc. With regards to fleet mining operation costs, studies were carried out to assess the most cost-effective method (hourly dry hire rates versus full contract volume rates). A detailed pricing submission process was carried out with reputable operating fleet hire/contract companies, during which multiple cost estimates were provided for both cost methods. Using these submissions studies showed a cost advantage in applying full contract volume rates to the two large open pits of Zoroastrian and excelsior, while displaying a minimal advantage in applying full contract volume rates to the satellite deposits. As part of the cost model build process, Auralia Mining Consulting excluded the best and worst confirming cost estimates for each fleet type and upon review selected the second most cost effective option across both fleet types, an all-inclusive full contract volume rate mine operating cost, covering site establishment, mobilisation/demobilisation, personnel, maintenance and drill blast operations. The assumptions made regarding geotechnical parameters (e.g. pit slopes, stope sizes, etc), grade control and preproduction drilling. Underground operating cost submissions were received from several underground contractors, the selected contractor was a reputable group whose overall costs were in the mid-point of all submissions. The contract rates were split into fixed and variable and covered all aspects of operation. The major assumptions made and Mineral Resource model used for pit and stope optimisation (if appropriate). Standard open pit mining methods using an excavator and truck fleet have been are employed, assuming double shifting on a continuous basis. The size of the fleet applied for costing and design works was dependent upon the deposit designation (and thus size) Satellite deposits have had a 85t excavator paired with 40t articulated truck fleet costs and design specifications to them. The excelsior and Zoroastrian deposits have had a 120t excavator paired with 90t truck fleet costs and design specifications to them. The underground method that will primarily be employed at Zoroastrian is longhole open stoping using mechanised equipment. Hand-held/Airleg equipment will supplement the mechanised equipment. 13

14 Criteria JORC Code Explanation Commentary In the case of pre-existing historical pits, designs have been created to take into account minimum mining widths to allow mining access at depth. Three separate geotechnical case studies (comprising three separate reports) were carried out by independent expert geotechnical firm Peter O Bryan & Associates as part of these Pre-Feasibility works. These studies determined the final Pre-Feasibility level design specifications for the open pit satellite deposits, the Excelsior open pit deposit and the Zoroastrian open-pitable and underground sections of the deposit. The mining dilution factors used. The mining recovery factors used. Any minimum mining widths used. The manner in which Inferred Mineral Resources are utilised in mining studies and the sensitivity of the outcome to their inclusion. The infrastructure requirements of the selected mining methods. The underground design explicitly includes sill pillars, rib, half rib or island pillars have been accounted for in the mining recovery. Waste material will be left underground where possible by backfilling completed stopes, no other backfill is currently planned. A 5% mining dilution and 97% mining recovery in the open pits and a 10% mining dilution and 93% mining recovery for underground was applied during these works Pre-Feasibility Works. A minimum pre-goodbye cut mining width of 10m was applied as a constraint to the Satellite pit designs. A minimum pre-goodbye cut mining width of 20m was applied as a constraint to the Excelsior and Zoroastrian pit designs. The minimum stoping width used was 2.5m. Only the Measured and Indicated portions of the Mineral Resource classified material types were used in the Pre-Feasibility Study optimisation works; while the final designs may contain Inferred material as part of the final material inventory, Inferred material was not utilised as an economic driver and thus not included for consideration for any of Ore Reserve calculations. Any mining infrastructure required has been costed for (via study, price submissions, or quotations) to a Pre-Feasibility level and either allocated as appropriate directly to mining operating or fixed costs, mining capital, or accounted for in shared site capital costs (such as administration offices). Metallurgical factors or assumptions The metallurgical process proposed and the appropriateness of that process to the style of mineralisation. The planned Kalgoorlie North Gold Project processing facility is a conventional 1.0Mtpa CIL plant specifically designed for the projects mineralisation and consists of primary crusher, secondary crusher, ball mill, gravity recovery, CIL (carbon-in-leach), carbon elution, electrowinning and smelting to produce gold doré. Whether the metallurgical process is welltested technology or novel in nature. The nature, amount and representativeness of metallurgical test work undertaken, the nature of the metallurgical domaining applied and the corresponding metallurgical recovery factors applied. The planned process is a conventional, robust, well tested technology, and is appropriate for the lode style of mineralisation in all the Project deposits, as demonstrated by successful similar prior plant operation in the area. Metallurgical testwork samples were sourced from diamond drill core holes and RC chip holes (Jackorite and Big Blow South) drilled in all deposits that have Ore Reserves (excluding Nerrin Nerrin and Bulletin which have had no metallurgical testwork conducted to date). The major deposits of Zoroastrian and Excelsior were further separated and tested as distinct weathering types defined as Oxide-Transitional or Primary domains. A comprehensive metallurgical characterisation testwork program on the metallurgical core samples included comminution testwork, detailed elemental head grade analysis, comprehensive mineralogical analysis (QEMScan), size by size gold distribution, gravity and leach recovery testwork, diagnostic leach testwork, CIL optimisation (agitated leach testwork) and rheology testwork. Accordingly, the metallurgical test work is considered representative of the deposits. Any assumptions or allowances made for deleterious elements. The metallurgical characterisation testwork program indicated deleterious elements are sufficiently low in content. Agitated leach testwork of SMP samples of Big Blow South and Jackorite demonstrated high viscosity with 100% blend at 50% solids in leach. Viscosity impacts were reduced by decreasing leach % solids to 35% for 100% blend testwork and operational mitigation would include blending satellite material to reduce leach slurry viscosity. The existence of any bulk sample or pilot scale test work and the degree to which such samples are considered No bulk samples of sufficient quantity for pilot scale test work have been collected or tested. See previous note on metallurgical test work completed to date. 14

15 Criteria JORC Code Explanation Commentary representative of the orebody as a whole. For minerals that are defined by a specification, has the ore reserve estimation been based on the appropriate mineralogy to meet the specifications? Ore Reserves are quoted delivered to mill basis, which excludes metallurgical recovery factors. The test work discussed above, carried out as part of this Pre-Feasibility study predicted varying overall plant gold recoveries, dependent upon deposit type. An average overall recovery of 92.6%, at a grind size 80% passing 180 microns, 24 hour leach residence time, at 44% solids in the leach, and soluble gold level of 0.01 g/t in the CIL tail. Each deposit s mill recovery, as applied during this study, are displayed below: Mill Recoveries, Kalgoorlie North Project Deposit Mill Recovery Oxide Material Mill Recovery Transitional Material Mill Recovery Fresh Material Satellite Deposits % 93.0% 93.0% Excelsior % 94.7% 91.9% Zoroastrian 91.8% 91.8% 90.5% 1 The various Satellite Deposits leach testwork was limited to single leach test at grind sizes ranging from 75 to 106 micron with recoveries ranged from 92 to 96% over a 24 hour leach residence time. A recovery of 93% was selected for all Satellite Deposits at a grind size 80% passing 180 microns and 24 hour leach residence time. 2 Tails material exist in-situ. Air core and reverse circulation in-pit drilling works have displayed grade being carried within the tails material. However, studies to date are not accurate to allow for inclusion in the Pre-Feasibility works as part of the final Ore Reserve, and thus the tails has been treated as waste, with no mill recovery figure viable. Environmental The status of studies of potential environmental impacts of the mining and processing operation. Details of waste rock characterisation and the consideration of potential sites, status of design options considered and, where applicable, the status of approvals for process residue storage and waste dumps should be reported. Environmental studies have been carried out in conjunction with this Pre-Feasibility study to Mining Proposal (MP) reporting levels, with the intention of being able to release an MP to the Department of Mines within quick succession of the release of the maiden Ore Reserves if required. These works include flora and fauna surveys, water testing, existing land disturbance surveys, waste rock and tailings sampling, soil analysis, hydrology and native title and heritage database reviews. Waste Rock Dump designs take into consideration any Potential Acid Forming Material (PAF) and will be designed to meet the license requirements. Any current waste dump designs take into consideration stability and erosion measures; any waste landforms will be rehabilitated as per the license requirements. Infrastructure The existence of appropriate infrastructure: availability of land for plant development, power, water, transportation (particularly for bulk commodities), labour, accommodation; or the ease with which the infrastructure can be provided, or accessed. The large portion of mining activities covered by this Pre-Feasibility study take place on the historical Bardoc Mining Centre, most recently mined by Aberfoyle Gold Pty Ltd between 1987 and Prior cleared land, dumps, open pits and underground workings exist in this area. Prior cleared land exists for plant development. The project s location close to the Goldfield-Menzies Highway, meaning power, water, and site access can be easily obtained and/or accessed. The bulk of the site labour is planned to be sourced from, and commute between, the City of Kalgoorlie-Boulder and the project via this highway. Costs The derivation of, or assumptions made, regarding projected capital costs in the study. The methodology used to estimate operating costs. Project capital costs are based on o Detailed PFS level process plant design and costing study by Mintrex Pty Ltd o Power supply studies and cost estimates by Western Power and Cardno BEC o Infrastructure relocation cost estimates from contractors based on detailed designs developed by SMEC Australia Pty Ltd o Mine start-up capital estimates by Auralia Mining Consulting With regards to fleet mining operation costs, studies were carried out to assess the most cost-effective method (hourly dry hire rates versus full contract volume rates). A detailed pricing submission process was carried out with reputable operating fleet hire/contract companies, during which multiple cost estimates were provided for both cost methods. Using these submissions studies showed a cost advantage in applying full contract volume rates to the two large open pits of Zoroastrian and excelsior, while displaying a minimal advantage in applying full contract volume rates to the satellite deposits. As part of the cost model build process, Auralia Mining Consulting excluded the best and worst confirming cost estimates for each fleet type and upon review selected the second most cost 15

16 Criteria JORC Code Explanation Commentary effective option across both fleet types, an all-inclusive full contract volume rate mine operating cost, covering site establishment, mobilisation/demobilisation, personnel, maintenance and drill blast operations. Underground operating cost submissions were received from several underground contractors, the selected contractor was a reputable group whose overall costs were in the mid-point of all submissions. The contract rates were split into fixed and variable and covered all aspects of operation. Derivation of transportation charges. Ore haulage transportation charges were applied to all satellite mining operations. Based on assumed haulage routes, they utilise an on-road/off-road ctkm figure (contractor quoted), with the costs then being accounted for as $/t ore (additional to the processing operating costs) during the optimisation process. The basis for forecasting or source of treatment and refining charges, penalties for failure to meet specification, etc. With regards to processing operating costs, an independent operating cost estimate was carried out by Mintrex Pty Ltd to Pre- Feasibility levels. Methodologies were based upon a mix of known comparable operating actuals, process design criteria and assumed values. The derivation of assumptions made of metal or commodity price(s), for the principal minerals and co- products. The source of exchange rates used in the study. The allowances made for royalties payable, both Government and private. All costs are in Australian Dollars. An assumed base gold price of A$1,450 per gold ounce was applied to the final PFS works. N/A all costs are in Australian Dollars. Allowances were made for WA State government royalties; 2.5% of the sale price was reduced as a sell cost upfront during the optimisation works. Specific private royalties have also been included in the Pre-Feasibility study. Allowances made for the content of deleterious elements. Elemental analysis and metallurgical characterisation test work carried out as part of this study did not show any deleterious elements that would affect process costs. Any PAF material is planned to be placed within the waste dump and fully encapsulated; this process did not add any additional costs for the mining process under a volume rate mining contract. Revenue factors The derivation of, or assumptions made regarding revenue factors including head grade, metal or commodity price(s) exchange rates, transportation and treatment charges, penalties, net smelter returns, etc. The head grade is derived from each individual Mineral Resource and applied Modifying Factors as described above. An assumed base gold price of A$1,450 per gold ounce was applied to the final Pre-Feasibility study. No doré transport or refining costs were applied. Market assessment The derivation of assumptions made of metal or commodity price(s), for the principal metals, minerals and co-products. The demand, supply and stock situation for the particular commodity, consumption trends and factors likely to affect supply and demand into the future. No revenue is allocated from silver by-product in doré. Gold is a precious metal and thus subject to fluctuations, due principally to market sentiment. A customer and competitor analysis along with the identification of likely market windows for the product. Production from the operating Project processing facility is planned to be sold as a mixture of spot and hedged gold. Price and volume forecasts and the basis for these forecasts. Using the parameters outlined in this section, the Pre-Feasibility lifeof-mine planning indicates that the Kalgoorlie North Gold Project could produce between 55k Oz Au and approximately 85k Oz Au per year, at an average of 70k Oz Au per year, over a 7+ year mine schedule. For industrial minerals the customer specification, testing and acceptance requirements prior to a supply contract. Economic The inputs to the economic analysis to produce the net present value (NPV) in the study, the source and confidence of these economic inputs including estimated inflation, discount rate, etc. N/A A discount rate of 10% was applied to the optimisation works. Inputs to the economic analysis include Modifying Factors as described above. 16

17 Criteria JORC Code Explanation Commentary NPV ranges and sensitivity to variations in the significant assumptions and inputs. Sensitivity studies were carried out. Standard linear deviations were observed. Social The status of agreements with key stakeholders and matters leading to social licence to operate. All key stakeholder agreements, including Native title and Pastoral Lease holder agreements are in place. The Company has close working relationships with communities and key stakeholders surrounding the Project. Other To the extent relevant, the impact of the following on the project and/or on the estimation and classification of the Ore Reserves: Any identified material naturally occurring risks. There are no known significant naturally occurring risks to the project. The status of material legal agreements and marketing arrangements. Certain tenements within the KNGP are subject to the Bardoc South Retained Right Agreement which provides Norton Goldfield Limited with a first right of refusal to treat ore mined from the tenements at the Paddington Mill and a royalty on gold produced. This Agreement covers satellite deposits at Jackorite, Castlereagh, Nerrin Nerrin, Big Blow South and El Dorado which form part of this Ore Reserve statement. The status of governmental agreements and approvals critical to the viability of the project, such as mineral tenement status, and government and statutory approvals. There must be reasonable grounds to expect that all necessary Government approvals will be received within the timeframes anticipated in the Pre- Feasibility or Feasibility study. Highlight and discuss the materiality of any unresolved matter that is dependent on a third party on which extraction of the reserve is contingent. All current deposits are located on granted Mining Leases and mining will be subject to the DMP approval process. There are no currently identified grounds upon which it is likely that mining approvals will be withheld. Access to mining in the Excelsior and Zoroastrian South open pits is restricted by road, rail and gas pipeline infrastructure which will require relocation prior to mining. Studies have been undertaken into the logistics and cost of relocation of this infrastructure which imposes cost and time constraints on the mining of these open pits. Negotiations with relevant government departments and infrastructure operators on the basis of detailed infrastructure relocation designs carried out by SMEC Australia Pty Ltd indicate that the relocation of the infrastructure is feasible and potentially economically viable. Classification The basis for the classification of the Ore Reserves into varying confidence categories. Measured Resources have been converted to Proven Reserves. Indicated Resources have been converted to Probable Reserves. Whether the result appropriately reflects the Competent Person s view of the deposit. The estimated Ore Reserves are, in the opinion of the Competent Person, appropriate for this style of deposit. Audits or reviews The proportion of Probable Ore Reserves that have been derived from Measured Mineral Resources (if any). The results of any audits or reviews of Ore Reserve estimates. No Measured Resources were downgraded to Probable Reserves Auralia Mining Consulting has completed an internal review of the Ore Reserve estimate resulting from this Pre-Feasibility study. Discussion of relative accuracy/ confidence Where appropriate a statement of the relative accuracy and confidence level in the Ore Reserve estimate using an approach or procedure deemed appropriate by the Competent Person. For example, the application of statistical or geostatistical procedures to quantify the relative accuracy of the reserve within stated confidence limits, or, if such an approach is not deemed appropriate, a qualitative discussion of the factors which could affect the relative accuracy and confidence of the estimate. The level of study carried out as part of this maiden Ore Reserve is to a Pre-Feasibility level. As per JORC 2012 definition it s at a lower confidence level than that of a Feasibility study and any risk factors, or areas of uncertainty which may impact on the confidence of the Ore Reserve Statement arising from these works must be taken into account accordingly. The statement should specify whether it relates to global or local estimates, and, if local, state the relevant tonnages, which should be relevant to technical and economic evaluation. Documentation should include assumptions made and the procedures used. Accuracy and confidence discussions should extend to specific discussions of It should be noted that all open pit deposits the optimal cash flow revenue factor (RF1) shell on which to base final pit designs. 17

18 Criteria JORC Code Explanation Commentary any applied Modifying Factors that may have a material impact on Ore Reserve viability, or for which there are remaining areas of uncertainty at the current study stage. Additionally, although the tails material was shown to carry grade in the excelsior pit, it was excluded from this study. It is recognised that this may not be possible or appropriate in all circumstances. These statements of relative accuracy and confidence of the estimate should be compared with production data, where available. Sensitivity studies were carried out. Standard linear deviations were observed. Globally, the project is susceptible to fluctuations in gold price. END 18