zoroastrian mineral resource and ore reserve update · 7/6/2015 · the underground mine design...

1 Excelsior Gold Limited ABN 38 123 629 863

Address: Unit 2, 124 Stirling Highway, North Fremantle WA 6159 Postal: PO Box 520, North Fremantle WA 6159 Telephone: 08 9335 7770 Facsimile: 08 9335 6231

6 July 2015 ASX Market Announcements ASX Limited Exchange Centre ASX Code: EXG

20 Bridge Street Sydney NSW 2000

ZOROASTRIAN MINERAL RESOURCE AND ORE RESERVE UPDATE

Highlights:

Updated Zoroastrian Mineral Resource estimates improves Mineral Resource

confidence with 10% increase in Indicated Mineral Resource ounces

7.14 million tonnes @ 2.53g/t Au for 581,000ozs at 0.6 and 3.0g/t Au lower cut-offs

Feasibility mine design works derive Zoroastrian open pit and underground Ore

Reserves

2.63 million tonnes @ 2.84g/t Au for 239,900ozs

Total Kalgoorlie North Gold Project Ore Reserves to date at A$1,380/oz gold price

3.29 million tonnes @ 2.74g/t Au for 289,700ozs

Excelsior Gold Limited (“Excelsior Gold” or the “Company”) is pleased to announce an updated

Mineral Resource and Ore Reserve for the Zoroastrian deposit in the central part of the

Kalgoorlie North Gold Project (“Project”).

Gold mineralisation associated with quartz veins and quartz stockworks extends for over 1.4

kilometres of strike within the Zoroastrian Dolerite. Drilling programs conducted in December

2014, were designed to infill previous drilling which had delineated Indicated and Inferred

Mineral Resources totalling 6.69 million tonnes grading 2.70g/t Au for 581,200 ounces of gold

(ASX announcement 12 November 2013).

The 2014 drilling targeted Inferred Mineral Resource material and unclassified mineralisation

within and adjacent to the initial Pre-Feasibility Study (“PFS”) Zoroastrian open pit and

conceptual underground mine designs (ASX announcement 4 March 2014) to increase resource

classification confidence rather than expand the mineral resources. A total of 5,023 metres of

reverse circulation drilling was completed in 71 holes.

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As a result of this drilling overall Mineral Resources at Zoroastrian remained static but resource

confidence was improved with a 10% increase in Indicated Mineral Resources predominately in

the deeper portion (>150m vertical depth) of the resource.

DEPTH

LOWER

CUT

(g/t Au)

INDICATED INFERRED TOTAL RESOURCES

Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces

(t) (g/t Au) (oz) (t) (g/t Au) (oz) (t) (g/t Au) (oz)

<150m

0.6

4,467,000 2.30 330,600

1,719,000 1.86 102,900

6,186,000 2.18 433,500

>150m

3.0

736,800 4.83 114,500

218,300 4.70 33,000

955,100 4.80 147,500

TOTAL

5,203,800 2.66 445,100

1,937,400 2.18 135,800

7,141,200 2.53 581,000

Numbers may not sum due to rounding

Table 1: Zoroastrian Mineral Resources – June 2015

Using the new Mineral Resource estimate, a new Zoroastrian Ore Reserve was derived

following Feasibility mine design works completed as part of the Mining Proposal for the

development of the Zoroastrian deposit. This Mining Proposal, which is in addition to the March

2015 Mining Proposal for the Bardoc South and Bulletin South open pits (ASX announcement 18

March 2015), was lodged with the Department of Mines and Petroleum (“DMP”) on 29 May 2015.

Mine design for the Zoroastrian Central open pit was completed by Auralia Mining Consulting

Pty Ltd (“Auralia”). Mining Plus Pty Ltd (“Mining Plus”) completed design work on the

Zoroastrian Extended open pit, Zoroastrian South open pits and the Zoroastrian underground.

The open pit design studies were based on Whittle optimisation runs conducted on Indicated

Mineral Resources utilising independently tendered mining operating costs.

The underground mine design study utilised Minable Shape Optimiser® (MSO), a Datamine

Studio3® tool, to determine the preliminary mining extents or stope shapes. The MSO data

provides a means of assessing a mining envelope by considering the deposit in terms of tonnes,

grade, mining width, level spacing and cut-off grade. A cut-off grade of 2.5g/t, a level spacing of

20 metres and a minimum mining width of 1.5 metres were selected to further analyse from the

MSO results.

An Australian dollar gold price of A$1,380 per ounce was used in all the mining studies.

Ore treatment costs are derived from the cost structure associated with the long term

cooperative Capital Contribution and Ore Treatment Agreement with Paddington Gold (ASX

announcements 18 June 2014 and 20 October 2014).

The Zoroastrian Ore Reserves are derived from total Indicated Mineral Resources of 5.20

million tonnes @ 2.66g/t Au, containing 445,100ozs of gold. Total Zoroastrian Probable Ore

Reserves are

2.63 million tonnes @ 2.84g/t Au for 239,900 ounces of gold

Due to the use of some historical drilling data in the resource estimates, Excelsior Gold does not

quote Measured Mineral Resources or Proved Ore Reserves classifications although data

quality, drill density, geological continuity and Mineral Resource confidence are high.

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Source

Proved Ore Reserve Probable Ore Reserve Total Ore Reserve


(,000t) (g/t Au) (,000oz) (,000t) (g/t Au) (,000oz) (,000t) (g/t Au) (,000oz)

Zoroastrian Central

1

0 0.00 0 1,176 1.88 70.9 1,176 1.88 70.9

Zoroastrian Extension

2

0 0.00 0 20 4.57 3.3 20 4.57 3.3

Zoroastrian South

2 North Pit

0 0.00 0 60 1.56 2.8 60 1.56 2.8

Zoroastrian South

2 South Pit

0 0.00 0 60 2.09 3.9 60 2.09 3.9

Total Open Pits 0 0.00 0 1,316 1.92 80.9 1,316 1.92 80.9

Underground2 0 0.00 0 1,310 3.77 159.0 1,310 3.77 159.0

TOTAL 0 0.00 0 2,626 2.84 239.9 2,626 2.84 239.9

Numbers may not sum due to rounding 1Auralia Mining Consulting Pty Ltd

2Mining Plus Pty Ltd

Table 2: Zoroastrian Ore Reserves – June 2015

The preliminary underground design is economically viable and therefore qualifies as an Ore

Reserve but further design refinement is in progress, incorporating current underground mining

cost parameters to optimise the mine design and resultant cash flows. The preliminary design is

based on Sublevel Open Stoping as the single mining method as it provides higher production

rates and generally lower operating costs, however further studies may show that more than

one mining method may be used to extract selected areas on the deposit.

Further redesign will also focus on the portal location in the base of the Zoroastrian Central pit

and on the crown pillar interface between the open pit and underground where additional

material is expected to be recovered.

Total Project Ore Reserves derived from the recent round of mining studies applying the cost

structures associated with the Paddington ore processing agreements are

3.29 million tonnes @ 2.74g/t Au for 289,700 ounces of gold.

The Project Ore Reserves, mine designs and pre-production mining schedule are derived from

total Indicated Mineral Resources of 6.38 million tonnes @ 2.59g/t Au for 530,500 ounces on six

of the current 22 resource areas. These Ore Reserves form a basis for the initial development of

the Project. The future inclusion of additional resources areas, conversion of Indicated and

Inferred Mineral Resources to Ore Reserves and extension of existing resources will enable

refinement of the mining schedule and expansion of the life and scope of the Project.

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Source

Proved Ore Reserve Probable Ore Reserve Total Ore Reserve


(,000t) (g/t Au) (,000oz) (,000t) (g/t Au) (,000oz) (,000t) (g/t Au) (,000oz)

Bulletin South1 0 0.00 0 458 2.14 31.6 458 2.14 31.6

Jackorite1 0 0.00 0 76 2.76 6.7 76 2.76 6.7

Castlereagh1 0 0.00 0 66 2.23 4.8 66 2.23 4.8

Big Blow South1 0 0.00 0 27 3.66 3.2 27 3.66 3.2

Nerrin Nerrin1 0 0.00 0 36 2.97 3.5 36 2.97 3.5

Zoroastrian Central

1

0 0.00 0 1,176 1.88 70.9 1,176 1.88 70.9

Zoroastrian Extension

2

0 0.00 0 20 4.57 3.3 20 4.57 3.3

Zoroastrian South

2 North Pit

0 0.00 0 60 1.56 2.8 60 1.56 2.8

Zoroastrian South

2 South Pit

0 0.00 0 60 2.09 3.9 60 2.09 3.9

Total Open Pits 0 0.00 0 1,979 2.05 130.7 1,979 2.05 130.7

Zoroastrian Underground

2

0 0.00 0 1,310 3.77 159.0 1,310 3.77 159.0

TOTAL 0 0.00 0 3,289 2.74 289.7 3,289 2.74 289.7

Numbers may not sum due to rounding 1Auralia Mining Consulting Pty Ltd

2Mining Plus Pty Ltd

Table 3: Kalgoorlie North Gold Project Ore Reserves – June 2015

(refer ASX announcements 18 March and 10 April 2015)

For further information contact

Excelsior Gold Limited

David Hamlyn David Potter Managing Director Technical Director

T: + 61 8 9335 7770 T: + 61 8 9335 7770

E: [email protected] E: [email protected] Competent Person Statement – Exploration Results and Mineral Resources:

Information in this announcement that relates to Mineral Resource 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 that he is undertaking, to qualify as 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 Zoroastrian Central Open Pit

The information in this Release which relates to the Ore Reserve estimates accurately reflect 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 Zoroastrian Central Open Pit Ore Reserve at the Excelsior Gold Kalgoorlie North Gold Project is based on information resulting from Feasibility works carried out by

Auralia Mining Consulting. Mr. Daniel Tuffin completed the Ore Reserve estimate for this Zoroastrian Central Open Pit. Mr Daniel Tuffin is a Member and Chartered Professional (Mining) of the Australasian Institute of Mining and Metallurgy and has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to

the activity that he is undertaking to qualify him as a Competent Person as defined in accordance with the 2012 Edition of the Australasian Joint Ore Reserves Committee (JORC). Mr Tuffin consents to the inclusion in the document of the information in the form and context in which it appears.

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mailto:[email protected]

mailto:[email protected]



Competent Persons Statements – Ore Reserves Zoroastrian Extended and Zoroastrian South Open Pits

The information in this Release which relates to the Ore Reserve estimates accurately reflect 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 Zoroastrian Extended and Zoroastrian South

Ore Reserves at the Excelsior Gold Kalgoorlie North Gold Project is based on information resulting from Feasibility works carried out by Mining Plus. Mr. David Billington completed the Ore Reserve estimate for these pits. Mr Billington is a Member of the Australasian Institute of Mining and Metallurgy and has sufficient experience that is relevant to the style of

mineralisation and type of deposit under consideration and to the activity that he is undertaking to qualify him as a Competent Person as defined in accordance with the 2012 Edition of the Australasian Joint Ore Reserves Committee (JORC). Mr Billington consents to the inclusion in the document of the information in the form and context in which it

appears.

Competent Persons Statements – Ore Reserves Zoroastrian Underground

The information in this Release which relates to the Ore Reserve estimates accurately reflect 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 Zoroastrian Extended and Zoroastrian South

Ore Reserves at the Excelsior Gold Kalgoorlie North Gold Project is based on information resulting from Feasibility works carried out by Mining Plus. Mr. Peter Lock completed the Ore Reserve estimate for these pits. Mr Lock is a Member of the Australasian Institute of Mining and Metallurgy and has sufficient experience that is relevant to the style of

mineralisation and type of deposit under consideration and to the activity that he is undertaking to qualify him as a Competent Person as defined in accordance with the 2012 Edition of the Australasian Joint Ore Reserves Committee (JORC). Mr Lock consents to the inclusion in the document of the information in the form and context in which it appears.

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.

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JORC Code, 2012 Edition – Table 1

Section 1 Sampling Techniques and Data –

(Criteria in this section apply to all succeeding sections.) Information for historical (Pre Excelsior Gold

from 1983 to 2008) drilling, sampling, mining and milling of the Zoroastrian deposit has been

extensively viewed and validated where possible. Information pertaining to historical QAQC

procedures and data is incomplete but of a sufficient quality and detail to allow drilling and assay data

to be used for resource estimations. Further, Excelsior Gold has undertaken extensive infill and

confirmation drilling which confirm historical drill results. Sections 1 and 2 describe the work

undertaken by Excelsior and only refer to historical information where appropriate and/or available.

Criteria JORC Code explanation Commentary

Sampling

techniques Nature and quality of sampling (e.g. cut

channels, random chips, or specific specialised industry standard

measurement tools appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld

XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling.

Include reference to measures taken to ensure sample representivity and the

appropriate calibration of any measurement tools or systems used.

Aspects of the determination of mineralisation that are Material to the

Public Report. In cases where ‘industry standard’ work has been done this would be relatively simple (e.g. ‘reverse

circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’).

In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling

problems. Unusual commodities or mineralisation types (e.g. submarine nodules) may warrant disclosure of

detailed information.

The mineralization was sampled by Reverse

Circulation (RC) on nominal 20m x 20m grid spacing. The holes were generally drilled towards grid east at -

60 degrees to optimally intersect the mineralized zones.

The drill hole locations were designed to allow for

spatial spread of samples across multiple mineralized zones and different rock types. All RC recovered samples were collected and passed through a cone

splitter. Prior to drilling the drill hole locations were pegged using either contract surveyors or hand held GPS units. After drilling, all drill hole locations are

picked up by contract surveyors using a RTK system. All drill holes greater than 80m drilled by EXG used in the Ore Resource calculations were down hole

surveyed by contractors using specific non-magnetic tools.

All RC drilling was sampled on one metre down hole intervals. The recovered samples were passed through

a cone splitter and a nominal 2.5kg – 3.5kg sample was taken to a Kalgoorlie contract laboratory. Samples were oven dried, reduced by riffle splitting to 3kg as

required and pulverized in a single stage process to 85% passing 75 µm. The sample is then prepared by standard fire assay techniques with a 50g charge.

Approximately 200g of pulp material is returned to Excelsior for storage and potential assay at a later date. Samples were oven dried, crushed to a nominal

10mm by a jaw crusher, reduced by riffle splitting to 3kg as required and pulverized in a single stage process to 85% passing 75 µm. The sample is then

prepared by standard fire assay techniques with a 50g charge. Approximately 200g of pulp material is returned to Excelsior for storage and potential assay at

a later date.

Drilling techniques

Drill type (e.g. core

reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (e.g. core diameter, triple

or standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what

method, etc).

All assays reported in this announcement have come

from RC drilling using a drilling contractor. The RC drilling system employed the use of a face sampling hammer and a nominal 146mm diameter drill bit.

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Drill sample recovery

Method of recording and assessing core

and chip sample recoveries and results assessed

Measures taken to maximise sample

recovery and ensure representative nature of the samples

Whether a relationship exists between

sample recovery and grade and whether sample bias may have occurred due to

preferential loss/gain of fine/coarse material.

All RC 1m samples are logged for drilling recovery by

a visual estimate and this information is recorded and stored in the drilling database. At least every 10

th

metre is collected in a plastic bag and these are

weighed when they are utilized for the collection of field duplicate samples. The weight of the sample in the plastic bag is recorded and the total sample

recovery can be calculated. All samples received by the laboratory are weighed with the data collected and stored in the database. Sample loss or gain is

reviewed on an ongoing basis and feedback given to the drillers to enable the best representative sample to always be obtained.

RC samples are visually logged for moisture content,

sample recovery and contamination. This is information is stored in the database. The RC drill

system utilizes a face sampling hammer which is industry best practice and the contractor aims to maximize recovery at all times. RC holes are drilled dry whenever practicable to maximize recovery of

sample.

Study of sample recovery vs gold grade does not show

any bias towards differing sample recoveries or gold grade. The drilling contractor uses standard industry

drilling techniques to ensure minimal loss of any size fraction. The sample recovery vs gold grade is assessed on an ongoing basis throughout the drilling

program.

Logging Whether core and chip samples have

been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation,

mining studies and metallurgical studies.

Whether logging is qualitative or

quantitative in nature. Core (or costean, channel, etc) photography.

The total length and percentage of the relevant intersections logged.

All RC samples are geologically logged. Specifically,

each interval is visually inspected with a hand lens and the following parameters are recorded where observed: weathering, regolith, rock type, alteration,

mineralization, shearing/foliation and any other features that are present. This information is transferred electronically from the geologist to the

database.

Where required the logging records the abundance of

specific minerals or the amount of alteration (including weathering) using defined ranges.

The entire lengths of RC holes are logged on a 1m interval basis, i.e. 100% of the drilling is logged, and

where no sample is returned due to voids (or potentially lost sample) it is logged and recorded as such.

Sub-sampling

techniques and sample preparation

If core, whether cut or sawn and whether

quarter, half or all core taken.

If non-core, whether riffled, tube sampled,

rotary split, etc and whether sampled wet or dry.

For all sample types, the nature, quality and appropriateness of the sample

preparation technique.

n/a

All RC samples are put through a cone splitter and the

sample is collected in a unique pre-numbered calico sample bag. The moisture content of each sample is

recorded in the database. The drilling method is designed to maximize sample recovery and representative splitting of samples. The drilling

methods also maximize dry samples as they are designed to keep water out of the hole when possible.

The sample preparation technique for all samples follows industry best practice, by an accredited

laboratory. The techniques and practices are appropriate for the type and style of mineralization. The RC samples are sorted, oven dried, the entire sample

is pulverized in a one stage process to 85% passing 75 µm. The bulk pulverized sample is then bagged and approximately 200g extracted by spatula to a

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Quality control procedures adopted for all

sub-sampling stages to maximise representivity of samples.

Measures taken to ensure that the sampling is representative of the in situ

material collected, including for instance results for field duplicate/second-half sampling.

Whether sample sizes are appropriate to the grain size of the material being

sampled.

numbered paper bag that is used for the 50g fire assay charge.

RC samples submitted to the laboratory are sorted and

reconciled against the submission documents. Excelsior inserts blanks and standards with blanks submitted in sample number sequence at 1 in 50 and

standards submitted in sample number sequence at 1 in 20. The laboratory uses their own internal standards of 2 duplicates, 2 replicates, 2 standards, and 1 blank

per 50 fire assays. The laboratory also uses barren flushes on the pulveriser.

In the field every 10th metre from the bulk sample port

on the cone splitter is bagged and placed in order on

the ground with other samples. This sample is then used for collection of field duplicates via riffle splitting. RC field duplicate samples are collected after results

are received from the original sample assay. Generally, field duplicates are only collected where the original assay result is equal to or greater than 0.1g/t Au. The field duplicates are submitted to the laboratory for the

standard assay process. The laboratory is blind to the original sample number.

The sample sizes are considered to be appropriate for the type, style, thickness and consistency of

mineralization located at this project. The sample size is also appropriate for the sampling methodology employed and the gold grade ranges returned.

Quality of assay

data and laboratory tests

The nature, quality and appropriateness

of the assaying and laboratory procedures used and whether the

technique is considered partial or total.

For geophysical tools, spectrometers,

handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and

model, reading times, calibrations factors applied and their derivation, etc.

Nature of quality control procedures

adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of

accuracy (i.e. lack of bias) and precision have been established.

The assay method is designed to measure total gold

in the sample. The laboratory procedures are appropriate for the testing of gold at this project given

its mineralization style. The technique involves using a 50g sample charge with a lead flux which is decomposed in a furnace with the prill being totally

digested by 2 acids (HCl and HNO3) before measurement of the gold content by an AA machine.

Not used for reporting or interpretation of gold

mineralization.

The QC procedures are industry best practice. The laboratory is accredited and uses its own certified

reference material. The laboratory has 2 duplicates, 2 replicates, 1 standard and 1 blank per 50 fire assays. At the same time Excelsior submits blanks at the rate

of 1 in 50 samples and certified reference material standards at the rate of 1 in 20 samples in the normal run of sample submission numbers. As part of normal

procedures Excelsior examines all standards and blanks to ensure that they are within tolerances. Additionally, sample size, grind size and field

duplicates are examined to ensure no bias to gold grade exists.

Verification of sampling and assaying

The verification of significant intersections by either independent or alternative company personnel.

The use of twinned holes.

Exploration Manager, Bradley Toms and Technical Director, David Potter, have inspected drill core and RC chips in the field to verify the correlation of mineralized zones between assay results and lithology/alteration/mineralization.

A number of diamond core and RC holes have been drilled throughout the deposit to twin RC holes. These twinned holes returned results comparable to the original holes and were also used to collect geological information and material for metallurgical assessment. A number of RC holes have also been drilled that confirmed results obtained from historical drillholes.

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Documentation of primary data, data

entry procedures, data verification, data storage (physical and electronic) protocols.

\

Discuss any adjustment to assay data.

Primary data is sent digitally every 2-3 days from the

field to Excelsior’s Database Administrator (DBA). The DBA imports the data into the commercially available and industry accepted DataShed database software.

Assay results are merged when received electronically from the laboratory. The responsible geologist reviews the data in the database to ensure that it is correct and

has merged properly and that all data has been received and entered. Any variations that are required are recorded permanently in the database.

No adjustments or calibrations were made to any

assay data used in this report.

Location of data points

Accuracy and quality of surveys used to

locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource

estimation

Specification of the grid system used

Quality and adequacy of topographic control.

All drill holes have their collar location recorded from a

hand held GPS unit. Holes that may be in a future resource estimate area have their collar position picked up by licensed contract surveyors using a RTK system.

Downhole surveys are completed every 30m downhole.

All drill holes and resource estimation use the MGA94, Zone 51 grid system.

The topographic data used was obtained from consultant surveyors and is based on a LiDAR survey

flown in 2012. It is adequate for the reporting of Exploration Results and subsequent Mineral Resource estimates.

Data spacing and distribution

Data spacing for reporting of Exploration

Results.

Whether the data spacing and distribution is sufficient to establish the degree of

geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and

classifications applied.

Whether sample compositing has been

applied.

At Zoroastrian the nominal drill spacing is 20m x 20m

with some cross-sections in-filled to 10m across strike. At Navan the nominal drill spacing is 20m x 10m with some cross-sections in-filled to 5m across strike. This

spacing includes data that has been verified from previous exploration activities on the project.

This report is for the reporting of exploration results. The drill spacing, spatial distribution and quality of

assay results is sufficient to support the current JORC classification of material contained within this report and is appropriate for the nature and style of mineralisation being reported.

Compositing has not been applied to reporting of

exploration results.

Orientation of data in relation to geological

structure

Whether the orientation of sampling achieves unbiased sampling of possible

structures and the extent to which this is known, considering the deposit type.

If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to

have introduced a sampling bias, this should be assessed and reported if material.

The majority of drilling is to grid east. The bulk of the mineralized zones are perpendicular to the drilling

direction. Structural logging of orientated drill core supports the drilling direction and sampling method.

No drilling orientation and sampling bias has been recognized at this time.

Sample security The measures taken to ensure sample

security.

Sample security is part of Excelsior’s QAQC and sampling procedures. RC samples are delivered directly from the field to the Kalgoorlie laboratory by Excelsior personnel on a daily basis with no detours, the laboratory then checks the physically received samples against an Excelsior generated sample submission list and reports back any discrepancies

Drill core is transported daily directly from the drill site to Excelsior’s secure core processing facility by Excelsior personnel with no detours. The core is then placed on racks within a secure shed and processed until it requires cutting. Core is then transported directly by Excelsior’s staff to the Kalgoorlie laboratory where it is cut in half by laboratory staff and then sampled by

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Excelsior staff. The core is then prepared for assay in Kalgoorlie to the pulverizing stage whereupon the

laboratory transports it using a contractor directly to their Perth based assay facility.

Audits or reviews

The results of any audits or reviews of sampling techniques and data.

An internal review of sampling techniques and procedures was completed in March 2014. No external

or third party audits or reviews have been completed.

Section 2 Reporting of Exploration Results –

(Criteria listed in the preceding section also apply to this section.)


Mineral

tenement and land tenure status

Type, reference name/number, location

and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding

royalties, native title interests, historical sites, wilderness or national park and environmental settings.

The security of the tenure held at the time

of reporting along with any known impediments to obtaining a licence to operate in the area.

The results reported in this Announcement are on

granted Mining Leases held by GPM Resources Pty Ltd, a wholly owned subsidiary of Excelsior Gold Limited.

At this time the tenements are believed to be in good

standing. There are no known impediments to obtaining a license to operate, other than those set out

by statutory requirements.

Exploration

done by other parties

Acknowledgment and appraisal of

exploration by other parties.

Exploration by other parties has been reviewed and is

used as a guide to Excelsior’s exploration activities. Previous parties have completed both open pit and underground mining, geophysical data collection and

interpretation, soil sampling and drilling. This report comments on only exploration results collected by Excelsior.

Geology Deposit type, geological setting and style

of mineralisation. The mineralisation in the Zoroastrian area is

predominately associated with a complex array of multiple dimensional and variable orientated quartz veins and stock works within the differentiated

Zoroastrian Dolerite. In places a surficial 1-2m thick calcrete/lateritic gold bearing horizon and small near surface supergene pods exist. Recent open pits,

historical workings and shafts exist within this unit throughout the Company’s tenements and beyond. Detailed mapping and sampling of these workings and

structural measurements from orientated diamond core drilling forms the basis of the geological interpretation.

Drill hole Information

A summary of all information material to the understanding of the exploration

results including a tabulation of the following information for all Material drill holes:

o easting and northing of the drill hole collar

o elevation or RL (Reduced Level – elevation above sea level in metres) of the drill hole collar

o dip and azimuth of the hole

o down hole length and interception depth

The drill holes reported in this Announcement have the following parameters applied. All drill holes completed, including holes with no significant gold intersections are reported in this announcement.

Easting and northing are in MGA94 Zone 51

RL is AHD

Dip is the inclination of the hole from the horizontal (i.e. a vertically down drilled hole from the surface is -90°). Azimuth is reported in magnetic degrees as the direction toward which the hole is drilled. MGA94 and magnetic degrees vary by approximately 1° in this project area

Down hole length of the hole is the distance from the surface to the end of the hole, as measured along the drill trace. Interception depth is the distance down the hole as measured along the drill trace. Intersection

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o hole length.

If the exclusion of this information is

justified on the basis that the information is not Material and this exclusion does not detract from the understanding of the

report, the Competent Person should clearly explain why this is the case.

width is the downhole distance of an intersection as

measured along the drill trace

Hole length is the distance from the surface to the end of the hole, as measured along the drill trace.

No results from previous exploration are the subject of

this Announcement.

Data aggregation methods

In reporting Exploration Results, weighting averaging techniques,

maximum and/or minimum grade truncations (e.g. cutting of high grades) and cut-off grades are usually Material

and should be stated.

Where aggregate intercepts incorporate

short lengths of high grade results and longer lengths of low grade results, the procedure used for such aggregation

should be stated and some typical examples of such aggregations should be shown in detail.

The assumptions used for any reporting

of metal equivalent values should be clearly stated.

No high grade cuts have been applied to assay results. RC assay results are distance weighted using 1m for

each assay.

Intersections are reported if the interval is at least 1m wide at 1g/t Au grade. Intersections greater than 1m in

downhole distance can contain up to 2m of low grade or barren material.

No metal equivalent reporting is used or applied.

Relationship between

mineralisation widths and intercept

lengths

These relationships are particularly

important in the reporting of Exploration Results.

If the geometry of the mineralisation with respect to the drill hole angle is known,

its nature should be reported.

If it is not known and only the down hole

lengths are reported, there should be a clear statement to this effect (e.g. ‘down hole length, true width not known’).

The intersection width is measured down the hole

trace, it is not usually the true width. Cross sections in previous Announcements allow the relationship between true and down hole width to be viewed. At Navan the holes were drilled vertically into the

horizontal mineralisation and therefore represent true widths.

Data collected from orientated drill core and from the open pit, confirm that the drilling direction is optimal for

the mineralized zones at Zoroastrian. The multiple mineralized zones have a northerly strike and dip steeply to the west with some minor local overturning

of lodes.

All drill results within this announcement are downhole

intervals only and due to variable mineralisation and style true widths are not able to be calculated until

modelling of the mineralisation.

Diagrams Appropriate maps and sections (with

scales) and tabulations of intercepts should be included for any significant discovery being reported These should

include, but not be limited to a plan view of drill hole collar locations and appropriate sectional views.

Numerous cross sections and plans for Zoroastrian

have been included in past announcements.

Balanced

reporting Where comprehensive reporting of all

Exploration Results is not practicable, representative reporting of both low and

high grades and/or widths should be practiced to avoid misleading reporting of Exploration Results.

All drill holes completed are included in the results

Table in the Announcement.

Other substantive

exploration data

Other exploration data, if meaningful and

material, should be reported including (but not limited to): geological observations; geophysical survey results;

geochemical survey results; bulk samples – size and method of treatment; metallurgical test results; bulk density,

groundwater, geotechnical and rock characteristics; potential deleterious or contaminating substances.

No other exploration data is considered meaningful and

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Further work

The nature and scale of planned further

work (e.g. tests for lateral extensions or depth extensions or large-scale step-out drilling).

Diagrams clearly highlighting the areas of possible extensions, including the main

geological interpretations and future drilling areas, provided this information is not commercially sensitive.

Upon receipt of mining approvals mining of open pit

material is set to start.

No further drilling outside of pit designs is planned. Grade control drilling inside the pit will be conducted on

a nominal 7.5m x 5m spacing from surface and then subsequent 20m benches

Section 3 Estimation and Reporting of Mineral Resources –

(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)


Database

integrity Measures taken to ensure that data has

not been corrupted by, for example, transcription or keying errors, between its

initial collection and its use for Mineral Resource estimation purposes.

Data validation procedures used.

The company utilizes a number of different software that is used to validate data during collection, before import into and within the database and after import into Micromine.

Any errors recorded from the various validation processes are manually checked and correlated back to the original collection of data. If necessary field checks are made to confirm validation issues.

Site visits Comment on any site visits undertaken

by the Competent Person and the outcome of those visits.

If no site visits have been undertaken indicate why this is the case.

Numerous site visits have been undertaken by Mr Potter to review core and RC spoil piles. Purpose of review was to obtain understanding of mineralization occurrence, associated alteration and extents of previous workings.

Not applicable

Geological interpretation

Confidence in (or conversely, the uncertainty of) the geological

interpretation of the mineral deposit.

Nature of the data used and of any

assumptions made.

The effect, if any, of alternative

interpretations on Mineral Resource estimation.

The use of geology in guiding and

controlling Mineral Resource estimation.

The factors affecting continuity both of grade and geology.

The geology of the system and the gold distribution is complex. As such the company does not report measured resources regardless of drill and sample density.

The use of historical drilling provides a level of uncertainty as the company cannot validate the QAQC data and downhole surrey data. As such throughout the deposit the company has twinned historical holes to confirm results and location.

Different interpretations of the gold mineralisation wireframes have been undertaken to assess the influence on mineral resource estimation and mining economics. This work demonstrated that a possible +/- 10% difference exists between different lode interpretations. Where geological interpretation has a high degree of uncertainty it is classified as inferred regardless of modelling parameters.

Detailed mapping, sampling of historical workings (including the existing open pit) and diamond core provides confidence that the style of gold mineralisation is similar to other known deposits such as the Paddington orebody 16km to the south. When undertaking extensional and infill drilling mineralisation is consistently intersected within +/- 5m of projected gold mineralisation positions, thus confirming current interpretations.

Continuity of geology and structure can be identified and traced between drillholes by visual, geophysical and geochemical characteristics. The gold distribution within these structures does display a high nugget effect;

however gross high grade positions and plunge controls

can be determined.

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Dimensions The extent and variability of the Mineral

Resource expressed as length (along strike or otherwise), plan width, and depth below surface to the upper and

lower limits of the Mineral Resource.

Mineralisation extends 1500m north/south, 470m

east/west and 370m in elevation. Mineralisation is present at surface for some lodes with most mineralised lodes starting from within 10m of surface.

Lodes are also present on the pit floor and walls from previous mining activities.

Estimation and modelling

techniques

The nature and appropriateness of the

estimation technique(s) applied and key assumptions, including treatment of extreme grade values, domaining,

interpolation parameters and maximum distance of extrapolation from data points. If a computer assisted estimation

method was chosen include a description of computer software and parameters used.

The availability of check estimates, previous estimates and/or mine

production records and whether the Mineral Resource estimate takes appropriate account of such data.

The assumptions made regarding recovery of by-products.

Estimation of deleterious elements or

other non-grade variables of economic significance (e.g. sulphur for acid mine drainage characterization).

In the case of block model interpolation, the block size in relation to the average

sample spacing and the search employed.

Any assumptions behind modelling of selective mining units.

Any assumptions about correlation

between variables.

Description of how the geological

interpretation was used to control the resource estimates.

Discussion of basis for using or not using grade cutting or capping.

The process of validation, the checking process used, the comparison of model data to drill hole data, and use of

reconciliation data if available.

Block models were estimated by Mr. Potter using

Ordinary Kriging with Micromine software. Estimation parameters were determined using QKNA analysis on selected blocks for each mineralisation type.

Estimations were run within the EXG mineralised wireframes using the assay data determined by EXG.

Comparison models were conducted by EXG which

confirmed that the estimation process was appropriate and results were similar in nature.

No consideration has been made to by-products

Whilst the ore is associated with arsenopyrite, assay

data and metallurgical test work indicate this does not affect recoveries. No other deleterious elements have been identified.

Drilling is at 40m X 40m spaced drilling with some

areas infilled to 20m X 20m spaced drilling. The block size is 10mN x 2mE x 5mRL. This block size was used by EXG staff to represent likely mining methods.

Block sizes were chosen to represent the most likely

selective mining units when extraction is by open pit method utilizing a traditional open pit mining fleet. Portions of the resource that may be amenable to underground mining extraction methods have block

sizes used that are appropriate to possible underground stoping methods.

Not applicable

Blocks were hard bounded with mineralised wireframes generated by EXG staff geologist.

One metre composites were top-cut to a maximum of

55g/t for vein style mineralized domains and 6g/t for lateritic horizons. Top cut determination undertaken by Excelsior and was based on population breaks using

log-probability plots.

Comparisons of drill hole data to block estimates was

used for validation of unbiasness. Comparison with previously reported mineral resources is reasonable

when taken into account the amount of new drilling.

Moisture Whether the tonnages are estimated on a

dry basis or with natural moisture, and the method of determination of the moisture content.

Tonnages were based on a dry basis.

Cut-off parameters

The basis of the adopted cut-off grade(s)

or quality parameters applied. Nominal lower-cut offs for modelling were chosen

based on geological and grade continuity mindful of possible economic breakeven grades

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Mining factors or assumptions

Assumptions made regarding possible

mining methods, minimum mining dimensions and internal (or, if applicable, external) mining dilution. It is always

necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider

potential mining methods, but the assumptions made regarding mining methods and parameters when

estimating Mineral Resources may not always be rigorous. Where this is the case, this should be reported with an

explanation of the basis of the mining assumptions made.

The model was undertaken by subdividing the

mineralisation into shallower zones of mineralisation less than 150 metres vertical depth which are potentially amenable to open pit mining (calculated at a

lower cut 0.6g/t Au) and deeper, greater than 150 metres vertical depth mineralisation which more likely represent underground mining opportunities and is

modelled at a lower cut-off grade greater than 3.0g/t Au. Potential mining methods and economics were taken into account when interpreting mineralisation

including internal dilution, final widths and grade.

Metallurgical factors or

assumptions

The basis for assumptions or predictions regarding metallurgical amenability. It is

always necessary as part of the process of determining reasonable prospects for eventual economic extraction to consider

potential metallurgical methods, but the assumptions regarding metallurgical treatment processes and parameters

made when reporting Mineral Resources may not always be rigorous. Where this is the case, this should be reported with

an explanation of the basis of the metallurgical assumptions made.

Detailed Waste and ore characterizations have been undertaken as part of an ongoing pre-feasibility study

and indicate that the ore is highly amenable to a standard CIL extraction process and that no metallurgical or environmental issues exist.

Environmental factors or assumptions

Assumptions made regarding possible waste and process residue disposal

options. It is always necessary as part of the process of determining reasonable prospects for eventual economic

extraction to consider the potential environmental impacts of the mining and processing operation. While at this stage

the determination of potential environmental impacts, particularly for a greenfields project, may not always be

well advanced, the status of early consideration of these potential environmental impacts should be

reported. Where these aspects have not been considered this should be reported with an explanation of the environmental

assumptions made.

As above. Environmental studies have also been completed as part of the PFS and no environmental

issues exist concerning the extraction or disposal of waste or tailing material.

Bulk density Whether assumed or determined. If

assumed, the basis for the assumptions. If determined, the method used, whether

wet or dry, the frequency of the measurements, the nature, size and representativeness of the samples

The bulk density for bulk material must have been measured by methods that

adequately account for void spaces (vugs, porosity, etc), moisture and differences between rock and alteration

zones within the deposit.

Discuss assumptions for bulk density

estimates used in the evaluation process of the different materials.

Density was determined by two different methods,

geophysical using a downhole density logging tool and drill core samples using a gravimetric technique

performed by a contract assay laboratory. The core samples were taken from locations that are spatially representative of the different rock types, amount of

weathering and whether the material is ore or waste. The core samples were generally 50mm in diameter and approximately 10-20cm long. The geophysical

method involved the lowering of a density tool, the Auslog A65 Calliperty Calliper Tool by a contract geophysicist down open drill holes within the

mineralized zones of Zoroastrian.

The bulk densities used in the Resource Model take

into account void spaces and vugs within differing rock and weathering types.

The bulk density measurements by the two different methods are comparable to previously used bulk

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densities used during the historic mining of the existing Zoroastrian Pit completed in the 1990’s and also to

other mining operations in similar rock and weathering types in the local area.

Classification The basis for the classification of the

Mineral Resources into varying confidence categories.

Whether appropriate account has been taken of all relevant factors (i.e. relative

confidence in tonnage/grade estimations, reliability of input data, confidence in continuity of geology and metal values,

quality, quantity and distribution of the data).

Whether the result appropriately reflects

the Competent Person’s view of the deposit.

The models and associated calculations utilised all

available data and whilst depleted for known workings no adjustment was made for smaller undefined

workings.

Excelsior follows the JORC classification system with

final individual block classification being assigned by statistically methods and visually taking into account the following factors and adjusting on: Drill spacing and orientation.

Average distance to fill individual blocks.

Number of holes and points used to fill the block.

Statistical analysis of results.

Classification of surrounding blocks, and

Lode position and confidence in interpretation

Excelsior does not classify any resources that make use of historical data as Measured due to varying QAQC data. Those blocks that were nominally

classified as Measured were automatically reclassified as Indicated. Further, Excelsior does not classify any resources that are based on historical data as

Indicated unless this has been confirmed by drilling undertaken by the company. Those blocks that were nominally classified as Measured/Indicated where

confirmation drilling has not been undertaken are automatically reclassified as Inferred.

Audits or reviews

The results of any audits or reviews of Mineral Resource estimates.

Excelsior have undertaken a review of the mineral resource estimate including validation, visual checks

and multiple estimations with changing variables and believe the estimation to be valid within the degree of statistical error

Discussion of

relative accuracy/ confidence

Where appropriate a statement of the

relative accuracy and confidence level in the Mineral Resource 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 resource within stated confidence limits, or, if such an approach is not deemed appropriate,

a qualitative discussion of the factors that could affect the relative accuracy and confidence of the estimate.

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.

These statements of relative accuracy and confidence of the estimate should be

compared with production data, where available.

The large amount of production and geological

information available from historical mining production data allows for a high degree of confidence in geological, mining and milling parameters. Grade and

geological continuity can be estimated to a degree of accuracy high enough to allow for a proportion of the resource to be classified as Measured, Indicated or

Inferred where appropriate. Additionally, there is a high density of drill spacing, confirmation drilling, and QAQC procedures.

The block model estimate is a global resource estimate

which has block sizes chosen at the expected “SMU” selection size. Block grades will tend to be smoothed between the drill hole sections but should represent the

total contained tonnes and metal of the mineralisation

Reconciliation between previous mining production and

the depleted resource within the pit demonstrated +/- 5% in contained ounces

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Section 4 (Auralia) Estimation and Reporting of Zoroastrian Central Open Pit Ore Reserve (Criteria listed in section 1, and where relevant in sections 2 and 3 for 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.

The Mineral Resources for the Kalgoorlie North Gold Project

(KNGP) have been estimated by Mr David Potter of Excelsior Gold Limited (EXG). These Mineral Resources are inclusive of

the area referred to as the Zoroastrian Central Open Pit Ore Reserve.

The following table comprises the Ore Reserve for the

Zoroastrian Central Open Pit, contained within the Kalgoorlie North Gold Project: Any Mineral Resources are reported as wholly inclusive of the Ore Reserves.

Please note, some errors may exist due to rounding

Site visits Comment on any site visits undertaken

by the Competent Person and the outcome of those visits.

If no site visits have been undertaken indicate why this is the case

Multiple prior site visits have been carried out by the Competent

Person Mr Daniel Tuffin, an AusIMM Chartered Professional.

Study status The type and level of study undertaken

to enable Mineral Resources to be converted to Ore Reserves.

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.

This is a Feasibility (FS) level of study. The study has been

carried out to update the re-aligned goals from those contained in the prior 2014 PFS Ore Reserve, which consisted of the material

contained in the area designated as the Zoroastrian Central Open Pit being processed in an owner operated mill as part of the larger Kalgoorlie North Gold Project. It is now planned to

process the Zoroastrian Central Open Pit material through the Norton Goldfield’s (NGF) operated Paddington Mill as part of the joint ore treatment agreement between the two parties.

A mine plan has been scheduled that is technically achievable,

and is economically viable to the expected detail of FS levels. Individual deposit discounting and global capital costs have been applied to these works. A full comprehensive, detailed global

project financial review has been carried out as part of these works in-house by EXG.

Where appropriate, modifying factors have been applied to these FS works. These modifying factors have been calculated based on data resulting from independently tendered mining operating

costs, vendor-sourced capital cost estimates, independent mining and geotechnical studies, and metallurgical and environmental studies.

Any material classified as an Inferred Mineral Resource was not

included for consideration as an economic driver during any of the optimisation processes and does not influence the final Ore Reserves calculations.

DEPTH

LOWER

CUT

(g/t Au)

INDICATED INFERRED TOTAL RESOURCES


(t) (g/t Au) (oz) (t) (g/t Au) (oz) (t) (g/t Au) (oz)

<150m

0.6

4,467,000 2.30 330,600

1,719,000 1.86 102,900

6,186,000 2.18 433,500

>150m

3.0

736,800 4.83 114,500

218,300 4.70 33,000

955,100 4.80 147,500

TOTAL

5,203,800 2.66 445,100

1,937,400 2.18 135,800

7,141,200 2.53 581,000

Numbers may not sum due to rounding

Table 1: Zoroastrian Mineral Resources – June 2015

Deposit Tonnes

(,000t)

Grade

(g/t Au)

Ounces

(,000oz) Tonnes (,000t)

Grade (g/t

Au)

Ounces

(,000oz)

Tonnes

(,000t)

Grade

(g/t Au)

Ounces

(,000oz)

Zoroastrian Central O/P 1,176 1.88 70.9 1,176 1.88 70.9

PROVEN ORE RESERVE PROBABLE ORE RESERVE TOTAL ORE RESERVES

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Cut-off

parameters The basis of the cut-off grade(s) or

quality parameters applied. The singular economic cut off applied was 0.91g/t for all material

and weathering types contained within the Mineral Resource model.


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).

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.

The assumptions made regarding

geotechnical parameters (e.g. pit slopes, stope sizes, etc), grade control

and pre-production drilling.

The major assumptions made and

Mineral Resource model used for pit and stope optimisation (if appropriate).

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.

Where appropriate, modifying factors have been applied to these FS works. These modifying factors have been applied at varying

points as required during Whittle optimisation, pit design, scheduling and reporting of Ore Reserves.

The final calculation of the Ore Reserve figures was performed using the Geovia Surpac

TM software suite.

The selected method was open cut mining.

With regards to fleet mining operation costs, studies were firstly carried out to assess the most cost-effective and practical

method. A detailed pricing submission process was then carried out, with multiple submissions supplied. This pricing process was pre-final contract sign off, and should not be confused as such.

A standard 90t truck fleet combination was selected to be applied to the bulk of the project – ie: the utilisation of 90 tonne rigid-body

trucks matched with a suitable excavator paring. The fleet included standard ancillary machinery – grader, dozer and water cart.

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.

Geotechnical pit design parameters were sourced via independent expert assessment. Geotechnical firm Peter

O’Bryan & Associates provided a technical note covering these parameters.

A 15% mine dilution factor was applied during the Ore Reserve works.

A 95% mining recovery was applied during the Ore Reserve works.

Where possible and appropriate a minimum pre-goodbye cut

mining width of 20m was applied as a constraint to the design.

Only the Measured and Indicated portions of the Mineral

Resource classified material types were used in the optimisation works; while the final design 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 Feasibility Study 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.

Whether the metallurgical process is

well-tested technology or novel in nature.

The nature, amount and

representativeness of metallurgical test work undertaken, the nature of the

The planned treatment of Zoroastrian Central Open Pit ore is at the Paddington processing facility, a conventional 3.5Mtpa CIL

plant suitable for regional mineralisation, consisting of primary crusher, SAG mill, pebble crusher, secondary ball mill, gravity recovery, CIL (carbon-in-leach), carbon elution, electrowinning

and smelting to produce gold doré

The planned process is a conventional, robust, well tested

technology, and is appropriate for the lode style of the Zoroastrian Central Open Pit deposit, as demonstrated by

successful treatment of similar regional deposits for 30 years and ore metallurgical test work replicating plant conditions and parameters.

Metallurgical test work samples were sourced from diamond drill core. The metallurgical characterisation test work program on the metallurgical core samples included detailed elemental head

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metallurgical domaining applied and

the corresponding metallurgical recovery factors applied.

Any assumptions or allowances made for deleterious elements.

The existence of any bulk sample or pilot scale test work and the degree to

which such samples are considered 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?

grade analysis, gravity and leach recovery test work. Accordingly,

the samples used for the metallurgical test work is considered representative of the deposits and proposed treatment methodology.

The metallurgical characterisation test work program indicated deleterious elements are sufficiently low in content. Plant

recovery test work indicated rapid leach rate with high gold recovery.

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.

Ore Reserves are quoted on a ‘delivered to mill’ basis, which

excludes metallurgical recovery factors. The test work discussed above was carried out as part of this study, and predicted varying overall plant gold recoveries, dependent upon weathering profile

type.

To allow for averaging, continuity (with the previous Kalgoorlie

North Gold Project work) and conservatism, a mill recovery of 93% at a grind size of 80% passing 106 microns and 24 hour leach residence time was applied to the Zoroastrian Central

Open Pit during the course of this study.

The Zoroastrian Central Open Pit mine schedule is estimated to

contain 87% Oxide-Transitional Ore and 13% Primary Ore. The test work weighted average recovery is 94.5% for Zoroastrian

Central Open Pit deposit.

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 these works to a detailed level to allow the lodgment of a

Mining Proposal (MP) for these areas.

These works include flora and fauna surveys, existing land

disturbance surveys, waste rock sampling, soil analysis, hydrology, Aboriginal heritage surveys and database reviews.

Waste Rock Landforms are conservatively designed to take into consideration high proportions of oxide waste and 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 Zoroastrian Central Open Pit is situated on the historical

Bardoc Mining Centre, most recently mined by Aberfoyle Gold Pty Ltd between 1987 and 1991. Prior cleared land, dumps, open

pits and underground workings exist throughout the area. The project’s location is situated 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

Project capital costs are based on:

Haul road construction cost estimate based on a budget pricing submission from local ore haulage contractor.

Haul road crossing costs estimate based on an approved engineered design provided by a locally based

engineering firm.

Light vehicle and Information Technology (IT) costs are based on vendor quotations.

With regards to fleet mining operation costs, a feasibility level

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operating costs.

Derivation of transportation charges.

The basis for forecasting or source of

treatment and refining charges, penalties for failure to meet

specification, etc.

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.

Allowances made for the content of

deleterious elements.

detailed pricing submission process was carried out. Contractor

mining and drill and blast rates from this process were used for the basis of the load and haul and drill and blast cost.

Ore haulage transportation charges were applied. Based on an

assumed haulage route, they utilise an on-road/off-road ctkm figure (quoted), with the costs then being accounted for as $/t

ore (additional to the processing operating costs) during the optimisation process.

Treatment and refining charges are based on current costs associated with the treatment of similar ores at the Paddington

Mill as supplied by Norton Gold Fields.

All costs are in Australian Dollars. An assumed base gold price

of A$1,380 per gold ounce was applied to the final Zoroastrian Central Open Pit 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.

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. No Potentially Acid

Forming (PAF) waste material has been detected.

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 derivation of assumptions made of metal or commodity price(s), for the

principal metals, minerals and co-products.

The head grade is derived from each individual Mineral Resource

and applied Modifying Factors as described above.

An assumed base gold price of A$1,380 per gold ounce was

applied to the final study. No doré transport or refining costs were applied.

No revenue has been allocated to any possible economically beneficial by-products.

Market

assessment The demand, supply and stock

situation for the particular commodity, consumption trends and factors likely

to affect supply and demand into the future.

A customer and competitor analysis along with the identification of likely

market windows for the product.

Price and volume forecasts and the

basis for these forecasts.

For industrial minerals the customer

specification, testing and acceptance requirements prior to a supply contract.

Gold is a precious metal and thus subject to fluctuations, due

principally to market sentiment.

Payment will be made based on the value of the contained gold

in each ore parcel (Recovered Gold Credits) by NGF based on the Gold Recovery Statement derived from the detailed Ore

Stockpiling, Sampling and Grade Determination Procedure. NGF will sell the Recovered Gold Credits at the AUD Spot Gold Price as quoted by the Refiner on the business day preceding the

delivery of the Gold Recovery Statement.

The gold sell price used for the Zoroastrian Central Open Pit

works was A$1,380/oz. The planned volume of production for is to supply 1,176,000t of ore at 1.88g/t of gold to the nearby NGF Paddington Mill.

N/A

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.

A discount rate of 10% was applied to the optimisation works.

Inputs to the economic analysis include Modifying Factors as described above.

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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.

The status of material legal

agreements and marketing arrangements.

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.

Barring standard economic and/or labour force fluctuations or

other unforeseen acts there are no known significant impacts that could affect the Ore Reserves specific to the area.

There are no known significant naturally occurring risks to the

project.

Under the terms of the Capital Contribution and Ore Treatment

Agreement between Paddington Gold Pty Ltd (a wholly owned subsidiary of Norton Gold Fields Limited) and GPM Resources Pty Ltd (a wholly owned subsidiary of Excelsior Gold Limited),

dated 20 October 2014, Norton agrees, subject to GPM contributing capital to upgrade the Paddington Mill, to process a minimum of 500,000 tonnes of ore per annum from the Kalgoorlie

North Gold Project over a period of up to 10 years. The Zoroastrian project falls under this agreement. Excelsior Gold will be responsible for all of the mining operations whilst Norton will

be responsible for haulage and milling of the ore.

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; all Mining Proposal and clearing permits and Project Management Plans have been submitted for review.

Classification The basis for the classification of the

Ore Reserves into varying confidence categories.

Whether the result appropriately

reflects the Competent Person’s view of the deposit.

The proportion of Probable Ore Reserves that have been derived from

Measured Mineral Resources (if any).

Indicated Mineral Resources have been converted to Probable

Ore Reserves. As no Measured Mineral Resources exist for the Zoroastrian Central Open Pit there has been no conversion of

Mineral Resources to Proven Ore Reserves.

The estimated Zoroastrian Central Open Pit Ore Reserves are,

in the opinion of the Competent Person, appropriate for this style of deposit.

No Measured Mineral Resources existed. Thus none were downgraded to Probable Ore Reserves

Audits or reviews

The results of any audits or reviews of

Ore Reserve estimates. No external audits or reviews have taken place for the portion

of Ore Reserve covering the Zoroastrian Central Open Pit. Auralia Mining Consulting has completed an internal review of this Ore Reserve estimate.

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

The level of study carried out as part of this Zoroastrian Central

Open Pit Ore Reserve is to a Feasibility Study level. The relative accuracy of the estimate is reflected in the reporting of the Ore Reserves as per the guidelines re: modifying factors, study levels

and Competent Persons contained in the JORC 2012 Code.

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appropriate, a qualitative discussion of

the factors which could affect the relative accuracy and confidence of the estimate.

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 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.

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.

This statement relates to global estimates of tonnes and grade.

It should be noted that for all deposits the optimal cash flow

revenue factor (RF1) shell was selected on which to base final pit designs.

Sensitivity studies were carried out. Standard linear deviations were observed. The project is most susceptible to fluctuations

in gold price.

No relevant modern production data as yet exists.

Section 4 (Mining Plus) Estimation and Reporting of Ore Reserve (Criteria listed in section 1, and where relevant in sections 2 and 3 for also apply to this section.)


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.

Surface

Mineral Resources used were provided by Excelsior Gold for

Zoroastrian South, Central and Extended.

Please note, some errors may exist due to rounding

The Zoroastrian Open Pit Reserves are wholly within of the

Open pit Resources reported for Zoroastrian

The Zoroastrian Underground Reserves are wholly within of the

Open pit Resources reported for Zoroastrian

Site visits Comment on any site visits undertaken by the Competent Person and the outcome of those visits.

If no site visits have been undertaken

indicate why this is the case

David Billington completed a site visit, 15th May 2015.

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Study status The type and level of study undertaken

to enable Mineral Resources to be converted to Ore Reserves.

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.

Surface

Previous mining has taken place in the Zoroastrian area, with an

open pit nominally 60m deep. Previous pre-feasibility study has

been published to support Zoroastrian South Central and

Extended.

This Mining study was to review the effects of updated

parameters of the previous Pre-Feasibility Study.

The estimation of JORC (2012) Ore Reserves were prepared at

the Pre-Feasibility Study level

Underground

Ore Reserves were estimated using a suit of specialised mine

planning software package and production scheduling program.

The input parameters selected are based on the review of the

mining studies completed by Mining Plus and discussions with

Excelsior personnel.

The estimation of JORC (2012) Ore Reserves were prepared at

the Pre-Feasibility Study level

Cut-off

parameters The basis of the cut-off grade(s) or

quality parameters applied. The resource model CSV imported was “1412_zoro_final for

engines.csv”

The resource model was converted to a Datamine model and the

tonnes and grades agreed with Excelsior on 0.6g/t and 3.0g/t cut off grades

The resource cut off grades of 0.6g/t were used to define material to be evaluated for processing for open cut

The overall grade cut-off, based on costs provided by Excelsior, is 3.0 g/t Au. Stope shapes were generated, using specialised software and an input cut-off grade of 2.5 g/t Au. The stope

shapes were then individually checked again the geological block model

Gold price of AUD1380/oz has been utilized


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).

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.

The assumptions made regarding geotechnical parameters (e.g. pit

slopes, stope sizes, etc), grade control and pre-production drilling.

The major assumptions made and Mineral Resource model used for pit

and stope optimisation (if appropriate).

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.

Surface

The open pit mining method used to convert Mineral Resource to

Reserve was a highly selective truck and excavator system

suitable to very narrow vein type mining. The resource was

limited to oxide and transitional materials to avoid additional

dilution and mining loss from the intense blast of fresh rock

Only material classified as Indicated has been processed and

hence has had economic factors applied

An independent geotechnical consultant, Peter O’Bryan

produced has produced a report “Preliminary Geotechnical

Assessment Open Pit Mining Excelsior & Zoroastrian (February

2014)”. In the report prepared by Peter states the “the number

and range of data available are considered to be adequate for-

pre-feasibility assessment”. The assertion was given with 4

caveats and the competent person is not aware of any

conditions that would break these caveats

The Zoroastrian Extension pit likely requires the removal of an

existing instability in the top of the western wall as part of the

Zoroastrian Central Pit, the volumes have been assumed to be

included in the Zoroastrian Central Pit. The final design of the

Zoroastrian Central deposit is as yet incomplete hence no review

has been completed

A series of regularization were run, confirming the highly

selective nature of the deposit, indicating a doubling of any

dimension would produce a 25% grade reduction

An mine shape optimisation run has been conducted at 1m

minimum width and a 0.6g/t cut off, indicating 9% grade

reduction and 92% tonnage availability which calculates to an

84% mining recovery after 9% dilution at 0 g/t

It has been assumed that sufficient effort to clean off the waste

and mine the ore down to 0.5m widths across strike

A nominal minimum mining width of 12m has been used.

Underground

The deposit is planned to be mined both as an open pit and

underground operation. The underground extraction will be via

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long hole open stoping method with pillar support.

Pre-feasibility level geotechnical studies have been completed

by Excelsior, which have been used in the stope design

parameters and support requirements.

The minimum mining width is 1.5 m.;

The vertical level spacing is 20 m, floor to floor;

Mining recovery factor of 90% has been applied;

A dilution factor was calculated for each stope, based on an

additional 0.5 m added to the overall mining width;

Rib pillars and sill pillars were sized as recommended by the

geotechnical study entitled “Zoroastrian Deposit, Preliminary

Geotechnical Assessment, Underground Mining”, Peter 0’Bryan

& Associates, dated November 2013.

There was no Inferred Mineral Resources extracted by stoping

operations. Some Inferred Mineral Resource material was mined

in the course of developing access to the Indicated Mineral

Resources. This Inferred material, 18,000 tonnes, was treated as

mineralised waste with a grade of 0.0 g/t Au and hauled as

waste; The inclusion of this Inferred material does not materially

affect the mine schedule or techno-economic model;

The mine design included all major infrastructure requirements

to support the long hole open stoping mining method.

Metallurgical factors or

assumptions

The metallurgical process proposed and the appropriateness of that

process to the style of mineralisation.

Whether the metallurgical process is

well-tested 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.

Any assumptions or allowances made

for deleterious elements.

The existence of any bulk sample or

pilot scale test work and the degree to which such samples are considered 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?

Surface

Process costs were provided from the long term milling

allocation agreement with Norton Goldfields for the Paddington

Mill.

Metallurgical recoveries provided was 91.7% was used for both

transitional and oxide materials

Underground

A metallurgical recovery of 91.3% has been applied to the mined

gold oz to calculate the recovered gold oz and the revenue for

the cash flow purposes.

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.

Surface

Mining License exists for Zoroastrian, Mining Proposal yet to be

prepared

Underground

Mining Plus is not, and has not been made, aware of any

reports, data or restrictions that may exist in regards to potential environmental impacts;

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.

Surface

It is estimated the project area has sufficient land available for

the required run of mine stockpiles for haulage

The project is expected to be run residentially from Kalgoorlie

Open Pit mining contractors have priced in mobilizing their infrastructure to site

The Goldfields gas pipeline crossed the mineralized zone and for

the ore reserves, it has been assumed the pipeline has not been

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moved, however the 25m offset either side from the data

provided as the pipeline has been utilised. However it is recognized that haul roads will need to cross this pipeline. Depths checks have been completed on site to confirm the depth

of the pipeline to make preliminary recommendations for coverage to ensure pipeline stability and integrity. The preliminary recommendations are that 1m of cover will suffice

and this not considered an encumbrance to the project and the cost to build a 1m high crossing over the 50 odd m required for a road widths of 20m is nominally 1,000bcm which likely to be

overburden hauled from the pit.

The surface haulage road to the Paddington Mill is part of the arrangement with Paddington

Underground

The access to mine site is via the existing road infrastructure in

the area;

The mine site will require an area for administration and

technical support offices. The mine infrastructure requires an equipment repair shop and service facility with water and diesel storage tanks. All power for the mine and office facilities is

assumed to be grid power;

Processing will be conducted by a third party off site, so no

metallurgical plant is required to be constructed;

Personnel will housed in Kalgoorlie

Costs The derivation of, or assumptions made, regarding projected capital

costs in the study.

The methodology used to estimate

operating costs.

Derivation of transportation charges.

The basis for forecasting or source of

treatment and refining charges, penalties for failure to meet

specification, etc.

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.

Allowances made for the content of deleterious elements.

Surface

Open Pit mining costs were provided from a suite of competitive

indicative prices from contracts familiar with earth moving in the region, Neither the lowest or highest estimates were used

Open pit mining costs provided are based on a different

schedule, prior to operation quotes should be obtained to match schedule and highly selective mining method

Surface Haulage costs from the Ore Treatment Agreement

Processing costs from Ore Treatment Agreement

The Australian Dollar (AUD) is the base currency in the study;

A Government royalty of 2.5% of gold revenue was included

Underground

The operating costs for the study were provided by Excelsior and

were based on a quotation from a mining contractor, which appear reasonable and to an acceptable level of accuracy;

Operating costs were calculated using the mine production schedule and equipment productivities;

The transport costs to the processing plants were included and

based on a quotation from a trucking company which appear reasonable and to an acceptable level of accuracy;

The processing costs were provided by Excelsior and based on information from the process plant operator;

The Australian Dollar (AUD) is the base currency in the study;

A Government royalty of 2.5% of gold revenue was included.

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 derivation of assumptions made of metal or commodity price(s), for the

principal metals, minerals and co-products.

Surface and Underground

Gold Price AUD$1380

Underground

The underground Ore Reserve was based on a gold price of

AUD $1,380 per ounce and an average operating cost of AUD 105 per tonne treated. This includes a transport to plant cost of

and a processing cost as per the Ore Treatment Agreement. For

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Market

assessment The demand, supply and stock

situation for the particular commodity, consumption trends and factors likely to affect supply and demand into the

future.

A customer and competitor analysis

along with the identification of likely market windows for the product.

Price and volume forecasts and the basis for these forecasts.

For industrial minerals the customer

specification, testing and acceptance requirements prior to a supply contract.

Surface and Underground

Market assessment has not been conducted as the gold metal is

planned to be sold on the open market.

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.

NPV ranges and sensitivity to variations in the significant

assumptions and inputs.

Surface

Cumulative Cash Flow analysis have been conducted indicating

positive cash flows from the open pits

regarding the preferential sequencing Zoroastrian with the

mining of several other deposits

NPV sensitivities were conducted as part of the pit optimization

and selection process, the open pits are most sensitive to gold price

Underground

The NPV discount rate, provided by Excelsior, is 8%;

Inflation and escalation was not considered in the economic model

Social The status of agreements with key stakeholders and matters leading to

social licence to operate.

Surface

Mining License exists for Zoroastrian, Mining Proposal yet to be

prepared

Underground

Mining Plus is not, and has not been made, aware of any data or

restrictions that may negate a social license to operate.

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.

The status of material legal

agreements and marketing arrangements.

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.

Surface

Mining License exists for Zoroastrian, Mining Proposal yet to be prepared

Underground

There is an agreement to supply the plant, located off-site and

operated by a third party, mineralised material at the rate of 500,000 tonnes per annum for five years.

While there are existing mining approvals for various surface

workings, it is expected that Government approval of the Mining Proposal for underground operations will be received within the

schedule anticipated in the pre-feasibility study

Classification The basis for the classification of the Ore Reserves into varying confidence

categories.

Whether the result appropriately

reflects the Competent Person’s view of the deposit.

Surface

Indicated Resources have been converted to Probable Ore

Reserves with the application of the selected mining dilution and recovery assumptions

Underground

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The proportion of Probable Ore

Reserves that have been derived from Measured Mineral Resources (if any).

Mining Plus has classified all the Indicated Mineral Resource as

Probable Mining Reserve;

The classification is consistent with the Competent Person’s

view of the deposits;

There were no Mineral Resources classified as Measured;

Audits or reviews

The results of any audits or reviews of Ore Reserve estimates.

Surface

Internal reviews conducted on application of data provided into

optimisation and design process

Underground

The Ore Reserve was peer reviewed, internally, and the Ore

Reserve meets the requirements as set out by JORC 2012.

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 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 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.

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.

Surface

The application of statistical or geostastical procedures to quantify the relative accuracy of the Ore Reserve is within stated

confidence limits is not considered appropriate, as it the Reserve is all considered Probable.

Local cost estimates have used where available from formal

agreements in place, recent indicative pricing available

Subsequent to the completion of the optimisation and open pit

design work some minor cost revisions have been provided. These have been assess for materiality and have been decided

to be not material. For example the ore cartage cost estimate has been provided which raises the Whittle processing cost estimate by 2%, which is considered not material from the

sensitivity analysis conducting during the process.

Underground

Confidence level for the reserves was tested performing

sensitivity check based on a techno-economic model generated by Mining Plus;

Sensitivity analysis was conducted on revenue (gold price), operating and capital costs. The analysis showed that the project

economics is most sensitive to gold price, followed by operating cost.

The Ore Reserve was found to be resilient to +/-15% variation in

key parameters employed for sensitivity tests, except Revenue, which resulted in a small negative NPV at a variation of -15%;

The accuracy and confidence level of the input parameters are in

line with expected pre-feasibility study limits of accuracy;

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zoroastrian mineral resource and ore reserve update · 7/6/2015 · the underground mine design...

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