Life of Mine Plan defines basis for optimising business outcomes from the Paddington assets

Transcription

1 ASX/MEDIA ANNOUNCEMENT 3 July 2008 Life of Mine Plan defines basis for optimising business outcomes from the Paddington assets Key points Paddington Life of Mine Plan (LOM) is now defined for ten years of mining It is the basis for good business decision making including: o pit sequencing o optimising feed to the mill o directing resource definition and exploration drilling It reflects the 31 March 2008 resource position and it will be progressively updated and extended as additional exploration and geological information become available It is derived from: o resources, reserves and other mineral inventory o open cut and underground mining delivering 3.3 Mtpa of mill feed It sets out: o Key parameters for evaluating each project including quantity, strip ratio, grade, location and ore type o the basis for achieving up to 250,000 oz gold production per year Annual exploration spend of ~$6M has the objective of improving the LOM gold production profile. Norton Gold Fields Limited ((Norton) (ASX code: NGF)) today announced the Paddington Life of Mine Plan setting out a ten-year mining program to support planning decisions and provide focus and direction for the Paddington Gold Mine. It will be progressively updated as further exploration results and geological information become available. This LOM (1 July 2008) is based on the resource position at 31 March 2008 of 4.8 Moz Mineral Resource including 1 Moz Ore Reserve. The LOM is detailed for the first four years and conceptual for next six years. The LOM involves open cut mining to deliver 2.8 Mtpa to the Paddington CIP plant to produce 150,000 oz of gold (1.8 g/t head grade, 93.5% recovery). The balance of 0.5 Mtpa will be high grade feed from underground and small open cut operations, generating an additional 100,000 oz pa. Norton Gold Fields Limited L1 79 Hope Street, South Brisbane, Queensland 4101 Australia ACN Tel Fax

2 The project area of 1,200 km 2 contains over 100 known prospects of which 69 have been subject of modern exploration. The current Resource Statement covers 19 of these. The focus of the exploration budget is to convert current Resource estimates to Ore Reserves and convert the mineral inventory into JORC code compliant Resources. The project has a number of key drivers that are balanced to provide the best possible business outcomes from gold production. These drivers comprise: 1. Base load feed projects capable of providing the larger percentage of the total mill feed. 2. Grade, metallurgical recovery and operating costs. 3. Ore hardness mining and milling rates and costs are largely driven by the hardness of the ore. The plan currently targets an ore blend of 60:40 hard to soft. 4. Strip ratio 5. Distance from Kalgoorlie / Paddington Mill mining costs and ore transport are affected by location. 6. Supplementary feeds these ore bodies are generally smaller than base load and need to demonstrate high margins per tonne to justify mining. They can be either open cut or underground. In addition to the projects now documented in the LOM, a number of advanced prospects are currently being explored and modelled. An advanced project will be developed ahead of a project currently scheduled in the LOM where further work demonstrates that this provides superior economic benefits. Production and planning figures used to compile the LOM are primarily based on Proven and Probable Reserves and conversion of known Resources based on a conservative conversion factor. The Life of Mine Plan is set out in detail in the attachment and is also posted on the Company s website About Norton Gold Fields Norton Gold Fields Limited is Australia s fourth largest ASX-listed Australian gold producer. It also has active gold, copper, and coal exploration projects. Norton recently made an all-share offer to acquire Bellamel Mining Limited which, if accepted, will add 1.68 Moz of gold to the Paddington Resources, and further extend the life of the Paddington Mine. Bellamel also has the potential to develop a 40-50,000 oz per year gold heap leach operation. Additionally, the Bellamel properties are highly prospective for underground development. Further strategic acquisitions of new resource projects are planned in order to build a major mining company. The Company operates the Paddington Gold Mine near Kalgoorlie in Western Australia and is planning to develop the Mount Morgan Gold Project in Queensland. Paddington has a 4.8M oz resource and a 3 Mtpa CIP plant capable of producing more than 150,000 oz of gold per year. With the planned addition of underground operations in FY2010, production is expected to lift to 250,000 oz per year. Page 2 of 3

3 Norton plans to augment this with up to 50,000 oz of gold annually from a tailings retreatment operation at Mount Morgan. For further information Simon Brodie Chief Financial Officer Norton Gold Fields Limited +61 (0) Competent Person Statement The Mineral Resource statement, with the exception of the Mt Pleasant Mineral Resource estimate, has been compiled by Mr Ian Copeland who is a Member of the Australasian Institute of Mining and Metallurgy, and qualifies as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Ian Copeland is a full time staff member of Norton Goldfields and consents to the inclusion in the release of the matters based on the information in the form and context in which it appears. The Mt Pleasant Mineral Resource estimate, with the exception of the Homestead Mineral Resource estimate, has been compiled with the consent of Mr David Williams, who is a Member of the Australasian Institute of Mining and Metallurgy, and qualifies as a Competent Person as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr David Williams is a full time staff member of CSA Australia Pty Ltd and consents to the inclusion in the release of the matters based on the information in the form and context in which it appears. The Homestead Mineral Resource estimate was compiled with the consent of Mr Ian Copeland. The Mineral Resource estimate is tabulated inclusive of Ore Reserves. Cut-off grades used to estimate the Mineral Resource vary by deposit, ranging from 0.7g/t Au up to 1.0g/t Au. Note rounding errors may occur in the tabulation of the Mineral Resource estimate. Measured Resources are 0.65Mt at 1.7 g/t for 35,000 oz, Indicated Resources are 41.66Mt at 2.0 g/t for 2,720,000 oz and Inferred Resources of 29.64Mt at 2.2 g/t for 2,070,000 oz. Proven Reserves are 0.12Mt at 1.2 g/t for 4,700 oz, and Probable Reserves are 17.74Mt at 1.8 g/t for 1,007,700oz. Page 3 of 3

4 Paddington Gold Mine Life of Mine Plan 1 July

5 Life of Mine Concept The Paddington Life of Mine Plan (LOM) sets out a nominal ten-year mining program to support planning decisions and provide focus and direction for the Paddington Gold Mine. It will be updated as further information comes to hand. This 1 July 2008 LOM is based on the Resource position at 31 March 2008 of 4.8 Moz Mineral Resource including 1 Moz Ore Reserve. The LOM is detailed for the first four years and conceptual for the next six years. The plan framework sets an open cut mining target of 2.8 Mt per year to the Paddington CIP plant to produce 150 koz of gold (1.8 g/t Au head grade, 93.5% recovery). Additionally, 0.5 Mt per year of high grade feed from underground operations with some make up from small high grade open cut operations will provide an additional 100 koz. The project area of 1,200 km 2 contains over 100 known prospects of which 69 have been subject of modern exploration. The current Resource Statement covers 19 of these. Paddington has an annual exploration budget of ~$6M pa. The focus of the exploration budget is to convert current Resource estimates to Ore reserves and convert the mineral inventory into JORC code compliant Resources. Additionally, it provides brown-fields exploration on projects that can improve the LOM gold production profile. The project has a number of key drivers that are balanced to provide the best possible business outcomes from gold production. These drivers comprise: 1. Base load feed projects capable of providing the larger percentage of the total mill feed. 2. Grade, metallurgical recovery and operating costs 3. Ore hardness mining and milling rates and costs are largely driven by the hardness of the ore. The plan currently targets an ore blend of 60:40 hard to soft. 4. Strip ratio. 5. Distance from Kalgoorlie / Paddington Mill mining costs and ore transport are affected by location. 6. Supplementary feeds these ore bodies are generally smaller than base load and need to demonstrate high margins per tonne to justify mining. These can either be open cut or underground. In addition to the projects now documented in the LOM, a number of advanced prospects are currently being explored and modelled. An advanced project will be developed ahead of a project currently scheduled in the LOM where further work demonstrates this provides superior economic benefits. Production and planning figures used to compile the LOM are primarily based on Proven and Probable Reserves and conversion of known Resources based on a conservative conversion factor. 2

6 Summary of Projects Projects in reserve category that form part of the LOM Havana Federal Robinsons GBLC / Waldon Janet Ivy Enterprise Mulgarrie Rose West Reserve 1.8g/t. Mining at 1.8 Mtpa for 16 mth mine life. Ore mining start Apr 08 finish Aug 09, SR 8:1, hard ore, 8km from Paddington. Large resource with potential to extend life with further cutbacks. Reserve 1.9g/t. Mining at 1.8 Mtpa for 13 mth mine life. Ore mining start Sep09, finish Sep10. SR 8:1, hard ore, 8km from Paddington. Adjacent to Havana. Reserve 1.3g/t. Mining at 1 Mtpa for 13 mth mine life. Ore mining start Jun 08 finish Jul 09, SR 4:1, hard ore, 25km from Paddington. Large resource with potential to extend life with further cutbacks. Reserve 1.3g/t. Mining at 1 Mtpa for 18 mth mine life. Ore mining start Aug 09 finish Feb 11, SR 4:1, hard ore, 25km from Paddington. Reserve 1.8g/t. Mining at 1.8 Mtpa for 9 mth mine life. Ore mining start Oct11 finish Jul12, SR 8:1, hard ore, 42km from Paddington. Large resource with potential to extend life with further cutbacks. Reserve 2.1g/t. Mining at 2 Mtpa for 26 mth mine life. Ore mining start Aug12 finish Oct14, SR 8:1, hard ore, 30km nth of Paddington. Large pre-strip required, lower met recoveries. Reserve 3.5g/t. Mining at 1 Mtpa for 8 mth mine life. Ore mining start Mar11, finish Nov11. 20km to Paddington. Could be brought forward. Reserve 2g/t. Supplementary pit, used to fill short term gaps in schedule. Golden Flag Stockpiles Reserve 2.5g/t. supplementary pit, used to fill short term gaps in schedule. Reserve 0.9g/t. Used as backup ore supply, hard and soft ore as required. Projects in resource category that form part of the LOM Homestead Greater Mt Pleasant Resource Mining at 240ktpa for 24 mth mine life. Ore mining commence Jun09, finish May11. Hard ore, underground, 15km from Paddington. Part of u/g pipeline, Currently under Feasibility study Resource of 3g/t (incl u/g). Includes Area2, Henning and Tuart. Combination soft and hard ores. Further evaluation needed. 15km from Paddington mill Advanced prospects that do not now form part of the LOM Lady Bountiful Racetrack / Woolshed Not classified, large mineral endowment. Trial mine start Sept08, and if successful last > 6yrs. Soft ore, SR 10:1, dozer push application. 25km to Paddington Resource 3g/t. Project under review and metallurgical test work underway to determine processing options 3

7 7,000 6,000 5,000 4,000 3,000 2,000 1, ,989 1,013 3,720 3,277 2,980 2,399 2,549 1,939 1, , ,716 4, , , ,313 1,682 4,829-4 Havana Robinson Enterprise Janet Ivy BLC Mulgarrie Federal Mt Pleasant Area 2 Tuart Henning Homestead Racetrack Other PGM Projects Navajo Chief Fort William Centurion Other BMM Projects Total Mineral Resource Norton Gold Fields Ltd - Paddington Project - Mineral Resources Existing NGF Projects New BMM Projects 6,511 Contained Gold (koz)

8 Paddington Reserves and Resources 1 July

9 Ore Reserves for Paddington Gold Mine as At 31 st March 2008 Project Reserve Mt Grade Ounces Mt Grade Ounces Mt Grade Ounces Havana GBLC , , ,500 Robinsons , ,400 Enterprise , ,000 Janet Ivy , ,500 Rose West , ,100 Golden Flag , ,300 Federal , ,000 Mulgarrie , ,200 Stockpiles , ,500 Total Mining Reserve , ,007, ,012,500 6

10 Mineral Resource Estimate (Inclusive of Mining Reserves) for Paddington Gold Mine at 31 st March 2008 Project Measured Indicated Inferred Total Mt Grade Ounces Mt Grade Ounces Mt Grade Ounces Mt Grade Ounces Havana , , ,000 Enterprise , , ,013,000 Mulgarrie , , ,000 Federal , , ,000 Golden Flag , , ,000 Mt Pleasant , ,175, ,736,000 Rose West , , ,000 Natal , , , ,000 Janet Ivy , , ,000 GBLC , , , ,000 Robinson , , ,000 Stockpiles , ,500 Total Mineral Resource , ,704, ,024, ,829,000 7

11 Paddington Mining and Milling Schedule 1 July

12 Paddington Project Development Schedule Paddington - Ten Year Life of Mine Plan 2009E 2010E 2011E 2012E 2013E 2014E 2015E 2016E 2017E 2018E Base Load - Open Cut Base Plan (1) Reasonably Assumed Inventory (2) Ore milled (Mt) Gold grade (g/t) Mill Recovery 93.5% 93.5% 93.5% 93.5% 93.5% 93.5% 93.5% 93.5% 93.5% 93.5% Base Load Gold (koz) Underground Ore milled (Kt) Gold grade Milled (g/t) Mill Recovery 95% 95% 95% 95% 95% 95% 95% 95% 95% 95% Total Produced (koz) Total Gold Production (koz) 171 (b) (1) Base plan includes projects currently in Reserve and, Resource. Underground projects subject to final feasibility. (2) Reasonably assumed inventory includes project in the resource statement with an assumed conversion rate of 60% of resource to reserve NOTES a) Base case comprises 19 of the known 69 advanced projects within the lease holding. Further resource development and conversion of the remaining 50 projects to JORC status. b) Focus of planning and reserve/resource development to bring 2010 up to 250koz c) Green fields exploration and data base review has identified a further 30 prospective target areas to be evaluated and tested over the next 18 months d) Underground projects within the Mt Pleasant, Golden Cities and Ora Banda regions have been prioritised to provide a high grade underground feed stock at 300,000t per annum 9

13 Paddington Open Cut Reserve Projects 1 July

14 Havana Open Cut Mine The Havana open cut mine is located 12 km north-east of the Paddington mill and 37 km north of Kalgoorlie. The mine is currently the major supplier of base-load hard ore to the mill. Operations commenced in Sep 07 and expected to finish Aug 09. The mine commenced with a 25m prestrip, and has an overall strip ratio of 8:1. A cutback has been planned and will be assessed following completion of the current pit. History Havana forms part of the Golden Cities group of projects that was first drilled by AMX Resources in In 1996 AMX discovered the Havana Suva deposit which was the first significant deposit discovered within the granites in the Kalgoorlie region. From 1996 to 1999 the project was drilled to a resource status and then a feasibility study prepared. In 2000 the project was purchased by Placer Dome. Placer undertook further drilling on 2001 before mining the Suva open cut in Mineral Resources Indicated Inferred Total , , ,000 Ore Reserves Development Status , ,000 In production: Pre-strip of 3.5 million BCM completed and producing approximately 150 kt of per month grading 1.8 g/t. Operating at a mining rate of 600,000 BCM capacity with a mining fleet comprising an O&K RH120 excavator and 4 Cat 785 trucks plus support equipment on a 24/7 basis. Geology Gold mineralisation at Havana is dominantly structurally controlled by sets of brittle fractures developed in a medium-grained biotite-hornblende granodiorite. The Havana mineralisation occurs within two main shoots, which trend towards the NW and dip at about 60 degrees to the NE. Gold is hosted in narrow pyrite veins. The veins are up to 1cm wide, but most commonly are only pyrite linings on fracture surfaces. The overall grade is primarily a function of vein density. 11

15 Robinson s Open Cut Mine The Robinson s open cut mine is located 25 km south-east of the Paddington mill and 20 km north-east of Kalgoorlie. The mine is currently the major supplier of base-load soft ore to the mill. Operations commenced in May 08 and are planned to finish Aug 09. The mine had no pre-strip, with ore zones outcropping. The pit has an overall strip ratio of 4:1. A further cutback may be possible and will be assessed following completion of the current pit. History Robinson s and Waldron form part of the GBLC project (see map below). Initial reconnaissance drilling was done in 1982 to 1985 leading to mining of the BLC pit in by Delta/Pancontinental JV. The next phase of exploration was undertaken from 1993 to 1996 to prove resources in the Robinson s and Waldron deposits. Various reviews and assessments have been undertaken since then. Mineral Resources Indicated Inferred Total , , ,000 Ore Reserves Development Status , ,418 In production: Pre-strip of 3.5 million BCM completed and producing approximately 100 kt of per month grading 1.4 g/t. Operating at a mining rate of 500,000 BCM capacity per month with a mining fleet comprising a Komatsu PC 2000 excavator and 4 Cat 777 trucks plus support equipment on a 24/7 basis. Geology Robinsons Ultramafic is an ENE trending m thick komatiite. In the Robinsons area, both oxide and fresh mineralisation is confined primarily to the ultramafic with only very limited, low grade intercepts within surrounding sediments. Dominant primary mineralisation style comprises relatively thin, moderately (30 o ) south east dipping zones associated with splays of the Marquis Shear. The Completely Oxidised zone is mainly depleted. Supergene mineralisation within the transitional zone forms the bulk of the Robinsons resource. This material is flat lying and trends the north-north east. 12

16 Waldon (GBLC) Open Cut Mine The Waldon open cut mine is located 25 km south-east of the Paddington mill and 20 km north-east of Kalgoorlie. The mine will become supplier of baseload soft ore to the mill. Operations will commence in Jul 09 and cease in Feb 11. The mine has a 25 metre pre-strip, with an overall strip ratio of 4:1. The mine is located 500 metres south of Robinsons and will use all the same surface infrastructure and mining fleet. History See history of the GBLC project above. No specific details for drilling the separate projects are available, however drilling of the whole GBLC resource has totalled 167,060m, comprising 147,108m RC drilling and 19,952m of diamond drilling. Mineral Resources Measured Indicated Inferred Total tonnes (M) tonnes ounces tonnes (M) grade ounces tonnes (M) grade ounces tonnes (M)grade ounces , , , ,000 Ore Reserves , , ,000 Development Status Feasibility study completed and permits in place. Project adjacent to Robinson s and planned as the next development following completion. Geology The ultramafic rock at Waldon represents the south west continuation of Robinson's Ultramafic unit. It is lithologically similar, but hosts a different style of mineralisation. Rare thin, steeply dipping porphyries are volumetrically insignificant. Alluvial sediments vary from absent to locally 3 m thick. The oxidised zone is 10 to 40m thick, and is underlain by 15 to 40 m of transitional material. 13

17 Federal Open Cut Mine The Federal open cut mine is located 12 km north-east of the Paddington mill and 37 km north of Kalgoorlie. The mine is designed to produce baseload hard ore to the mill. Operations are scheduled to commence in Sep 08 and planned to finish Aug 09. The mine has a 25 m pre-strip, and has an overall strip ratio of 9:1. A further cutback has been planned and will be further assessed following completion of the current pit. History Federal is located 2km ESE of Havana on M24/616. The existing pit is 650m long by 230m wide and comprises 75 and 90m deep northern and southern sub-pits linked by a 45m deep central saddle. The new mine development is an extension of the existing pit to the north. Mineral Resources Indicated Inferred Total , , ,000 Ore Reserves Development Status , ,585 Currently in planning stage. Pit optimisations were completed Feb 08 and project is ready for final design work. All relevant mine permits have been completed as part of the Havana project. Geology The Federal project is located within the Kalgoorlie Terrane of the Eastern Goldfields province in the Achaean Yilgarn Craton of Western Australia. The Golden Cities deposits are hosted within the Scotia-Kanowna Granitoid which sits within the core of the Boorara Domain of the Kalgoorlie Terrane. The Scotia granitoid occupies the core of a regional F2, shallow SSE plunging anticline and is composed of biotite-hornblende granodiorite intrusives. 14

18 Mineral Resources Janet Ivy Open Cut Mine The Janet Ivy open cut mine is located 30 km south of the Paddington mill and 9 km WSW of Kalgoorlie. The mine is planned to produce baseload hard ore to the mill. Operations are scheduled to commence in Jun 09 and planned to finish Jul 10. The mine has an overall strip ratio of 8:1. A further cutback has been planned and will be further assessed following completion of the current pit. Indicated Inferred Total , , ,000 Ore Reserves , ,515 History The project was discovered by Intercontinental in 1988 and has had a succession of owners comprising ACM Gold, Intermin Resources, Pegasus Gold Australia, Delta Gold, Aurion and Placer who drilled a total of 35,863m of reverse circulation and 6,322m of diamond drilling on 20m by 20m spacing. Geology The Janet Ivy porphyry is approximately 2.5 kilometres long, up to 150 metres wide and is open at depth. Within this unit, gold distribution is controlled by quartz-pyrite veining and associated alteration selvedges emplaced along brittle fractures or tension cracks created by probable shearing along the porphyry margins. This mineralisation style is also evident within the Eastern Porphyry. The tenement offers considerable potential for additional gold discovery. The Janet Ivy Resource is open at depth and along strike and requires further drilling to define the strike extents of the mineralised system. Within the mineralised area there are indications of high grade vein clusters and fracture zones that provide a focus for future deeper resource definition drilling and even potential underground targets. Development Status Currently in planning stage. Pit optimisations completed Dec 07 and project ready for final design work. Permits required. 15

19 Mulgarrie Open Cut Mine The Mulgarrie open cut mine is located 18 km north-east of the Paddington mill and 40 km north of Kalgoorlie. The mine is expected to produce highgrade supplementary hard ore to the mill. Operations are scheduled to commence in Jun 10 and planned to finish in Nov 11. The mine plan provides for a 25 m prestrip, and has an overall strip ratio of 16:1. History Gold was discovered at Mulgarrie in the early 1900 s, no production was recorded for the mines centred at Mulgarrie and the nearby Palm deposits. Modern exploration was undertaken by Centaur Mining and Exploration and BHP Gold in the 1980 s. Newcrest mined an open pit on a paleochannel resource in 1990 yielding g/t. The current open pit at Mulgarrie was mined by Delta Gold as part of the Golden Feather Project from June The current resource has been defined by 50,418m of RC and 3,978m of diamond drilling on 25m by 25m spacing. Mineral Resources Indicated Inferred Total , , ,000 Ore Reserves , ,243 Development Status In Feb 08 Lower Quartile Solutions Pty Ltd completed an optimisation study of Mulgarrie using mu0401 at several gold prices and various wall angles. Permitting and final design work is required. Geology The Mulgarrie deposit is characterised by massive carbonate alteration pods in talc-chlorite schist; and several similar pods of carbonate alteration are located along the strike of this unit at Trigg and Allen West. Enterprise Open Cut Mine 16

20 The Enterprise open cut mine is located 38 km north-west of the Paddington mill and 68 km north of Kalgoorlie. The mine is planned to produce baseload hard ore to the mill for a 2 year period. Operations are scheduled to commence in Sep 10 and planned to finish Aug 14. The mine plan provides for a 30 m prestrip, and has an overall strip ratio of 10:1. Future underground operations possible following completion of the planned open pit. Old workings comprised a series of vertical shafts from mining in the early 1900 s. BHP Gold proved up an initial oxide resource in 1987 and mining continued in several stages though until The project was purchased by Centaur Mining and Exploration in 1997, and a scoping study based on the current resource completed in The ore is partially refractory. Recovery of 82% was achieved when processing the open pit fresh ore. Test work has shown recoveries improve with ultra fine grinding. The resource has been defined by 196 RC and 584 diamond holes for 106,000m of drilling Mineral Resources Indicated Inferred Total , , ,013,000 Ore Reserves Development Status , ,462 Scoping study completed in Nov 2007 followed by pit optimisation study in Feb 08. Project requires final design work and permitting. Further metallurgical test work planned due to current expected recovery of 85%. Geology Enterprise is a large, flat dipping ore body that continues at depth below an existing open pit. Gold mineralisation is characterised by multiple fault orientations with a major envelope controlled by the intersection of 080 trending faults with a moderately south-west dipping differentiated intrusive sill. The deposit is a typical Archaean lode system but has an unusual geometry and gold distribution due to the host rock controls. The resource has been defined by 58,000m of diamond and 46,900 of RC drilling on 25m by 25m spacing. History 17

21 Rose West Open Cut Mine The Rose West open cut mine is located 18 km south-west of the Paddington mill and 37 km north of Kalgoorlie. The mine is scoped to produce supplementary ore to the mill and only planned for development later in the mine schedule, only if appropriate development timing arises. History Rose West was discovered by Centaur Mining and Exploration (CME) in 1998, through extensional drilling of the nearby Rose deposit. CME exploration consisted of 40m spaced lines of RC drilling to a depth of 60m below surface. In December 2005 infill RC drilling completed by Barrick closed the drill spacing down to a 20m by 20m grid. In February 2006 an ordinary kriged block model was generated using the CME and recently completed RC drilling. Mineral Resources Indicated Inferred Total , , ,000 Ore Reserves Development Status , ,000 Open cut optimisation Nov 06 basis for evaluation. Updated in Dec 07 with recent cost parameters. permits required. Geology The Rose West orebody is a supergene deposit located predominantly in the base of a tributary of a palaeochannel and extending through a thin transitional horizon into the upper 5m of fresh basaltic rock of the Bent Tree Basalt. The Tertiary palaeochannel system that contains the Rose West mineralisation forms part of the regionally extensive Roe Palaeodrainage Aquifer system, which hosts the nearby Lady bountiful deposits. 18

22 Golden Flag Open Cut Mine The Golden Flag open cut mine is located 12 km south-west of the Paddington mill and 37 km north of Kalgoorlie. The mine is scoped to produce supplementary ore to the mill and only planned for development later in the mine schedule, only if appropriate development timing arises. History The Golden Flag deposit was found by Western Mining Corporation RAB drilling over old workings in The main Golden Flag ore zone was defined by Forrest Gold in 1987 and drilled out by Resolute Resources in In 1995 M24/165 along with other leases included in the Black Flag joint venture was sold to Centaur Mining and Exploration (CME). In 1998 CME generated an inverse distance block model of the Golden Flag mineralisation; this contained a total resource of 1, g/t Au for 121 koz. The project was sold to PGM on Further revisions of the resource models, created the at the current resource and reserve estimation.. Details of drilling used to define the resource comprises 14 diamond, 125 RC, 144 rotary blast and 17 air core holes for a total of 19,700 metres Mineral Resources Indicated Inferred Total , , ,000 Ore Reserves Development Status , ,300 The Rose West project had an open pit optimisation study undertaken in This was followed by an upgrade of the resource model in 2006 following further infill drilling. Geology The Golden Flag deposit lies on the eastern limb of the gently south-east plunging Mount Pleasant anticline. Gold mineralisation is associated with the contact between the Victorious and Bent tree basalts, where dextral north-east faults offset the contact. This deformation zone parallels the strongly mineralised Royal standard and Black Flag faults, which host the majority of the mineralisation at Mt Pleasant. 19

23 Stockpiles Stockpiles of low grade or mineralised waste are located on a series of tenements within a 40 km radius of the Paddington mill. The stockpiles are used to supplement short-term shortages of primary ore and to optimise material feed blends to the mill to achieve the desire hard:soft ore ratios where economically superior to do so.. Geology No specific geological review has been made of the dumps, although the dumps are characterised as either fresh or oxide and used as a supplementary mill feed. A summary of stockpiles on the project is: Stockpile Mt Au g/t Ounces Mt Au g/t Ounces Mt Au g/t Ounces Natal , ,053 Paddington A , ,086 Homestead , ,956 Red Hill , ,491 Suva , ,291 Rose , ,933 Total , ,757 Mineral Resources Indicated Inferred Total , ,757 Ore Reserves Development Status , ,757 The stockpiles remain a supplementary ore feed to the mill to manage the hard:soft ore blend in the milling schedule where the economics are justified.. Classification of stockpiles is difficult as many mining factors, such as dilution, mining recovery, affect stockpile grade estimates. The origin of the estimate is an important factor in the classification of a stockpile. Material mined from a particular resource category, when tracked properly, should reflect that resource category. As such the following classification has been developed to categorize stockpiles at Paddington: Proven material has been mined from ore blocks designed from a grade control block which has been based on grade control drilling of sufficient density and integrity to define the ore zone. In addition planned and unplanned dilution and mining recovery has been accounted for in the estimation of tonnes and grade. Probable stockpiles which have been surveyed or for which production data is available and which have been sampled by an appropriate method to ascertain a reasonable approximation of the overall grade. 20

24 Paddington Underground Projects / Prospects 16 May

25 Homestead Underground Mine The Homestead underground mine is located 15 km south-west of the Paddington mill and 28 km north-east of Kalgoorlie. A detailed feasibility study is currently being compiled to deliver 300kt pa of ore grading 7.5 g/t (75koz pa) from the project. Underground development is scheduled to commence in Q2 FY09 with the development of a 2km decline. (see diagram). Mining will be with up-hole bench retreat stoping techniques. History The Homestead open cut was mined from 1996 to 1998 producing approximately 26koz from mining 286kt of ore grading 2.8 g/t. The underground was discovered in the late 1990 s and further follow up drilling undertaken by Aurion and Placer to further define the resource. Mineral Resources Indicated Inferred Total , , ,000 Ore Reserves Development Status Feasibility study currently in progress, with development expected to commence in Q1, FY09. Geology: Mineralisation at Homestead Underground is of the Mt Pleasant style; high-grade laminated veins, and hosted at or near a basalt/basalt contact. The veins are steep dipping of north-south strike and have an average width of 2-3 metres. The top of economic mineralisation of VN01 and VN02 is approximately 150m below surface and extends 220m and 80m respectively. The top of mineralisation of VN03 is approximately 200m below surface and extends 100 metres. Gold within the lodes is often coarse and visible and strongly associated with galena and sphalerite mineralisation. All mineralisation is hosted within fresh rock and is free milling. 22

26 Green Gum, Marlock and Tuart Underground Projects The Green Gum, Marlock and Tuart Underground projects are located 15 km south-west of the Paddington mill and 28 km north-east of Kalgoorlie. These projects form part of a 10-year underground project pipeline History Gold mineralisation was identified in the Quarters area by CME during a regional gold exploration program between 1993 and Open pit mining was undertaken at Quarters, and Tuart between 1998 to 2006 by CME and Placer Dome. Blue Gum is a blind discovery located beneath existing overburden dumps Total production from the Quarters area was g/t Au for 514 koz. Mineral Resources Indicated Inferred Total , , ,000 Ore Reserves Development Status Conceptual stage, further drilling is required to target the potential extents of the respective deposits. Deposits are drilled to a shallow depth. Exploration planned from surface. Geology Gold Mineralisation is hosted in steeply dipping laminated quartz veins orientated, 020, 040, 060, 080, 115 and 150. The gold mineralisation is hosted within the Bent Tree Basalt unit. 23

27 Paddington Advanced Open Cut Prospects 16 May

28 Lady Bountiful Open Cut Project The Lady Bountiful project lies approximately 10 km west of Paddington and 3 km north of the old Mt Pleasant processing plant. The project primarily comprises a series of deep leads that can supply soft ore to the mill, largely as soft sands and grit. The ore will be low grade (1 to 1.5 g/t) however grade can be offset by low cost mining and processing options. Further development and planning needed to assess low cost mining options for overburden removal. History Mining in the Lady Bountiful area was commenced in 1980 by National Mine Management. Between this date and completion of mining in the late 1980 s 4.49g/t for 324,000 ounces was mined from 23 open pits. All of this material was either supergene oxide or alluvial sands. A database comprising 355,168m reverse circulation and 21,000m of diamond drilling has identified a series of prospective targets for further evaluation. Mineral Resources Indicated Inferred Total Ore Reserves Development Status An advanced project that has an extensive database of previous drilling and mining results, however no JORC code compliant resource estimation is available. Current planning is to trial mine one section of a deep lead to assess robustness of historical mining and drilling data. Opportunity for dozer-push operations. Can provide a large supply of low cost, soft ore for the mill. Geology Gold mineralisation historically mined within the western section of the Lady Bountiful Project area consisted predominantly of chemically precipitated and alluvial concentrated gold within the basal sands and gravels of the Woolibar Sandstone Formation - overlying the Liberty Granodiorite. This supergene gold blanket also occurs as an overprint on primary mineralised structures. The area has significant potential for the discovery of further high grade vein deposits and additional supergene or paleochannel related mineralisation. 25

29 Greater Mt Pleasant Prospects The Greater Mt Pleasant project, comprising the Tuart, Henning, Racetrack and Area 2 prospects, is located 18 km south-west of the Paddington mill and 28 km north-east of Kalgoorlie. These project are the focus of future development plans and form the basis of the Mt Pleasant Super pit that has the potential to form a single source, long term base load ore supply to the mill. Work on optimising pit designs and mining methods is in progress, working in conjunction with current underground development proposals. History Centaur Mining and Exploration acquired the Mt Pleasant area (150km2) in A major exploration campaign was conducted by targeting areas of geological interest. Additional RC drilling results led to resource definition around Mt Pleasant (inc. Quarters area). By 1997 a total resource of g/t Au, for 4 Moz was defined. Mineral Resources Indicated Inferred Total , ,148, ,545,000 Ore Reserves Development Status Resources have been defined and pit optimisation studies completed. Requires detailed mine design, project planning and approvals prior to development. Geology Gold mineralisation is hosted laminated quartz veins, forming brittleductile shear zones, within the Bent Tree basalt, the Victorious Basalt and the Spargoville Sediments. Gold Bearing structures are in a variety of orientations as a result of the inflection of the Black Flag fault in this area. 26