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1 ASX ANNOUNCEMENT 29 July 2011 KATANNING UPDATE GOLD DISCOVERED AT JACKSON First-pass drilling at Jackson confirms presence of primary gold mineralisation Potential for third ore body at the Katanning Gold Discovery Geometry of Jackson ore body mirrors Jinkas and Dingo mineralisation o Highlights from Jackson include: g/t Au from 17m (BSRC0256) 3.12 g/t Au from 34m (BSRC0121) 7.05 g/t Au from 10m (BSRC0280) 3.34 g/t Au from 15m (BSRC0265) 2.27 g/t Au from 24m (BSRC0270) 2.05 g/t Au from 25m (BSRC0254) Dingo gold mineralisation now exceeds 1 kilometre in length and remains open at strike and depth Experienced Regional Manager appointed to oversee regional exploration across entire Boddington South Project Ausgold Limited ( Ausgold or the Company ) (ASX: AUC) is pleased to provide an update on its ongoing drilling program at the Katanning Gold Discovery, the Company s key project located southeast of Newmont s Boddington Gold Mine (Figure 1). To date, the Company has completed 40,000 metres of drilling and the latest results include first-pass drilling at Jackson, where a potential third ore body has been identified and Dingo, where the strike length now extends over 1 kilometre and remains open at depth and along strike.

2 Figure 1: Location of Ausgold s Katanning Gold Discovery positioned within the Company s greater Boddington South Exploration Project where an extensive greenstone package has recently been identified in the same geological terrain as Newmont s Boddington Gold Deposit Jackson Ausgold recently commenced a first-pass reverse circulation ( RC ) drill program at Jackson, which was designed to test the bedrock gold mineralisation at this prospect (Table 1). The Jackson prospect sits within the Western Corridor of the Katanning Gold Discovery and is located approximately five kilometres north and along strike of the Dingo ore body (Figure 2). The latest assay results from this drilling confirmed significant gold mineralisation is present at Jackson and suggests the potential for a third gold deposit at Katanning.

3 Significantly, this mineralisation is relatively shallow with the majority of the gold mineralisation at Jackson intersected within 25 metres of the surface. Preliminary results also indicate that the mineralisation at Jackson appears similar in style to that already discovered by Ausgold at Jinkas and Dingo (Figure 3). The results from this initial drill program have also enabled Ausgold to better understand the mineralisation at Jackson, which appears to be more complex than Jinkas or Dingo. The increased knowledge of the Jackson prospect will be reflected in the follow-up drilling of this highly prospective target. Currently, the Company is awaiting assays from an additional 72 holes from Jackson, which is anticipated to be received by Ausgold during August. Results returned to date include; g/t Au from 17m (BSRC0256) 7.05 g/t Au from 10m (BSRC0280) 1.27 g/t Au from 9m (BSRC0119) 3.34 g/t Au from 15m (BSRC0265) 1.41 g/t Au from 15m (BSRC0132) 2.27 g/t Au from 24m (BSRC0270) 2.05 g/t Au from 25m (BSRC0254) 8.91 g/t Au from 18m (BSRC0266) 1.73 g/t Au from 29m (BSRC0269) 8.84 g/t Au from 20m (BSRC0116) 3.12 g/t Au from 34m (BSRC0121)

4 For personal use only Figure 2: Simplified geology map of the Western and Eastern Corridors hosting Ausgold s Katanning Gold Discovery. The areas of known gold mineralisation or significant anomalism are indicated in red on this image and occur along at granite-greenstone contact.

5 Figure 3: Simplified geological cross section of the Jackson prospect. Gold mineralisation at Jackson has a similar easterly dip to the Dingo gold deposit located along strike and approximately six kilometres south. Dingo Ausgold is continuing its resource drilling of the Dingo ore body with four RC drills currently on site testing the strike and depth continuation of the known mineralisation (Table 1). The strike of the gold mineralisation at Dingo now exceeds 1 kilometre in length and remains open along strike (Figure 4). Ausgold is continuing to drill test the southern strike extension of this ore body and results from this resource drilling are pending. Ausgold s initial drill program at Dingo focussed on delineating a gold resource down to 100 metres below the ground surface. The Company is now also undertaking drilling to test the depth continuation of this mineralisation with recently received assays confirming gold mineralisation at Dingo extends more than 150 metres below surface (RC hole BSRC0304, which returned 1.54 g/t Au from 185m).

6 During the past quarter the Company has drilled 70 RC holes into the Dingo ore body and is presently awaiting assays from 55 holes from this drilling, which are expected to be received during August. Ausgold is currently experiencing a backlog of assay results from the laboratory, with the total number of pending assays from Dingo, Jackson and Olympia combined standing at over 17,000. Ausgold is continuing to seek measures to streamline its processes and minimise the turnaround time of its drill results including distributing samples across a number of assay laboratories. Due to this delay, it has only been possible to announce a small number of results from the Dingo drilling campaign. It should be noted however that the drilling completed during the past quarter continued to intersect favourable geology and wide sulphidic zones potentially associated with gold mineralisation as the company s exploration continues to the test the southern strike extension of the Dingo ore body. Ausgold recently completed a close-spaced soil-sampling program immediately south of Dingo to better define a number of historic gold-in-soil anomalies on both the Western and Eastern Corridors. The Company anticipates receiving the results from this survey in August with any subsequent targets being immediately drill tested. Figure 4: Simplified cross section of the Dingo ore body within Ausgold s Katanning Gold Discovery. This image shows the consistent nature of this gold deposit along the 1 kilometre strike (north to south) as indicated by the orange to red shaded gram-metre contours. The Dingo ore body continues to remain open along strike and depth, with recent drilling continuing to intersect favourable geology and sulphidic zones potentially associated with gold mineralisation.

7 Olympia Encouraged by a strong historic gold-in-soil anomaly (peak 942ppb Au), Ausgold recently completed a bedrock drilling campaign at Olympia, located along strike of the Jinkas ore body (Figure 2). Whilst assay results of this drill program are currently pending, this drilling did confirm the presence of two mineralised corridors within the Katanning Gold Discovery with target zones intersected at 34 metres down-hole (potential Olympia mineralisation within Eastern Corridor) and at 198 metres down-hole (potential Jackson mineralisation within Western Corridor) (Figure 5). CEO, Benjamin Bell said, The latest round of drilling has been very encouraging of particular note is the first-pass drilling at Jackson aimed at testing the primary gold mineralisation and what we have found is potentially a third ore body at Katanning which mirrors the existing Dingo and Jinkas. We will use the information gleaned from these results to determine the next stage of drilling to further explore the potential at Jackson. We are currently experiencing a backlog of assay results from the laboratory covering Dingo, Jackson and Olympia, it is important to note at Dingo that from results reported to date, wide zones of mineralisation continue to be intersected as the drilling program continues to the south. The Company is currently assessing its options to streamline this process to avoid future delays. Fraser Along strike (and 500m south) of the Jinkas ore body, Ausgold has recently completed an air core drilling program at Fraser (Figure 2). The Company is currently awaiting the assay results. Bullock Pool At the Bullock Pool prospect, located within the Ausgold Kingsgate Joint Venture area, an air core drilling program is currently underway (Figure 6). Approximately 400 holes will be drilled across this prospect over the coming month with the resulting assays being announced as they become available.

8 Figure 5: Simplified geological cross section at Jackson and Olympia that illustrates the position of the Western and Eastern Corridors at Katanning relative to each other. First-pass drilling at these prospects appears to confirm the Jinkas Olympia Eastern Corridor and the Dingo Jackson Western Corridors have a similar geometry. Regional Exploration Manager Ausgold is pleased to announce the appointment of Mr Russell Birrell as the Company s Regional Exploration Manager. Russell will drive regional exploration across the 6,000km² Boddington South project area that surrounds the Katanning Gold Discovery. Russell is exceptionally qualified for this role with over 30 years experience within the mining industry that includes experience within the Boddington greenstone belt and the greater southwest Yilgarn in addition to gold provinces across North and South America, Africa.

9 His most recent roles including Regional Exploration Manager for Redbank Copper, Exploration Manager and Mine Geologist in Uganda for Anglo Ugandan Mining, Vice President of Exploration in Chile for Southern Hemisphere Mining and Executive Director of St Francis Mining. Ben Bell continued, We also welcome the appointment of Russell Birrell as Regional Exploration Manager of the greater Boddington South Exploration Project. Russell s skill set as a geochemist honed from his time leading research teams will be invaluable for Ausgold as the Company looks to expand the regional exploration campaign across its vast ground holding to identify additional gold deposits beyond the significant mineralised corridors at Katanning. ***ENDS*** For further information, shareholders and media please contact: Benjamin Bell Victoria Thomas Chief Executive Officer Six Degrees Investor Relations Ph: (08) Ph: (03) bbell@ausgoldlimited.com victoria@sixdegreesmedia.com.au The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Benjamin Bell, who is a Member of the Australian Institute of Geoscientists. Mr Bell is the Chief Executive Officer and a full-time employee of Ausgold Limited, and has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Bell consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

10 Figure 6: Schematic image of selected regional gold targets within the Ausgold s greater Boddington South Exploration Project derived from open-file databases, which suggests possible repetitions of Katanning-style gold mineralisation across the Company s greater tenement holding.

11 About Ausgold Limited Ausgold Limited (ASX: AUC) listed in 2009 with the aim of utilising the best expertise and innovation in geoscience to target and discover new gold and copper ore bodies in underexplored mineral provinces in Australia. Ausgold s Boddington South Exploration Project is located southeast of Perth and covers an area in excess of 6,000 square kilometres over the Southwest Terrain of the Yilgarn Craton. Within this project lies Ausgold s Katanning Gold Discovery. A major drilling campaign is currently underway to drill out the depth and strike extensions of Katanning Gold Discovery, test an 18 kilometre strike of gold mineralisation within the regional Boddington South Exploration Project and begin exploration of the 100 kilometres of greenstones that have been identified in the Company s tenement package.

12 Table 1: Summary of latest assays from Ausgold s reverse circulation (RC) drilling at Jackson and Dingo Prospect Hole Number Easting Northing Total Depth From To Interval Jackson BSRC Jackson BSRC NSI Jackson BSRC Jackson BSRC including Jackson BSRC Jackson BSRC Jackson BSRC Jackson BSRC Jackson BSRC Jackson BSRC Jackson BSRC Jackson BSRC Jackson BSRC including Jackson BSRC Jackson BSRC Jackson BSRC including Jackson BSRC including Gold (g/t)

13 Prospect Hole Number Easting Northing Total Depth From To Interval Jackson BSRC Jackson BSRC Jackson BSRC including Jackson BSRC Jackson BSRC including Dingo BSRC Dingo BSRC NSI Dingo BSRC Dingo BSRC Dingo BSRC Dingo BSRC Dingo BSRC NSI Dingo BSRC Dingo BSRC Dingo BSRC NSI Dingo BSRC Dingo BSRC Dingo BSRC NSI Dingo BSRC Dingo BSRC NSI Gold (g/t) NSI No significant gold intersection returned from the assay laboratory

14 Co-ordinates are in MGA Zone 50 GDA94. All holes are drilled on an azimuth of 243 and dip at -60 degrees. Intercepts calculated using a 0.5 g/t Au lower cut, no upper cut, and a maximum 2 metre internal dilution All assays determined by 1 metre split samples using fire assay by Ultra Trace Laboratories and Quantum Analytical Services in Perth

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