Update on Merger with Polymetals - Notice of Meeting

BDO CORPORATE FINANCE (WA) PTY LTD
Polymetals Mining Limited and Southern Cross Goldfields Limited
Technical Specialist's Report
4.1.4.3 Western Areas NL (Southern Cross 30% Nickel Interest, 100% Nonnickel
Interest) .......................................................................................... 31
4.1.5 Exploration .................................................................................................................... 31
4.1.5.1 Gold .......................................................................................................... 31
4.1.5.2 Red Boomerang ....................................................................................... 31
4.1.5.3 Lancelot .................................................................................................... 31
4.1.5.4 White Pointer ............................................................................................ 31
4.1.5.5 Thresher ................................................................................................... 31
4.1.5.6 Copper Bore ............................................................................................. 31
4.1.6 Mining ........................................................................................................................... 32
4.1.7 Ore Reserves ................................................................................................................ 32
4.1.8 Metallurgy and Processing ........................................................................................... 33
4.1.8.1 Introduction ............................................................................................... 33
4.1.8.2 Metallurgical Test Work ............................................................................ 33
4.1.8.3 Process Plant ........................................................................................... 34
4.1.8.4 Gold Recovery.......................................................................................... 35
4.1.8.5 Plant Throughput ...................................................................................... 35
4.1.8.6 Capital Estimate Plant and Infrastructure ................................................ 35
4.1.8.7 Operating Cost Estimate .......................................................................... 36
4.1.9 Environment .................................................................................................................. 37
4.1.9.1 Overview .................................................................................................. 37
4.1.9.2 Statutory Environmental Approval............................................................ 37
4.1.10 Flora and Fauna ........................................................................................................... 38
4.1.11 Acid and Metalliferous Drainage ................................................................................... 38
4.1.12 Water Management ...................................................................................................... 39
4.1.13 Rehabilitation and closure ............................................................................................ 39
4.1.14 Project Implementation ................................................................................................. 39
4.1.15 AMC Production Cases ................................................................................................ 39
4.2 Sandstone Project ........................................................................................................................ 41
4.2.1 Geology ......................................................................................................................... 43
4.2.2 Mineral Resources ........................................................................................................ 45
4.2.3 Exploration .................................................................................................................... 47
4.2.4 Valuation ....................................................................................................................... 47
5 QUALIFICATIONS.................................................................................................................................. 48
TABLES
Table I Polymetals – Exploration Values .............................................................................................. ii
Table II Southern Cross – Exploration Values ...................................................................................... iii
Table 1.1 Polymetals Gold Mineral Resources ......................................................................................... 1
Table 1.2 Polymetals Base Metal Inferred Mineral Resources ................................................................. 1
Table 1.3 Polymetals Gold Ore Reserves – Mt Boppy ............................................................................. 1
Table 1.4 Southern Cross Gold Mineral Resources ................................................................................. 2
Table 1.5 Southern Cross Gold Ore Reserves – Marda ........................................................................... 2
Table 3.1 Mt Boppy Mineral Resources at 30 March 2013 (Includes Mt Boppy South) ........................... 7
Table 3.2 Ore Reserves for Mt Boppy .................................................................................................... 10
Table 3.3 Capital Estimate for Mt Boppy Redevelopment ...................................................................... 13
Table 3.4 Basic Design Parameters ....................................................................................................... 14
Table 3.5 Processing Unit Cost .............................................................................................................. 14
Table 3.6 Turner River Gold Project – Mineral Resources at 13 March 2013 ........................................ 21
Table 3.7 Turner River Base Metal Inferred Mineral Resources at 24 April 2013 .................................. 25
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