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
3.1.4 Ore Reserves
The pit optimisation report formed the basis for the development of an Ore Reserve statement for the project.
AMC has not reviewed the Ore Reserves however the Ore Reserves quoted are consistent with the study
and the financial modelling.
Table 3.2 shows the estimate Ore Reserves for Mt Boppy.
Table 3.2
Ore Reserves for Mt Boppy
Reserve
Category
Tonnes
(kt)
Gold
Grade
(g/t Au)
Contained
Gold
(oz Au)
Proved 42 5.63 7,600
Probable 507 4.19 68,300
Total 549 4.30 75,900
Key assumptions used for the Ore Reserve calculations include:
• Mining dilution 10%.
• Mine recovery 95%.
• Gold price $1,350/oz.
3.1.5 Processing Operations
Polymetals treated purchased tailings from the Elura Mine from 1993 to 2002, yielding 32 t of silver and
5 koz of gold. From 2002 to 2005, Polymetals operated an open pit mine at Mt Boppy and produced 68 koz
of gold from 500 kt of ore.
The Mt Boppy plant has remained idle since 2005. The overall development concept requires processing for
approximately 24 months of 300 ktpa of ore grading 4.32 g/t Au. The shortness of the overall campaign
presents economic challenges such as the danger of over-capitalisation, and the need to quickly attain
forecast plant performance.
3.1.5.1 Proposed Flowsheet
Polymetals engineers developed the flowsheet shown in Figure 3.4 using experience gained from previous
Mt Boppy operations, at White Dam and elsewhere plus the results of metallurgical test work carried out on
Mt Boppy samples in 2012.
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