Update on Merger with Polymetals - Notice of Meeting

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BDO CORPORATE FINANCE (WA) PTY LTD Polymetals Mining Limited and Southern Cross Goldfields Limited Technical Specialist's Report Marda comprises: • A 500,000 tpa conventional CIP/CIL gold processing facility producing nominally 35,000 oz of gold per year. • Up to ten open pit mining operations at Marda and satellite pits. • Infrastructure, maintenance, and administration facilities. • Accommodation and airstrip to support a fly-in-fly-out (FIFO) operation. Mineral Resources total 8.4 Mt at 2.0 g/t with contained metal of 546 koz of gold of which 66% is in the Measured and Indicated category. The reported Ore Reserve for the Project is 2.3 Mt at a grade of 2.4 g/t with 178,500 contained ounces of gold. Additional exploration targets exist adjacent to the project and these areas are subject to current exploration activities. A formal feasibility study and supporting documentation exists for the Marda project. AMC visited the site in 2013 as part of a separate review of the feasibility study. The Southern Cross tenements in the Southern Cross area comprise: • 26 mining leases. • 91 exploration licences. • 92 prospecting licences. • 1 general purpose leases. • 11 miscellaneous licences. • 2 retention leases. The Southern Cross tenements cover an area of 2,920 km 2 . 4.1.2 Geology Marda comprises two areas: Northern Deposits and Southern Deposits. The Northern Deposits include the Marda Central deposits (Dolly Pot, Dugite, Python and Goldstream), the Die Hardy Deposits (Die Hardy and Red Legs), King Brown and Golden Orb. The Southern Deposits comprise Battler and British Hill. 4.1.2.1 Northern Deposits The Northern Deposits are located 150 km north of Southern Cross within the Archaean Marda-Diemals greenstone belt. The Marda-Diemals greenstone belt comprises ultramafic and mafic rocks with overlying felsics, narrow interflow sediments and BIF. The greenstone belt is divided into two supracrustal successions divided by an unconformity. The upper Marda Complex comprises thick sequences of rhyolitic and andesitic volcanic, and associated felsic sediments. The lower succession comprises three associations based on lithological assemblages. The lower association is dominated by tholeiitic basalt with ultramafic, gabbro and mafic tuffaceous rocks. The middle association is characterised by the Jackson Range BIF and is dominated by moderately thick, continuous BIF and chert. The upper association comprises a variety of rock types including tholeiitic basalt, various chemical sediments and minor clastic and volcanic felsics. The upper association of the lower succession hosts the Marda Central deposits. The lower association of the lower succession hosts the King Brown and Golden Orb deposits. The greenstone belt is surrounded and intruded by granitoids. Younger west-north-west and west-south-west trending dykes are evident throughout the belt. The Marda Central deposits comprise a series of discrete gold deposits within a highly deformed segment of the Marda BIF and locally intercalated with mafic and ultramafic units. The deposits are characterised by quartz veining accompanied by pyrite, silica and sericite alteration. The structural setting is dominated by isoclinal folds, low angle shears and late, high angle cross faults. 28
BDO CORPORATE FINANCE (WA) PTY LTD Polymetals Mining Limited and Southern Cross Goldfields Limited Technical Specialist's Report The Golden Orb deposit comprises a chert BIF unit enclosed by a sequence of basalt, high magnesium basalt, ultramafics and minor gabbro. The deposit has been interpreted to have developed in a dilational position along a strike-slip shear. The Die Hardy and Red Legs deposits are associated with BIF in conjunction with variably trending shear zones. Similarly, gold mineralisation at Mt King is interpreted to be concentrated around the intersection of cross cutting faults and the BIFs. The King Brown deposit is hosted in highly weathered ultramafic saprolitic clays interspersed with narrow BIF units. Complete oxidation extends to between 45 m below surface and 80 m below surface and locally reaches depths of greater than 100 m. 4.1.2.2 Southern Deposits Mineralisation at the Battler Deposit is associated with one major easterly-dipping north-trending shear zone in conjunction with a major north-north-west-trending, steeply east-dipping splay shear zone. British Hill mineralisation is associated with BIF-hosted quartz veining associated with north-trending, subvertical shear zones within a mafic-ultramafic greenstone sequence. Three main shears have been identified. 4.1.3 Resources Mineral Resources for Marda at 25 September 2012 are listed in Table 4.1. AMC has independently reviewed the total tonnes and grade of the Marda Central, King Brown, Golden Orb, Barranco Option, British Hill and Battler Mineral Resource estimates and found no material differences when compared to the total tonnes and grade reported at 25 September 2012. Table 4.1 Marda Gold Project – Mineral Resources as at 25 September 2012 1 2 3 4 Location Measured Indicated Inferred Tonnes (Mt) Grade (g/t Au) Contained Gold (oz Au) Tonnes (Mt) Grade (g/t Au) Contained Gold (oz Au) Tonnes (Mt) Grade (g/t Au) Northern Deposits Total 2,795,670 2.26 203,446 2,639,664 1.8 155,084 3,051,843 1.9 187,593 Marda Central includes Python, Dolly Pot, Dugite, Goldstream, Cobra, Taipan and Green Tree. Mt King estimated in 2008 by Hellman and Schofield using multiple indicator kriging with block support adjustment. Red Legs and Die Hardy deposits are subject to an option agreement. Contained Gold (oz Au) Marda Central 1 1,918,197 1.91 117,885 161,609 1.61 8,371 326,748 1.71 17,953 King Brown 100,300 4.36 14,060 63,300 2.59 5,274 73,925 2.95 7,012 Golden Orb 415,829 3.01 40,246 102,890 1.97 6,517 175,600 1.79 10,107 Mt King 2 - - - - - - 523,000 3 50,450 Subtotal 2,434,326 2.2 172,191 327,799 1.91 20,162 1,099,273 2.42 85,522 Barranco Option 3 - - - 1,302,243 1.7 71,900 949,576 1.64 50,300 Subtotal 2,434,326 2.2 172,191 1,630,042 1.74 92,062 2,048,849 2.06 135,822 Southern Deposits Battler 361,344 2.69 31,255 39,300 3.46 4,372 52,087 3.53 5,912 British Hill 4 - - - 970,322 1.88 58,650 950,907 1.5 45,859 Subtotal 361,344 2.69 31,255 1,009,622 1.9 63,022 1,002,994 1.61 51,771 Indicated and Inferred tonnes differ from those announced by Southern Cross on 23 November 2012. Southern Cross advised the Resource for British Hill was incorrectly reported and the values in the table above are correct and match those provided by Ravensgate. The following comments apply to all resources estimated by Ravensgate during 2012. The resource estimates are based mostly on diamond and RC drilling. 29
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ASX ANNOUNCEMENT / MEDIA RELEASE Fr
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ABN 71 124 374 321 U16,162 Colin St
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3. Access to the cash reserves of P
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Disclaimer and Important Notice •
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SXG - Well Placed • • •
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SXG and PLY - Key Merger Metrics
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Indicative Merger Timetable •
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A Diversified Portfolio of Australi
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Marda Project • Rare greenfields
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Northern Gold Corridor Targets - Dr
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WA Gold Assets - Turner River • P
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Mt Boppy - A Near-Term Production O
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ASX Code: Investor Presentation J
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Pro Forma Gold Reserve Statement Pr
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ABN 71 124 374 321 U16,162 Colin St
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- 3 - Notice of General Meeting Not
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- 5 - Proxy appointment, voting and
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- 7 - 1.2 Rationale for the Merger
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- 9 - 1.5 Implementation of the Mer
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- 11 - in terms of assets and marke
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- 13 - (a) You may not agree with t
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- 15 - (b) the Technical Specialist
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- 17 - (a) Identity of the person r
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- 19 - (i) Other matters The Direct
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- 21 - The purpose of Resolution 2
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- 23 - Schedule 1 - Information abo
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- 25 - Woodside Energy Ltd and Dire
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- 27 - Stephen Jones (Chief Financi
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- 29 - In accordance with ASIC Clas
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- 31 - million SXG Options which ha
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- 33 - Schedule 2 - Terms & Conditi
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- 35 - the Company out of profits o
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- 37 - Glossary In this Explanatory
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- 39 - Peak Litigation The litigati
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- 41 - Annexure A Refer enclosed In
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Financial Services Guide 21 June 20
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TABLE OF CONTENTS 1. Introduction 1
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2. Summary and Opinion 2.1 Purpose
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The respective advantages and disad
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elieves that there are sufficient r
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Existing SXG PLY Capital structure
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Sandstone Exploration Potential In
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5.3 Historical Balance Sheet Southe
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in tenement acquisition costs also
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The current SXG unlisted options on
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Drew Hill - White Dam Gold Project
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6.4 Historical Statement of Compreh
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At 31 March 2013, PLY have recorded
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Gold Demand/Supply Mined Metric ton
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• On 9 August 2012, Regis Resourc
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eport to be used in our report. At
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eport to be used in our report. At
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Funding assumptions SXG has receive
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AMC modelled two cases for the Mard
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Marda Project Case 2 Units 31-Dec-1
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uildings and water supply. The $38.
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Considering the valuation outcomes
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Southern Cross Goldfields Limited V
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We calculated the corporate costs o
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SXG share price and trading volume
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On 28 February 2013 SXG announced t
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Control Premium The concept of a pr
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We note that SXG’s EV/resource mu
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The Adjusted Mt Boppy Model was pre
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2013 2014 2015 2016 2017 2018 Gold
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AMC and management of PLY advise th
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Mt Boppy Case 2 Mt Boppy Project Ca
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Mt Boppy Case 2 Sensitivity analysi
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Polymetals Mining Limited Value of
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projects. PLY has discounted the to
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The Merged Entity - SXG Low Preferr
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Note f: Minority discount Following
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12. Is the Transaction fair In asse
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As set out in section 12, the Trans
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15. Sources of information This rep
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Page 168 and 169: AMC Consultants Pty Ltd ABN 58 008
Page 170 and 171: BDO CORPORATE FINANCE (WA) PTY LTD
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Update on Merger with Polymetals - Notice of Meeting

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