Update on Merger with Polymetals - Notice of Meeting

Sandstone Exploration Potential
In December 2012, SXG entered into an agreement to acquire the Sandstone Project assets from Troy
Resources Limited. The consideration for these assets comprised:
• $5 million cash ($2.7 million of which goes towards the replacement of existing environmental
bonds);
• A 2% net smelter royalty on all non-nickel production from the Sandstone tenements; and
• 43.665 million unlisted options with an exercise price of $0.10 and a term of 5 years.
The cash component of the Sandstone acquisition was financed through a $7 million finance facility from
RMB Australia Holdings Limited.
The Sandstone project tenements are located near the town of Sandstone, approximately 730 kms north
east of Perth.
Included in the Sandstone Project assets are a 600,000 tonnes per annum gold processing plant and a 100
person camp within a 985km 2 exploration portfolio. SXG relocated the Sandstone plant to the Marda Gold
Project. Through the acquisition of the processing plant, SXG’s capital expenditure requirement in
relation to the Marda Project has reduced.
The increased resources acquired from Sandstone result in SXG’s total measured resource of 204,000
ounces, indicated of 301,000 ounces and inferred of 762,000 increasing total resources to 1.27 million
ounces with the total tenement holdings increasing to 3,900km 2 .
Marda Exploration Potential
A review of exploration in 2011 and 2012 indentified high priority targets along the Evanston Shear Zone
and Andromeda Trend.
Exploration in the March 2013 quarter resulted in two new exploration projects being identified, the
Thresher Prospect and the White Pointer Prospect. Thresher is located approximately 60km north of the
proposed gold treatment facility at Marda whilst White Pointer is located 40km north-west of the proposed
facility.
Red Boomerang is a gold exploration target located approximately 500m north-west of previously drilled
sites which had encouraging results.
The Lancelot prospect lies north of the Gwendolyn tenement which is currently being drilled by Vector
Resources. Drilling results reported by Vector in May 2012 included a high grade intercept of 1m @
1,165g/t from 26m which lies within an overall intercept of 5m @ 253.3g/t from 24m. Additional drilling is
planned for this site throughout 2013.
Copper Bore
The Copper Bore project is located approximately 400km north-east of Perth at the northern end of the
Marda region. SXG holds tenement interests for base metals across an area of approximately 2,900km 2 and
in 2012 it announced the discovery of a VMS base metal system at Copper Bore. A follow up drilling
campaign has been planned for 2013 however the Company’s primary focus is the development of the
Marda Gold Project.
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