Feasibility Study and Technical Report - Pretivm

Canadian development expense and 60% to aCanadian exploration expense in 2016, and 70% toa Canadian development expense in 2017 and 30%to a Canadian exploration expense in 2017.Provincial (BC) Mining Tax SystemNet Current Proceeds (2%) Tax:Two percent is levied on amount by which grossrevenues exceed current operating costs.Hedging income and losses, royalties and financingcosts are excluded.Capital costs including exploration, pre-productiondevelopment costs and leasing costs are excluded.Capital costs are relevant for net revenue tax(below).Net current proceeds tax is added to a cumulativetax credit account (CTCA) and is available to offsetnet revenue tax payable.Net Revenue (13%) TaxTax is levied at 13% of net revenue.All capital expenditures, both mine developmentcosts and fixed asset purchases, are accumulatedin a cumulative expenditures account (CEA).Net revenue is defined as 13% of gross revenuesless the current operating costs for the year, lessany accumulated CEA balance.Therefore, for net revenue tax, all current andcapital expenditures are fully deductible in the yearthey are incurred or in the following year.Net revenue does not become assessable until thecosts of all pre-production capital expenditureshave been recovered.A “New mine allowance” is also provided toencourage new mine development in BC. Theallowance allows a mine operator to add 14% of itscapital expenditures incurred prior to commencingproduction to the CEA account.Under current legislation, the new mine allowanceis scheduled to expire on January 1, 2016. ThePretium Resources Inc. 22-9 1291990200-REP-R0012-02Feasibility Study and Technical Report on the BrucejackProject, Stewart, BC