HANKING GOLD MINING Diggers & Dealers August 2016
Important Notice and Disclaimer IMPORTANT: YOU MUST READ THE FOLLOWING BEFORE CONTINUING The following Important Notice applies to this presentation and you are therefore advised to read this carefully before reading or making any other use of this presentation or any information contained in this presentation. In accepting this presentation, you agree to be bound by the following conditions, including any modifications to them. If you do not agree to be so bound, you should immediately return this document. The information in and accompanying this presentation has been compiled by China Hanking Holdings Limited and Hanking Gold Mining Limited (Hanking) (a wholly owned subsidiary of China Hanking Holdings Limited). Basis of preparation This presentation has been prepared as at 31 July, 2016 (Preparation Date) on the basis of information provided to China Hanking Holdings Limited by external parties. China Hanking Holdings Limited has relied upon and assumed, without independent verification, the accuracy and completeness of that information. In this presentation, certain documents and agreements and certain other information are described in summary form. The summaries do not purport to be complete descriptions of those documents, agreements or information. They are intended only to assist in a reading of such documents, agreements and information and must not be relied on as a basis for decision making. The delivery of this presentation at any time after the Preparation Date does not imply that the information contained or referred to in it is correct at any time after the Preparation Date. The delivery of this presentation neither implies, nor is to be relied on as a representation or warranty that: there has been no change since the Preparation Date in the affairs or financial condition of China Hanking Holdings Limited; or the information contained or referred to in this presentation remains correct and not misleading at any time after the Preparation Date. No person undertakes to review the financial condition or affairs of China Hanking Holdings Limited, to keep you informed of changes in the financial condition or affairs of China Hanking Holdings Limited and/or anything contained or referred to in this presentation nor to correct any inaccuracies or omissions or any information contained or referred to in this presentation which may exist or become apparent. No liability Except as required by law, China Hanking Holdings Limited, its related bodies corporate and other affiliates, and their respective officers, employees, consultants and agents (China Hanking Holdings Limited Group) make any representation or warranty as to the accuracy, completeness, timeliness, fairness or reliability of this presentation. To the maximum extent permitted by law, no member of China Hanking Holdings Limited Group accepts any liability (including without limitation, any liability arising from fault or negligence on the part of any of them) for any direct or indirect loss or damage whatsoever arising from any use of this presentation or otherwise arising in connection with it. Forward statements This document contains forward-looking statements, forecasts, estimates and projections (Forward Statements). Neither any member of China Hanking Holdings Limited Group nor any independent third party has reviewed the reasonableness of the Forward Statements. No member of China Hanking Holdings Limited Group represents or warrants that the Forward Statements will be achieved or will prove to be correct. Actual results could vary materially from the Forward Statements. Similarly, no representation or warranty is made that the assumptions on which the Forward Statements are based are reasonable. No fiduciary The recipient acknowledges that neither it nor China Hanking Holdings Limited Group intends that China Hanking Holdings Limited Group act or be responsible as a fiduciary to the recipient, its officers, employees, security holders, creditors or any other person. Each of the recipient and China Hanking Holdings Limited Group, by accepting and providing this document respectively, expressly disclaims any fiduciary relationship and agrees that it is responsible for making its own independent judgments with respect to any acquisition transaction and any other matters arising in connection with this presentation. 1
Introduction to Hanking Gold Hanking Gold is a high grade, long life, low cost, ~160Koz pa gold producer in Western Australia SXO belt has known gold endowment of >10Moz Acquired Southern Cross ( SXO ) from SBM in Apr-13 Unloved quality assets, but needed a new strategy and investment Hanking Gold was aware of the opportunity at acquisition Increased tenement package to 1,084km 2 Increased JORC resource to 4.63 Moz Au @ 4.1 g/t, and JORC Reserve to 1.01 Moz Au @3.3 g/t Au Today, SXO is a ~160Koz pa high grade, low cost, gold mine 2
Progress Since Acquisition Hanking Gold has invested $136m since acquisition and successfully redeveloped SXO through implementation of a new strategy 1. Marvel Loch mine put on care & maintenance Ongoing Exploration Success (JORC Resource Moz) 4.6 2. 3. Substantial Resource growth through significant investment in exploration Marvel Loch Processing Plant refurbished 2.4 2.5 2.8 3.0 3.2 4. Developed open-pit and underground mine operations 5. Commercial production achieved Aug 15 6. Current 7-year LOM plan (~A160koz pa) Apr-13 (Acquisition) Jan-14 Aug-14 Mar-15 Feb-16 Jul-16 (Today) 3
Hanking Gold Today High grade substantial Reserve and Resource underpinning 7 year life of mine plan 1.0Moz JORC Reserves at 3.3g/t Au 4.6Moz of JORC Resource at 4.1g/t Au, incl. 3.3 Moz Au at 4.1 g/t in Measured and Indicated Category Production of ~160koz pa Au over 7 year life of mine Attractive AISC of ~A$950/oz 1,084km 2 consolidated tenement package Further growth through exploration success JORC Resources by CSA, Cube, SRK and DW Consulting, LOM reviewed by CSA 4
Flyover of SXO Operations 5
Mine Plan Overview Production of ~160koz pa over 7 years at an average AISC of ~A$950/oz over the life of mine Key Highlights 7-year initial mine life, with potential for +10 years Average production of ~160Koz pa AISC 1 of ~A$950/oz Production Profile 2 (Koz Au) 200 150 ~160 Reserves represent 87% of LOM production Blending of open-cut and underground ore 100 All deposits within short trucking range of processing plant on private haul road 0.6 Moz @ 5.2 g/t new JORC Resource from Copperhead has not been considered in the LOM 50-2016E 2017E 2018E 2019E 2020E 2021E 2022E OC Production UG production 1. All-in Sustaining Cost, which consists of cash operating costs, royalties and sustaining capex, calculated on a pre-stripping basis. Post stripping AISC is ~A$1050/oz over LOM 2. Production profile based on 87% JORC Reserves and conversion of Measured & Indicated JORC Resources 6
Site Infrastructure Overview All key infrastructure is in place to support mining operations and low capex production growth Key Highlights Marvel Loch processing plant has 2.2Mtpa capacity Conventional CIP and gravity flowsheet Recently refurbished (A$25 m cost) Plant replacement value of ~A$200m 350+ person camp, incl.120 new rooms, new gym On-site admin. buildings, offices and workshops Existing grid power and water Proximity to Southern Cross, Perth and Kalgoorlie 7
Axehandle Brand new open-pit that will produce ~214 Koz Au over 3 years Key Highlights Designed Pit Nearly tripled the JORC Resource since acquisition (300Koz today) Transported material JORC Reserve of 214 Koz Au Oxide material Brand new open-pit being developed (1km by 400m) Transitional material Currently mining with 3 diggers 11m @ 4.1 g/t 4m @ 4.5 g/t 25m @ 4.1 g/t Fresh material Already in the orebody after 8 months pre-stripping Still open at depth and along the strike (drill to <200m deep) 16m @ 2.1 g/t 10m @ 1.9 g/t 11m @ 3.1 g/t AXEHANDLE DESIGNED PIT Section 12700 n 8
Axehandle: From Aug 2015 Feasibility to Production Sept 2015 Clearing Early 2016- Progress June 2016 July 2016 Ore on ML ROM 9
Nevoria Underground Gold Mine Nevoria Underground to produce ~150 Koz Au over three years 411 SP Key Highlights Nevoria East (Being Mined) Current underground production from Nevoria East (~45 Koz pa) Low capex (A$3m) development into Nevoria West (commenced in June 2016) Nevoria West (Being Developed) JORC Resource of 0.42Moz at 3.4 g/t, of which 0.38Moz is JORC Measured & Indicated Positive reconciliation in ore tonnes, grade and ounces 10
Nevoria East Current Production Key Highlights Decline: 5.2mW x 5.5mH Ore drive/sp: 5.0mW x 5.0mH RAW/EWA: 4.5mW x 4.5mH Airleg rise: 1.5mW x 1.5mH Current development at 266 level Future development is up to 215 level New drilling has not been inclosed in the resource and LOM Monthly targets Ore production: ~ 45 Kt Total movement: ~50 kt Nevoria West, currently being developed, is scheduled to produce at similar rate. 11
Yilgarn Star A large mine that produced 1.1 Moz Au by 2003, but recently defined 1.0 Moz Au JORC resource. Key Highlights New drilling extends the gold mineralization to 3km strike long. Current JORC Code 2012 Resource of 5.1Mt @ 6.1 g/t for 1 Moz Au High grade JORC Resource of 1.0Moz at 6.1 g/t, of which 0.87Moz is JORC Measured & Indicated 1 st Phase feasibility study completed in July 2016, initial production of ~280koz Au over 3-years A further 0.5 Moz Au Measured and Indicated resource for reserve conversion Gold mineralization extending 3km long and to a depth of 1 km, the majority of the 3 km long strike length has only been drilled to less than 200m deep. 12
Copperhead Substantial high-grade JORC Resource, with potential for bulk underground mine Reserves Key Highlights Historically, the second largest gold mine in the SXO greenstone belt (behind Marvel Loch) 1.5 Moz Au produced since 1910, mostly by WMC to late 1980s. The production was from the higher-grade North Series Lode. The lower-grade South Series Lode was largely left untouched. Current in-situ JORC 2012 Code Resource of 0.59 Moz Au at 5.2 g/t, with about 90% in the Indicated Category, estimated by Cube Consulting. Potential for bulk underground mining. This new resource has not been included in the 7-year LOM plan Two deep holes on the lower-grade South Lode with the intersections of 22.3m @7.6 g/t Au and 0.55m@ 19.5 g/t Au at 1000m down hole. 13
Significant Exploration Upside 14
Significant Exploration Upside 15
Significant Exploration Potential 16
Significant Exploration Potential 17
Summary 1 2 ~160Koz Au producer in a stable jurisdiction 7 year life of mine plan, potential for +10 years Substantial high grade Reserves & Resource JORC resource of 4.63 Moz Au at 4.1 g/t, including 3.3Moz Au at 4.1 g/t in M&I category and 1.0Moz at 3.3 g/t Reserve Striving for best practice in HSEC 3 Attractive AISC of A$950/oz A$1,050 including pre-stripping 4 1,084km 2 tenements cover 150km continuous strike length Consolidated package, dominating position 5 +92% increase in Resources since acquisition Growth from 2.4Moz to 4.6Moz 6 Management track record of developing the project Experienced local management and production team www.hanking.com.au 18
APPENDIX JORC Reserves & Resources
JORC Compliant Mineral Reserves Proved Probable Total Deposit Ore (Kt) Grade (g/t Au) Contained Gold (Koz) Ore (Kt) Grade (g/t Au) Contained Gold (Koz) Ore (Kt) Grade (g/t Au) Contained Gold (Koz) Open-pit Axehandle 2,168 2.5 174 544 2.3 40 2,712 2.5 214 Cornishman 35 1.5 2 - - - 35 1.5 2 Yilgarn Star Open-pit 1,547 2.9 144 - - - 1,547 2.9 144 Aquarius - - - 616 3.3 65 616 3.3 65 Frasers - - - 340 3.4 37 340 3.4 37 Edwards Find North - - - 327 2.7 28 327 2.7 28 Sub-total (Open-pit) 3,750 2.7 320 1,827 2.9 171 5,577 2.7 492 Underground Nevoria Underground - - - 1,076 3.7 128 1,076 4.0 128 CNC Underground - - - 473 4.3 65 473 4.3 65 Frasers South Underground - - - 550 4.5 80 550 4.5 80 Jaccoletti Underground - - - 988 3.5 111 988 3.5 111 Yilgarn Star Underground - - - 896 4.7 134 896 4.7 134 Sub-total (Underground) - - - 3,983 4.0 518 3,983 4.0 518 Total 3,750 2.7 320 5,810 3.7 689 9,560 3.3 1,010 Note: JORC Compliant Mineral Resources Statement as at July 2016. 20
JORC Compliant Mineral Resources Project Axehandle- Cornishman Deposit / Orebody Measured Indicated Inferred Total Ore Grade Au Ore Grade Au Ore Grade Au Ore Grade Au (Kt) (g/t) (Koz) (Kt) (g/t) (Koz) (Kt) (g/t) (Koz) (Kt) (g/t) (Koz) Axehandle 2,275 2.6 188 990 2.5 78 436 2.1 30 3,701 2.5 295 Cornishman 620 5.1 101 535 5.1 88 434 5.5 77 1,589 5.2 266 Sub-total 2,895 3.1 289 1,525 3.4 166 870 3.8 107 5,290 3.3 561 Nevoria Sub-total - - - 3,482 3.4 377 323 3.9 41 3,805 3.4 418 Yilgarn Star Sub-total 2,582 5.9 490 1,849 6.3 377 707 6.1 139 5,139 6.1 1,006 Copperhead Sub-total - - - 3,116 5.3 529 417 4.6 62 3,533 5.2 590 Frasers-Transvaal Marvel Loch- Jaccoletti Edwards Find GVG Transvaal 2 - - - 1,630 4.7 249 1,800 4.9 286 3,430 4.8 535 Frasers - - - 1,117 4.6 165 1,474 6.1 289 2,591 5.5 454 New Zealand Gully - - - 64 7.5 16 46 5.9 9 110 6.8 24 Ruapehu - - - 52 8.5 14 358 4.0 46 410 4.6 60 Sub-Total - - - 2,863 4.8 444 3,678 5.3 630 6,541 5.1 1,073 Marvel Loch 287 3.1 29 2,930 3.2 299 1,400 2.5 112 4,617 3.0 440 Jaccoletti - - - 852 4.5 124 298 3.1 30 1,150 4.2 154 Sub-Total 287 3.1 29 3,782 3.5 423 1,698 2.6 142 5,767 3.2 594 Edwards Find - - - 364 3.1 37 261 2.3 19 625 2.8 56 Edwards Find North - - - 641 2.4 49 227 1.6 12 868 2.2 61 Tamarin - - - 117 1.8 7 361 1.3 15 478 1.4 22 Sub-Total - - - 1,122 2.6 93 849 1.7 46 1,971 2.2 139 GVG - - - 1,494 2.3 111 8 2.1 1 1,502 2.3 111 Zeus - - - - - - 469 2.0 30 469 2.0 30 Sub-Total - - - 1,494 2.3 111 477 2.0 30 1,971 2.2 141 Redwing Sub-Total - - - - - - 1,400 2.4 108 1,400 2.4 108 Total 5,764 4.4 808 19,233 4.1 2,519 10,419 3.9 1,305 35,417 4.1 4,630 Note: JORC Compliant Mineral Resources Statement as at July 2016. 1. JORC Compliant Mineral Resources are inclusive of JORC Compliant Mineral Reserves. 2. Cut-off grades: Axehandle (0.7 g/t), Cornishman (OP 0.9 g/t, UG 2.5 g/t), Nevoria (OP 0.6g/t, UG 2.0 g/t), Yilgarn Star (2.5 g/t), Copperhead (3.0 g/t), Transvaal (OP 1.0-1.7 g/t, UG 2.6 g/t), Frasers (OP 1.0 g/t, UG 2.5 g/t), New Zealand Gully (2.5 g/t), Ruapehu (2.6 g/t), Jacoletti (2.0 g/t), Marvel Loch (2.1 g/t), Edwards Find Project (0.7 g/t), GVG (0.7 g/t, 1.0 g/t), Zeus (1.0 g/t). 21