MOUNT BUNDY GOLD PROJECT Investor Update Developing the Mount Bundy Gold Province July 2016 ASX: PGO www.primarygold.com.au
Cautionary Statement Statements and material contained in this Presentation, particularly those regarding possible or assumed future performance, production levels or rates, resources or potential growth of Primary Gold Limited (PGO), industry growth or other trend projections are, or may be, forward looking statements. Such statements relate to future events and expectations and, as such, involve known and unknown risks and uncertainties. Although PGO believes that the expectations contained in any forward looking statements in this presentation are, as at the date of this presentation, made on a reasonable basis, such statements are not guarantees of future performance and actual results and the timing of such results may differ materially from those herein described. Factors which may impact on future performance and cause actual results to differ materially from those contained in forward looking statements include, without limitation, changes in commodity prices, exchange rates, PGO s access to capital and general and market conditions. This presentation may describe Measured, Indicated and/or Inferred Resources. Inferred Resources have a greater amount of uncertainty as to their existence and greater uncertainty as to their economic feasibility. It cannot be assumed that all or any part of any Inferred Resource will ever be upgraded to a higher category. Exploration is an inherently risky proposition and investors are advised that most exploration projects fail to identify economic resources. The Company has at present not confirmed the economic viability of any resources at the project. The company plans further drilling programs and studies with the objective of confirmation of any deposits and ultimately completing a feasibility study to demonstrate the economics of the resources. The information contained in this presentation is for informational purposes only and does not constitute an offer to issue, or arrange to issue, securities or other financial products. The information contained in this presentation is not investment or financial product advice and is not intended to be used as the basis for making an investment decision. The presentation has been prepared without taking into account the investment objectives, financial situation or particular needs of any particular person. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this presentation. To the maximum extent permitted by law, none of PGO, their directors, employees or agents, nor any other person accepts any liability, including, without limitation, any liability arising out of fault of negligence, for any loss arising from the use of the information contained in this presentation. In particular, no representation or warranty, express or implied is given as to the accuracy, completeness or correctness, likelihood of achievement or reasonableness or any forecasts, prospects or returns contained in this presentation nor is any obligation assumed to update such information. Such forecasts, prospects or returns are by their nature subject to significant uncertainties and contingencies. Before making an investment decision, you should consider, with or without the assistance of a financial adviser, whether an investment is appropriate in light of your particular investment needs, objectives and financial circumstances. 2
Company Snapshot PGO: An Emerging Australian Gold Producer >1.2Moz Current Mineral Resource Base Dominant Land Position With 1,500km 2 Tenements New Board and Development Strategy $4.5M Cash at Bank
0.12 7,000 Share Price For personal use only Corporate Overview Capital Structure Shareholding Structure ASX Code PGO Ordinary Shares Options ($0.03 - $0.20/share) Market Cap. (@ $0.10/share) 452M 81M A$45M 74.0% 26.0% Board & Related Parties Other PGO Shareholders Cash (30 June 2016) A$4.5M Share Price History New Board Established $4.0M Capital Raising New Executive Team & Strategy Rustlers Roost Resource Update Plan to Drill, Resources, Investor Marke ng 0.1 0.08 0.06 0.04 0.02 6,000 5,000 4,000 3,000 2,000 1,000 Volume ('000s) 0 0 Volume Closing Price 4
Comparison to ASX Gold Developers $150 Enterprise Value / Resources (A$/oz) $125 $125 $122 $118 $100 $91 $82 Average $89/oz $75 $57 $50 $31 $25 $0 Eastern Goldfields Dacian Echo Capricorn Gold Road Gascoyne Primary Gold Source: PCF Capital (30 June 2016) 5
New Highly Credentialed Board Patrick Walta Executive Director Metallurgist & Mineral Economist Former Executive Director of Carbine Resources Strong experience in mineral processing, project feasibility development and gold operations Appointed June 2016 Marat Abzalov Executive Director - Exploration Appointed June 2016 Geologist with 30 years mining industry experience Former Exploration Manager New Opportunities at Rio Tinto Wide ranging experience & skills in ore body exploration & definition Tony Patrizi Non Executive Director Mechanical Engineer, >30 years industry experience Current Executive Director GR Engineering, recognized as an industry leader in mineral processing plant EPC Garry Mills Non Executive Director Mining Engineer with 30 years operations experience Former Operations Manager Dominion Mining, responsible for successful narrow vein mining strategy Evan Cranston Non Executive Director Principal of Konkera Corporate boutique corporate advisory and company administration firm Current Director of Carbine Resources, Clancy Resources, Boss Resources and Attila Resources Appointed March 2016 Appointed March 2016 Appointed March 2016 Dale Rogers Non Executive Chairman Mining Engineer with 25 years industry experience Appointed 2013 Mark Qiu Non Executive Director Geologist with 25 years industry experience Appointed 2014
Project Overview Mount Bundy Gold Project Current resource base 26.9Mt at 1.5g/t (1.24Moz gold) Current resources all within 10km (centralised treatment opportunity) 100km from Darwin, with highways, power, water intersecting tenements 1,500km 2 tenement package in prolific gold producing region >10 holes drilled over the tenements outside of Toms Gully in last 20 years ~50km of structure controlling gold distribution remains under explored
Mount Bundy is Not Just Toms Gully! OLD STRATEGY Small Underground Ops NEW STRATEGY Large Bulk Tonnage Ops Toms Gully Underground Main Feed 1.1Mt @ 8.9g/t Au Rustlers Roost Open Pit Main Feed 22.4Mt @ 1.1g/t Au Processing Plant Bulk Tonnage Toms Gully Underground High Grade Feed 1.1Mt @ 8.9g/t Au Initial Focus Exploration, Drilling & Resource Growth Processing Plant 0.25 Mtpa Quest 29 Open Pit Mine Life Extension 3.4Mt @ 1.4g/t Au Greenfield & Brownfield Exploration Exploration Upside??? 8
Rustlers Roost Deposit Rustlers Roost: >750,000oz resource with upside Large open pit gold system along 1000m strike Low strip ratio ore body (historical estimates of 2:1) Existing resource open both along strike and down dip Look-a-like deposit mineralisation identified to the east & west Significant brownfield resource expansion potential 9
Rustlers Roost Deposit For personal use only
Toms Gully Deposit Toms Gully: 315,000oz with upside 300m wide, shallow dipping quartz-gold reef Remnant high grade resource untouched by historical production Recent drilling success outside of interpreted mineralisation zone (between faults) Resource limited by drilling only, targeting reef extensions along strike and outside faults 11
Toms Gully Deposit For personal use only
Quest 29 & Quest 30 Deposits Quest 29: Resource of 148,000oz over 3.5km Current resource 3.4Mt @ 1.4g/t gold (oxide & transitional ore only) Average drilling depth 40m (primary sulphide remains untested) Only 2% of drill holes >100m Deposit open in all directions Quest 30: Mineralised strike over 8.0km Identical geological setting to Quest 29 (anticline adjacent to granite intrusion) Rock chips up to 19.3g/t Poorly drill tested (historical MLs focus) 13
Exploration for New Discoveries ~50km of structure controlling gold distribution remains under explored Rock-chips(Greenfield) 2,691 samples; 69 samples >5g/t max 88.2g/t Au Rock-chips(Brownfield) Rustlers Roost 26.1g/t& 16.4g/t Quest 29 5.2g/t& 4.0g/t Soils samples 42,696 samples; 2,200 >1.0g/t; max 159g/t Au ~60 targets identified for follow up exploration with modern techniques
Exploration for New Discoveries Rustlers North High grade Toms Gully style targets Stream sediments up to 48ppb Toms Gully only 13ppb at discovery Target never drill tested Rustlers East Large tonnage, Rustlers Roost style targets Significant soil anomaly up to 170bbp Similar stratigraphy & structural setting to Rustlers Roost Threedrillholesto15mdepthonly 15
Development Around Rustlers Roost Historical Operations (mid 1990s) Heap leaching of oxide ore & carbon loading circuit Rustlers Roost Historical Open Pit 4.7Mt prod. @ 1.05g/t (113,000oz) @ 65-70% recovery Preg-robbing identified as reason for poor recoveries Current Mineral Resources Suitable for conventional cyanide leaching (no POX/roast) Potential to gravity upgrade (>3g/t con. in ~25% mass) Resin-in-Leach processing eliminates preg-robbing issue Valencia Ventures 2006 Feasibility Study Improved recoveries utilising resins instead of carbon (91-93% recovery through RIL circuit SGS Lakefield Labs) Positive NPV @ US$650/oz gold (AUD/USD $0.75) Project not implemented due to gold price (~US$600/oz) 16
Resin-in-Leach Overview RIL & CIL: Established commercial gold extraction processes RIL used globally, uncommon in Australia due to ore types J Resources Penjom Mine RIL Plant RIL & CIL equipment near identical (similar capex/opex) >3.5 million oz/yr gold produced via RIL processing Resin processing used at both: Muruntau(world s largest gold mine) Goldstrike(world's third largest gold mine) Company Listing Mine Location Start up RIL Throughput Barrick Gold TSX: ABX Goldstrike USA 2014 4.0 Mtpa Petropavlovsk LSE: POG Albyn Russia 2011 4.5 Mtpa Petropavlovsk LSE: POG Pioneer Russia 2008 7.0 Mtpa Alhambra Resources TSX: ALH Uzboy Kazakhstan 2006 1.0 Mtpa Petropavlovsk LSE: POG Pokrovskiy Russia 2004 2.0 Mtpa Petropavlovsk LSE: POG Malomir Russia 2003 4.5 Mtpa J Resources JK: PSAB Penjom Malaysia 1999 0.5 Mtpa Golden Jubilee Mining N/A Golden Jubilee South Africa 1988 Closed NGMK State Owned Muruntau Uzbekistan 1971 ~23 Mtpa
Why Invest in Primary Gold? New high calibre Board & strategy targeting large scale bulk operations Existing resource based >1.2Moz gold 1,500km 2 of underexplored tenements in proven gold producing region ~50km of gold controlling structures totally untouched by drilling New aggressive exploration strategy planned PGO undervalued against peers
JORC Statement Resources Indicated Inferred Total Tonnes (kt) Grade (g/t) Au (koz) Tonnes (kt) Grade (g/t) Au (koz) Tonnes (kt) Grade (g/t) Au (koz) Toms Gully 835 9.0 242 265 8.5 73 1,100 8.9 315 Rustlers Roost* 14,420 1.1 505 7,960 1.0 266 22,380 1.1 772 Quest 29 2,190 1.4 98 1,205 1.3 50 3,395 1.4 148 Total 17,445 1.5 845 9,430 1.2 389 26,875 1.5 1,235 Reserves Proved Probable Total Tonnes (kt) Grade (g/t) Au (koz) Tonnes (kt) Grade (g/t) Au (koz) Tonnes (kt) Grade (g/t) Au (koz) Toms Gully 775 6.9 175 775 6.9 175 * PGO 80% Equity Ownership PRIMARY GOLD MINERAL RESOURCES & ORE RESERVES, COMPETENT PERSON S STATEMENTS: The information in this announcement that relates to Toms Gully, Rustlers Roost and Quest 29 Mineral Resources is based on, and fairly represents, information and supporting documentation compiled and prepared by Mr Brian Fitzpatrick. Mr Fitzpatrick is a Member of The Australasian Institute of Mining and Metallurgy and a full-time employee of Cube Consulting Pty Ltd. Neither Cube nor Mr Fitzpatrick holds any interest in Primary Gold, its related parties, or in any of the mineral properties that are the subject of this report. Mr Fitzpatrick has sufficient experience which is relevant to the styles of mineralisation and types of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Fitzpatrick has provided prior written consent as to the form and context in which the Exploration Results and Mineral Resources and the supporting information are presented in this market announcement. The information in this market announcement that relates to Toms Gully Ore Reserves is extracted from the report entitled Toms Gully Ore Reserve Estimate Summary Report, August 2013 as announced 27 August 2013. Both report and announcement are available to view on www.primarygold.com.au. Primary Gold Limited confirms it is not aware of any new information or data that materially affects the information in the original market announcements relating to Toms Gully ore reserves, that all material assumptions and technical parameters underpinning the Toms Gully mineral resource estimate continue to apply and have not materially changed. The company confirms that the form and context in which the Competent Person s findings are presented have not been materially modified from the original market announcement.
Contact Patrick Walta Executive Director Primary Gold Limited Suite 23, 513 Hay Street, Subiaco WA 6008 T +61 8 6143 6700 E info@primarygold.com.au W www.primarygold.com.au