Name and Location
Mt Morgans gold project (MMGP), Australia.

Client
Dacian Gold.

Project Description
The MMGP hosts high-grade mineral resources of three-million ounces at an average grade of 2.2 g/t gold.

Dacian has also identified multiple exploration targets and resource extension opportunities. If proven, they will enable growth of Mt Morgansí existing mineral resource and ore reserve base.

A scoping study completed on the MMGP, in the Laverton gold mining district, has determined that the project demonstrates robust project fundamentals, with low technical risk. The study envisages the co-development of a large openpit mining complex at the Jupiter prospect and a large underground mining complex at the Westralia prospect, located 15 km to the west, with lesser material mined from the Transvaal prospect.

Central to the MMGP is the construction of a standalone 2.5-million-tonne-a-year ore processing facility located close to the Jupiter prospect.

The Jupiter prospect is being considered as a potential new openpit mining complex comprising three openpits; and the Westralia prospect as a potential new, two-mine, three-decline underground mining operation. The Transvaal prospect has been evaluated as accessing existing underground development to mine a selection of newly defined stoping areas. All mined material is being considered for the treatment plant.

Total mine production for the MMGP is estimated at 16-million tonnes at 2.54 g/t for 1.31-million ounces.

Openpit production totals 11-million tonnes and underground production five-million tonnes.

Total gold produced is estimated at 1.2-million ounces.

Peak production is expected in Year 3, when more than 280 000 oz of gold is produced.

The Jupiter prospect openpits are expected to mine an estimated 484 000 oz of gold for 445 000 oz produced, assuming 92% recovery.

The Westralia prospect underground mines are expected to produce an estimated 745 000 oz of gold for 678 000 oz produced, assuming 91% recovery.

Dacian expects all mining will be completed by mining contractors, while all management and technical services will be undertaken by Dacian personnel.

Net Present Value/Internal Rate of Return
Not stated.

Value
The total infrastructure capital costs at MMGP are estimated at A$157-million.

The main capital cost is A$131-million for the 2.5-million-tonne-a-year treatment plant.

Duration
The scoping study estimates gold production to start at the beginning of 2018. The estimate assumes a 12-month construction period (during 2017) for the treatment plant.

Latest Developments
A decision to mine is expected to be made following the completion of a detailed feasibility study.

Before deciding to proceed with construction, the MMGP requires an estimated $157-million for site infrastructure capital to first production. It is assumed that financing for the required capital and regulatory approvals to start construction will be sourced during the second half of 2016.

Key Contracts and Suppliers
None stated.

On Budget and on Time?
Not stated.

Contact Details for Project Information
Dacian Gold, tel +61 8 9226 4622, fax +61 8 9226 4722 or email info@daciangold.com.au.