Name and Location
Siana underground gold project, Philippines.

Client
Red 5 Limited.

Project Description
A feasibility study on the project includes a maiden ore reserve estimate for the Siana underground mine of 3.01-million tonnes grading 4.1 g/t of gold, underpinning the proposed development of an underground mine directly below the existing openpit to extract 504 000 t/y of ore.

The mine will use a conservative short up-hole retreat mining method, with cemented paste-fill for the majority of the orebody.

Ore from the underground operation will be processed at the existing 1.1-million-tonne-a-year gravity and carbon-in-leach processing facility at Siana.
The underground project is expected to produce on estimated 60 000 oz/y over an eight-year production mine life.

There is considerable potential to extend the mine life through resource extension and further exploration of near-mine targets.

Net Present Value/Internal Rate of Return
The project has a pretax net present value, at a 10% discount rate, of $50-million and an internal rate of return of 22%, assuming a gold price from $1 200/oz.

Value
The preproduction capital cost for the underground mine development, including infrastructure, paste plant and development, is estimated at $60-million.
Red 5 believes that it will be able to fund the underground mine development at Siana using the cash flow generated by the existing openpit operation over the next 18 months. This belief includes being able to accelerate initial underground development through a short-term loan facility provided by Metropolitan Bank & Trust Company of the Philippines. This will enable the operation to transition to underground mining, following the completion of the openpit, by the end of calendar year 2017.

Duration
The positive results from the feasibility study paves the way for the start of underground mine development, with a projected 12-month timeline to access first underground ore.

Latest Developments
Based on the positive outcomes of the updated feasibility study, the Siana underground mine has been approved for development.

Key Contracts and Suppliers
Mining One (updated feasibility study).

On Budget and on Time?
Not stated.

Contact Details for Project Information
Red 5 Limited, tel +61 8 9322 4455 or fax +61 8 9481 5950.
Mining One, tel +61 3 9600 3588, fax +61 3 9600 3944or email Info@miningone.com.au.