Ann: Consolidation, Growth & Commercialisation - Mangaroon Gold, page-14

I asked DT about my concerns:

1. Do you think it's risky to put out Exploration Targets so soon into a campaign, could it be misleading?

2. What kind of timeframe for commercialisation could you see?

3. Is 300km too far to truck to the BC8 mill?

His reply:

Hopefully these are just a small start of agreements to come. But does lay out a nice pathway for the high-grade gold strategy at Mangaroon. Certainly, to be one of our core focuses with near term commercialisation potential.

Regarding your questions:

1. No, this Exploration Target is restricted to the areas with drilling and is supported by 31 historical holes and 10 Dreadnought holes including two diamond. The geological modelling and numbers were assembled through PayneGeo.

To the point there were several discussions about whether or not we put out an inferred resource. Given the level of knowledge on the historical holes, we decided against declaring a resource.

For comparison, the recently announced Pepper Resource from Spartan was based of 9 holes.

So, we have constrained this exploration target to areas of drilling (no strike, depth or other workings) for which we have enough drilling to arguably put out an inferred resource, but we viewed that, putting out a resource, as being too risky. A drilling constrained exploration target is more appropriate.

2. We are aiming for 12 months.

3. No. A great comparison is the Vivien Gold Mine which Ramelius used as high-grade feed to Mt Magnet for almost 10 years. Vivien Gold Mine was trucked 300kms and produced at an average grade of 5.7g/t over its lifetime with Ramelius. Based on current information, SoM should produce at higher grade that that.

This is the benefit of high-grade gold. While exploring for the next Penny, Never Never, Break of Day etc if we define near surface high grade gold, in particular on our already granted mining leases, we can quickly commercialise them through a win-win relationship with Paulsens.