DECEMBER 2016 QUARTERLY ACTIVITIES AND CASH FLOW REPORT Beacon Minerals Limited (ASX:BCN) (Beacon or Company) is pleased to present its Quarterly Activities Report for the period ended 31 December 2016. Highlights Beacon Executes Option to Purchase Jaurdi Gold Project Appointment of Project Manager Beacon Pays Inaugural Dividend Beacon Executes Option to Purchase Jaurdi Gold Project On 3 January 2017, the Company announced that it had executed an exclusive option to purchase the Jaurdi Gold Project comprising Mining Lease M16/529 (ML) from Fenton and Martin Mining Developments Pty Ltd (Fenton and Martin) (Option to Purchase Agreement). The Jaurdi Gold Project is located 35 kilometres north west of Coolgardie and is close to infrastructure, including public and private road access to Coolgardie and Kalgoorlie. Under the Option to Purchase Agreement, Beacon will have 110 days to undertake due diligence on the Jaurdi Gold Project, which will include the following: o A detailed survey of all previous work on the ML, which includes 114 RAB/RC drill holes by the current and former tenement holders; o Collation and audit of the data within the BM Geological Services Pty Ltd (BMGS) database. BMGS have already undertaken work on the project for current and previous tenement holders; and o Design and implement a drill program on the ML to: Drill check holes against existing holes; Delineate the extent of the gold mineralised system within the ML; and Compile a resource inventory. o During the option period Fenton and Martin can continue to mine ore on the tenement up to a maximum of 20,000 tonnes. The mining of this ore will not materially affect the resource tonnes or ounces and will provide valuable information for Beacon’s decision to exercise the option. The key terms of the Option to Purchase Agreement with Fenton and Martin include the following: a) Beacon will pay $100,000 to purchase the ML; and b) Beacon will pay an initial royalty of $90 per refined ounce of gold for the first 10,000 ounces produced from the tenement and $80 per refined ounce of gold produced thereafter. BEACON MINERALS LIMITED ACN 119 611 559 Kalgoorlie Office 144 Vivian Street, Boulder, WA 6432 Registered Office Level 1, 115 Cambridge Street, PO Box 1305, West Leederville, WA 6007 Website
www.beaconminerals.com Phone 08 9322 6600 Facsimile 08 9322 6610 2 A pre‐paid royalty of $900,000 will be paid to Fenton and Martin upon the transfer of the tenement and this amount will satisfy the royalty payments up to this amount. Subsequent to the end the quarter a survey of previous drill collars has been undertaken, a drill program designed and drilling has commenced. Phase 1 of the drilling campaign on the ML, consisting of 2,100 metres of shallow reverse circulation drilling, using both air‐core and hammer techniques, was completed on 23 January 2017. The Company is waiting on the receipt of all the results from the Phase 1 drilling campaign, including bottle rolls at an independent laboratory. Phase 1 Drilling at Jaurdi Project ‐ January 2017 Appointment of Project Manager The Board of Directors advised that Mr Alex McCulloch had been appointed Project Manager of the Jaurdi Project for the due diligence period and, if the option is exercised, to Manage the project through to production. Mr McCulloch is a mining engineer who graduated from the School of Mines in WA in 1997. He has over 37 years experience in the mining industry. Mr McCulloch has previously worked at a number of open pit BEACON MINERALS LIMITED ACN 119 611 559 Kalgoorlie Office 144 Vivian Street, Boulder, WA 6432 Registered Office Level 1, 115 Cambridge Street, PO Box 1305, West Leederville, WA 6007 Website
www.beaconminerals.com Phone 08 9322 6600 Facsimile 08 9322 6610 3 operations in Australia and overseas, including the start‐up and ongoing production of an open pit copper/gold mine in NSW and has more recently been involved in the evaluation, planning and operation of mineral projects in the WA Goldfields. Mr McCulloch has been providing technical assistance to the Executive Management of Beacon since September 2015. Mr McCulloch has assisted Beacon in the evaluation of more than 40 projects, which have included desk top studies and where required, local and overseas site visits. For more information in relation to Mr McCulloch’s appointment please see Beacon’s ASX announcement dated 3 January 2017 “Beacon Executes Option to Purchase Jaurdi Gold Project”. Dividend Payment The Board of Beacon announced on 29 September 2016 that a dividend of $0.0025 per share would be paid to shareholders. The unfranked dividend for Australian taxation purposes was paid to shareholders on 3 November 2016. The payment of the dividend is in line with the previously stated objectives of the Directors. CASH RESERVES As at 31 December 2016 the Company had approximately $3.208 million in cash reserves. CAPITAL STRUCTURE As at the date of this report the Company has the following capital structure: Fully Paid Ordinary Shares (BCN) 1,495,470,963 OTHER OPPORTUNITIES Senior management and external consultants have undertaken desk top reviews, and where justified, field inspections of more than 40 exploration/mining properties since the beginning of the year. The Company had made an unconditional cash offer for one property but this was subsequently rejected. Discussions continue and shareholders will be advised immediately of any material outcomes. Should shareholders have any questions regarding Beacon, please feel free to contact Executive Chairman Geoff Greenhill or Managing Director Graham McGarry
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