Sp. 77cTolhurstInitiation of Coverage • Conquest Mining has...

Sp. 77c

Tolhurst

Initiation of Coverage

• Conquest Mining has 100% interest in the Mt Carlton Project (with
Goldfields retaining a 3% gross royalty payment), with current
resources of over 1.6m ounces of gold equivalent, and still growing.

• The project is at an advanced stage, with scoping study already
completed and BFS expected to be completed during 2008.

• Based on current criteria, we forecast annual production peaking at
over 200k ounces of gold equivalent, with further growth a
possibility should the current regional exploration program prove
successful.

• We anticipate production should commence in late 2009, or early
2010 based on the current development schedule.

• Given the low strip ratio and high gold equivalent grades, we
forecast the operating costs will fall within the lowest quartile of
Australian gold producers. As there is a high grade core to Silver
Hill, we also are assuming significant high-grading can occur
during the early years of the project, resulting in exceptionally low
forecast operating costs during the early years of the project.

• We still see further significant greenfields exploration upside, with
minimal spend required by Conquest due to the Joint Venture
agreement with Goldfields Australia.

• We have Conquest trading at a significant discount to our
discounted cash flow valuation. This compares to our current sector
average premium to valuation of 83%, with only 6 out of the 18
companies analysed trading at a discount to valuation.

• We are initiating Coverage with an ACCUMULATE recommendation
for the short and long term with a Price Target of $1.00.