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Further Drill Results Highlight Blue Vein Potential

Tempus Resources Ltd is pleased to announce further assay results from drill-holes from its Elizabeth Gold Project in British Columbia, Canada. Drill holes being reported in this release are EZ-21-15, EZ-21-16, EZ-21-17, EZ-21-18, and EZ-21-19. The drill holes targeted the SW Vein at a vertical depth below 200 metres and the Blue Vein in the vicinity of the ‘bonanza’ grade discovery hole demonstrate high grade …

Tempus Resources Ltd (” Tempus ” or the ” Company “) (ASX:TMR)(TSXV:TMRR)(OTCQB:TMRFF) is pleased to announce further assay results from drill-holes from its Elizabeth Gold Project in British Columbia, Canada. Drill holes being reported in this release are EZ-21-15, EZ-21-16, EZ-21-17, EZ-21-18, and EZ-21-19. The drill holes targeted the SW Vein at a vertical depth below 200 metres and the Blue Vein (EZ-21-19

HIGHLIGHTS

  • Assays received for the first follow-up drill-hole on the Blue Vein (drill-hole EZ-21-19) in the vicinity of the ‘bonanza’ grade discovery hole (drill-hole EZ-21-12, announced on 21 October) demonstrate high grade mineralisation continues down dip.
  • Multiple high grade intersections were encountered in drill-hole EZ-21-19:
    • 0.50m at 4.52g/t Au from 127.50m;
    • 1.50m at 4.25g/t Au from 129.00m; and
    • 0.90m at 6.14g/t Au from 167.80m
  • Assay results have now been received for three drill holes that intersected the Blue Vein located approximately 150 metres NW of the SW Vein (EZ-21-09, EZ-21-12, EZ-21-19). The results to date show continuity of the Blue Vein over a strike length of at least 380 metres and demonstrates continuity down dip.
  • The results from EZ-21-19 indicate the potential for the Blue Vein to be a source of new Mineral Resources at Elizabeth Gold Project.
  • More broadly, the discovery of the Blue Vein and continued success in demonstrating its mineralised content, highlight the potential for multiple vein sets at the Elizabeth Project. Multiple identified veins are yet to be drilled (No 9 Vein, Main Vein and West Vein) and there’s great potential for additional new vein discoveries.
  • Tempus has suspended drilling at Elizabeth for the season, pending the approval of the Notice of Work amendment for extension of the Lower Portal adit access for underground drilling – A total of 28 drill-holes over approximately 7,740 metres were completed during 2021. Assays are pending for nine drill holes from the 2021 drill program, including four drill holes that intersected the Blue Vein (EZ-21-24, EZ-21-25, EZ-21-26, EZ-21-27), which are expected to be received in tranches over the next 12 weeks

Tempus President and CEO, Jason Bahnsen commented “The assay results for drill hole EZ-21-19 show continued high-grade gold mineralisation down dip of the previously reported ‘bonanza’ grade intersection at the newly discovered Blue Vein. Assays have now been received for three out of the seven drill holes that have intersected the Blue Vein. With the historic resource at Elizabeth largely centred on the SW Vein, the Blue Vein holds significant potential for expanding the current resource base for the project.”

Blue Vein Results

Tempus discovered the new Blue Vein with drill hole EZ-21-12 with an intersection of visible gold in the drill core, as announced on 27 September 2021. The Blue Vein is located approximately 150 metres to the northwest, and parallel, to the SW Vein (See Figure 1). This previously unknown vein has now been intersected by 7 drill-holes (EZ-21-09, EZ-21-12, EZ-21-19, EZ-21-24, EZ-21-25, EZ-21-26, EZ-21-27) demonstrating an initial strike length of 380 metres (see Figure 2), with four of those drill-holes pending assay results.

Drill hole EZ-21-12 (see announcement 26 October 2021) included high-grade gold intersections with assays of including 33.7g/t gold over 1.0 metre from 117.8 metres, 26.4g/t gold over 0.5m from 130.7 metres, and 8.4g/t gold over 0.5m from 163.9 metres. EZ-21-19 was drilled at a steeper angle than EZ-21-12 and demonstrates continuity of the Blue Vein down dip .

Results from EZ-21-24 to EZ-21-27, which specifically target the Blue Vein, were all successful in intersecting the quartz vein and are currently in the lab with assays pending. See Table 1 below for Blue Vein drill results received to date.

Table 1 – Elizabeth Gold Project Blue Vein Drill Intersections

Hole ID

From (m)

To (m)

Interval (m)

True Thickness (m)

Gold Grade (g/t Au)

MET Screen Grade (g/t Au)

EZ-21-09

58.60

59.10

0.50

0.43

0.31

Not Performed

EZ-21-12

117.80

118.80

1.00

0.85

47.6

33.7

and

130.70

131.20

0.50

0.43

26.4

Not Performed

and

163.90

164.40

0.50

0.43

5.50

8.41

EZ-21-19

127.50

128.00

0.50

0.43

4.52

Not Performed

and

129.00

130.50

1.50

1.28

4.25

Not Performed

and

167.80

168.70

0.90

0.76

4.50

6.14

EZ-21-24

pending

EZ-21-25

pending

EZ-21-26

pending

EZ-21-27

pending

*true thickness is estimated using a multiplier of 0.85.

SW Vein Results

Each of drill holes being reported today have successfully intersected the SW Vein and continue to indicate significant mineralisation and anomalous gold values. Mineralised intervals are consistent with mesothermal/orogenic gold veins and contain highly elevated values in arsenic, antimony, silver, and mercury. Drill holes EZ-21-15, EZ-21-16, EZ-21-17, EZ-21-18, and EZ-21-19 targeted the southern portion of the SW Vein at depths below 200m vertical. See Appendix 1 Table 1 for detailed results.

Tempus has now completed exploration drilling at Elizabeth for 2021. A total of 28 drill holes have been completed at Elizabeth for approximately 7,740 metres. Combined with the 11 drill holes completed in 2020, Tempus has now completed 39 drillholes for a total of approximately 9,750 metres at Elizabeth since Tempus began drilling in November 2020. Drill collar information can be seen in Appendix 1, Table 1. There are currently 9 drill holes pending assay results.

The underground development permit for the Elizabeth Lower Portal exploration drift is still pending (see announcement 13 September 2021).

Figure 1 – The Elizabeth Project – Plan map of drilling

DiagramDescription automatically generated

Figure 2 – Elizabeth Project – Long-section of the Blue Vein

DiagramDescription automatically generated with medium confidence

Competent Persons Statement

Information in this report relating to Exploration Results is based on information reviewed by Mr. Kevin Piepgrass, who is a Member of the Association of Professional Engineers and Geoscientists of the province of BC (APEGBC), which is a recognised Professional Organisation (RPO), and an employee of Tempus Resources. Mr. Piepgrass has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined by the 2012 Edition of the Australasian Code for reporting of Exploration Results, Mineral Resources and Ore Reserves, and as a Qualified Person for the purposes of NI43-101. Mr. Piepgrass consents to the inclusion of the data in the form and context in which it appears.

For further information:

Tempus Resources LTD
Melanie Ross – Director/Company Secretary Phone: +61 8 6188 8181

About Tempus Resources Ltd

Tempus Resources Ltd (“Tempus”) is a growth orientated gold exploration company listed on ASX (“TMR”) and TSX.V (“TMRR”) and OTCQB (“TMRFF”) stock exchanges. Tempus is actively exploring projects located in Canada and Ecuador. The flagship project for Tempus is the Elizabeth-Blackdome Project, a high-grade gold past producing project located in Southern British Columbia. Tempus is currently midway through a drill program at Elizabeth-Blackdome that will form the basis of an updated NI43-101/JORC resource estimate. The second key group of projects for Tempus are the Rio Zarza and Valle del Tigre projects located in south east Ecuador. The Rio Zarza project is located adjacent to Lundin Gold’s Fruta del Norte project. The Valle del Tigre project is currently subject to a sampling program to develop anomalies identified through geophysical work.

Forward-Looking Information and Statements

This press release contains certain “forward-looking information” within the meaning of applicable Canadian securities legislation. Such forward-looking information and forward-looking statements are not representative of historical facts or information or current condition, but instead represent only the Company’s beliefs regarding future events, plans or objectives, many of which, by their nature, are inherently uncertain and outside of Tempus’s control. Generally, such forward-looking information or forward-looking statements can be identified by the use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or may contain statements that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “will continue”, “will occur” or “will be achieved”. The forward-looking information and forward-looking statements contained herein may include, but are not limited to, the ability of Tempus to successfully achieve business objectives, and expectations for other economic, business, and/or competitive factors. Forward-looking statements and information are subject to various known and unknown risks and uncertainties, many of which are beyond the ability of Tempus to control or predict, that may cause Tempus’ actual results, performance or achievements to be materially different from those expressed or implied thereby, and and are developed based on assumptions about such risks, uncertainties and other factors set out herein and the other risks and uncertainties disclosed on Page 27 under the heading “Risk and Uncertainties” in the Company’s Management’s Discussion & Analysis for the quarter ended September 30, 2021 dated November 15, 2021 filed on SEDAR. Should one or more of these risks, uncertainties or other factors materialize, or should assumptions underlying the forward-looking information or statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated, believed, estimated or expected. Although Tempus believes that the assumptions and factors used in preparing, and the expectations contained in, the forward-looking information and statements are reasonable, undue reliance should not be placed on such information and statements, and no assurance or guarantee can be given that such forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information and statements. The forward-looking information and forward-looking statements contained in this press release are made as of the date of this press release, and Tempus does not undertake to update any forward-looking information and/or forward-looking statements that are contained or referenced herein, except in accordance with applicable securities laws. All subsequent written and oral forward-looking information and statements attributable to Tempus or persons acting on its behalf are expressly qualified in its entirety by this notice. Neither the TSX Venture Exchange nor its Regulation Service Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release .

Appendix 1

Table 1:Drill Hole Collar Table

UTM

UTM

Hole ID

Target

Easting (NAD83

Northing (NAD83

Elevation (m)

Length (m)

Azimuth

Dip

Z10)

Z10)

EZ-21-01

SW Vein

531203

5653771

2400

105

121

-52

EZ-21-02

SW Vein

531203

5653771

2400

132

146

-55

EZ-21-03

SW Vein

531203

5653771

2400

111

158

-47

EZ-21-04

SW Vein

531203

5653771

2400

135

168

-58

EZ-21-05

SW Vein

531078

5653776

2400

561

123

-48

EZ-21-06

SW Vein

531078

5653776

2400

255

110

-55

EZ-21-07

SW Vein

531203

5653771

2400

126

115

-75

EZ-21-07b

SW Vein

531203

5653771

2400

186

115

-75

EZ-21-08

SW Vein

531195

5653839

2427

231

115

-68

EZ-21-09

SW Vein

531200

5654020

2330

360

120

-48

EZ-21-10

SW Vein

530953

5653772

2390

354

127

-50

EZ-21-11

SW Vein

530953

5653772

2390

381

136

-50

EZ-21-12

SW Vein

530953

5653772

2390

375

125

-45

EZ-21-13

SW Vein

530919

5653596

2300

261

94

-45

EZ-21-14

SW Vein

530919

5653596

2300

261

108

-55

EZ-21-15

SW Vein

530919

5653596

2300

330

100

-55

EZ-21-16

SW Vein

530919

5653596

2300

330

83

-48.5

EZ-21-17

SW Vein

530919

5653596

2300

414

98

-63

EZ-21-18

SW Vein

530919

5653596

2300

351

128.5

-63

EZ-21-19

SW Vein

530953

5653772

2390

417

129

-58

EZ-21-20

SW Vein

530849

5653432

2260

300

129

-45

EZ-21-21

East Veins

531695

5653463

2120

357

90

-45

EZ-21-22

SW Vein

531195

5653839

2427

188

75

-45

EZ-21-23

SW Vein

531695

5653463

2120

165

91

-45

EZ-21-24

Blue Vein

530953

5653772

2390

219

84

-54

EZ-21-25

Blue Vein

530953

5653772

2390

201

105

-58

EZ-21-26

Blue Vein

530953

5653772

2390

198

95

-45

EZ-21-27

Blue Vein

530953

5653772

2390

195

150

-60

EZ-21-28

No.9 Vein

530953

5653772

2390

321

300

-55

Table 2: Significant Interval Table

Hole ID

From (m)

To (m)

Interval (m)

True Thickness (m)

Gold Grade

MET Screen Grade

Vein

EZ-21-01

94.00

96.60

2.60

2.21

4.60

5.12

SW Vein

and

83.50

84.00

0.50

0.43

20.50

pending

SW Vein

EZ-21-02

102.40

109.00

6.60

5.61

8.40

pending

SW Vein

including

105.40

106.50

1.10

0.93

46.30

pending

SW Vein

EZ-21-03

88.60

95.00

6.40

5.44

7.22

pending

SW Vein

including

89.30

91.90

2.60

2.21

11.80

pending

SW Vein

and

90.00

91.30

1.30

1.11

19.80

pending

SW Vein

and

34.70

35.20

0.50

0.43

3.15

pending

SW Vein

EZ-21-04

122.00

126.00

4.00

3.40

31.20

34.40

SW Vein

including

123.00

124.50

1.50

1.28

52.10

68.30

SW Vein

including

124.00

124.50

0.50

0.43

72.00

87.30

SW Vein

EZ-21-05

134.00

135.00

1.00

0.85

1.38

not performed

7 Vein

217.55

218.25

0.70

0.59

1.74

1.67

SW Vein

and

256.00

256.50

0.50

0.43

1.03

0.89

SW Vein

and

554.85

555.35

0.50

0.43

0.24

not performed

West Vein

EZ-21-06

134.50

136.00

1.50

1.28

1.10

1.71

7 Vein

and

245.00

246.00

1.00

0.85

2.05

2.45

SW Vein

EZ-21-07

Hole lost

EZ-21-07B

40.10

41.10

1.00

0.85

4.88

not performed

7 Vein

and

51.50

52.20

0.70

0.60

9.06

not performed

7 Vein

and

160.00

165.75

5.75

4.89

0.53

0.70

SW Vein

EZ-21-08

196.25

202.40

6.15

5.23

0.65

0.66

SW Vein

and

226.60

227.10

0.50

0.43

1.54

1.85

SW Vein

EZ-21-09

58.60

59.10

0.50

0.43

0.31

not performed

Blue Vein

and

270.90

272.90

2.00

1.70

2.56

not performed

SW Vein

and

355.88

357.00

1.12

0.95

0.85

not performed

SW Vein

EZ-21-10

223.00

223.50

0.50

0.43

4.04

not performed

7 Vein

and

347.70

349.20

1.50

1.28

0.22

0.21

SW Vein

EZ-21-11

326.90

327.40

0.50

0.43

0.55

0.44

SW Vein

Hole ID

From (m)

To (m)

Interval (m)

True Thickness (m)

Gold Grade

MET Screen Grade

Vein

EZ-21-12

117.80

118.80

1.00

0.85

47.6

33.7

Blue Vein

and

130.70

131.20

0.50

0.43

26.4

not performed

Blue Vein

and

163.90

164.40

0.50

0.43

5.50

8.41

Blue Vein

and

344.90

347.00

2.10

1.79

0.78

1.22

SW Vein

EZ-21-13

230.70

232.60

1.90

1.62

0.76

0.71

SW Vein

EZ-21-14

224.00

224.90

0.90

0.77

1.63

1.15

SW Vein

EZ-21-15

318.40

320.80

2.40

2.04

0.31

not performed

SW Vein

including

320.30

320.80

0.50

0.43

1.14

not performed

SW Vein

EZ-21-16

305.00

306.90

1.90

1.61

0.55

not performed

SW Vein

EZ-21-17

171.00

171.50

0.50

0.43

0.14

0.57

Vein

and

204.00

204.60

0.60

0.51

0.53

not performed

vein

and

254.60

256.85

2.25

1.91

1.40

1.58

7 Vein

and

350.13

350.75

0.62

0.53

1.01

not performed

SW Vein

and

379.47

382.00

2.53

2.15

0.63

0.64

SW Vein

EZ-21-18

299.50

299.90

0.40

0.34

1.53

not performed

SW Vein

EZ-21-19

127.50

128.00

0.50

0.43

4.52

not performed

Blue Vein

and

129.00

130.50

1.50

1.28

4.25

not performed

Blue Vein

and

167.80

168.70

0.90

0.76

4.50

6.14

Blue Vein

and

351.80

354.90

3.10

2.63

0.34

not performed

SW Vein

*true thickness is estimated using a multiplier of 0.85.

Appendix 2: The following tables are providedto ensure compliance with the JORC Code (2012) requirements for the reporting of Exploration Results for the Elizabeth – Blackdome Gold Project

Section 1: SamplingTechniques and Data

(Criteria in this sectionapply to all succeeding sections.)

Criteria

JORC Code explanation

Commentary

Sampling techniques

  • Nature and qualityof sampling (eg cut channels, random chips, or specific specialised industry standard measurement tools appropriate to the minerals under investigation, such as down hole gammasondes, or handheld XRF instruments, etc).These examples shouldnot be taken as limiting the broad meaningof sampling.
  • Include reference to measures taken to ensuresample representivity and the appropriate calibration of any measurement tools or systemsused.
  • Aspects of the determination of mineralisation that are Materialto the Public Report. In cases where ‘industry standard’ work has been done this would be relatively simple(eg ‘reverse circulation drilling was used to obtain1 m samples from which 3 kg was pulverised to produce a 30 g charge for fire assay’). In other cases more explanation may be required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types(eg submarine nodules) may warrant disclosure of detailed

information.

  • HQ (63.5 mm) sized diamondcore using standardequipment.
  • Mineralised and potentially mineralised zones, comprising veins, breccias, and alteration zoneswere sampled.
  • Samples were half core.
  • Typical core samples are 1m in length.
  • Core samples sent to the lab will be crushedand pulverized to 85% passing75 microns. A 50g pulp will be fire assayedfor gold and multi-element ICP.Samples over 10 g/t gold will be reanalysed by fire assay with gravimetric finish

Drilling techniques

  • Drill type (eg core, reverse circulation, open-hole hammer, rotaryair blast, auger,Bangka, sonic, etc) and details(eg core diameter, triple or standardtube, depth of diamond tails, face-sampling bit or other type, whethercore is oriented and if so, by

what method, etc).

  • Diamond Drilling from surface(HQ size)

Drill sample recovery

  • Method of recording and assessing core and chip sample recoveries and results assessed.
  • Measures taken to maximise samplerecovery and ensurerepresentative nature of the samples.
  • Whether a relationship exists between samplerecovery and grade and whethersample bias may

have occurred due to preferential loss/gain of fine/coarse material.

  • Detailed calculation of recovery was recorded, withmost holes achieving over95%
  • No relationship has yet been noted between recovery and grade and no sample bias was noted to have occurred.

Criteria

JORC Code explanation

Commentary

Logging

  • Whether core and chip sampleshave been geologically and geotechnically loggedto a level of detailto support appropriate Mineral Resource estimation, mining studies and metallurgical studies.
  • Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography.
  • The total length and percentage of the relevantintersections logged.
  • Detailed geological and geotechnical loggingwas completed for each hole.
  • Allcore has been photographed.
  • Complete holes were logged.

Sub- sampling techniques andsample preparation

  • If core, whethercut or sawn and whetherquarter, half or all core taken.
  • If non-core, whetherriffled, tube sampled,rotary split, etc and whethersampled wet or dry.
  • For all sample types, the nature, qualityand appropriateness of the samplepreparation technique.
  • Quality control procedures adopted for all sub- sampling stages to maximise representivity of samples.
  • Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance resultsfor field duplicate/second-half sampling.
  • Whether sample sizes are appropriate to the grainsize of the material being sampled.
  • Half core was sampled, using a core saw.
  • Duplicate samples of new and historical core are Quarter core or half core where not previously sampled
  • Sample sizes are considered appropriate for the grainsize of the material being sampled.
  • It is expectedthat bulk sampling will be utilisedas the projectadvances, to more accurately determine grade.

Quality of assay data and laboratory tests

  • The nature, qualityand appropriateness of the assaying and laboratory procedures used and whetherthe technique is considered partialor total.
  • For geophysical tools,spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, readingtimes, calibrations factorsapplied andtheir derivation, etc.
  • Nature of qualitycontrol procedures adopted(eg standards, blanks,duplicates, external laboratory checks) and whetheracceptable levels of accuracy (ie lack of bias) and precision have been established.
  • Core samples that have been sent to the lab for analysis include control samples(standards, blanks and prep duplicates) inserted at a minimum rate of 1:5 samples.
  • In addition to the minimumrate of inserted control samples, a standard or a blank is inserted following a zoneof mineralization or visible gold
  • Further duplicate sampleswere analysed to assess variability

Verification ofsampling and assaying

  • The verification of significant intersections by either independent or alternative companypersonnel.
  • The use of twinned holes.
  • Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols.
  • Discuss any adjustment to assay data.
  • Re-assaying of selectedintervals of historiccore have been sent for analysis.

Criteria

JORC Code explanation

Commentary

Location of datapoints

  • Accuracy and qualityof surveys used to locatedrill holes (collarand down-hole surveys), trenches, mine workings and other locations used in MineralResource estimation.
  • Specification of the grid system used.
  • Quality and adequacyof topographic control.
  • All sampling pointswere surveyed using a hand held GPS.
  • UTMgrid NAD83 Zone 10.
  • A more accurate survey pickup will be completed at the end of the program, to ensure data is appropriate for geological modelling and Resource Estimation.
  • Down hole surveys have been completed on all holes.

Data spacing anddistribution

  • Data spacing for reporting of Exploration Results.
  • Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserveestimation procedure(s) and classifications applied.
  • Whether sample compositing has been applied.
  • Most drilling is targeting verification and extension of known mineralisation.
  • It is expectedthat the data will be utilised in a preparation of a MineralResource statement.
  • Additional drilling is exploration beneathgeochemical anomalies, and would requirefurther delineation drilling to be incorporated in a MineralResource.

Orientation of data in relation to geological structure

  • Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type.
  • If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias,this should be assessed and reported if material.
  • In general, the aim was to drill perpendicular to the mineralised structures, to gain an estimate of the true thickness of the mineralised structures.
  • At several locations, a series (fan) of holes was drilled to help confirm the orientation of the mineralised structures and to keep land disturbance to a minimum.

Sample s Security

  • Themeasures taken to ensure samplesecurity.
  • Samples from Elizabeth were delivered to the laboratory by a commercial transport service.

Audits or Reviews

  • The results of any auditsor reviews of sampling techniques and data.
  • An independent geological consultant has recently visited the site as part of preparing an updated NI43-101Technical Report for the Project.

Section 2: Reportingof Exploration Results

(Criteria listed in the preceding section also apply to this section.)

Criteria

JORC Code explanation

Commentary

Mineral tenement and land tenurestatus

  • Type, reference name/number, location and ownership including agreements or material issueswith third partiessuch as joint ventures, partnerships, overriding royalties, nativetitle interests, historical sites, wilderness or national park and environmental settings.
  • The securityof the tenureheld at the time of reporting along with any known impediments to obtaining a licence to operate in the area.
  • The Blackdome-Elizabeth Projectis comprised of 73 contiguous mineral claims underlain by 14 Crown granted mineral claims and two mining leases.
  • The Property is located in the Clintonand Lillooet MiningDivisions approximately 230 km NNE of Vancouver
  • Tempus has exercised the option to acquire the Elizabeth Gold Project and has completed an addendum to the original Elizabeth Option Agreement

(refer to ASX announcement 15 December 2020)

  • A net smelterroyalty of 3% NSR (1% purchasable) appliesto several claimson the Elizabeth Property.
  • No royalties applyto the Blackdome Property or Elizabeth Regional Properties.
  • There are currently no known impediments to developing a project in this area, and all tenure is in good standing.

Exploration done by other parties

  • Acknowledgment and appraisal of exploration by other parties.
  • In the 1940s, placergold was discovered in Fairless Creek west of Blackdome Summit.Prospecting by Lawrence Frenier shortly afterward led to the discovery of gold-bearing quartzveins on the southwest slopeof the mountain that resulted in the stakingof mining claimsin 1947. EmpireValley Gold Mines Ltd and Silver Standard Resources drove two adits and completed basicsurface work during the 1950s.
  • The Blackdome area was not worked again until 1977 when Barrier Reef Resources Ltd. re-staked the area and performed surfacework in additionto underground development. The Blackdome Mining Corp. was formed in 1978 and performed extensive surface and underground work with variousjoint venture partnersthat resulted in a positive feasibility study. A 200 ton/daymill, camp facilities and tailings pond were constructed and mining operations officially commenced in 1986. The mine ceased operations in 1991, havingproduced 225,000 oz of Au and 547,000oz of Ag from 338,000tons of ore (Godardet al., 2010)
  • After a period of inactivity, Claimstaker Resources Ltd. tookover the project, reopening the mine in late 1998.

Criteria

JORC Code explanation

Commentary

Mining operations lasted six months and ended in May of 1999. During this period, 6,547 oz of Au and 17,300 oz of Ag were producedfrom 21,268 tons of ore. Further exploration programs were continued by Claimstaker over the following years and a Japanese joint venture partnerwas brought onboardthat prompted a name changeto J-Pacific Gold Inc. This partnership was terminated by 2010, resulting in another name change to Sona Resources Corp.

  • Gold-bearing quartz veins were discovered near Blue Creek in 1934, and in 1940-1941 the Elizabeth No. 1-4 claims were staked.
  • Bralorne Mines Ltd. optioned the property in 1941 and during the period 1948-1949, explored the presently- named Main and West Veins by about 700 metresof cross-cutting and drifting, as well as about 110 metres of raises.
  • After acquiring the Elizabeth Gold Project in 2002, J- Pacific (now Sona) has conducted a series of exploration programs that included diamonddrilling 66 holes totalling 8962.8 metres (up until 2009) Other exploration work by Sona at the Elizabeth Gold Project has included two soil grid, stream sediment sampling, geological mappingand sampling, underground rehabilitation, structural mapping and airborne photography and topographic base map generation.

Geology

  • Deposit type, geological setting and styleof mineralisation.
  • The Blackdome property is situatedin a region underlain by rocks of Triassic to Tertiary age. Sedimentary and igneous rocks of the Triassic Pavilion Group occurring along the FraserRiver represent the oldest rocks in the region. A large, Triassic age, ultramafic complex(Shulaps Complex) was emplaced along the Yalakomfault; a regional scale structure locatedsome 30 kilometres south of the property. Sediments and volcanics of the Cretaceous Jackass Mountain Groupand Spences Bridge/Kingsvale Formations overlie the Triassic assemblages. Some of these rocks occur severalkilometres south of Blackdome.
  • Overlying the Cretaceous rocks are volcanics and minor sediments of Eocene age.These rocks underlie much of

Blackdome and are correlated with the KamloopsGroup seen in the Ashcroft and Nicola regions.

Criteria

JORC Code explanation

Commentary

Geochemical studies (Vivian, 1988)have shown these rocks to be derivedfrom a “calc-alkaline” magma in a volcanicarc type tectonicsetting. Eocene age granitic intrusions at Poison Mountain some 22 kilometres southwest of Blackdome are host to a gold bearing porphyry copper/molybdenum deposit. It is speculated that this or related intrusions could reflect the source magmas of the volcanic rocks seen at Blackdome. There is some documented evidenceof young graniticrocks several kilometres south of the mine near Lone Cabin Creek.

The youngest rocks present are Oligocene to Miocene basalts of the Chilcotin Group. These are exposed on the uppermost slopes of Blackdome Mountain and Red Mountain to the south.

  • Transecting the property in a NE-SWstrike direction are a seriesof faults that range from vertical to moderately westerly dipping. These faultsare the principal host structures for Au- Ag mineralisation. The faults anastomose, and form sygmoidal loops.
  • The area in which the Elizabeth Gold Project is situated is underlain by Late Paleozoic to Mesozoic rock assemblages that are juxtaposed across a complexsystem of faultsmainly of Cretaceous and Tertiary age. These Paleozoic to Mesozoic-age rocks are intrudedby Cretaceous and Tertiary-age stocksand dykes of mainly felsicto intermediate composition, and are locallyoverlain by Paleogene volcanic and sedimentary rocks. The Elizabeth Gold Project is partly underlain by ultramafic rocksof the Shulaps Ultramafic Complex,which include harzburgite, serpentinite and theiralteration product listwanite.
  • The gold mineralisation found on the Elizabeth Gold Project presentcharacteristics typical of epigenetic mesothermal gold deposits. The auriferous quartz vein mineralisation is analogous to that foundin the Bralorne- Pioneer deposits. Gold mineralisation is hosted by a seriesof northeast trending, steeply northwest dippingveins that crosscut the Blue Creek porphyry intrusion. The Main and West vein systems displaymesothermal textures, including ribboned-laminated veins and comprehensive wall rock breccias. Vein formation and gold mineralisation were associated with extensional-

brittle faulting believed to be contemporaneous with mid- Eocene extensional faulting along the Marshall Creek,Mission Ridge and Quartz Mountain faults.

Criteria

JORC Code explanation

Commentary

Drill hole Information

  • A summary of all information material to the understanding of the exploration results including a tabulation of the following information for all Material drill holes:
    • easting and northing of the drill hole collar
    • elevation or RL (Reduced Level- elevation abovesea level in metres) of the drill hole collar
    • dipand azimuth of the hole
    • down hole lengthand interception depth
    • hole length.
  • If the exclusion of this information is justified on the basisthat the information is not Material and this exclusion does not detractfrom the understanding

of the report, the Competent Person should clearlyexplain why this isthe case.

  • Refer to Appendix 1 for drillhole collar information

Data aggregation methods

  • In reporting Exploration Results, weighting averaging techniques, maximum and/orminimum grade truncations (eg cutting of high grades)and cut-off gradesare usually Material and should be stated.
  • Where aggregate intercepts incorporate short lengthsof high grade results and longer lengthsof low grade results, the procedure used for such aggregation shouldbe stated and some typicalexamples of such aggregations shouldbe shown in detail.
  • The assumptions used for any reporting of metal equivalent values should be clearly stated.
  • Intervals reported usingseveral samples are calculated using a weighted average.
  • Calculated intervals usinga weighted averagedid not use a top cut on high-grade samples.High-grade samples are reported as ‘including’
  • Calculated weighted averageintervals are continuous intervals of a mineralized zone and do not includeunsampled intervals or unmineralized intervals.

Relationship between mineralisation widths andintercept lengths

  • These relationships are particularly important in the reporting of Exploration Results.
  • If the geometry of the mineralisation with respect to the drill hole angle is known,its nature shouldbe reported.
  • If it is not known and only the down hole lengths are reported, thereshould be a clear statement to this effect(eg ‘down hole length, true width not

known’).

  • In general, drilling is designed to intersect the mineralized zone at a normal angle,but this is not always possible.
  • For the reported intervals, true widthsare reported where mineralized core was intactand possible to measure the orientation. Otherwise the true widthis left blank

Diagrams

  • Appropriate maps and sections (with scales) and tabulations of intercepts shouldbe included for any significant discovery being reportedThese should include, but not be limited to a plan view of drill

hole collar locations and appropriate sectional views.

  • Refer to maps within announcement for drill hole locations.

Criteria

JORC Code explanation

Commentary

Balanced

reporting

  • Where comprehensive reporting of all Exploration Results is not practicable, representative reporting of both low and high grades and/or widthsshould be practiced to avoid misleading reporting of Exploration

Results.

  • Where broader low-grade intervals are reportedthe high-grade intercepts are reported as ‘including’ within the reported interval

Other substantive exploration data

  • Other exploration data, if meaningful and material, shouldbe reported including (but not limitedto): geological observations; geophysical survey results;geochemical survey results; bulk samples – size and method of treatment; metallurgical test results; bulk density, groundwater, geotechnical and rock characteristics; potential deleterious or contaminating

substances.

  • Tempus recently completed an airborne magnetic and radiometric survey over the Elizabeth Gold Project (refer to ASX announcement 02 August 2021) by completing 97 lines for a total of 735 line-kilometres. Flight lines are oriented east-west with north-south tie lines and spaced 200 metres across the entire 115km2 Elizabeth property. Line spacing of 100 metres was flown over the Elizabeth Main and Elizabeth East Zones.
  • The airborne magnetic survey data was reviewed and interpreted by Insight Geophysics Inc. using 3D magnetization vector inversion (MVI) modelling.
  • The geophysical surveys identified the Blue Creek Porphyry, which is the known host of the high-grade Elizabeth gold-quartz veins, as a relative magnetic low anomaly within the Shulaps Ultramafic Complex. From this correlation of geology and geophysics it was determined that the Blue Creek Porphyry, originally explored / mapped to approximately 1.1km2 in size, is likely much larger. The airborne magnetic survey and MVI 3D modelling interpret the Blue Creek Porphyry to be at least four-times the size at approximately 4.5km2.
  • This interpretation of the Blue Creek Porphyry is also extensive at depth extending to at least 2km deep

Further work

  • The nature and scale of planned furtherwork (eg testsfor lateral extensions or depth extensions or large- scale step-out drilling).
  • Diagrams clearly highlighting the areas of possible extensions, including the main geological interpretations and future drillingareas, provided this

information is not commercially sensitive.

  • Tempus plans to update historical NI43-101 foreign resource estimates to currentNI43-101 and JORC 2012 standards
  • Tempus is also seeking to expand the scale of the mineralisation at the projectthrough further exploration.

SOURCE: Tempus Resources Ltd

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Lihir Phase 14A PFS indicates potential for growth and large scale, long life, low cost production Confirms Lihir’s pathway to become a 1Moz+ gold producer for at least 10 years from FY241 $179m investment projected to deliver outstanding return metrics of 37% IRR & 2.6 year payback2,3,4 Increases Lihir’s Ore Reserves by 1 million ounces5 Project implementation to enhance operational flexibility and risk management …

  • Lihir Phase 14A PFS indicates potential for growth and large scale, long life, low cost production
  • Confirms Lihir’s pathway to become a 1Moz+ gold producer for at least 10 years from FY241
  • $179m investment projected to deliver outstanding return metrics of 37% IRR & 2.6 year payback2,3,4
  • Increases Lihir’s Ore Reserves by 1 million ounces5
  • Project implementation to enhance operational flexibility and risk management
  • Potential to deploy Phase 14A mining techniques in other parts of the mine to unlock more value
  • Feasibility Study expected to be completed in the second half of FY226

Newcrest Mining Limited (ASX: NCM) (TSX: NCM) (PNGX: NCM) is pleased to announce that the Newcrest Board has approved the Lihir Phase 14A Pre-Feasibility Study (the Phase 14A Study), enabling the commencement of the Feasibility Study and Early Works Program.

The Study focuses on extending the Phase 14 cutback and safely steepening the walls of the pit utilising civil engineering techniques to access existing Indicated Mineral Resources that would have otherwise been inaccessible through standard mining techniques. The Study integrates Phase 14A’s future mine design and sequence into Lihir’s mine plan and establishes the expected costs, schedule and sustainable production rate.

Newcrest Managing Director and Chief Executive Officer, Sandeep Biswas, said “The findings of our Lihir Phase 14A Pre-Feasibility Study accelerate the realisation of our aspiration for Lihir to be a 1 million ounce plus per annum producer from FY24, which will benefit landowners, all Lihirians and PNG. Phase 14A increases Lihir’s Ore Reserves, brings forward gold production and improves operational flexibility by establishing an additional independent ore source. The Study also highlights the opportunity for Phase14A techniques to be applied to future cutbacks at Lihir, potentially unlocking more value. We have also confirmed the deferral of the need for the Seepage Barrier to Q2 FY26, with the potential to further defer the timing of the barrier.”

Summary of Phase 14A Study Findings2,3,7

The Phase 14A Study has identified the following:

  • Estimated project capital expenditure of $179 million
  • Internal Rate of Return (IRR) of 37% (real, after tax)
  • Payback of 2.6 years4
  • Net Present Value (NPV) of $284 million[8]
  • Mill feed increase of 483koz contained gold, with ~400koz of additional gold produced from FY23 to FY26
  • Additional Life of Mine (LOM) gold production of 965koz

The Feasibility Study is expected to be completed in the fourth quarter of FY226, with the expenditures and study scope expected to include:

  • Early Works expenditure of $47 million for fleet procurement and initial bench establishment
  • Trial works for ground support anchors to validate design, costs and schedule
  • Additional drilling and test work to validate ore deposit knowledge

The Lihir Ore Reserves estimate has been updated to include the conversion of the Phase 14A Indicated Mineral Resource to Probable Ore Reserves, increasing Lihir’s Total Ore Reserves by 1Moz to 23Moz as at 30 June 20215.

Mining of Phase 14A is expected to take place between FY22 and FY26. Ore mined from this Phase will replace lower grade ore feed to the processing plant, with an initial 13Mt of high and medium grade ore from Phase 14A planned to be fed between FY22 and FY26. Lower grade material will be stockpiled and fed progressively over the remaining LOM. This is expected to deliver an additional 965koz of gold production over the LOM.

In addition, Newcrest has completed its Seepage Barrier Feasibility Study, which enables further definition of the expected construction costs and schedule. The findings from the project field trials indicate that the Seepage Barrier can be constructed using hydromill cutters and grouting methods. Approval of the Seepage Barrier Feasibility Study to move to Execution has been deferred until FY23, in line with the findings of the Lihir Mine Optimisation Study (LMOS) which established that the eastern limits of Phases 16 and 17 could be moved further east, deferring the need for the Seepage Barrier by ~18 months to Q2 FY26.

Table 1: Key Phase 14A Study Findings7

Study Outcomes
Area Measure Unit Phase 14A2,3 LOM9
Production Ore milled / milling rate (max) Mtpa 15.5 15.5
Ore milled Mt 310
LOM Years 5[10] 22
Ore mined Mt 20.5 236
Average gold grade g/t 2.4 2.3
Gold produced Moz 1.0 19
Capital Production stripping (capitalised) US$m (real) 111
Sustaining capital US$m (real) 69
Total capital US$m (real) 179
Economic assumptions Gold price US$/oz 1,500
Financials11 NPV8 US$m (real) 284
IRR % (real) 37
Payback period4 Years 2.6

Phase 14A Overview2

In February 2021, Newcrest announced the findings of the LMOS which included the identification of a new, essentially brownfield opportunity called Phase 14A. The Phase 14A Study focused on extending the Phase 14 cutback and safely steepening the walls of the pit by utilising civil engineering techniques to access existing Indicated Mineral Resources which would have otherwise been inaccessible through standard mining techniques. The Phase 14A cutback is expected to provide an additional mining front enabling further flexibility for fresh competent ore feed. The Phase 14A cutback is fully permitted and is within the existing mine lease.

Field trials of the wall support technology are planned for the December 2021 quarter6, with long lead materials to be ordered and the engagement of specialist contractors in progress.

The addition of Phase 14A into the Lihir mine plan accelerates Newcrest’s aspiration for Lihir to be a 1Moz+ per annum producer from FY24.

Mining of Phase 14A is expected to take place from FY22 to FY26 and include:

  • Total ex-pit mining of 34Mt, including 13Mt of high and medium grade ore at an average of 3g/t, which will displace lower grade ore (mostly stockpile) that would otherwise have been processed in the mill
  • An uplift in the total mill feed grade and an additional 483koz of gold in feed and 400koz recovered gold over FY23 – FY263
Material Class Tonnage (Mt) Au Grade (g/t)
High Grade (HG) 4.5 4.5
Medium Grade (MG) 8.5 2.2
Low Grade (LG) 7.5 1.3
Waste 13.5
Total 34
Stripping Ratio (Waste: Ore) 0.66

Table 2: Phase 14A Inventory Summary3

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Figure 1: Phase 14 Mining ore production by financial year3

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Backfilling the cutback will occur after the completion of mining and will act as a buttress supporting long-term stability of the highwall.

A program of infill resource definition drilling and trial installations of the ground anchors is underway and will be completed in FY22. This program is expected to improve resource definition, further reducing project risk.

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Figure 2: Lihir Mine cutbacks including Phase 14A

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The Phase 14A design utilises civil engineering techniques, in conjunction with existing mining practices, to increase pit wall angles. The upper Argillic horizons without ground support typically have an unsupported slope angle of ~45° which has been increased to ~77° using soil anchors to provide stability. The soil anchors will be installed in the upper benches of the cutback to support the steeper wall angles in these areas. The slope angles of the lower benches will be similar to the existing walls in Phase 14. The increase in pit wall angle enables access to ore within the current permitted pit shell.

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Figure 3: Phase 14A design showing current vs supported design slopes

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The soil anchors provide ground support in the form of multi-strand anchors with shotcrete and/or high tensile wire mesh as face support in the Argillic and upper Epithermal zones.

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Figure 4: Phase 14A wall stabilisation design

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To integrate with the civil construction, mining will be conducted by a dedicated mining fleet which will comprise a small excavator and dump trucks mining 3m flitches. The 3m flitches are required to provide a working platform for installation of soil anchors at 3m vertical spacings.

The Lihir base case gold production schedule projects mining rates to increase up to 50Mtpa over the coming years and an average milling rate of 15.5Mtpa9. Ore from Phase 14A is expected to be mined between FY22-26 and will be processed over the LOM.

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Figure 5: Lihir LOM indicative gold production profile9

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Base Case Expit Mining to 50Mtpa

Mining rates for Lihir are expected to increase (as identified in the LMOS) over the coming years through a combination of equipment capacity and mining efficiency projects. Additional mining capacity is expected to be delivered through increased truck availability as a result of a program of truck re-builds and the replacement of primary dig units. This program is currently underway and is scheduled to be completed by December 20216.

Mine efficiency improvements identified in the Study include improved fleet utilisation, which is expected to be achieved by increasing operator availability and improving dispatch tactics to reduce equipment delays.

Process Plant Improvements12

Newcrest is currently implementing numerous throughput improvement initiatives which are targeting the achievement of a process plant throughput rate of 15.5Mtpa from FY24. Lihir has previously demonstrated annualised milling performance rates of ~16Mtpa during Q4 FY18 and Q4 FY19.

Recovery Improvements

Recovery improvements are expected to be achieved through a combination of increasing mill feed grades, improved feed blends and recovery improvement projects that are currently in progress. Phase 14A is expected to provide additional fresh ore to the mill, offsetting lower grade and lower performing recovery material types.

The Front End Recovery project is expected to deliver increased recoveries from the beginning of FY23, with further studies assessing recovery improvements underway.

Project Investment

The Phase 14A Project requires a total capital investment of $179 million and comprises:

Activity $m2,7
Study and trial costs 22
Mining and ancillary fleet
(Excluding contractor ground support equipment)
46
Production stripping cost (capitalised) 111
Total 179

Production Stripping

Pre-production stripping of Phase 14A waste material is expected to commence in the second half of FY226. Due to the initial civil works requirements and available bench space, there is expected to be a ramp up of the mining rate to a peak of ~1Mtpa per month through FY23 and FY24.

Phase 14A has a very low strip ratio of 0.66 and as such will start producing HG and MG ore within six months from the commencement of mining. This is expected to provide significant HG mill feed through FY24 and FY25, lifting intended production rates to 1Moz+ per year from FY24, prior to completion of pre-stripping in Phase 179.

Indicative Mine Production Profile (Includes Phase 14A)9,13,14,15

Year Sources Total Material Movement (Mt)[16] Waste (Mt) Tonnes to Stockpile
(Mt)
Ex-Pit
Tonnes
Fed (Mt)
Stockpile
Tonnes
Fed (Mt)
Plant
Feed
(Mt)
17
Average
Gold Grade (g/t)
FY22-24 Lienetz, medium/low grade stockpiles and pre-strip 200 – 220 100 – 120 15 – 25 25 – 35 10 – 20 40 – 50 2.4 – 2.6
FY25-27 Lienetz, Kapit, medium/low grade stockpiles and pre-strip 210 – 230 90 – 110 25 – 35 25 – 35 10 – 20 40 – 50 2.8 – 3.0
FY28-30 Lienetz, Kapit, low grade stockpiles and pre-strip 160 – 180 80 – 100 5 – 15 10 – 20 30 – 40 40 – 50 2.4 – 3.0
FY31-33 Lienetz, Kapit, Minifie and low grade stockpiles 140 – 160 40 – 60 20 – 30 25 – 35 10 – 20 40 – 50 2.6 – 3.0
FY34-36 Lienetz, Kapit, Minifie and low grade stockpiles 130 – 150 50 – 70 10 – 20 25 – 35 10 – 20 40 – 50 2.0 – 2.3
FY37-39 Minifie and low grade stockpiles 50 – 70 0 – 10 0 – 10 0 – 10 40 – 50 40 – 50 1.3 – 1.5
FY40-42 Minifie and low grade stockpiles 30 – 50 0 – 10 0 – 10 0 – 10 25 – 35 25 – 35 1.2 – 1.3
FY43+ Remaining Reserves subject to ongoing study

Metal Price and Exchange Rate Sensitivity Analysis2,3,7

The IRR of the Phase 14A Project will vary according to the gold prices realised. Base case assumptions include a gold price of $1,500/oz.

The table below outlines how the estimated Base Case Phase 14A Project IRR of 37% varies using different price assumptions:

Scenario Assumption IRR
Gold price ($/oz) 1,200 22%
1,800 51%

Seepage Barrier Feasibility Study Update18

The development of the Kapit orebody requires construction of a seepage barrier to cut off ocean water inflows from Luise Harbour to the open pit as shown in Figures 6 and 7.

The LMOS defined a base case for the Lihir mine plan which found that through further geotechnical analysis, the eastern limits of Phases 16 and 17 could be moved further east, deferring the need for the Seepage Barrier by
18 months to Q2 FY26 to coincide with mining Phase 18.

Additional mining studies are underway to identify further options to delay timing and/or alter the scope for the Seepage Barrier, including:

  • Kapit Pit Slope Optimisation (steepening of pit walls using conventional methods)
  • Installation of a mini seepage barrier to access Phase 18 without the need for the full seepage barrier
  • Combined pit slope steepening with a mini seepage barrier

The Seepage Barrier Feasibility Study has further defined the technical elements, cost and execution of the Seepage Barrier. It has determined:

  • A cut-off wall can be constructed in line with the designed method using standard hydromill cutters and grouting methods with a sea water slurry cooling system and confirmation of the concrete mix
  • An expected capital cost of US$569 million7
  • Construction duration of approximately 72 months

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Figure 6 & 7 – Cut of wall Alignment and Seepage Barrier / Kapit Pit at EOM

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Estimated Development Capital Profile7,18

FY23 FY24 FY25 FY26 FY27 FY28 FY29 Total
Stage 1 – Cut-Off Wall ($m) 30 74 194 52 350
Stage 2 – Seepage Control Berm ($m) 35 95 70 19 219
Total ($m) 30 74 194 87 95 70 19 569

Lihir Mineral Resource19

The Lihir Mineral Resource has been updated for mining depletion to 30 June 2021 from that reported in the Annual Mineral Resources and Ore Reserves Statement as of 31 December 2020. All other assumptions remain unchanged. A summary of material assumptions is included in Appendix 1, JORC Table 1. It is reported in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves 2012 (JORC Code). Mineral Resources are reported inclusive of Ore Reserves. Mineral Resources that are not Ore Reserves do not have demonstrated economic viability.

Mineral Resource Gold
Mt g/t Moz
Measured Mineral Resource 63 2.0 4.0
Indicated Mineral Resource 530 2.3 39
Total Measured and Indicated 590 2.2 43

Mineral Resource Gold
Mt g/t Moz
Inferred Mineral Resource 67 2.3 4.9

Lihir Ore Reserve19

A summary of material assumptions is provided below and included in Appendix 1, JORC Table 1. There are no material differences between the definitions of Probable Ore Reserves under the JORC Code and the equivalent definitions under the 2014 CIM Definition Standards for Mineral Resources and Mineral Reserves.

Ore Reserve Gold
Mt g/t Moz
Proved Ore Reserve 63 2.0 4.0
Probable Ore Reserve 250 2.4 19
Total Ore Reserve 310 2.3 23

Material Assumptions for Ore Reserves

Lihir is an operating open pit mine on Lihir Island, and the Study incorporates learnings from operational execution to date. Work is progressing on a Feasibility Study for the Phase 14A cutback and any adjustments to the Ore Reserves statement will be made following the completion of the Feasibility Study.

Ore Reserve Classification

All of the in-situ Probable Ore Reserve is based on Indicated Mineral Resources. The Proved Ore Reserve is based on Measured Mineral Resources defined for known and quantified low grade stockpiles. The in-situ resource classification is based on an assessment of geological confidence as a function of geological and mineralisation continuity.

Mining Method

Current mining activity at Lihir is via conventional truck and shovel operation, with offshore barge disposal of waste rock and land based and in-pit stockpiling and reclaim of lower grade ore.

Ore Processing

Ore processing at Lihir involves the main operations of crushing, grinding, flotation, pressure oxidation, leaching and electrowinning to recover gold from relatively high-grade sulphide feed producing gold doré. The Lihir process plant utilises proven technology that is widely used in the gold industry for this style of mineralisation. The ore processing facility has been operating since it was commissioned in 1996 and upgrades took place during 2011 and 2012. Comminution circuit operating optimisations and minor upgrades are planned to achieve a 15.5Mtpa plant capacity12.

The metallurgical recovery assumption for ore feed to the autoclave is dependent on the gold and sulphide sulphur grades, and dependent on sulphur to calcium ratio and proportion of aged stockpile feed for flotation material. Overall metallurgical recovery is reconciled with historic production data, laboratory test samples for stockpiled ore and reflects a partial oxidation metallurgical operating strategy. Average life of mine gold recovery is modelled to be 81-82%.

Cut-Off Grade

Lihir open pit employs a grade based cut-off, taking into account gold price, metallurgical recovery assumptions and site operating costs. The site operating costs include transport and refining costs, royalty charges, mining and processing costs, relevant site general and administration costs and relevant sustaining capital costs. These costs equate to a break even cut off value of US$38/t milled used to define the ultimate pit shell and a marginal cut off value of US$33/t milled or 1.0 g/t gold used to define ore and waste material within the ultimate pit shell.

The marginal site cost is based on an end of mine life low grade stockpile reclaim strategy, reducing the site activity and long term cost base. The mining cost in the marginal site cost represents the stockpile reclaim cost.

Estimation Methodology

Estimation of the Lihir Ore Reserve involved standard steps of mine optimisation, mine design, production scheduling and financial modelling. Factors and assumptions have been based on operating experience and performance at the Lihir operations. The Ore Reserve has been evaluated through a financial model. All operating and capital costs as well as Ore Reserve revenue factors stated in this document were included in the financial model. A discount factor of 4.5% real was applied. This process demonstrated that the Lihir Ore Reserve has a positive NPV. Sensitivities were conducted on the key input parameters including commodity prices, capital and operating costs, ore grade, discount rate, exchange rate and recovery which confirmed the estimate to be robust.

Material Modifying Factors

The resource estimation process allows for ore dilution and recovery to be built into the resource model based on the assumption of the selective mining unit (SMU) as the block size. The SMU assumption is based on the mining fleet size and is consistent with a high mill throughput/bulk mining strategy. Due to the Localised Uniform Conditioning (LUC) approach adopted in the resource model no additional mining dilution or recovery factors have been applied to the Ore Reserve estimate.

This assumption is supported by the actual reconciliation between resource model and mill performance at Lihir to date being within an acceptable uncertainty range for the style of mineralisation under consideration.

The pit optimisation takes into account Inferred Mineral Resources, however only Measured and Indicated Mineral Resources are reported in the Ore Reserve estimate. The Inferred Mineral Resource represents a small portion of material within the ultimate pit design and both the design and financial model are insensitive to the exclusion of this material.

Civil engineered wall support is required for the Phase 14A cutback to allow access to the orebody. The cutback design also requires mining by a fleet of small equipment owing to the narrow ramp configuration required. Allowances for these activities are included in the preparation of the Ore Reserve estimate.

Other Modifying Factors

Lihir Gold Limited and the Lihir Open Pit are in material compliance with all legal and regulatory requirements. Naturally occurring risks that might have a material impact upon the Lihir ore reserve are discussed in the risks section of Newcrest’s Operating and Financial Review (in the Appendix 4E and Financial Report for the year ended 30 June 2021 which is available to view at www.asx.com.au under the code “NCM” and on Newcrest’s SEDAR profile) and include the potential impacts of seismic activity.

Environmental permitting for the Phase 14A Project has been assessed and approved by the Conservation and Environment Protection Authority (CEPA).

The known legal, political, environmental or other risks that could materially affect the potential development of the mineral resources or ore reserves are identified in Sections 3 and 4 of Appendix 1.

Appendix 1

JORC Table 1 – Lihir (100% Newcrest)

Section 1: Sampling Techniques and Data

Criteria Commentary
Sampling techniques Lihir is located in an active geothermal area and procedures have been developed to ensure that all drilling activities are conducted in a safe manner which is appropriate for when zones of high pressure steam are intersected. Data used for the resource estimation is obtained by two main drilling methods – diamond coring and reverse circulation (RC) drilling. All available diamond drill holes are sampled by cutting the core in half with a diamond saw with sample intervals being either 1m or 2m in length. Half the cut core is placed in a calico bag with a sample number and sent to the laboratory for assaying. All RC drilling was sampled at 1m intervals collected via a cyclone and split with a riffle splitter. The riffle split sample size of 4-5kg is placed in a calico bag with a sample number and sent to the laboratory for assaying.
Drilling techniques Drilling is the primary source of data for Mineral Resource estimation at Lihir. Data is obtained from two main drilling methods-diamond coring and RC drilling. The majority of drilling for the resource estimation is diamond drill core (93%), comprising PQ (84.8 mm core diameter), HQ (63.5 mm core diameter) and NQ (47.6 mm core diameter). Very little core orientation is performed on site as the structurally complex and geothermal conditions make it very difficult to obtain accurate orientations. Minor (~7%) of resource drilling is RC (5 1/4′” diameter) completed prior to 2002 used both vertical and angled holes. Since 2002 all resource drilling has been comprised of diamond core. Stockpile drilling is campaigned using an RC rig with a 4″ bit. Hole lengths are routinely 36m.
Drill sample recovery Core recovery is recorded and stored in an acQuire software database. There are only minor zones of core loss or poor core recovery. Core recovery is generally excellent with average core recoveries around 99%. There is no identified relationship between core loss and grade and the style of mineralisation suggests this is unlikely. There are no records of RC sample recovery.
Logging All diamond drill holes are geologically logged. Due to the nature of the intense alteration core is qualitatively logged for lithology and alteration and quantitatively logged for structure and geotechnical parameters. All core is logged and photographed after marking up metre intervals and prior to cutting and sampling. Logging data are entered into the acQuire database via a laptop computer or historically via manual data entry.
Sub-sampling techniques and sample preparation The sampling technique used is considered appropriate for the assessment of Lihir mineralisation. At the completion of drill core logging, the geologist defines which intervals of a drill hole are to be cut for analysis. All recent drilling is analysed on 2m intervals on the metre mark. PQ and HQ sized drill core is sampled by cutting the core in half with a diamond blade saw when intact and competent. The left hand half is placed in a calico bag marked with the appropriate sample number and sent to the assay laboratory for analysis. Where the core is too soft to be cut with a diamond saw, a knife is used to cut the core in the core tray. Where the core is too broken or brittle to be cut by the saw, the fragments are manually sampled. NQ sized core is not cut in half as the entire section is sampled so that sample support is maintained. The standard sampling interval is 2m but has varied over time from 1m to 2m. The remaining half core is stored in the original trays on pallets at the core processing facility.

Lihir has a sample preparation facility at the mine and up to January 2015 there are records for crusher duplicates. Drill core was crushed and RC and blast hole samples were dried and loaded into the pulverisers without laboratory splitting. After 2015 there was a reduction in core sampling and all samples were transferred directly to a bank of 6 * LM5 pulverisers without crushing or splitting. There are two standby jaw crushers with a small single deck riffle splitter which are rarely used.

Sample preparation for analysis is as follows: Samples are crushed if required to 10mm maximum diameter and split to a nominal weight of 2.5 – 3kg using a riffle splitter. Split samples are dried in an oven at 105°C until dry. Each sample is pulverised using a Labtechnics LM5 pulverizing mill to specified grind parameters of 95% passing 106µm. A 200g sub-sample is collected for analysis and submitted to the assay laboratory. Pulp replicates (not duplicates) are routinely undertaken. Crushed and pulp duplicates are collected at the Orange laboratory.

The sample preparation and size is considered appropriate for assessment of bulk tonnage mineral deposits of this type.

Quality of assay data and laboratory tests The Lihir onsite laboratory has been the primary laboratory used for assaying, with some more recent assaying completed at the Newcrest Services laboratory (Orange, NSW).

Samples are routinely assayed for gold and sulphur. Gold analysis is by fire assay with 25g charge and Atomic Absorption Spectroscopy (AAS) finish and detection limit of 0.01ppm (g/t), which is considered complete. Sulphide sulphur is by Labfit method where the sample is ignited at high temperature in a stream of oxygen. The resulting sulphur dioxide is measured by an infra-red detector using a Carbon/Sulphur analyser.

A detailed Quality Assurance/Quality Control (QAQC) program is in place for on-going assessment of sampling and analytical procedures. The process currently involves analysis of blind submissions of certified reference material (standards) to Lihir laboratory, duplicates from the LM5 pulveriser pulp, assayed during the same batch, blind resubmission of pulps to Lihir laboratory, replicate submissions of pulps to an alternative laboratory for analysis, submission of coarse blank samples (non-Lihir Island barren rock samples), checks on grind and crush size from the sample preparation steps and laboratory inspections and monthly QA/QC meetings. A monthly report is prepared detailing QA/QC performance to support the Mineral Resource estimate. There have been 30 standards used, not all of which were certified for sulphur. The first 16 standards were commercially available standards. Since 2008, there have been 14 standards used, all matrix-matched.

Data suggests that during the period between 2007 and 2012 there was a positive bias of between 5 and 20% in sulphide sulphur analysis conducted at Lihir laboratory data acquisition compared to standards reference materials. This suggests the Lihir method during this period reflects a total sulphur assay rather than the sulphide sulphur of the certified reference materials. In 2013 alternative sulphide sulphur techniques were introduced at Lihir which have improved the method accuracy. A further sulphide sulphur methodology improvement was implemented in 2016, with the installation of the Leco Infrared combustion analytical equipment.

Verification of sampling and assaying All data and interpretative inputs to Mineral Resource estimates are checked and verified in accordance with a range of Newcrest standard operating procedures. Procedures were also in place for all historical drilling programs at Lihir. Diamond drill core samples are processed in-house using a dedicated core processing facility, sample preparation and analytical laboratory. All resource logging data is automatically uploaded to the resource database via logging notebook computers. Newcrest employs a centralised resource drill hole database team to check, verify and validate new data and to ensure the integrity of the total resource database. Day-to-day management of the resource data is undertaken by the database administrator on site using the acQuire database system. Prior to resource estimation a centralised resource team conducts further data checks to ensure data integrity prior to estimation.

Regular internal and external reviews of all geological and Mineral Resource estimation processes are conducted to check the quality and integrity of these procedures. No adjustments have been made to assay data.

Location of data points The grid applied is a local Mine Grid that has it based on AMG Zone 56.

The original topography surface is a Light Detection and Ranging (LIDAR) surface created pre-mining. Mining activities are surveyed each month and incorporated into a topographic surface model for depletion purposes.

All completed drill hole collars are surveyed by the mine surveyors.

A variety of methods have been used to measure down hole deviation (dip and azimuth), including conventional borehole camera, electronic single shot and gyroscopic methods. The majority of the holes have been surveyed using conventional borehole camera methods.

Data spacing and distribution Historical drilling has been nominally on 35m eastings, but noting the orebody is generally insensitive to drill orientation due to complex mineralisation events.

The Mineral Resource has been classified into Indicated and Inferred Mineral Resource after assessing the following factors: drill hole spacing (only areas drilled to 70m x70m drill density have been classified as Indicated Resource), style of mineralisation and geological continuity, data quality and associated QA/QC, grade continuity and proposed mining selectivity and scale of mining. Refer Section 3 Resource Classification for further details.

The data spacing and distribution is sufficient to establish geological and grade continuity appropriate for Mineral Resource estimation and classification and supported by historical reconciliation with actual production results.
Samples for estimation purposes have been taken, but no physical compositing of samples has occurred during the analysis process.

Orientation of data in relation to geological structure Gold mineralisation in the Luise Caldera is hosted within volcanics, intrusives, and breccias which have undergone extensive alteration. Two major alteration episodes have been identified which have destroyed much of the original host rock lithologies, and due to this an “ore type” classification has been developed based largely upon various combinations of alteration, hardness, the degree of brecciation and/or leaching of matrix material, and the presence of late stage anhydrite veining. The deposit is generally sub-horizontal.

The nature of the mineralisation distribution is such that it is insensitive to drill orientation with a wide variety of orientations having been used. Diamond holes prior to 2002 are predominantly vertical, with angled holes used subsequently to define the Mineral Resource. RC holes completed prior to 2002 used both vertical and angled holes.

Sample security Samples were transported from drill site to core shed and to site laboratory, all within the operational security zone of the mine. Sample dispatches are reconciled against Laboratory samples received and discrepancies reconciled by geology staff.
Audits or reviews An independent review of assaying and QAQC in September 2012 concluded: “The historic assay bias for gold has now been rectified at Lihir, sulphur from sulphide has not been assayed correctly at Lihir laboratory during some stages of the life of operation. Assaying precision for gold is considered consistent with industry standards but lacking for sulphide sulphur. Overall the quality of the Lihir laboratory is now well controlled.”

Section 2: Reporting of Exploration Results

Criteria Commentary
Mineral tenement and land tenure status Mining and ore processing operations at Lihir are conducted pursuant to a mining development contract with the State of Papua New Guinea and the related special mining lease, and a series of granted mining leases, exploration licenses, leases for mining purposes and mining easements, and associated environmental and other approvals. The granted tenements and permits cover all infrastructure in the immediate vicinity of the mine site, including the open pit, accommodation, plant site, power station, waste-rock and tailings disposal, and bore fields. All infrastructure is in place for the continued operation of Lihir.

Current tenements granted under the PNG Mining Act comprise Special Mining Lease (SML) 6, two granted Mining Leases (MLs) and one granted Exploration Licence (EL), plus a number of miscellaneous mining purpose and easement leases. The total area under lease/licence is approximately 250 km2. The Mineral Resource lies entirely within SML 6. The registered holder for all tenure is Lihir Gold Limited, a wholly-owned subsidiary of Newcrest Mining Limited since late 2010. SML 6 expires 16 March 2035 and EL485 expired on 31 March 2020. Process for a new renewal from 1 April 2020 to 31 March 2022 was delayed by COVID-19 restrictions and will be lodged for EL485. The two MLs are current to July 2025.

Exploration done by other parties The first systematic mineral exploration in the area was by the PNG Bureau of Mineral Resources and the Geological Survey of PNG between 1969 and 1974. In their report (which was released in 1982), it detailed the hydrothermal alteration and thermal activity on Lihir Island and suggested that it was a favourable geologic environment for epithermal gold mineralisation.

The Ladolam gold deposit was initially discovered in 1982 by joint venture between Kennecott Exploration and Niugini Mining. A feasibility study was completed by Kennecott Mining in March 1992. In the mid 1990’s a joint venture was formed between Kennecott Mining and Rio Tinto. Lihir Gold Limited (LGL) was subsequently formed to hold the Mining Development Contract, the Special Mining Lease and associated tenure. Mining operations commenced at Lihir in 1997.

In 2005 Rio Tinto sold its interest in LGL, then, in late 2010, Newcrest Mining Limited acquired LGL by scheme of arrangement.

Geology Exploration has identified several adjacent and partly overlapping mineral deposits in the Luise Caldera, which are collectively called the Ladolam Deposit. The principal component deposits are called Lienetz, Minifie, Coastal and Kapit. Gold mineralisation in the Luise Caldera is contained in a hydrothermally-altered porphyry gold system with the gold hosted in volcanic, intrusive and breccias within the caldera. Two major alteration episodes have been identified which have destroyed much of the original host rock lithologies, and due to this an “ore type” classification has been developed based largely upon various combinations of alteration, hardness, the degree of brecciation and/or leaching of matrix material, and the presence of late stage anhydrite veining. The majority of the gold is contained in sulphides.

The limits of the mineralisation have not been completely defined and the deposit remains are open at depth, along strike and to the east (currently limited by the Pacific Ocean).

Drill hole Information No exploration has been reported in this release, therefore there is no drill hole information to report. This section is not relevant to this report on Ore Reserves and Mineral Resources.

Comments relating to drill hole information relevant to the Mineral Resource estimate can be found in Section 1 – “Sampling techniques”, “Drilling techniques” and “Drill sample recovery”.

Data aggregation methods No exploration has been reported in this release, therefore there are no drill hole intercepts to report. This section is not relevant to this report on Ore Reserves and Mineral Resources.

Comments relating to data aggregation methods relevant to the Mineral Resource estimate can be found in Section 1 – “Sampling techniques”, “Drilling techniques” and “Drill sample recovery”.

Relationship between mineralisation widths and intercept lengths No exploration has been reported in this release, therefore there are no relationships between mineralisation widths and intercept lengths to report. This section is not relevant to this report on Ore Reserves and Mineral Resources.
Diagrams No exploration has been reported in this release; therefore no exploration diagrams have been produced. This section is not relevant to this report on Ore Reserves and Mineral Resources.
Balanced reporting No exploration has been reported in this release, therefore there are no results to report. This section is not relevant to this report on Ore Reserves and Mineral Resources.
Other substantive exploration data Previously reported drilling results have confirmed the extension of geological and grade continuity beyond the current Mineral Resource seaward constraint.
Further work A concept study of mining beyond the current seaward constraint of the Mineral Resource is required to assess the reasonable prospects for eventual economic extraction of identified mineralisation outside the current Mineral Resource seaward constraint.

Section 3: Estimation and Reporting of Mineral Resources

Criteria Commentary
Database integrity Data is stored in a SQL Server database known as acQuire. Assay and geological data are electronically loaded into acQuire and the database is replicated in Newcrest’s centralized database system. Regular reviews of data quality are conducted by site and corporate teams prior to resource estimation, in addition to external reviews.
Site visits The Competent Person for the Lihir Mineral Resource is part of the operational management team for Lihir Mine.
Geological interpretation Gold mineralisation in the Luise Caldera is hosted within volcanics, intrusives, and breccias which have undergone extensive alteration. Two major alteration episodes have been identified; an earlier and deeper “porphyry style” event resulting in potassic alteration grading laterally into propylitic alteration, and a later and higher level epithermal event producing argillic, advanced argillic, phyllic, and lower temperature potassic alteration. This intensive alteration has destroyed much of the original host rock lithologies, and due to this an “ore type” classification has been developed based essentially upon various combinations of alteration, hardness, the degree of brecciation and/or leaching of matrix material, and the presence of late stage anhydrite veining. The ore types are roughly sub-horizontal in occurrence and form a fairly consistent vertical sequence of clay-rich rock, grading into white mica-feldspar rock, then feldspar-biotite and, at depth, into feldspar-biotite-anhydrite rock. Within and at the boundaries of the ore types, geological structure is also a major influence on the localization of higher gold grades in the orebodies.
Dimension The maximum extent of the Mineral Resource is 3km x 1km x 350m. The deposit is generally sub-horizontal with the reporting of the Mineral Resource extent limited by a seaward constraint. An exploration target known as Kapit North East is a seaward extension outside the Mineral Resource.
Estimation and modelling techniques The Lihir resource estimate contains estimates for gold, arsenic, silver, copper, carbonate, molybdenum and sulphide sulphur. Gold is the primary economic metal with sulphur and carbonate estimates required for autoclave feed management. Estimates of minor elements are required to assist with overall plant performance management.

The estimation for each element was undertaken using the non-linear estimation method of Localised Uniform Conditioning (LUC) and is based on an underlying ‘diffusion’ model, where, in general, grade tends to trend from lower to higher values and vice versa in a relatively continuous way. Raw data was composited to 12m intervals for gold and all other elements. Uniform Conditioning (UC) was used to estimate gold and sulphide sulphur within 100x100x12m panels. The UC model was converted to a LUC model into 20m x 20m x 12m blocks that define the selective mining unit (SMU). Ordinary Kriging (OK) was used for the local estimation of density into the SMU blocks. All other elements (arsenic, silver, copper, carbonate, molybdenum and calcium) were estimated into the SMU. All elements are estimated independently of each other.

In 2017 the estimation domains were updated for geologically interpreted fault blocks as well as geometallurgical domains. These were assessed and validated using contact analysis. Nine estimation domains were used for gold (used also for sulphide sulphur, carbonate, silver, arsenic, copper and molybdenum). Top cutting of extreme values for each element was done on a domain basis by examining the histogram of data such that the top 1% samples were cut so that they contained approximately 10% or less of total metal (for example this ranged from 4 to 30 g/t for gold domains).

The resource estimate is validated via visual, geostatistical and production reconciliation methods.

The December 2017 model is the basis of the Lihir December 2020 Mineral Resource.

Moisture All tonnages are calculated and reported on a dry tonnes basis.
Cut-off parameters Lihir open pit employs a grade based cut-off, taking into account metallurgical recovery assumptions, transport costs, refining charges and royalty charges. The site operating costs include mining cost, processing cost, relevant site general and administration costs and relevant sustaining capital costs. These costs equate to a break even cut off value of US$40/t milled used to define the ultimate pit shell and a marginal cut off value of US$35/t milled or 1.0 g/t gold used to define ore and waste material within the ultimate pit shell.

The marginal site cost is based on an end of mine life low grade stockpile reclaim strategy, reducing the site activity and long term cost base. The mining cost in the marginal site cost represents the stockpile reclaim cost.

Mining factors or assumptions The Mineral Resource estimate is reported within a constraining notional pit shell. The Lihir deposit is extracted via a large Open Cut. Consequently, some aspects of the model construction reflect the proposed bulk mining method of open pit mining on 12 m benches with a 20m x 20m selective mining unit.
Metallurgical factors or assumptions Gold extraction is by pressure oxidation of ore from a combination of direct feed and flotation feed sources depending on sulphur levels. The target sulphur content in slurry to the autoclave is in the range 5-10% to ensure auto-thermal operation of the autoclave. Ore blending and flotation plant operation is undertaken in a manner to maintain feed sulphur content in this range. Metallurgical test work and operating experience at site has shown that there are four main rock /alteration domain groups identified as: Argillic Clay, Advanced Argillic, Epithermal and Porphyry.

Gold recoveries recognise float recovery differences between in-situ and stockpile material, and overall neutralisation cyanidation adsorption (NCA) recovery formulae reflect oxidation intensity.

Environmental factors or assumptions Lihir operations comprise an open pit mine, ore processing plant, and associated supporting infrastructure. Higher-grade ore is processed via pressure oxidation and carbon-in-leach cyanidation methods, with lower grade ore stockpiled for later processing. Lihir uses deep sea tailings placement (DSTP). In view of the heavy rainfall typically experienced on Niolam Island, the lack of suitable area for a tailings storage facility and the high seismicity of the region, DSTP was the preferred tailings placement method for Lihir. The plant tailings are premixed with sea water within the confines of the mining lease before being placed offshore. Baseline studies were undertaken prior to the approval by PNG environmental authorities and commencement of the DSTP. Regular monitoring is undertaken to verify the operational performance of the system and is subject to the regulatory criteria established by the PNG CEPA. Waste rock from the mine is either used for construction purposes or transported in barges for off-shore submarine disposal. Submarine disposal is carefully planned and controlled to achieve a continuous rill slope along the steeply dipping sea floor and to prevent uncontrolled slumping triggering a rise in water levels.

The Mineral Resource assumes the continued use of these waste management processes.

Bulk Density All bulk density measurements are carried out in accordance with site standard procedures for Specific Gravity. The physical determination of bulk density is undertaken on solid pieces of core, 10cm in length. Intervals for bulk density determination are selected according to lithology or alteration / mineralisation type (to best represent certain intervals as defined by the geologist). The measurements are performed on site (as part of the logging process), by geological assistants. Measurements are generally taken at 50m intervals down hole, or more frequently if required. This is a dry air method of analysis.

Ordinary Kriging (OK) was used for the local estimation of density into the nine geometallurgical domains.

Classification The in-situ Mineral Resource has been classified into Indicated and Inferred based on grade continuity assessments using the criteria of slope of regression (SOR) and the variogram weighted distance (WTD). For Indicated classification a guideline of SOR > 0.7 and WTD 0.65 and WTD
Audits or reviews The current Mineral Resource estimate has been externally reviewed by SRK in December 2017 and there were no issues or concerns with the Mineral Resource inputs, process and execution. SRK concluded that the Mineral Resource estimate was suitable for reporting in accordance with the requirements of the JORC Code (2012).
Discussion of relative accuracy/ confidence For an Indicated Resource it is considered reasonable for the relative uncertainty to be +/- 15% in tonnage, grade and metal (exclusive of each other, i.e., each variable has to satisfy the criteria) for an annual production volume at a 90% confidence level. Geostatistical evaluations indicate that based on the annual processing throughputs from the pits this criteria is satisfied globally within the deposit. Relative uncertainties and confidence level estimates are only considered for gold as it is the primary economic contributor.

Detailed monthly mine reconciliations have been maintained since production commenced. The mine reconciliations since 2012 confirm that the in-situ tonnage, grade and metal variances are well within the Indicated Resource relative uncertainty band, globally.

Section 4: Estimation and Reporting of Ore Reserves

Criteria Commentary
Mineral Resource Estimate for conversion to Ore Reserves A technical description of the Mineral Resource estimate that provided the basis for the December 2020 Lihir Ore Reserve estimate is presented in the preceding sections to this table.

The Ladolam gold deposit is located within the Louise Caldera, on the eastern side of Lihir Island, New Ireland Province, Papua New Guinea. Gold mineralisation in the Luise Caldera is hosted within volcanics, intrusives, and breccias that have undergone extensive alteration. The ore body is contained in a hydrothermally-altered porphyry gold system with the gold hosted in volcanic, intrusive and breccias within the caldera. The majority of the gold is contained in sulphides.

The Measured and Indicated Mineral Resources reported in the Mineral Resource report are inclusive of those Mineral Resources modified to produce the Ore Reserves Estimate herein.

Site Visits The Competent Person for the Ore Reserve estimate is an employee of Newcrest Mining Limited and at the time of Phase 14A Ore Reserve preparation was the Senior Specialist – Long Term Planning. The CP was based on site from 2015 to 2020 providing long term and strategic planning support for operations and technical studies. This experience has been used to validate technical and operating assumptions used in the preparation of this Ore Reserve estimate.
Study Status Production at Lihir commenced in 1996 and it is now a mature and stable operation with well-established mining and processing performance.
Cut-off Parameters Lihir open pit employs a grade based cut-off, taking into account gold price, metallurgical recovery assumptions and site operating costs. The site operating costs include transport and refining costs, royalty charges, mining and processing costs, relevant site general and administration costs and relevant sustaining capital costs. These costs equate to a break even cut off value of US$38/t milled used to define the ultimate pit shell and a marginal cut off value of US$33/t milled or 1.0 g/t gold used to define ore and waste material within the ultimate pit shell.

The marginal site cost is based on an end of mine life low grade stockpile reclaim strategy, reducing the site activity and long term cost base. The mining cost in the marginal site cost represents the stockpile reclaim cost.

Mining factors or assumptions Estimation of the Lihir Ore Reserve involved standard steps of pit optimisation, mine design, production scheduling and financial modelling. Factors and assumptions have been determined as part of a prefeasibility level study completed in 2020, or are based on operating experience and performance.

Current mining activity at Lihir is via conventional truck and shovel operation, with offshore barge disposal of waste rock and land based and in-pit stockpiling and reclaim of lower grade ore. The current mining activities demonstrate the appropriateness of this mining method as the basis of the Ore Reserve estimate.

Phase 14A design parameters are tabled below:

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Geotechnical slope parameters are based on the detailed analysis of ground conditions and other factors which influence geotechnical performance within the Phase 14A cutback. The Phase 14A slope design parameters are also based on the assumption that a comprehensive system of soil nails, cable anchors, mesh, shotcreting and depressurisation is used to provide additional support to the final wall configuration during cutback development, and that a backfill buttress is used to provide long term support after cutback completion. The design parameters are based on current geotechnical experience and a prefeasibility level study for the cutback mining area.

The Lihir Resource Model utilises LUC to estimate block gold content. This process allows for ore dilution and recovery to be built into the resource model based on the assumption of the selective mining unit (SMU) as the block size. The SMU assumption (20m x 20m x 12m) is based on the mining fleet size and is consistent with a high mill throughput/bulk mining strategy. Due to the LUC approach adopted in the resource model no additional mining dilution or recovery factors have been applied to the Ore Reserve estimate. This assumption is supported by the actual reconciliation between resource model and mill performance at Lihir project to date being within an acceptable uncertainty range for the style of mineralisation under consideration.

The pit optimisation takes into account Inferred Mineral Resource, however only Measured and Indicated Resource is reported in the Ore Reserve estimate. The Inferred Resource represents a small portion of material within the ultimate pit design and both the design and financial model are insensitive to the exclusion of this material.

The selected mining method requires civil engineered wall support as described above to allow access to the Phase 14A orebody. The cutback design also requires mining by a fleet of small equipment owing to the narrow ramp configuration required. Allowances for these activities are included in the preparation of the Ore Reserve estimate.
A backfill buttress required for long term support of the final cutback wall prevents mining of some existing Reserves inventory.

Metallurgical factors or assumptions The Ore Reserve estimate is based on a maximum 15.5Mtpa comminution rate plant producing gold doré. Ore processing at Lihir involves the main operations of crushing, grinding, flotation, pressure oxidation, leaching and electrowinning to recover gold from relatively high-grade sulphide feed. The Lihir process plant utilises proven technology that is widely used in the gold industry for this style of mineralisation.

The ore processing facility has been operating since it was commissioned in 1996 and upgrades took place during 2011/2012. Comminution circuit operating optimisations and minor upgrades are planned to achieve a 15.5Mtpa plant capacity.

The metallurgical recovery assumption for ore feed to the autoclave is dependent on the gold and sulphide sulphur grades, and dependent on sulphur to calcium ratio and proportion of aged stockpile feed for flotation material. Overall metallurgical recovery is reconciled with historic production data, laboratory test samples for stockpiled ore and reflects a partial oxidation metallurgical operating strategy. Average life of mine gold recovery is modelled to be
81-82%.

The potential impact of the presence of low concentrations of copper on leaching efficiency and cyanide consumption has been assessed and is not considered an issue for the Ore Reserve estimate. Copper levels are generally below 500ppm, and historical performance indicates that levels below 1000ppm show no material impact.

Environmental Lihir open pit is an operating mine and has been granted an environmental permit for the mining of the Phase 14A cutback.
Infrastructure The Lihir operation is an operating mine and has the necessary infrastructure in place for its continued operation.
Costs Capital and operating costs have been determined as part of the prefeasibility study based on estimated operating costs for a drilling, shotcreting and cable bolt installation program. Reserve cost estimates are considered to be pre-feasibility level. Provision has also been made for capital expenditure required for a fleet of smaller mining equipment suited to the cutback access configuration. Life of cutback non-sustaining capital is estimated in the range of US$60-70 million.

No cost impact is expected from deleterious elements. It has therefore not been necessary to include additional costs relating to minor elements when preparing the Ore Reserve estimate.

Transport and refining charges have been developed from first principles consistent with the application and input assumptions for these costs used by the current operation. Refining charges and transport costs are estimated to average US$2.24/oz of gold.

A royalty of 2.0% of gold revenue (net of refining and transport costs) is divided between federal, provincial governments and local level governments and landowners. A mining levy of 0.5% (net of refining and transport costs) is also applied in the preparation of this reserve estimate.

Revenue factors Long term metal prices and exchange rate assumptions adopted in the December 2020 Reserve estimation process are US$1,300/oz for gold at a AUD:USD exchange rate of 0.75. These assumptions are consistent with Newcrest metal price guideline for December 2020 Ore Reserve period.
Market assessment Newcrest is a price taker and gold is sold on the open market and subject to price fluctuations. Supply and demand for gold from Lihir is not a constraint in the estimation of the Ore Reserve.
Economic The Ore Reserve has been evaluated through a financial model. All operating and capital costs as well as revenue factors stated in this document were included in the financial model. This process demonstrated the Lihir Ore Reserve to have a positive NPV.

Sensitivities have been conducted on the key input parameters of costs and recovery which confirm the estimate to be robust. The NPV range has not been provided as Newcrest considers this to be commercially sensitive information.

Social Engagement with landowners for affected blocks within the cutback footprint and the local community was undertaken through a series of meetings in conjunction with the Mineral Resources Authority (MRA). Approval for the project has been endorsed by block executives as documented in the engagement meeting minutes.

Environmental permitting for the Phase 14A Project has been assessed and approved by CEPA.

Other Lihir Gold Limited and the Lihir Open Pit are in material compliance with all legal and regulatory requirements.

Naturally occurring risks that might have a material impact upon the Lihir ore reserve are discussed in the risks section of Newcrest’s Operating and Financial Review (in the Appendix 4E and Financial Report for the year ended 30 June 2021 which is available to view at www.asx.com.au under the code “NCM” and on Newcrest’s SEDAR profile) and include the potential impacts of seismic activity.

Classification All of the in-situ Ore Reserve is currently derived from Indicated Resources. This classification is based on the density of drilling, the ore body experience and the mining method employed. The only Proved Ore Reserves derived from Measured Resources are those reported in known and quantified stockpiles.

It is the Competent Person’s view that the classifications used for the Ore Reserves are appropriate.

Audits or reviews Golder Associates Pty Ltd (Golder) was commissioned in 2020 to conduct an independent review of the Ore Reserve estimation processes and results that did not include Phase 14A.

Golder concluded that the Ore Reserve had been prepared using accepted industry practice and is considered suitable and reported in accordance with the JORC Code, 2012 Edition.

A competent independent review of the Phase 14A Ore Reserve estimate has been undertaken by Newcrest group planning with no non-compliances or material issues.

Discussion of relative accuracy/ confidence The accuracy of the estimates within this Ore Reserve is mostly determined by the order of accuracy associated with the geotechnical slope parameters, the Mineral Resource model and the cost factors used.

The Competent Person views the Lihir Ore Reserve a reasonable assessment of the global estimate.

Forward Looking Statements

This document includes forward looking statements and forward looking information within the meaning of securities laws of applicable jurisdictions. Forward looking statements can generally be identified by the use of words such as “may”, “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “believe”, “continue”, “objectives”, “targets”, “outlook” and “guidance”, or other similar words and may include, without limitation, statements regarding estimated reserves and resources, certain plans, strategies, aspirations and objectives of management, anticipated production, study or construction dates, expected costs, cash flow or production outputs and anticipated productive lives of projects and mines. Newcrest continues to distinguish between outlook and guidance. Guidance statements relate to the current financial year. Outlook statements relate to years subsequent to the current financial year.

These forward looking statements involve known and unknown risks, uncertainties and other factors that may cause Newcrest’s actual results, performance and achievements or industry results to differ materially from any future results, performance or achievements, or industry results, expressed or implied by these forward-looking statements. Relevant factors may include, but are not limited to, changes in commodity prices, foreign exchange fluctuations and general economic conditions, increased costs and demand for production inputs, the speculative nature of exploration and project development, including the risks of obtaining necessary licences and permits and diminishing quantities or grades of reserves, political and social risks, changes to the regulatory framework within which Newcrest operates or may in the future operate, environmental conditions including extreme weather conditions, recruitment and retention of personnel, industrial relations issues and litigation. For further information as to the risks which may impact on Newcrest’s results and performance, please see the risk factors included in the Operating and Financial Review in the Appendix 4E and Financial Report for the year ended 30 June 2021 which is available to view at www.asx.com.au under the code “NCM” and on Newcrest’s SEDAR profile.

Forward looking statements are based on Newcrest’s good faith assumptions as to the financial, market, regulatory and other relevant environments that will exist and affect Newcrest’s business and operations in the future. Newcrest does not give any assurance that the assumptions will prove to be correct. There may be other factors that could cause actual results or events not to be as anticipated, and many events are beyond the reasonable control of Newcrest. Readers are cautioned not to place undue reliance on forward looking statements, particularly in the current economic climate with the significant volatility, uncertainty and disruption caused by the COVID-19 pandemic. Forward looking statements in this document speak only at the date of issue. Except as required by applicable laws or regulations, Newcrest does not undertake any obligation to publicly update or revise any of the forward looking statements or to advise of any change in assumptions on which any such statement is based.

Non-IFRS Information

Newcrest’s results are reported under International Financial Reporting Standards (IFRS). This document includes non-IFRS financial information within the meaning of ASIC Regulatory Guide 230: ‘Disclosing non-IFRS financial information’ published by ASIC and within the meaning of Canadian Securities Administrators Staff Notice 52-306 – Non-GAAP Financial Measures. Such information includes: ‘Free Cash Flow’ (calculated as cash flow from operating activities less cash flow related to investing activities and ‘AISC’ (All-In Sustaining Cost) as per updated World Gold Council Guidance Note on Non-GAAP Metrics released November 2018. AISC will vary from period to period as a result of various factors including production performance, timing of sales and the level of sustaining capital and the relative contribution of each asset. These measures are used internally by Newcrest management to assess the performance of the business and make decisions on the allocation of resources and are included in this document to provide greater understanding of the underlying performance of Newcrest’s operations. The non-IFRS information has not been subject to audit or review by Newcrest’s external auditor and should be used in addition to IFRS information. Such non-IFRS financial information/non-GAAP financial measures do not have a standardised meaning prescribed by IFRS and may be calculated differently by other companies. Although Newcrest believes these non-IFRS/non-GAAP financial measures provide useful information to investors in measuring the financial performance and condition of its business, investors are cautioned not to place undue reliance on any non-IFRS financial information/non-GAAP financial measures included in this document. When reviewing business performance, this non-IFRS information should be used in addition to, and not as a replacement of, measures prepared in accordance with IFRS, available on Newcrest’s website, the ASX platform and SEDAR.

Ore Reserves and Mineral Resources Reporting Requirements

As an Australian Company with securities listed on the Australian Securities Exchange (ASX), Newcrest is subject to Australian disclosure requirements and standards, including the requirements of the Corporations Act 2001 and the ASX. Investors should note that it is a requirement of the ASX listing rules that the reporting of ore reserves and mineral resources in Australia is in accordance with the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code) and that Newcrest’s ore reserve and mineral resource estimates comply with the JORC Code.

Newcrest is also subject to certain Canadian disclosure requirements and standards, as a result of its secondary listing on the Toronto Stock Exchange (TSX), including the requirements of National Instrument 43-101 (NI 43-101). Investors should note that it is a requirement of Canadian securities law that the reporting of Mineral Reserves and Mineral Resources in Canada and the disclosure of scientific and technical information concerning a mineral project on a property material to Newcrest comply with NI 43-101. Newcrest’s material properties are currently Cadia, Lihir, Red Chris and Wafi-Golpu. Copies of the NI 43-101 Reports for Cadia, Lihir and Wafi-Golpu, which were released on 14 October 2020, are available at www.newcrest.com and on Newcrest’s SEDAR profile. The Red Chris NI 43-101 report is expected to be submitted within 45 days of the date of this market release.

Competent Person’s Statement

The information in this document that relates to Lihir Ore Reserves is based on and fairly represents information compiled by
Mr David Grigg. Mr David Grigg is the Senior Specialist Long Term Planning and a full-time employee of Newcrest Mining Limited. He is a shareholder in Newcrest Mining Limited and is entitled to participate in Newcrest’s executive equity long term incentive plan, details of which are included in Newcrest’s 2021 Remuneration Report. He is a Member of the Australasian Institute of Mining and Metallurgy. Mr David Grigg has sufficient experience which is relevant to the styles of mineralisation and types of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the JORC Code. Mr David Grigg consents to the inclusion of material of the matters based on his information in the form and context in which it appears.

The information in this document that relates to Lihir Mineral Resources is based on and fairly represents information compiled by Mr Benjamin Likia. Mr Likia is the Manager – Mining and a full-time employee of Newcrest Mining Limited. He is entitled to participate in Newcrest’s executive equity long term incentive plan, details of which are included in Newcrest’s 2021 Remuneration Report. He is a Member of the Australian Institute of Mining and Metallurgy. Mr Likia has sufficient experience which is relevant to the styles of mineralisation and types of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the JORC Code. Mr Likia consents to the inclusion of material of the matters based on his information in the form and context in which it appears.

Technical and Scientific Information

The technical and scientific information contained in this document relating to Lihir (including the Mineral Resource and Ore Reserve) was reviewed and approved by Craig Jones, Newcrest’s Chief Operating Officer Papua New Guinea, FAusIMM and a Qualified Person as defined in NI 43-101.

Authorised by a Newcrest Board Committee

For further information please contact

Investor Enquiries
Tom Dixon
+61 3 9522 5570
+61 450 541 389
Tom.Dixon@newcrest.com.au

Ben Lovick
+61 3 9522 5334
+61 407 269 478
Ben.Lovick@newcrest.com.au

North American Investor Enquiries
Ryan Skaleskog
+1 866 396 0242
+61 403 435 222
Ryan.Skaleskog@newcrest.com.au

Media Enquiries
Tom Dixon
+61 3 9522 5570
+61 450 541 389
Tom.Dixon@newcrest.com.au

This information is available on our website at www.newcrest.com

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a bowl of U3O8 yellow cake

Australia is the second largest producer of uranium in the world. Here's a look at the mines that are producing today, and the significant ones that are being developed.

Despite sitting on the largest known recoverable resources of uranium worldwide — 1.69 million metric tonnes in 2019 — Australia uses no part of it for energy. Instead, Australia exports the valuable resource, which accounts for one-quarter of its energy exports.

In fact, Australia was the second largest producer of uranium in 2020, producing 6,203 metric tonnes. It was only beaten by Kazakhstan, which produced nearly 20,000 metric tonnes that year.

Australian uranium production has centred around three mines in recent years — Olympic Dam, Beverly Four Mile and Ranger — until the Ranger mine ceased operations in 2021.

Main mines in the country

Here's a closer at these mines and the companies that own them:

1. Olympic Dam owned by BHP Billiton (ASX:BHP,NYSE:BHP,LSE:BHP)

The Olympic Dam complex is built upon one of the world's most significant deposits of copper, gold, silver and uranium. In fact, it's the world's largest known uranium deposit. It has both underground and surface operations and it has a fully integrated processing facility, which means it is capable of extracting, refining and processing mined commodities.

In 2020, BHP Billiton produced 3,000 metric tonnes of uranium oxide (U3O8), which is nearly half of Australia's output and 6 percent of the world's production. In 2021, their uranium segment accounted for US$249 million in revenue.

Although the company produces a significant amount of global uranium, its production of copper, iron ore, coal and petroleum dwarfs its uranium production by a wide margin.

2. Beverly and Four Mile owned by private company Heathgate Resources

Australia's first in-situ recovery mine at Beverly sits on a uranium deposit about 520 kilometres from Adelaide. Owned by Heathgate Resources, a subsidiary of US-based General Atomics, the Beverly mine itself has all been mined out and production exclusively occurs at the nearby Four Mile mine (owned by Quasar, a subsidiary of Heathgate).

In 2020, Heathgate Resources mined 2,130 tonnes of uranium oxide from Four Mile, accounting for 4 percent of the world's uranium production.

3. Ranger Uranium Mine owned by Energy Resources of Australia (ASX:ERA)

Ranger was the longest serving uranium production mine in Australia at 35 years, located 8 km east of the town of Jabiru. The mine officially stopped processing operations in January 2021 after traditional owners of the land did not support extending the Energy Resources of Australia's (ERA) authority in the area. The company had already stopped mining operations back in 2012 and had been processing stockpiled ore since then.

The ERA, whose parent company is Rio Tinto, produced 1,574 tonnes of uranium oxide for 2020 — accounting for 2 percent of the world's uranium production — before shutting the mine down.

According to their 2020 annual report, continuing mining at Ranger in the future is also unviable. A change in legislation would be required and the company states that monitoring the mine in the gap between ceasing and resuming operations would simply add to its cost burden.

While ERA still holds the lease on the nearby Jabiluka orebody, it has been firm that it will not develop the site without the consent of the Mirrar Aboriginal people, and so the Jabiluka development has been indefinitely deferred.

Future mines in Australia

Australia accounts for almost one-third of the world's uranium deposits and there are several future exploration and expansion uranium projects brewing in the country. With 31 known deposits for uranium including the three discussed above, the list for potential new mines or mines being brought back online is long. Here are a few noteworthy ones.

1. Honeymoon

The deposit was discovered in the 1970s, and in 2015 Boss Energy (ASX:BOE) bought Uranium One Australia and acquired the mine as part of the deal. The project is permitted to export up to 3.3 million pounds (1,496 tonnes) per annum and production is expected soon.

2. Mulga Rock

This polymetallic deposit was first discovered by PNC Exploration in 1979 and is now owned by Vimy Resources (ASX:VMY), formerly Energy & Minerals Australia. The deposit is divided into Mulga Rock East and West, and also hosts scandium, nickel and cobalt.

With approvals from both state and federal governments in 2016 and 2017 respectively, the mine can produce up to 1,300 tonnes of U3O8 per year. Vimy Resources intends to start on the Ambassador deposit with open-pit mining with an 85 percent recovery rate.

3. Angela / Bigrlyi / Obagooma / Thatcher Soak

Elevate Uranium (ASX:EL8), formerly known as Marenica Energy, has acquired or bought stakes in several mining projects in the Northern Territory and Western Australia. While there is no clear timeline on start of operations for any project, managing director and CEO Murray Hill was quoted saying that he expects the price of uranium to increase over the next decade, meaning the company would be well-leveraged as it bought assets at a reduced price.

Hill also expects modular reactor technology to improve in the next decade, allowing nuclear energy to be used across the landscape in rural areas and not just the bigger cities.

Market Outlook

After suffering low prices after the 2011 Fukushima disaster, the nuclear energy market is expected to pick up, with generation growing nearly 3 percent annually by 2040, according to the World Nuclear Association's Nuclear Report. As the world continues to pivot to net-zero emissions, nuclear energy will find increasing favour from countries looking to shift their energy generation to cleaner sources.

The report states that uranium production will remain stable until the end of the 2020s and then decrease by nearly half from 2030 to 2040, highlighting the need for increased exploration and production in the space to avoid future supply disruptions.

Many projects are at advanced development stages and are only waiting for improved prices from the market.

Don't forget to follow us @INN_Australia for real-time updates!

Securities Disclosure: I, Pallavi Rao, hold no direct investment interest in any company mentioned in this article.

kangaroos in front of the sunrise

Silver is on the rise in Australia, with new silver mines opening, production potential booming and the precious metal's valuation reaching new heights.

Analysts have been bullish on gold for the better part of the past decade, but now it's silver's time to shine. While the price of silver tends to rise and fall alongside that of gold, silver's valuation is generally more volatile — slower to move in either direction, but more prone to abrupt spikes and plunges.

Considering the market's longtime gold rush, silver is due for a major price hike. In 2020, silver hit a seven year high with 27 percent year-over-year growth, climbing faster than gold. Silver was on the rise again in February 2021, bolstered by WallStreetBets fervour. Though prices have stabilised since, they remain elevated compared to the past decade. Additionally, at only a fraction of gold's valuation, silver is a much more attainable buy.

Shrewd investors are looking to Australia for their silver picks. A country whose silver mines continued to flourish even when most of the world was in a precious metal slump, Australia has emerged from the COVID-19 pandemic as a major player in the global silver market.


A look at Australia and silver mining

When you think of mining in Australia, you may not think of silver, especially since the country is a top global producer of several other metals, including gold and iron ore. Nevertheless, silver is on the rise in Australia, with new silver mines opening, production potential booming and the precious metal's valuation reaching new heights.

This may be surprising news, especially since 2020 was an erratic year for silver. Global silver-mining production plunged by 5.9 percent in 2020 — its biggest drop in over 10 years —⁠ following four years of steady decline.

Output from primary silver mines plummeted by 11.9 percent year-over-year, while silver by-product suffered a more modest drop, with production from gold and lead-⁠zinc mines falling by 5.7 percent and 7.4 percent, respectively. Note that silver is largely produced as a by-product of other metal-mining processes, with 72 percent of silver production taking place at non-silver mines.

This production downturn was the result of COVID-19 restrictions that forced mines to suspend operations temporarily. Silver mine closures hit certain places harder than others, with extended closures in top silver-producing countries such as Peru, Mexico, Argentina and Bolivia causing major production drops.

Australia, however, was an exception to this rule, with production increasing by 3 percent. The reason for Australia's success is that it remained relatively untouched by COVID-19 restrictions. While other countries were forced to shut down production facilities, Australia was able to avoid these closures, continuing — and even upgrading — regular operations.

Australia is now the fifth largest silver producer globally, with an annual output of 43.8 million ounces in 2020. While the output of silver-mining giants such as Mexico and Peru (178.1 million and 109.7 million ounces produced in 2020, respectively) continues to far exceed that of Australia, global demand for silver is on the rise, hitting 900 million ounces annually and making room for a new silver-mining powerhouse.

What should investors know about silver investing in Australia?

Silver remains a relatively untapped resource in Australia, which means that investors have plenty of major mining companies to choose from.

Australia's largest mine is the Cannington mine owned by South32 (ASX:S32,OTC Pink:SHTLF). It is ranked as the ninth largest silver-producing mine worldwide, with 11.6 million ounces produced in 2020.

The country's second biggest silver-producing mine is the Mount Isa zinc mine. It is owned by Mount Isa Mines, a subsidiary of Glencore (LSE:GLEN,OTC Pink:GLCNF), and produced around 5.8 million ounces of silver in 2020. The Tritton copper mine, owned by Aeris Resources (ASX:AIS,OTC Pink:ARSRF), followed closely behind with nearly 4.5 million ounces produced in the same year.

Other notable Australian silver mines include the Golden Grove mine, which is owned by 29Metals (ASX:29M), and the Dugald River mine, which is owned by Metallic Minerals (ASX:MMG,TSXV:MMG,OTCQB:MMNGF). In 2020, these mines produced around 2.9 million and 2 million ounces of silver, respectively.

Australia's impressive silver-mining industry is well-positioned for further expansion, with Silver Mines (ASX:SVL,OTC Pink:SLVMF) planning to launch its Bowden silver project in 2023. This New South Wales-based silver mine is projected to produce around 6 million ounces of silver annually, which would make it the country's new second largest producer. The company hopes to capitalise on the promising solar panel market, which currently accounts for about 5.5 percent of all silver demand worldwide.

Moreover, Australian company Thomson Resources (ASX:TMZ,OTC Pink:TMZRF) bought the New South Wales-based Webb and Conrad silver projects from Silver Mines earlier this year in a transaction worth around US$8.6 million. The deal closed on March 31, and will enable Silver Mines to concentrate on its flagship Bowden project.

Investing in silver in Australia

There are many ways to invest in silver, including physical silver, stocks, exchange-traded funds (ETFs), mutual funds, options and futures. Choosing which investment route to take is all about balancing risk and reward.

Investing in physical silver is the most straightforward option: you simply buy a tangible piece of the precious metal in the form of bullion, official coins or medallions. Bullion is a bar or 1 ounce coin of solid silver with at least 99.9 percent purity. Official silver coins are currency produced by a government mint, while silver medallions resemble coins, but lack monetary value, .

The price of physical silver rises and falls alongside the metal's market value. Physical silver is a relatively safe investment, since its value can't be affected by third-party interference or bad business practices (risks characteristic of mining stocks). However, if you plan to trade often, the added costs of buying, selling and storing physical silver may make the investment not worth your while.

Investments in physical silver rose by 8 percent last year, boosted by silver's status as a safe asset and market bullishness on gold. In Australia, coins and medals fabrication increased by 35 percent year-over-year, making physical silver a smart choice for any risk-averse investor.

Of course, low risk often means low reward. If you're looking for a bigger payday, consider investing in silver-mining stocks instead. After all, when silver's market price goes up, it is often the case that the value of a mining stock could spike far higher than that of the physical metal. The disadvantage is that mining stocks are always risky — even when the silver market is strong, a mining endeavour can fail to pan out.

ETFs offer investors the best of both worlds. ETFs are a basket of varied equities, including physical metals and shares in mining companies. Much like individual stocks, they are liable to rise or fall in price according to the market, though they tend to be less risky than stocks.

In 2020, ETF investments were at an all-time-high, though Australia only has one silver ETF that includes the physical precious metal. Stocks are a much more common means of investing in silver in Australia. The country boasts over a dozen silver-mining companies, including South32 and Silver Mines, as well as Newcrest Mining (ASX:NCM,TSX:NCM,OTC Pink:NCMGF), Golden Deeps (ASX:GED) and Investigator Resources (ASX:IVR).

Don't forget to follow us @INN_Australia for real-time news updates.

Securities Disclosure: I, Isabel Armiento, hold no direct investment interest in any company mentioned in this article.