Annual Qualified Persons Report for

Konongo Gold Project,

Ghana
for the year ended 31st March 2015

Singapore

Effective date 31st March 2015

Prepared in accordance with the requirements of Singapore Exchange Securities Trading

Limited Practice Note 4C

Qualified Persons:
Simon Meadows Smith FIMMM (Geology)
Andrew Netherwood MAusIMM (Mineral Resources)
Joe Amanor MAusIMM CP (Geo) (Geology)

PREPARED BY:

17 Orphan Crescent,
Labone, Accra, Ghana
P.O. Box 2805,
Osu, Accra, Ghana

TEL: + 233 302 784 124

EMAIL: ghana@sems-xploration.com
Website: www.sems-exploration.com
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Contents
1 Executive Summary ............................................................................................................................... 8
1.1 Report Scope and Basis ..................................................................................................................... 8
1.2 Project Description ............................................................................................................................ 8
1.3 Geology and Mineralisation .............................................................................................................. 8
1.4 Mine Production................................................................................................................................ 9
1.5 Mineral Resources and Ore Reserves ............................................................................................. 10
1.6 Economic Analysis ........................................................................................................................... 13
1.7 Risk Assessment .............................................................................................................................. 13
1.8 Conclusions ..................................................................................................................................... 14
1.9 Recommendations .......................................................................................................................... 16
2 Introduction ........................................................................................................................................... 17
2.1 Aim and Scope of Report ................................................................................................................ 17
2.2 Use of Report .................................................................................................................................. 17
2.3 Reporting Standards........................................................................................................................ 17
2.4 Report Authors and Contributors ................................................................................................... 18
2.5 Qualified Persons Statement .......................................................................................................... 19
2.6 Basis of the Report .......................................................................................................................... 20
3 Project Description ................................................................................................................................. 20
3.1 Project Overview ............................................................................................................................. 20
3.2 Tenure ............................................................................................................................................. 22
3.3 Tenure Conditions ........................................................................................................................... 28
3.4 Property Location, Access and Infrastructure ................................................................................. 28
3.5 Climate ............................................................................................................................................ 29
3.6 Landforms and Soils ........................................................................................................................ 29
3.7 Fauna and Flora ............................................................................................................................... 30
3.8 Hydrology ........................................................................................................................................ 30
3.9 Cultural Environment ...................................................................................................................... 31
3.9.1 Republic of Ghana ...................................................................................................................... 31
3.9.2 Transport and Communication Systems .................................................................................... 31
3.9.3 Business and Investment Environment ..................................................................................... 31
3.9.4 Legal System................................................................................................................................... 32
3.9.5 Mining Code and Regulation .......................................................................................................... 32

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3.9.6 Government Equity in Mining Regulations .................................................................................... 32

3.9.7 Taxes .............................................................................................................................................. 32
4 History .................................................................................................................................................... 35
4.1 Exploration ...................................................................................................................................... 35
4.2 Mining ............................................................................................................................................... 37
5 Geological Setting................................................................................................................................... 40
5.1 Regional Geological Setting............................................................................................................. 40
5.1.1 Regional Overview ..................................................................................................................... 40
5.1.2 Geology of Ghana....................................................................................................................... 43
5.1.3 Local Geological Setting ............................................................................................................. 45
5.2 Mineralisation ................................................................................................................................. 49
5.2.1 Deposit type ............................................................................................................................... 49
5.2.2 Mineralisation ............................................................................................................................ 50
6 Exploration Activities.............................................................................................................................. 52
6.1 Exploration Overview ...................................................................................................................... 52
6.2 Exploration Methods ....................................................................................................................... 56
6.2.1 Geophysics and Remote sensing................................................................................................ 56
6.2.2 Geochemistry ............................................................................................................................. 58
6.2.3 Drilling ........................................................................................................................................ 59
6.2.4 Sampling..................................................................................................................................... 59
6.2.4.1 Standard Operating Procedures and Manuals........................................................................ 59
6.2.4.2 Diamond Core Sampling ......................................................................................................... 62
6.2.4.3 Reverse Circulation Sampling.................................................................................................. 62
6.2.4.4 Aircore Sampling ..................................................................................................................... 63
6.2.4.5 Trench Sampling...................................................................................................................... 63
6.2.4.6 Soil Sampling ........................................................................................................................... 63
6.2.4.7 Sample Preparation ................................................................................................................ 64
6.2.5 Chemical Analysis ....................................................................................................................... 65
6.2.6 Quality Assurance and Quality Control ...................................................................................... 66
6.2.7 Sample Security.......................................................................................................................... 66
6.3 Exploration Results ........................................................................................................................... 66
6.3.1 Exploration Results Overview .................................................................................................... 66
6.3.2 Exploration Drilling..................................................................................................................... 67

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6.3.3 Kurofa Soils Program .................................................................................................................. 71

6.4 QAQC Results .................................................................................................................................. 72
7.0 Mineral Processing and Metallurgical Testing .................................................................................... 73
7.1 Overview ......................................................................................................................................... 73
7.2 Metallurgical Test work .................................................................................................................... 73
7.2.1 Oxide Ores .................................................................................................................................. 73
7.2.2 Sulphide Ores ............................................................................................................................. 74
7.2.2.1 Metcon Laboratories 1997 ..................................................................................................... 75
7.2.2.2 BacTech .................................................................................................................................. 76
7.2.2.3 Amdel mineralogy .................................................................................................................. 77
7.3 Mineral Processing Design .............................................................................................................. 77
8.0 MINERAL RESOURCE ESTIMATES .................................................................................................... 80
8.1 Summary of Mineral Resources .................................................................................................. 80
8.2 General Description of Mineral Resource Estimation ................................................................ 81
8.3 Mineral Resource Estimate, May 2015 ....................................................................................... 84
8.3.1 Obenemase A & B............................................................................................................... 84
8.3.1.1 Mineral Resource Input Data ................................................................................................ 84
8.3.1.2 Geological Interpretation ...................................................................................................... 84
8.3.1.3 Data analysis and geostatistics.............................................................................................. 86
8.3.1.4 Domaining ............................................................................................................................. 87
8.3.1.5 Variography ........................................................................................................................... 87
8.3.1.6 Estimation ............................................................................................................................ 88
8.3.1.7 Validation .............................................................................................................................. 88
8.3.1.8 Classification.......................................................................................................................... 89
8.3.1.9 Reported Mineral Resources................................................................................................. 90
8.3.2 Obenemase D ........................................................................................................................... 92
8.3.2.1 Data Analysis and Geostatistics .......................................................................................... 94
8.3.2.2 Domaining ............................................................................................................................ 94
8.3.2.3 Variography ........................................................................................................................... 95
8.3.2.4 Estimation ............................................................................................................................. 95
8.3.2.5 Validation .............................................................................................................................. 95
8.3.2.6 Classification.......................................................................................................................... 96
8.3.2.7 Reported Mineral Resources................................................................................................. 96

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8.4 Other Konongo Deposits ................................................................................................................ 97

8.4.1 Mineral Resource input data.................................................................................................... 97
8.4.2 Geological Interpretation ......................................................................................................... 97
8.4.2.1 The Apan Deposit .................................................................................................................. 98
8.4.2.2 The Aserewa Deposit ............................................................................................................ 98
8.4.2.3 The Boabedroo Deposit ...................................................................................................... 100
8.5 Interpretations and Conclusions ................................................................................................... 101
9 Ore Reserves ........................................................................................................................................ 101
10 Mining ................................................................................................................................................ 102
11 Processing .......................................................................................................................................... 102
12 Infrastructure ..................................................................................................................................... 102
12.1 Mine Infrastructure ..................................................................................................................... 102
12.2 Power ............................................................................................................................................ 103
12.3 Water ............................................................................................................................................ 103
12.4 Transport....................................................................................................................................... 103
12.5 Staffing .......................................................................................................................................... 103
12.6 Accommodation ............................................................................................................................ 104
13 Social, Environmental, Heritage and Health and Safety Management .............................................. 104
13.1 Social Management..................................................................................................................... 104
13.2 Environmental Management ...................................................................................................... 104
13.3 Heritage Management ................................................................................................................ 104
13.4 Health and Safety Management ................................................................................................. 105
14 Market Studies and Contracts ............................................................................................................ 105
15 Financial Analysis ............................................................................................................................... 105
16 Risk Assessment ................................................................................................................................. 105
17 Interpretation and Conclusion ........................................................................................................... 116
18 Recommendations ............................................................................................................................. 117
19 References.......................................................................................................................................... 119
20 Qualified Persons Statements ........................................................................................................... 127
21 Glossary .............................................................................................................................................. 127

Appendix 1: JORC Table 1 ...................................................................................................................... 133

Appendix 2: QAQ Report .......................................................................................................................... 150

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Tables
Table 1: Summary of Mineral Resource estimation for the Konongo Gold Project ................................... 12
Table 2: Staff who contributed to this QPR ................................................................................................ 18
Table 3: Reliance on other Experts .............................................................................................................. 19
Table 4: Konongo Mining Lease and Kurofa Prospecting Licence summary .............................................. 23
Table 5: Konongo pillar locations (Latitude/Longitude)............................................................................. 25
Table 6: Kurofa pillars locations (Lat/Long) ............................................................................................... 26
Table 7: Standard Operating Procedures, Signature Metals ..................................................................... 60
Table 8: Significant DD and RC drilling results, year ending March 2015 .................................................. 70
Table 9: Metcon Au recoveries achieved using different processing options [Dominy et al 2014c]. ......... 75
Table 10: Metcon sample head assays ...................................................................................................... 75
Table 11: Flotation products leach test results .......................................................................................... 76
Table 12: Bioleach tests head assays ......................................................................................................... 77
Table 13: Gold recoveries at BacTech after different treatment options .................................................. 77
Table 14: Obenemase A and B deposit by Material Type, Mineral Resource as of May 1st 2015 ............... 80
Table 15: Konongo Other Deposits, Mineral Resources as of May 1st 2015 .............................................. 81
Table 16: Summary statistics of selected 1m composites inside mineralised envelopes. ......................... 87
Table 17: Block model parameters............................................................................................................. 88
Table 18: Grade estimation parameters. .................................................................................................. 88
Table 19: Obenemase A and B Mineral Resources, 1st May 2015 .............................................................. 91
Table 20: Obenemase A and B deposit by Material Type, Mineral Resource as of May 1st 2015 .............. 91
Table 21: Obenemase A and B deposit by JORC Category, Mineral Resource as of May 1st 2015 ............. 91
Table 22: Summary statistics of selected 1m composites inside mineralised envelopes. .......................... 94
Table 23: Block model parameters............................................................................................................. 95
Table 24: Grade estimation parameters. ................................................................................................... 95
Table 25: Obenemase D Mineral Resources, 1st May 2015 ....................................................................... 97
Table 26: Categories and definitions used to assess likelihood. .............................................................. 106
Table 27: Risk consequence...................................................................................................................... 106
Table 28: Risk probability ......................................................................................................................... 107
Table 29: Risk table, downgraded prospects. ........................................................................................... 108

Figures
Figure 1: Location, Konongo....................................................................................................................... 21
Figure 2: Tenements and Infrastructure ..................................................................................................... 23
Figure 3: Konongo Mining Lease 749/03 boundary. ................................................................................... 24
Figure 4: Kurofa Prospecting Lease PL6/296 boundary. ............................................................................. 26
Figure 5: Average Monthly Temperature, Konongo................................................................................... 29
Figure 6: Average Monthly Temperature, Konongo................................................................................... 29
Figure 7: Boabedroo South open pit .......................................................................................................... 33
Figure 8: Apan open pit .............................................................................................................................. 33
Figure 9: Kyereben open pit ........................................................................................................................ 34
Figure 10: Obenemase A & B link, open pit ................................................................................................ 34
Figure 11: preserved drill hole collar PVC pipe ............................................................................................ 34

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Figure 12: mineralised volcaniclastics from Obenemase drilling ............................................................... 34

Figure 13: Prospectivity Mapping, Konongo .............................................................................................. 36
Figure 14: Mine and prospect locations, Konongo..................................................................................... 37
Figure 15: Stratigraphy of the Birimian...................................................................................................... 41
Figure 16: West African Regional Geology (Adapted from Olson et al 1992) ............................................ 42
Figure 17: Regional Geology of southern Ghana ....................................................................................... 44
Figure 18: Schematic of the pre-compressional Birimian deposition ......................................................... 44
Figure 19: Prospect geology ....................................................................................................................... 46
Figure 20: Schematic geology, Konongo .................................................................................................... 48
Figure 21: Prospect geology and regional cross section. ........................................................................... 48
Figure 22: All drilling, Konongo. ................................................................................................................. 54
Figure 23: Geology, magnetics and soil geochemistry................................................................................ 55
Figure 24: Geophysical reinterpretation, Konongo .................................................................................... 56
Figure 25 flight lines, 2005 regional geophysics survey, Aerodat. .............................................................. 57
Figure 26: Geochemical soil sampling programs ....................................................................................... 58
Figure 27: sample preparation. .................................................................................................................. 65
Figure 28: Plan of drilling showing long section traces for Figures 11, 12 and 13. .................................... 68
Figure 29: Long Section OBA-OBA' (see Figure 23) showing holes targeting Obenemase A Lode ............. 68
Figure 30: Long Section OBB-OBB' (see Figure 23) showing holes targeting Obenemase B Lode ............. 69
Figure 31 : Long Section OBD-OBD' (see Figure 23) showing holes targeting Obenemase B Lode............. 69
Figure 32: 2014-2015 soils program .......................................................................................................... 71
Figure 33: Processing flow sheet, Konongo................................................................................................ 79
Figure 34: Obenemase Deposit drill-hole locations showing: hole traces (yellow) with mineralised
intersections (warm colours represent higher grades), recent holes (pink), approximate modelled zone
boundary (orange), and previously mined pit surface outline (blue dashed) ............................................. 83
Figure 35: Obenemase A, B, D and R. Oblique view, looking south (UTM). ............................................... 85
Figure 36: Geological interpretation for R-Zone of Obenemase B lode ..................................................... 86
Figure 37: Model Validation - Drill-hole sample grades versus model grades........................................... 89
Figure 38: Mineral resource wireframe model and drill-hole traces showing primary lode (brown) and
secondary lode (green) (looking NE)........................................................................................................... 90
Figure 39: Grade-tonnage curves for the modelled resources. .................................................................. 92
Figure 40: Obenemase A, B, D and R. Oblique view, looking north-west (UTM)....................................... 93
Figure 41: Geological interpretation for Obenemase D lode, looking north (UTM). ................................. 93
Figure 42: Model Validation - Drill-hole sample grades versus model grades, Obenemase D lode.......... 96
Figure 43: Odumase- Boabedroo Shear. Long section, looking northeast, showing historic mining drives
and pits...................................................................................................................................................... 101
Figure 44: Existing and proposed Tails Storage Facilities (TSFs) .............................................................. 103

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1 Executive Summary
This Qualified Persons Report (“QPR”) has been prepared for LionGold Corp Ltd (“LionGold”) as an
independent summary of the Mineral Resources and current geological understanding of the
Konongo Gold Project in Ghana. The QPR also provides brief overviews of other relevant
information such as mining, metallurgy, environmental and social issues.

1.1 Report Scope and Basis

LionGold Corporation Limited’s subsidiary, Signature Metals Limited (“Signature”), commissioned
SEMS Exploration Services Limited (“SEMS”) to prepare Mineral Resource statements for selected
deposits located within the Konongo Gold Project (“Project”), Ashanti Region, Ghana. These
deposits include Apan, Aserewa, Boabedroo (North, South and South Extension), Obenemase A,
Obenemase B and Obenemase D. It was requested that the Mineral Resources be reported in
accordance with the JORC Code 2012 (“JORC”). The Mineral Resources will be publically reported by
LionGold to the Singapore Exchange (SGX).

This QPR has been prepared on information available up to and including 31st March, 2015.

All references to units of currency in this Report are to Dollars of the United States (“$” or “US$”),
unless stipulated as Australian Dollars (“A$”). Standard abbreviations used are grams gold per tonne
(“g/t”), kilometres (“km”), metres (“m”), million (“M”), troy ounces gold (“oz”) and tonnes (“t”).

1.2 Project Description

LionGold holds an interest in the Project through their 77% ownership of ASX listed Signature
Metals Ltd (“Signature”). Signature holds 70% ownership of Owere Mines Ltd (“Owere”), a
company incorporated in Ghana. Owere’s principal asset is the Konongo Gold Project comprising
the Konongo Mining License 749/03 covering an area of 125.5 km², and the contiguous Kurofa
Prospecting Licence (P6/296) covering an area of 67km². The remaining ownership of Owere is held
by Talos Ghana Limited (“Talos”) 20% and the Government of Ghana holding 10%.

Signature was removed from the official listing of the Australian Stock Exchange of 1st May 2015.

1.3 Geology and Mineralisation

The Konongo Project is in the Ashanti Region of Ghana, West Africa and approximately 160 km
north of the capital Accra. The Project is situated on the western margin of the northeast trending
Ashanti Gold Belt, which hosts the world class Obuasi deposit (60km along trend to the southwest
and owned by AngloGold Ashanti), where past production has exceeded 22 Moz of gold. The
Ashanti Belt also hosts the Prestea / Bogosu deposits, currently mined by Golden Star Resources,
which have historically produced approximately 12Moz of gold. Both the Obuasi and Prestea /
Bogosu deposits are similar in terms of geological setting and mineralisation styles to the Konongo

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deposits. Gold deposits on the Ashanti Shear are notable for their short strike lengths and
persistent down-plunge mineralisation.

Historical mining at Konongo was centred on free milling quartz veins which were developed by
underground mining methods. Sulphide mineralisation, occurring proximal to the quartz veining,
was not extracted due to its refractory nature. Subsequent drilling has confirmed the relatively
continuous and high gold grades of the sulphide mineralisation.

In 2013, LionGold re-focused on the remnant and unmined sulphide-hosted mineralisation as the
Project’s primary target. Significant potential exists to define sulphide mineral resources down dip
and down-plunge of historic oxide mineralisation within the main Konongo and Obenemase mine
areas, as well as the other mineral resources and prospects along shears and in newly targeted
areas. This model has been successfully demonstrated by diamond core drilling campaigns
completed by Signature in 2010 and 2013/14 over the Obenemase deposit. Further potential exists
to target sulphide mineralisation beneath un-mined oxide prospects.

1.4 Mine Production

Gold mining commenced at Konongo and Obenemase in 1903 and over the last 112 years has
produced a total of 4.4 million tonnes of ore for approximately 1.6 million ounces of gold at an
average recovered grade of 11.8 grams per tonne.

A brief summary of historical mining activities and tenure is as follows:

Mining commenced with the discovery of gold at Obenemase in 1903, when the BI shaft
was sunk and four levels developed. Production ceased in 1907.

Konongo Mines Limited, between 1932 and 1986, mined a series of sulphidic quartz reefs
from underground to a maximum depth of 849 metres from six shafts. At Odumase -
Boabedroo, mining development reached 16 levels (849m) before ceasing in 1986. Other
shafts were sunk on Akyenase Central, Leopard, Odumase and South Shaft, Boabedroo and
Zongo. Konongo Mines Ltd abandoned mining activities due to decreasing efficiencies and
machinery failure. A final shaft, 5km to the south was sunk on Gibson’s Reef. This shaft was
abandoned at Level three due to flooding.

From 1988 until 1997 Southern Cross Mining Limited (“SCML”) and Obenemase Gold Mines
Limited (“OGM”) operated six shallow open pit mines targeting oxide ore in the Odumase -
Boabedroo area including the Apan, Aserewa North and South, Boabedroo North and South
and Atunsu deposits, as well as Obenemase A & B. The operation was unsuccessful,
primarily due to poor recoveries from the heap leach pads, and was closed in 1992.
Between 1988 and 1992, a total of 852,000t of ore was heap leached for 86,295 oz Au
recovered at a grade of 3.15 g/t Au.

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Between 1995 and 1997, 614,000 t of ore was treated through a CIL processing circuit
grading 2.96 g/t Au for 58,500 oz Au recovered. Production ceased in 1997 due to
decreasing production and increasing operating costs.

Resolute Mining Limited (“RML”) acquired OGM in 1997. RML undertook a pre-feasibility
study which indicated the potential for the definition of significant sulphide resources and
good metallurgical recoveries from Obenemase mineralisation by flotation, pressure
oxidation and cyanide leaching. RML failed to obtain a joint venture partner or purchaser for
the Konongo Gold Project and the ML’s were relinquished in December 2002.

In 2002 Talos acquired the current Konongo Mining Lease from the Government of Ghana,
and in 2004 entered into a joint venture agreement with African Gold Plc, forming Owere
Mines Limited. As part of this agreement African Gold Plc (now Mwana Africa Plc
(“Mwana”)) purchased a 70 % interest in the Project.

In 2009 Signature acquired a 70 % interest in the Project from Mwana, and

In March 2012 LionGold Corporation acquired 76.2 % of Signature (and increased this to
78% up to March 2015). During the period January 2012 to February 2013, Signature mined
and processed 297,911 t of oxide ore to yield 11,663 oz Au. The recovered grade was 1.2 g/t
Au, from a head grade of 1.7 g/t Au. During the period mill recovery averaged 71%, ranging
from between 50% to 81%.

1.5 Mineral Resources and Ore Reserves

LionGold initiated a review of mineralisation models and mineral resources within the Konongo
Gold Project in 2013. This work has been undertaken by both RSCMME and Snowden Mining
Consultants. Their work is summarised in the following four reports:
Dominy, S C and van Lente B, 2014a. Annual Qualified Persons Report for the Obenemase A
and B Lodes, Konongo Gold Project, Ghana - Year Ended 31 March 2014 - LionGold
Corporation Limited.

Dominy, S C and van Lente B, 2014b. Annual Qualified Persons Report for Selected Deposits,
Konongo Gold Project, Ghana - Year Ended 31 March 2014 - LionGold Corporation Limited.

Reid, W., 2014. Annual Qualified Persons Report for Selected Exploration Targets, Konongo
Gold Project, Ghana – Year end 31 March 2014.

Sterk, R, 2014. Obenemase Project - Technical Report and Mineral Resource Estimation of
the Obenemase Deposit, Ghana, Unpublished report by RSC Mining and Mineral Exploration
for Signature Metals Ltd. pp 128.

This report (the “SEMS 2015 Report”) supports mineralisation models reviewed by Snowden Mining
Consultants in 2014 and presents an updated Mineral Resource estimate for the Obenemase A & B

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deposit and the Obenemase D deposit. The SEMS 2015 Report also draws on mineralisation updates of
other declared Mineral Resources in the four documents listed above.

Prospects downgraded in Reid (2014) remain classified as Exploration Targets under the JORC Code
2012. Exploration Targets from downgraded prospects include: Asieye, Atunsu, Kyereben West, Leopard
Shaft, Nyabo East and Patuo, and are not included in this report.

The Global Mineral Resource estimate as reported in the LionGold Annual Qualified Persons Report for
the Konongo Gold Project, Ghana for year ended 31st March 2014 stood at 9,145,000 t at an average
grade of 3.2 g/t Au for 942,000 oz Au.

There has been no material change to the Apan, Aserewa, and Boabedroo (North, South and South
Extension) Mineral Resources since March 2014. However, drilling activities over the Obenemase A
& B deposit and Obenemase D deposit has resulted in a 28,000 ounce or 3% increase to the global
Mineral Resource estimate for the Konongo Gold Project.

A breakdown of the Mineral Resource estimation for the Konongo Gold Project, as of 31st March 2015, is
presented in Table 1.

There are no Ore Reserves reported for the Konongo Gold Project.

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Table 1: Summary of Mineral Resource estimation for the Konongo Gold Project

Gross Attributable to Net Attributable to

Licence Issuer (53.8%)
Change in
Contained gold
ounces from
Mineral Grade Grade in total
JORC Category Tonnes (t) Tonnes (t) previous
Type (gold) (g/t Au) (g/t Au) mineral
reported
resource
update*
Measured - - - - - -
Indicated - - - - - -
Apan
Inferred 731,000 2.3 393,000 2.3 0 55,000
Total 731,000 2.3 393,000 2.3 0 55,000
Measured - - - - - -
Indicated - - - - - -
Aserewa
Inferred 409,000 3.3 220,000 3.3 0 43,000
Total 409,000 3.3 220,000 3.3 0 43,000
Measured - - - - - -
Indicated - - - - - -
Boabedroo North
Inferred 285,000 3.6 153,000 3.6 0 33,000
Total 285,000 3.6 153,000 3.6 0 33,000
Measured - - - - - -
Indicated - - - - - -
Boabedroo South
Inferred 447,000 2.2 241,000 2.2 0 32,000
Total 447,000 2.2 241,000 2.2 0 32,000
Measured - - - - - -
Boabedroo South Indicated - - - - - -
Extended Inferred 1,841,000 3 991,000 3 0 178,000
Total 1,841,000 3 991,000 3 0 178,000
Measured - - - - - -
Indicated 3,334,000 3.8 1,794,000 3.8 0 408,000
Obenemase A & B
Inferred 1,507,000 3.7 811,000 3.7 15 181,000
Total 4,841,000 3.8 2,604,000 3.8 4 589,000
Measured - - - - - -
Indicated - - - - - -
Obenemase D
Inferred 686,000 1.8 369,000 1.8 8 40,000
Total 686,000 1.8 369,000 1.8 8 40,000
TOTAL All 9,240,000 3.3 4,971,000 3.3 3 970,000

* refers to the LionGold 2014 annual Qualified Persons Reports (Dominy and van Lente 2014a, 2014b)

All Resources have been depleted by the latest available mining surfaces and underground mining volumes. The
north-eastern portion of Obenemase D has been removed, since it overlaps with the Obenemase A and B deposit in
that area. Mineral Resources are reported at 0.5g/t Au cut-off for oxide and transitional and 1.0 g/t Au cut-off for
sulphide.

Note: Mineral Resources which are not Ore Reserves have not demonstrated economic viability. No Ore Reserves
are defined at these deposits. The estimate of Mineral Resources may be materially affected by environmental,
permitting, legal, title, taxation, socio-political, marketing, or other relevant issues. Tonnage is reported in metric
tonnes (t), grade as grams per tonne gold (g/t Au) and contained gold in troy ounces (oz Au). Tonnages rounded to
the nearest 1,000 t. Ounces rounded to the nearest 1,000 oz Au. Figures may not compute exactly due to rounding.

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In 2009, Signature acquired a 70% interest in the Project from African Gold PLC via the acquisition of their 70%
ownership of Owere Mines Ltd. In March 2012, LionGold acquired a 77% ownership in Signature. The net
attributable to LionGold is thus 53.8%. In May 2015, Signature was de-listed from the ASX, becoming a public, non-
listed entity. LionGold’s ownership remains at 77% as of 31 March 2015.

1.6 Economic Analysis

Obenemase is an advanced gold exploration project. No mining is currently being undertaken.
In July 2014 a Scoping Study (Dominy 2014c), based on the Snowden Mineral Resource estimation
(Dominy 2014a, Dominy 2014b), assessed the options for recommencement of mining activities at
Konongo. The Scoping Study report concludes that the Konongo sulphide resources indicate “reasonable
prospects for economic extraction”, with the following possible assessment:

 IRR: 35%
 NPV: US$ 22.926M
 Head grade: 3.48 g/t Au
 Mine Life: 6.75 years.
 Significant upside expected from exploration

1.7 Risk Assessment

The current Mineral Resource at Obenemase A & B carries an overall “medium” risk due to geological
and grade variability within portions of the Mineral Resource model. This is represented by the Inferred
category which accounts for 30% of the Obenemase A & B Mineral Resource. Within zones of closer
spaced drilling and adjacent to known underground workings the level of risk reduces and the Mineral
Resources are classified in the Indicated category.

The other Mineral Resources of Boabedroo, Apan and Aserewa as well as Obenemase D have an overall
“High” risk which is reflected in their classification as Inferred Mineral Resources.

Geological understanding of the Obenemase Mineral Resource is based on an approximate 20m by 20m
drill pattern plus historical mine development to 100m depth. Drill spacing increases to 40m x 40m at
depth. While there is some uncertainty concerning geological interpretations in the deeper portions of
the Obenemase A & B Mineral Resource models the overall geological risk is considered to be “low-
medium”.

However, geological understanding of the other deposits (Boabedroo, Apan, and Aserewa) needs to be
improved. Drill spacing is variable, with generally 20m grids covering the oxide portions of the mineral
resources (now depleted through mining) and spaced at 40 to 80m peripheral to the historic pits and
into fresh rock.

Samples used for gold analyses are considered to carry a “medium” risk rating. In-situ sample
representivity is likely to be reasonable, as there is minimal coarse-gold present with a relatively low
nugget effect. However, the use of data from several historical sampling campaigns and varying

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analytical methods will impart a level of error. Historical and recent QAQC audits indicate an acceptable
level of analysis quality.

Grade estimates for Obenemase A & B carry a “medium” risk whereas grade estimates for the other
deposits have a “high” risk rating due to variability with their Mineral Resource models. Estimation
block size is broadly appropriate to the drill spacing, however, on a block by block basis, estimation error
will be relatively high. The current global Mineral Resource estimate is reasonable, given that volumes
are based on models constrained by drill data and geological interpretation.

No Ore Reserves have been defined and no economic studies have been undertaken. The Snowden
Scoping study (Dominy 2014c) indicates that “extraction via an open pit and underground operation is
reasonable”. There is a fully operational processing plant at Konongo but this is optimised for oxide
rather than primary ore. The majority of the Obenemase Mineral Resource is primary-sulphide ore.
Previous metallurgical testwork indicates that the primary-sulphide ore is refractory and requires
additional processing. Further metallurgical testwork is required to prove extractability.

The Competent Persons believe the accuracy of the grade and tonnage estimate for Mineral Resources
within the Indicated category to be within ±25% globally. This opinion is based on over 70 years
combined experience of this style of mineralisation in the Birimian of West Africa. Similarly, the accuracy
of the grade and tonnage estimate for the Inferred Mineral Resources is considered to be within ±30-
50% globally.

Social, legal, political and environmental risks are considered “low”, given the relatively stable and
developed nature of Ghana as well as the maturity of its mining sector. However, the Competent
Persons have not undertaken a study of the social, legal, political and environmental factors that may
affect the Project on a district scale.

1.8 Conclusions
All Mineral Resources attributable to LionGold are located within the Konongo Mining licence, which is
valid until 2023. The Konongo Gold Project also includes an adjacent Prospecting Licence which is
renewable every two years, conditional on area reductions. The deposits are in close proximity to the
towns of Konongo and Obenemase, both approximately 200km by road northwest of Accra and
approximately 55km east of the major regional centre of Kumasi, within the Ashanti Region of
southwest Ghana.

Estimated gold production from the Konongo Mine between 1903 and 1997 is 1.6 Moz Au. To date, a
total of 118,521m of drilling and 18,640m of exploration trenching has been completed within the
Project. Since 2012, Signature has completed a total of 18,989m of drilling and 1,293m of exploration
trenching over the Obenemase deposit.

The Obenemase Mineral Resource is located at the northern end of the Mining Lease with Odumase –
Boabedroo in the south. Historic mineral resources include open pit and underground workings. The
deepest mine working extend to 849m at Boabedroo.

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Two styles of mineralisation are described at Obenemase, an early disseminated sulphide phase and a
later quartz vein phase. Gold mineralisation is associated with arsenopyrite, pyrite, and rare
chalcopyrite. Gold occurs free in veins, on fractures in sulphides as well as rimming sulphides. Quartz
veins are 0.5 m to 0.8 m wide, and display evidence of repeated shearing and resealing. Laminated
quartz is common, often with included wall fragments. Disseminated sulphide mineralisation forms a
wide zone around quartz veins and in tuff.

Drilling to date has supported the estimation of an Indicated and Inferred Mineral Resource of 970,000
oz Au, Table 1, for the Konongo Gold Project. This represents a 28,000 ounce or 3% increase on the
global Mineral Resource estimation reported as at 31st March 2014. The increase in Mineral Resources
is restricted to the Obenemase A & B deposit where the reported Mineral Resource contains 589,000 oz
Au in both the Indicated and Inferred categories and the Obenemase D deposit where the reported
Mineral Resource contains 40,000 oz Au in the Inferred category. The other deposits contain a total
Inferred Mineral Resource of 341,000 oz Au. All the Mineral Resources within the Konongo Gold Project
are classified in accordance with the JORC Code 2012 and contain three domains that are defined by
statistical and spatial analysis. These are principally based on ore type, including oxide, transitional and
primary material.

The Obenemase A & B Mineral Resource, the largest and most extensively tested deposit within the
Konongo Gold Project, was estimated using ordinary kriging. Based on drill spacing and the presence of
historical mine workings, the Mineral Resource at Obenemase A & B has been classified in both the
Inferred and Indicated categories (Table 1). This reflects the higher level of confidence of the estimated
blocks proximal to historical mine workings. Geological continuity in the mine workings is verified
through historical mapping and trial mining. The overall Mineral Resource risk for Obenemase A & B is
defined as “medium” which reflects the need for further drilling to increase and improve the Mineral
Resource classification. The Mineral Resource for Obenemase A & B is deemed by the Competent
Persons to have reasonable prospects for eventual economic extraction.

Mineral Resources for the other deposits were estimated using inverse distance squared (ID2) with a
top-cut. The overall Mineral Resource risk for the other deposits is defined as “high”, reflecting the
historical nature of the data, geological model and estimation methodology.
The Mineral Resource estimation to date for the Obenemase A and B lodes shows a deposit
hosting 589,000 ounces at an average grade of 3.8 g/t, in the Indicated and Inferred categories.
The deposit is a narrow vein, steeply dipping structure having a strike length of 1,000m and
extending up to 300 metres beneath the topography surface. It remains open at depth and
laterally in places.
Gold mineralisation within the Mineral Resource is predominantly hosted by volcaniclastic
siltstones and sandstones, with gold being associated with alteration and having a low nugget
effect.
The Mineral Resource has been classified as a combination of Indicated and Inferred, without a
Measured category. This is largely due to uncertainties in grade and structural continuity, which
may be a function of the limited drilling to date.

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SEMS is of the opinion that the Obenemase and other deposits have potential for extensions to
the existing Mineral Resource, which may be delineated with further drilling.
SEMS is not aware of any external factors such as environmental, socio-economic and legal that
could have a material effect on the Mineral Resource estimate. The Project is an historical mine
site and eventual economic extraction, if warranted, is likely to be by underground mining which
should lessen environmental impacts and potentially contribute to employment within the area.
A Scoping Study of the Konongo Gold Project in 2014 indicated reasonable prospects for
eventual economic mining of Obenemase A and B as well as Boabedroo North and South.

1.9 Recommendations
Resulting from the mineral resource estimations completed by SEMS in 2015 for the Konongo Gold
Project the following recommendations are proposed for the Obenemase A & B deposit:
External verification of density values used in the mineral resource model, especially those
assigned to the transitional ore.

Allocation of density values to mineral resource blocks in a gradational range between oxide and
transitional ore and between transitional and sulphide ore.

Further geological and structural studies to guide the delineation of improved mineralisation
wireframes. This will assist future drill planning especially for extensions of the Obenemase A
lode at depth and the position of Obenemase B lode.

Drilling is required within the existing mineral resource to:

 Upgrade Inferred category to Indicated category – infill drilling.

 Covert unclassified material into Mineral Resource status – extensional drilling beneath
0mRL.

Resulting from the mineral resource estimations completed by SEMS in 2015 for the Konongo Gold
Project the following recommendations are proposed for the Obenemase D deposit:
Further geological and structural studies to guide the delineation of improved mineralisation
wireframes and geological interpretations. This will assist future drill planning.

Drilling is required within the existing mineral resource to upgrade Inferred category to
Indicated category – infill drilling.

Resulting from the Scoping Study completed in 2014 the following recommendations are proposed:
Additional metallurgical testwork on the refractory, sulphide ore to better understand the
Project’s processing options.

Additional drilling to provide geotechnical information and metallurgical samples.

Due to QAQC issues with historical data, all remaining diamond core or pulps should be
reanalysed.

Continue the validation of historical data and incorporate uncaptured historical data into the

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Project database.

Refine and expand the Scoping Study to:

 Include all the Mineral Resources within the Konongo Gold Project

 Review underground mining options for higher grade ore shoots

 Assess the viability of an open pit mining option within the Konongo Mining Lease
 Incorporate longer-term planning to exploit known, deep, quartz vein-hosted, free
milling gold.

 Focus on bringing the Project datasets to a standard that will facilitate a Pre-Feasibility
Study.

Assess exploration targets outside the current mineral resources that lie on known structures
that are interpreted to control mineralisation.

2 Introduction
2.1 Aim and Scope of Report
LionGold Corp Ltd (“LionGold” or “LGC”) is a public company listed on the Catalist Board of the
Singapore Exchange. LionGold holds an interest in the Konongo Gold Project through their 77%
ownership of Signature Metals Ltd (“Signature”), which holds 70% of Owere Mines Ltd (“Owere”).
Owere is the owner of the Konongo Mining License.

LionGold tasked the author to deliver a Qualified Persons Report on Mineral Resources within the
Konongo Gold Project. The Report includes deposits with current Mineral Resources and relies on
information in two earlier reports:

Dominy, S C and van Lente B, 2014a. Annual Qualified Persons Report for the Obenemase A
and B Lodes, Konongo Gold Project, Ghana - Year Ended 31 March 2014 - LionGold
Corporation Limited.

Dominy, S C and van Lente B, 2014b. Annual Qualified Persons Report for Selected Deposits,
Konongo Gold Project, Ghana - Year Ended 31 March 2014 - LionGold Corporation
Limited.

The two reports are prepared in accordance with the Singapore Exchange Practice Note 6.3.

2.2 Use of Report

The Report will be submitted by LionGold to the Singapore Exchange Securities Trading Limited (“SGX”).

2.3 Reporting Standards

The SGX Catalist rules require that a QPR be prepared in accordance with one of three allowable
international public reporting standards. For this report, the JORC Code 2012 has been adopted as the

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reporting standard. The JORC Code requires that a public report concerning a company’s exploration
targets, exploration results, Mineral Resources or Ore Reserves must be based on, and fairly reflect, the
information and supporting documentation prepared by a Competent Person, as defined by the JORC
Code. SGX Catalist rules use the term Qualified Person, and provide a definition which is effectively
equivalent to a Competent Person. In this report, whenever reference is made to a Competent Person as
per the JORC Code, it is equivalent to a Qualified Person as per SGX Catalist rules.

2.4 Report Authors and Contributors

Staff who compiled this report are listed in Table 2.

Table 2: Staff who contributed to this QPR

Independent Date of Professional Contribution to

Name Position Employer
of LionGold Site Visit Designation QPR
Bill Reid Exploration LionGold No Resident MAusIMM Geology
Manager Corporation Chapters 1-7, 9-17
Simon MD SEMS Yes None FIMMM Resources &
Meadows Geologist Exploration Geology
Smith Chapters 1 & 8
Joe Amanor Geologist SEMS Yes May 2015 MAusIMM Resources &
Exploration CP (Geo) Geology Chapter 8
Andrew Mining SEMS Yes May 2015 MAusIMM Resources
Netherwood Engineer Exploration Chapter 8

The Authors drew on other sources during the preparation of this report, all sourced from written
reports, principally:

Dominy, S C and van Lente B, 2014a. Annual Qualified Persons Report for the Obenemase A and
B Lodes, Konongo Gold Project, Ghana - Year Ended 31 March 2014 - LionGold Corporation
Limited.

Dominy, S C and van Lente B, 2014b. Annual Qualified Persons Report for Selected Deposits,
o Konongo Gold Project, Ghana - Year Ended 31 March 2014 - LionGold Corporation
Limited.

Dominy, S C., Muller, H., Theron, P and Priest, J. 2014c. Owere Mines Limited Konongo Gold
Project No. L582 Scoping Study July 2014. 250pp.

Sterk, R, 2014. Obenemase Project - Technical Report and Resource Estimation of the
Obenemase Deposit, Ghana, Unpublished report by RSC Mining and Mineral Exploration for
Signature Metals Ltd. 128pp.

Netherwood, A, 2015. Mineral Resource update of the Konongo Gold Project

LionGold drew on the expertise of others during the compilation of this QPR. Key other experts are listed
in Table 3.

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Table 3: Reliance on other Experts

Independent Date of Professional Contribution to

Name Position Employer
of LionGold Site Visit Designation QPR
Bill Reid Exploration LionGold No Resident MAusIMM Geology
Manager Corporation Chapters 1-7, 9-17
Simon Meadows MD (1) SEMS Yes None FIMMM Resources
Smith Geologist Exploration Chapter 1 & 8
Joe Amanor Geologist (1) SEMS Yes May 2015 MAusIMM Resources &
Exploration CP (Geo) Geology
Chapter 8
Andrew Mining (1) SEMS Yes May 2015 MAusIMM Resources
Netherwood Engineer Exploration Chapter 8
Rene Sterk Principal (2) RSC Mining & Yes 2013 MAusIMM Competent Person,
Consultant Exploration Ltd MAIG Feb 2014 estimate
at Obenemase.
Dr Simon Executive (3) Snowden Yes None FAusIMM (CP) 2014 Report.
Dominy Consultant Group FAIG (RPGeo)
FGS(CGeol)
Dr Belinda Van Senior (3) Snowden Yes Feb. 2014 PrSciNat 2014 Resource
Lente Consultant Group estimation.

(1) Address: 17 Orphan Crescent, Labone, Accra, Ghana

(2) Address: 109 Princes Street, Dunedin 9016, New Zealand
(3)Address: Level 4, 1 Kingdom Street, Paddington Central, London W2 6BD, UK.

2.5 Qualified Persons Statement

The information in this Qualified Persons Report (“QPR”) relates to the geological setting and Mineral
Resource estimates for the Konongo Gold Project and is based on information supplied by the
Exploration Manager for Owere, Mr. Bill Reid.

The QPR was compiled by Andrew Netherwood, Joe Amanor and Simon Meadows Smith with assistance
from Bill Reid. By virtue of their education, relevant work experience and affiliation to recognized
professional associations Joe Amanor (MAusIMM CP), Simon Meadows Smith (FIMMM) and Andrew
Netherwood (MAusIMM) are independent Qualified Persons as defined by the JORC Code 2012.
Andrew Netherwood is a Mining Engineer with over 25 years of experience in open pit and underground
mine design and planning. He is a Member of the Australasian Institute of Mining and Metallurgy and
has sufficient experience which is relevant to the style of mineralisation and type of deposit under
consideration to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ and ASX Listing Rules
Guidance Note 31. Andrew has also been involved in a number of mineral resource and ore reserve
estimations of gold deposits within the Birimian of West Africa.
Joe Amanor is a consulting geologist with extensive experience in surface and underground exploration,
as well as mineral resource evaluation, of Birimian hosted gold deposits in Ghana. He is a Member of the
Australasian Institute of Mining and Metallurgy and has sufficient experience which is relevant to the
style of mineralisation and type of deposit under consideration to qualify as a Competent Person as

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defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral
Resources and Ore Reserves’ and ASX Listing Rules Guidance Note 31. Joe was previously Chief
Geologist for AngloGold Ashanti at the Obuasi gold mine and he also visited the Konongo Mine during
the period when underground mining operations were active.

Simon Meadows Smith is the Managing Director of SEMS and a key member of the geological
consultancy staff. He is a Fellow of the Institute of Materials, Minerals and Mining in London and has
sufficient experience which is relevant to the style of mineralisation and type of deposit under
consideration to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code
for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ and ASX Listing Rules
Guidance Note 31. Simon has over 25 years working experience in the Archaean Terrains of Western
Australia and the Proterozoic Terrains of West Africa. He has been working for SEMS since its inception
in 2002 and during that time has been involved in several mineral resource estimates for Birimian
hosted gold deposits in West Africa.

Mr. Reid is a Member of the Australasian Institute of Mining and Metallurgy and has sufficient
experience which is relevant to the style of mineralisation and type of deposit under consideration and
to the activity he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the
‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ and ASX
Listing Rules Guidance Note 31. Mr. Reid is an employee of LionGold Corporation and has worked on the
Konongo Gold Project, since October 2011.

The effective date of this QPR is 31st March, 2015.

2.6 Basis of the Report

The Report presents descriptions of Mineral Resources within the Konongo Gold Project and is in
accordance with the JORC Code (2012). All data has been sourced from on-site databases and reports or
peer reviewed manuscripts.

3 Project Description
3.1 Project Overview
The Konongo Gold Project is a gold project located in Asante Akyem District, Ashanti Region, Ghana.
Mineral Leases encompass the namesake town of Konongo which has an estimated population of
around 170,000. Konongo lies 160 km northwest of the Capital City of Accra and 40 km east of the major
regional centre of Kumasi, within the Ashanti Region of southwest Ghana (Figure 1). The Project
straddles the western margin of the Ashanti Belt, a demonstrated gold province.
The historical deposits at Konongo include open pit and underground workings. The project comprises
fifteen historic oxide pits and 6 historic shafts occurring over 12 kms of identified shears. The historic
mineral resources are located on two main shears (the Boabedroo Shear and the Zongo Shear) which
are approximately 300m apart. Deepest underground mining is at Boabedroo, to 849m (level 19). The
estimated production between 1903 and 2013 is 1.6 Moz Au.

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The project operator is Owere Mines Limited, which is 70% owned by Signature Metals Limited.
Signature Metals Limited is listed on the Australian Stock Exchange, but is in the process of delisting. It is
expected that the Company will be removed from the ASX Official List on or about 30 April 2015 or such
other time as determined by ASX. Signature Metals is 78% owned by Liongold Corporation Limited.
LionGold’s’ net ownership of the Konongo Project is 54.6%. The current operator is continues to explore
the property to build on existing mineral resources and high priority Exploration Targets.

Figure 1: Location, Konongo

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3.2 Tenure
The current concessions comprising the Konongo Gold Project, totalling 159.04 km2 are:
The current Mining Lease (749/03) - the amalgamation of three historic licences which formed
the Konongo Mining Lease concession (Figure 2, Figure 3 and Table 3), and

The Kurofa Prospecting Licence (P6/296), which wraps around the Mining Lease to the north
and east (Figure 2, Figure 4 and Table 4).

The history of the Konongo Mining Lease and the Kurofa Prospecting Licence is described below.

The concession was issued to the State Gold Mining Corporation (“SGMC”) on the 8th December 1986 for
a period of 30 years and subsequently assigned to Southern Cross Mining Limited on 8th August 1988.
Its extent captures the sheared margin of gold prospective Birimian volcanic rocks, including the historic
mining centres.

The Konongo Mining Lease 749/03 concession was issued to Talos in December 2002 for a period of 8
years and covered an area of 125.54 square kilometres (Figure 3). In 2004 Talos entered into a joint
venture agreement with African Gold Plc, forming Owere Mines Limited (“Owere”). As part of this
agreement African Gold Plc (now Mwana Africa Plc (“Mwana”)) purchased a 70 % interest in Owere. In
2009 Signature acquired a 70% interest in the Project from Mwana via the acquisition of their 70%
ownership of Owere Mines Limited. Licences are summarised in Table 4.

The current Mining Lease (Figure 2, Figure 3) was issued to Owere on 25th June 2010 for a period of 13
years. The Mining Lease (“ML”) is valid through to 2023. The 2014 Operating Licence and the
Environmental Permit for the ML have been delivered and are valid to January 6, 2016.

In 2014, the Mining Lease was converted to a graticular cadastral system employed by the Ghanaian
Minerals Commission, based on the pre-existing lease boundaries. The graticular cadastre is based on
15” north-south and east-west grid. The lease covers 125.54 km2.

There are no known impediments to the Konongo Mining Lease (749/03).

The Kurofa Prospecting Licence PL 6/296 originally covered 67 km2 was issued to Owere in August 2005.
The licence is immediately adjacent to the Mining Lease to the north and east. Its extents capture a
second limb of gold prospective Birimian volcanic rocks to the east of the historic mining centres. The
Prospecting Licence (“PL”) is conditional on acceptance of a terminal report submitted in December
each year. The PL is renewed on a two yearly basis, conditional on a 50% statutory reduction. The
reports are current to December 2014, and an exemption from the 50% reduction is included in the
report, following a reduction in 2013. During the reporting period, the Kurofa PL was converted to the
graticular cadastral system employed by the Ghanaian Minerals Commission, based on the pre-existing
lease boundaries. The graticular cadastre is based on 15” north-south and east-west grid. The licence
covers 33.5 km2.

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There are no known impediments to the Kurofa Prospecting Licence (P6/296).

Figure 2: Tenements and Infrastructure

Pillar numbers and pillar coordinates for the Konongo Mining Lease (749/03) are presented as Figure 3
and Table 5. Pillar numbers and pillar coordinates for the Kurofa Prospecting Licence (P6/296) are
presented as Figure 4 and Table 3.

Table 4: Konongo Mining Lease and Kurofa Prospecting Licence summary

Type of
Issuer's Development Licence Licence
Asset Name Country mineral, oil or Remarks
Interest Status Expiry Date Area
gas deposit
Konongo Mining Evaluation and
Ghana 53.8% June 2023 125.54 km² gold none
Lease (ML 749/03) exploration
Kurofa Prospecting December
Ghana 53.8% Exploration 33.50 km² gold none
Licence (PL 6/296) 2015

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Figure 3: Konongo Mining Lease 749/03 boundary.

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Table 5: Konongo ML pillar locations (Latitude/Longitude).

KONONGO CONCESSION BOUNDARY POINTS KONONGO CONCESSION BOUNDARY POINTS
LONG LAT LONG LAT
id (deg) (min) (sec) (deg) (min) (sec) id (deg) (min) (sec) (deg) (min) (sec)
1 -1 16 15 6 38 30 59 -1 7 15 6 43 15
2 -1 15 45 6 38 30 60 -1 7 0 6 43 15
3 -1 15 45 6 38 45 61 -1 7 0 6 43 0
4 -1 15 15 6 38 45 62 -1 6 30 6 43 0
5 -1 15 15 6 39 0 63 -1 6 30 6 42 30
6 -1 15 0 6 39 0 64 -1 6 45 6 42 30
7 -1 15 0 6 39 15 65 -1 6 45 6 42 15
8 -1 14 45 6 39 15 66 -1 7 0 6 42 15
9 -1 14 45 6 39 30 67 -1 7 0 6 42 0
10 -1 14 30 6 39 30 68 -1 7 15 6 42 0
11 -1 14 30 6 39 45 69 -1 7 15 6 41 45
12 -1 14 0 6 39 45 70 -1 7 30 6 41 45
13 -1 14 0 6 40 0 71 -1 7 30 6 41 30
14 -1 13 30 6 40 0 72 -1 7 45 6 41 30
15 -1 13 30 6 40 15 73 -1 7 45 6 41 0
16 -1 13 15 6 40 15 74 -1 8 0 6 41 0
17 -1 13 15 6 40 30 75 -1 8 0 6 40 45
18 -1 12 45 6 40 30 76 -1 8 15 6 40 45
19 -1 12 45 6 40 45 77 -1 8 15 6 40 30
20 -1 12 15 6 40 45 78 -1 8 30 6 40 30
21 -1 12 15 6 41 0 79 -1 8 30 6 40 15
22 -1 11 45 6 41 0 80 -1 8 45 6 40 15
23 -1 11 45 6 41 15 81 -1 8 45 6 40 0
24 -1 11 30 6 41 15 82 -1 9 0 6 40 0
25 -1 11 30 6 41 30 83 -1 9 0 6 39 45
26 -1 11 15 6 41 30 84 -1 9 15 6 39 45
27 -1 11 15 6 41 45 85 -1 9 15 6 39 30
28 -1 11 0 6 41 45 86 -1 9 0 6 39 30
29 -1 11 0 6 42 0 87 -1 9 0 6 39 15
30 -1 10 45 6 42 0 88 -1 9 15 6 39 15
31 -1 10 45 6 42 15 89 -1 9 15 6 38 45
32 -1 10 30 6 42 15 90 -1 9 30 6 38 45
33 -1 10 30 6 42 30 91 -1 9 30 6 38 30
34 -1 10 15 6 42 30 92 -1 9 45 6 38 30
35 -1 10 15 6 42 45 93 -1 9 45 6 38 0
36 -1 10 0 6 42 45 94 -1 10 0 6 38 0
37 -1 10 0 6 43 0 95 -1 10 0 6 37 45
38 -1 9 45 6 43 0 96 -1 10 15 6 37 45
39 -1 9 45 6 43 15 97 -1 10 15 6 37 15
40 -1 9 30 6 43 15 98 -1 10 30 6 37 15
41 -1 9 30 6 43 30 99 -1 10 30 6 36 45
42 -1 9 15 6 43 30 100 -1 10 45 6 36 45
43 -1 9 15 6 43 45 101 -1 10 45 6 36 30
44 -1 9 0 6 43 45 102 -1 11 0 6 36 30
45 -1 9 0 6 44 0 103 -1 11 0 6 36 0
46 -1 8 45 6 44 0 104 -1 11 15 6 36 0
47 -1 8 45 6 44 15 105 -1 11 15 6 35 45
48 -1 8 30 6 44 15 106 -1 11 45 6 35 45
49 -1 8 30 6 44 0 107 -1 11 45 6 35 30
50 -1 8 15 6 44 0 108 -1 14 15 6 35 30
51 -1 8 15 6 43 45 109 -1 14 15 6 35 45
52 -1 8 0 6 43 45 110 -1 14 45 6 35 45
53 -1 8 0 6 43 30 111 -1 14 45 6 36 0
54 -1 7 45 6 43 30 112 -1 15 15 6 36 0
55 -1 7 45 6 43 15 113 -1 15 15 6 36 15
56 -1 7 30 6 43 15 114 -1 15 45 6 36 15
57 -1 7 30 6 43 0 115 -1 15 45 6 36 30
58 -1 7 15 6 43 0 116 -1 16 15 6 36 30

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Figure 4: Kurofa Prospecting Licence PL6/296 boundary.

Table 6: Kurofa PL pillars locations (Lat/Long)

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KUROKA CONCESSION BOUNDARY POINTS KUROKA CONCESSION BOUNDARY POINTS

ID latitude longitude ID latitude longitude

(deg) (min) (sec) (deg) (min) (sec) (deg) (min) (sec) (deg) (min) (sec)
Ka1 6 43 0 -1 10 0 Ka48 6 39 45 -1 9 15
Ka2 6 44 15 -1 10 0 Ka49 6 39 45 -1 9 0
Ka3 6 44 15 -1 9 45 Ka50 6 40 0 -1 9 0
Ka4 6 44 45 -1 9 45 Ka51 6 40 0 -1 8 45
Ka5 6 44 45 -1 8 15 Ka52 6 40 15 -1 8 45
Ka6 6 44 15 -1 8 15 Ka53 6 40 15 -1 8 30
Ka7 6 44 15 -1 7 45 Ka54 6 40 30 -1 8 30
Ka8 6 44 0 -1 7 45 Ka55 6 40 30 -1 8 15
Ka9 6 44 0 -1 7 0 Ka56 6 40 45 -1 8 15
Ka10 6 43 45 -1 7 0 Ka57 6 40 45 -1 8 0
Ka11 6 43 45 -1 6 45 Ka58 6 41 0 -1 8 0
Ka12 6 43 30 -1 6 45 Ka59 6 41 0 -1 7 45
Ka13 6 43 30 -1 6 30 Ka60 6 41 30 -1 7 45
Ka14 6 43 15 -1 6 30 Ka61 6 41 30 -1 7 30
Ka15 6 43 15 -1 6 15 Ka62 6 41 45 -1 7 30
Ka16 6 42 15 -1 6 15 Ka63 6 41 45 -1 7 15
Ka17 6 42 15 -1 6 30 Ka64 6 42 0 -1 7 15
Ka18 6 42 0 -1 6 30 Ka65 6 42 0 -1 7 0
Ka19 6 42 0 -1 5 45 Ka66 6 42 15 -1 7 0
Ka20 6 40 45 -1 5 45 Ka67 6 42 15 -1 6 45
Ka21 6 40 45 -1 6 0 Ka68 6 42 30 -1 6 45
Ka22 6 40 30 -1 6 0 Ka69 6 42 30 -1 6 30
Ka23 6 40 30 -1 7 30 Ka70 6 43 0 -1 6 30
Ka24 6 39 45 -1 7 30 Ka71 6 43 0 -1 7 0
Ka25 6 39 45 -1 8 0 Ka72 6 43 15 -1 7 0
Ka26 6 39 0 -1 8 0 Ka73 6 43 15 -1 7 15
Ka27 6 39 0 -1 8 15 Ka74 6 43 0 -1 7 15
Ka28 6 38 45 -1 8 15 Ka75 6 43 0 -1 7 30
Ka29 6 38 45 -1 8 30 Ka76 6 43 15 -1 7 30
Ka30 6 38 30 -1 8 30 Ka77 6 43 15 -1 7 45
Ka31 6 38 30 -1 8 45 Ka78 6 43 30 -1 7 45
Ka32 6 37 45 -1 8 45 Ka79 6 43 30 -1 8 0
Ka33 6 37 45 -1 9 0 Ka80 6 43 45 -1 8 0
Ka34 6 37 30 -1 9 0 Ka81 6 43 45 -1 8 15
Ka35 6 37 30 -1 10 15 Ka82 6 44 0 -1 8 15
Ka36 6 37 45 -1 10 15 Ka83 6 44 0 -1 8 30
Ka37 6 37 45 -1 10 0 Ka84 6 44 15 -1 8 30
Ka38 6 38 0 -1 10 0 Ka85 6 44 15 -1 8 45
Ka39 6 38 0 -1 9 45 Ka86 6 44 0 -1 8 45
Ka40 6 38 30 -1 9 45 Ka87 6 44 0 -1 9 0
Ka41 6 38 30 -1 9 30 Ka88 6 43 45 -1 9 0
Ka42 6 38 45 -1 9 30 Ka89 6 43 45 -1 9 15
Ka43 6 38 45 -1 9 15 Ka90 6 43 30 -1 9 15
Ka44 6 39 15 -1 9 15 Ka91 6 43 30 -1 9 30
Ka45 6 39 15 -1 9 0 Ka92 6 43 15 -1 9 30
Ka46 6 39 30 -1 9 0 Ka93 6 43 15 -1 9 45
Ka47 6 39 30 -1 9 15 Ka94 6 43 0 -1 9 45

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3.3 Tenure Conditions

The legal framework governing mining and related activities within Ghana is embodied in the Ghanaian
Minerals and Mining Act 2006, Act 703.

Significant features of this legislation are as follows:

 All minerals are owned by the state: The Minister of Lands and Natural Resources (“MLNR”)
grants exclusive mineral rights. No transfers are permitted without the approval of the MLNR.
 Application of mineral legislation: The legislation is applied equally to both Ghanaians and
foreign entities, except for the provisions relating to small-scale mining of minerals, which is
reserved for Ghanaian entities. However, foreign entities can participate in the exploration and
exploitation of industrial minerals where the proposed investment is not less than US$10
million.
 Government participation in mining lease: The Government is entitled to a free-carried equity
interest of 10 % in mineral ventures. Any further participation is to be agreed with the holder.
 Payment of royalties: Royalties vary from 3-6 % of the gross value of minerals produced.
 Mining lease: A person, not necessarily a holder of a Reconnaissance / Prospecting License may
apply for a mining lease.
 Stability agreement: It seeks to protect the holder of a mineral right for a period of up to 15
years, from any adverse effects of future changes in law that are capable of imposing a large
financial burden on the holder. The agreement is subject to parliamentary approval.
 Development agreement: The MLNR may enter into a Development Agreement (“DA”) with the
holder of /applicant for a mining lease if the investment exceeds US$500 million. The DA may
contain terms of a stability agreement, in addition to terms that may vary the mining law
(especially the fiscal regime).

3.4 Property Location, Access and Infrastructure

Konongo (Figure 1) is 40km from the regional capital Kumasi which is 160km by road from Accra, the
national capital. The roads from Accra and Kumasi are almost fully sealed. The Konongo area was served
by the Accra Kumasi railway (currently non-operational and moderately degraded) as well as being
connected to the national power grid and telephone system.

Access within the concession is provided by several all-weather public roads, a haul road constructed
during operations in the 1990’s, and numerous minor tracks and footpaths.

LGC has an existing bulk power supply agreement with the Volta River Authority for electrical power
supply and their high voltage power lines run over the Konongo Mining License. The mine electrical
distribution system comprises 11,000 volt overhead power lines to the old Konongo mine area and the
processing plant. Transformers provide 440 volt 3 phase power supply via local substations.

The mine administrate offices are located on the outskirts of the major town of Konongo-Odumasi
which is located on the Accra-Kumasi highway. Both senior staff and junior staff accommodation exists
at Konongo.

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The topography is gently undulating with some prominent hills, covered primarily by secondary tropical
forest comprising trees up to 60 metres in height and thick undergrowth. Average elevation is 200 to
250 metres above sea level.

3.5 Climate
Temperatures in the region vary between 18⁰C and 35⁰C and rainfall averages about 1,200 mm per
annum (Figure 5, Figure 6). The rainy season is from April to October with two peak periods in May-June
and September. The topography is gently undulating with some prominent hills, covered primarily by
secondary tropical forest comprising trees up to 60 m in height and thick undergrowth. Average
elevation is 200 m to 250 m above sea level. It is possible for mining operations to continue throughout
the year, though occasional days may be lost due to extremely heavy rain. The exploration field season
can continue throughout the year.

Figure 5: Average Monthly Temperature, Konongo

Figure 6: Average Monthly Temperature, Konongo

3.6 Landforms and Soils

The topography is gently undulating with some prominent hills, determined by the underlying rock
types. Intrusive rocks, mineralised rocks and parts of the uppermost geological unit (the Tarkwaian)
typically occur as hills. The youngest rocks in the region, the Voltaian sediments, occur to the north of
the tenements and are characterized by abrupt, impressive cliffs. Sheared and faulted rocks form
recessive features.

Soils and landforms are mainly characterized by the underlying rocks (and their weathered products).
The regolith over volcanics rocks (Birimian) form clay rich weathered sequences up to 35m deep, with
humic soils to approximately 30cm. These rocks form either recessive valleys or minor prominences.

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Rocks are rarely exposed at surface. Altered Birimian rocks also form weak prominences, believed to be
the result of silica in the alteration suites. Intrusive rocks develop a skeletal residual soil profile, and are
often less affected by weathering, and include bald outcrops. Most prominent hills are weathering-
resistant intrusive rocks. The Tarkwaian, a quartz-rich sandy sequence, develops a clayey sand soil,
which is variably prominent or recessive. Generally, where affected by structures, these rocks are
recessive.

All areas have potential to include transported cover – colluvium and in some areas laterite. Thicknesses
vary, but the modern topography plays some control. Recessive topography is more inclined to develop
thicker transported cover, and prominent hills less likely to do so. Where laterites occur, there are
localized examples of terrain inversion (laterite formed in an historic depression is now a partially
prominent feature). These features are irregularly developed and there is no evidence of peneplanation
(as the laterites abut historic prominences).

Alluvial channels, follow existing northeast-southwest landforms (which in turn parallel geology) are a
mixture of sand and clay depending on the lithologies the watercourse crosses. Rivers and streams have
variably developed alluvial plains comprising basal (and often auriferous) gravels up to 2m thick beneath
sands and clays, also up to 2m thickness.

3.7 Fauna and Flora

Owere is located within the tropical rain forest zone of the country and the vegetation has been
classified by Hall and Swaine (1981) as a Moist Semi-Deciduous forest of the Northwest sub-type. The
land is covered by secondary tropical forest comprising trees up to 30 m in height and thick
undergrowth, or farming plots. Average elevation is 200 m to 250 m above sea level. Rainfall averages
1,200 mm per annum, falling primarily in the wet season from April to October, with two peak periods in
May‐June and September. Large areas within the project site have had a long history of land rotation
cultivation characterised by slash and burn so the present vegetation is a mosaic of fallow farmland
consisting of secondary forests, herbs, shrubs and swamp vegetation.

3.8 Hydrology
Drainage channels preferentially exploit weathered geological structures and contacts, forming herring
bone arrays of lower order streams and creeks into higher order streams. The principal drainage is away
from the main shears (which form a linear northeast trending prominence) and along the regional core
of the prospect scale syncline. East of the main shears, the Owere River, the principal river on the site,
flows along this structure and then cuts across the main shear at the Konongo township. The river
traverses the concession beginning at the Adumadum village (off the concession to the north), through
Obenemase and Odumase. The river is fed by a number of minor streams which drain perpendicular to a
series of northeast-southwest ridges. The Owere River has a catchment of approximately 100 km 2. From
the concession boundary it flows west to join the north-south flowing Anum River – the principal
drainage in the region.

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Typically, the main channel of the drainage is less than 3 m across. In many of the lesser streams, the
drainage is ephemeral. The alluvial plains are typically intensively farmed. Flooding is not uncommon,
occurring during and after heavy rains.

3.9 Cultural Environment

3.9.1 Republic of Ghana
The Republic of Ghana is located in West Africa on the Gulf of Guinea and shares borders with Côte
d'Ivoire (Ivory Coast) to the west, Togo to the east and Burkina Faso (formerly Upper Volta) to the north
(Figure 1). To the south are the Gulf of Guinea and the Atlantic Ocean. Ghana has a total land area of
approximately 239,540 km2. Ghana’s capital city is Accra, which is located along the south-eastern
coast. In March 1957, Ghana gained independence from Great Britain. Following a national referendum
in July 1960, it became a republic. Ghana has a population of approximately 24 million people. Most
speak English, together with a number of local languages. The local dialect at Konongo is dominantly
Twi.

3.9.2 Transport and Communication Systems

Passenger and freight transport in Ghana is generally by road. It is estimated that approximately 40% of
the road network is asphalt. The roads are poorly maintained and in passable condition.
Road traffic can become extremely congested in the major cities.
The rail network is restricted to the southern portion of the country. The network has deteriorated since
2000 and is not operational. However, much of the infrastructure remains in place. Road and rail
networks are summarised in Figure 1.
Kotoka International Airport is globally well connected with regular direct flights to Europe, North
America, Dubai, South Africa and many other African countries. Ghana does not operate a national
airline.

There is a good domestic airline business with flights from Accra to Takoradi, Kumasi, Tamale and
Sunyani.

Most of the country is covered by mobile phone networks, which reach many remote parts of the
country and provide adequate coverage for communication on exploration projects. Internet access is
also available on these networks, although the service may be slow in rural areas.

3.9.3 Business and Investment Environment

The economy of Ghana and the nation’s vast gold reserves were recently tied to the Chinese Yuan
Renminbi (CN¥). As a result the Bank of Ghana (BoG) began circulating the Renminbi throughout
Ghanaian state-owned banks and to the Ghanaian public as a tradable currency in addition to the Ghana
Cedi (GH₵). The Renminbi has replaced the traditional role played by the United States dollar.

Ghana is defined as a Middle Income Economy and as an Emerging Economy with an estimated
purchasing power parity at CN¥ 598.397 billion or GH₵ 210.998 billion (US$97.535 billion) and a GDP

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purchasing power parity per capita of CN¥ 22,825.6 thousand and GH₵8,048.43 thousand (US$3,720.426
thousand) in January 2014.

The Ghana Stock Exchange (GSE) is the third largest stock exchange in Africa after the Johannesburg
Stock Exchange (JSE) the Nigerian Stock Exchange (NSE). The Ghana economy is the 4th largest economy
in sub-Saharan Africa behind Nigeria, South Africa and Angola and 7th largest economy on the Africa
continent behind South Africa, Nigeria, Egypt, Algeria, Morocco, and Angola.

The Ghana economy is resource rich and relatively diverse with exports of minerals, agricultural
products (cocoa, rubber, fruit and shea butter), petroleum and natural gas as well as industries such as
electricity generation, information and communications technology, retailing and tourism being sources
of foreign exchange. The Akosombo Dam, which was built on the Volta River in 1965, the recently
completed Bui Dam and the Kpong Dam in addition to conventional oil and gas fired power stations
along the coast provide a relatively reliable source of electricity.

3.9.4 Legal System

The legal system in Ghana is largely based upon British law and is overseen by the Supreme Court which
is the highest authority to interpret the Ghanaian Constitution and has final ruling over legal matters.

3.9.5 Mining Code and Regulation

The Ministry of Lands and Natural Resources is the sector entrusted with the management of Ghana's
land, forests, wildlife and mineral resources. The Minister is the Hon. Nii Osah Mills (MP), Postal Address
P.O Box M 212 Accra Telephone (+233-302) 672336 Fax (+233-302) 666801.

3.9.6 Government Equity in Mining Regulations

The Republic of Ghana retains a non-contributing shareholding in every company holding a Mining
Lease. The Government’s percentage holding is generally set at 10%, but may be altered in
circumstances where special agreements exist. The Government’s share of dividends when declared by
the companies is collected by the Non Tax Revenue Unit of the Ministry of Finance and Economic
Planning.

3.9.7 Taxes
Corporate tax is currently fixed at 35% of net profit. All the mining companies under consideration are
on self-assessment schemes. Companies are allowed to forecast their profits for the year and pay some
deposits based on their own assessment. Companies are required to submit their yearly returns four
months after the end of the accounting year. In 2012, the country amended the capital allowance rules
for the mining sector. Ground rent is the annual payment made by mining companies and other
companies to the owners of the land.

All current mining companies operate on land held by traditional leaders on behalf of their tribal groups,
referred to in Ghana as Stool Lands (Chiefs sit on stools for traditional duties). Mining companies

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therefore pay their ground rent to the Office of the Administrator of Stool Lands. The amount payable as
ground rent depends on the size of the tenement.

Gold companies account for 80% of total government revenue from the mining industry.

Tax incentives are offered such that mining companies can carry forward their losses incurred over the
next five years of assessment. The losses can be deducted from the profits of the succeeding five years.
Mining firms are granted 20% capital allowance over a period of five years.

3.10 SEMS Site Visit

The Konongo Gold Project was visited by two Qualified Persons from SEMS, Joe Amanor and Andrew
Netherwood, on Tuesday, 5th May, 2015. The objective of the visit was to confirm that holes were
drilled at Obenemase A, B and D Lodes during 2014 and to inspect the drill core from this phase of
drilling. Intercepts from these holes have been incorporated into the 2015 Mineral Resource update.

The Owere Exploration Manager, Bill Reid, gave a presentation of the various mineral prospects
comprising the Konongo Gold Project prior to the team inspecting the surface expressions of Boabedroo
and continuing through Obenemase A, B and D where the most recent drilling was completed.

Bill Reid also showed the SEMS Qualified Persons exploration activities that were undertaken over
Kwakawkaw, the furthermost north prospect within the Konongo Gold Project. The field visit and the
drill core inspection were completed by Joe Amanor whilst Andrew Netherwood concentrated on
obtaining digital data required for the Mineral Resource upgrade.

The field visit was undertaken by Joe Amanor starting at the only surviving shaft head frame, the South
Shaft. Then to the various mined out pits, starting from Boabedroo and finishing off at Obenemase A
and B, where the most recent drilling had taken place.

Figure 7: Boabedroo South open pit Figure 8: Apan open pit

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Figure 9: Kyereben open pit Figure 10: Obenemase A & B link, open pit

Figure 11: preserved drill hole collar PVC pipe

Figure 12: mineralised volcaniclastics from Obenemase drilling

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4 History
4.1 Exploration
Operating since 1903, extensive underground exploration was undertaken throughout the life of the
Konongo mines, but few records of this work have been preserved. Similarly the records of systematic
surface exploration are fragmentary, improve steadily from 2002.

Geophysical techniques were used for prospecting as early as 1935 and have continued to be used up to
the present day, including regional VTEM and heli-magnetics flown by Fugro in 1995.

Geochemical surveys have been an effective tool in locating mineralisation. In the early 1950's a large,
detailed geochemical survey was completed on the concessions. A geochemical sampling program
commenced in November 1990 based on sample grid of 800 m by 30 m.

SGMC carried out orientation geochemical surveys at Obenemase in the 1970’s, as well as drilling a
series of 15 DD holes under the Obenemase A Lode and a series of 128 short RC holes.

SCM commenced exploration on the concession in 1987, initially to assess the oxide ore resources on
the project. RC holes were drilled on section lines 40 m apart to a depth of 50 m. A total of 87 DD holes,
811 RC holes and 221 production & exploration trenches are included in the database.
With mining having commenced in 1988, regional exploration was curtailed and exploration focused on
defining further mineable resources.

OGM carried out drilling between 1994 and 1998 with a total of 216 DD holes, 1,132 RC holes, 111 RAB
holes and 578 grade control trenches to support the open pit mining.

Following the formation of Owere Mines Limited, Mwana (then African Gold Plc) completed several
exploration programs at the project consisting of regional soil geochemistry, trenching, diamond core
and reverse circulation (RC) drilling, focused on the Boabedroo South deposit.

Owere drilled a series of deeper DD holes between 2004 and 2005 for a total of 65 holes.

Signature (before investment by LionGold in 2012) commenced work at the Project in May 2009 and
carried out Diamond Drilling, RC drilling, Aircore drilling and trenching of greenfield and brownfield
targets through early 2012, focused mainly on oxide potential throughout the project. Signature also
targeted the historic Konongo Tails, and commencing mining the Konongo Tails in 2011.

LionGold acquired the project in March 2012 and re-focused the operation to assess the sulphide
potential in early 2013. Resource work has focused on the Obenemase group of deposits. Seven other
historical brownfield prospects have been identified for future resource drilling, as well as numerous
exploration targets and untested greenfield targets. The known continuation of free-milling gold in
Quartz veins beneath historic mining centres remain a long-term mineralisation target

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Regional exploration has focused on geological-geophysical re-interpretation of the structural

framework and regional geophysical & geochemical targeting. This work, which includes a significant re-
interpretation of the geometry of the principal shear position on the property, was supported by
prospectivity mapping (Figure 13), based on quantitative variables and fuzzy product processing to
review and rank targets. Forty prioritised targets have been tested by LionGold, many of them on shears
and structures not assessed historically.

Figure 13: Prospectivity Mapping, Konongo

In 2012-2013, exploration activities focussed on two principle objectives – testing shallow surface
targets defined by geophysics, geochemistry and previous exploration along the Main (and historically
mined) Odumase Shear and Zongo Shear and the re-interpreted position of the Ashanti Shear with
Aircore and RC drilling, and testing under-explored or newly identified mineralisation with RC drilling to
assess continuity of the mineralisation at depth.

In 2013, LionGold continued an aggressive exploration program which included testing 40 of the better
regional prioritised targets with Aircore drilling in a 40,428m program during the calendar year, as well
as 3,612m of trenching in the same areas to constrain targets. In addition to this, 14,203m of regional
and resource RC drilling was completed on historic resources and as brownfield and greenfield testing.
53,282.52m of diamond drilling beneath the historic Obenemase Pits, targeting sulphide hosted gold ore
to a vertical depth of 300m.

The drilling in 2013 returned encouraging results. Major successes included:

Demonstrating that the re-interpreted position of the Ashanti shear is gold-mineralised, with
best results at the Kyekyewere, Ashanti North and Agyereago Targets (Figure 14). Further

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encouraging results were returned from the Domeabra Target, 3300m north (and on the same
structure as) the northern-most historic mine, Kwakawkaw North (Figure 14).

Brownfield exploration returned encouraging results at Kwakawkaw South and Akyenase

(Figure 14)

Resource Drilling at Obenemase B identified a new zone of mineralisation beneath the B Lode
mineralisation – R Zone. R Zone links the mineralisation at Obenemase A and Obenemase D
(Figure 9) The R-Zone target had been extended to 400m down-plunge and remains open in all
directions.

Figure 14: Mine and prospect locations, Konongo

4.2 Mining
The Konongo region has been mined in several periods since 1903. It has produced approximately 4.4
Mt of ore for 1.6 Moz of gold, at an average recovered grade of 11.8 g/t Au.

Mining activity predates European settlement at Konongo and native workings are found in both
Tarkwaian and Birimian rocks over a distance of 70 km. Numerous pits are found on the vein outcrops
and in down slope laterite.

Production at Konongo ceased in 1986, with a total of 2.84 Mt mined for 1,446,600 ounces of gold, at a
recoverable grade of 15.7 g/t Au (Signature, 2010).

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In 1987, SCM refurbished the Konongo Mines infrastructure, at that point still on care and maintenance,
providing a base for the exploration of the Obenemase A deposit. The first gold was poured in May
1988.
Between 1988 and 1992, SCM heap leached a total of 852,000 tonnes of ore for 86,295 recovered
ounces of gold at a recovered grade of 3.1 g/t Au (Reidy, 2012). Due primarily to poor recoveries from
the heap leach pads, the operation was unsuccessful. Final exploration was carried out in the
Obenemase area between 1992 and January 1993, after which the mine was placed on care and
maintenance.

In 1995, following the purchase of a second hand CIP oxide plant (320,000 tpa) from Aurora Australia,
OGM commenced open pit mining at Boabedroo, Apan, Atunsu, Aserewa, and Obenemase. Between
1995-1997, OGM treated 614,000 tonnes of ore grading 2.96 g/t for 58,500 oz gold. Mining halted in
1997, due to insufficient oxide ore and poor gold recoveries, which saw operating costs escalate from a
low of US$112/oz gold in June 1996, to US$397/oz gold in June 1997.

Obenemase production summaries show a total of 650,000 t of oxide ore at an average grade of 5.5 g/t
Au for a total of 115,000 oz Au. An additional 30,000 oz Au at an estimated grade of 9.5 g/t Au were
extracted from underground workings.

In May 2010 Signature completed a Mining Study into the recommencement of gold production at
Konongo, which was submitted to the Minerals Commission of Ghana. The Mining Study examined a
strategy proposed by Signature shortly after the acquisition of the Project from Mwana of mining oxide
ore from existing and new open pits. Remnant stockpiles and tailings were also examined for their
potential to provide supplemental mill feed. The re-focus on sulphide mining potential has largely
deprecated this study.

No Ore Reserves resulted from the study. In accordance with JORC guidelines for the Konongo Project
the mining study could only outline likely in-ground stocks (a “mining inventory”) as aspects of the study
and modifying factors were not completed in the necessary detail required to estimate Ore Reserves in
accordance with JORC guidelines.

During the period January 2012 to February 2013, Signature mined and processed 297,911 t of oxide ore
to yield 11,663 oz Au. The recovered grade was 1.2 g/t Au, from a head grade of 1.7 g/t Au.

There has been no mining during the 12 months to March 2015. The plant is on care and maintenance.
With significant additional work focused on sulphides, Signature continues to review the potential of at
several of the Mineral Resources and Exploration targets for potential to add to the mineralisation
inventory on the site.

In concert with the drilling programs, the Company engaged Snowden Mining Industry Consultants
(Snowden) to conduct a high level scoping study to support the exploration effort at Konongo. This
Snowden scoping study assessed the technical and economic merits of the Konongo project based on a
portion of the resources on site (Obenemase A, Obenemase B, Boabedroo Nth and Boabedroo South).

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Snowden have concluded that “there are reasonable prospects of economic extraction” at Konongo
(Dominy et al 2014c).

The study does not include the results of drilling (post-February 2014) or other previously quoted
resources that Snowden have not been re-estimated. These caveats introduce upside potential for
improved economics of potential mining scenarios.

The results of the Snowden’s Scoping Study are positive. Key measurable outcomes from the study
include:
• Cut-off grade are the gold abundance in the ore below which the ore is not economic. Cut-off
grades for different ore types include 0.5g/t (oxide), 0.7g/t (transition) and 1.0g/t (sulphide).

• Internal Rate of Return on investment (IRR) 35%

• Net Present Value (NPV) USD22.926M

• Head grade is the average grade of ore delivered to the plant for processing. Head grade:
3.48g/t Au.

• Mine Life: 6.75 years. An estimate based on the Boabedroo and Obenemase resources only.

• Gold Price US$1,250/oz. Average price for the past 18 months.

• Cautionary Statement concerning Scoping Study Results including Inferred Resources

Scoping Study results and production targets reflected above are preliminary in nature as conclusions
are drawn partly from Indicated Mineral Resources (65%) and partly from Inferred Mineral Resources
(35%). The mineral resources are complaint with the JORC Code (2012) and are reviewed in Chapter 8,
Mineral Resources. The Scoping Study is based on lower level technical and economic assessments and
is insufficient to support estimation of Ore Reserves or to provide assurance of an economic
development case at this stage, or to provide certainty that the conclusions of the Scoping Study will be
realised. There is a low level of geological confidence associated with Inferred Mineral Resources and
there is no certainty that further exploration work will result in the determination of Indicated Mineral
Resources or that the production target itself will be realised.

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5 Geological Setting
5.1 Regional Geological Setting
5.1.1 Regional Overview
Extending across a number of West African nations, the West African Craton has an Archean core
surrounded by younger Precambrian and Phanerozoic greenstone sequences. The southern part of the
craton, the Man Shield (Minerals Commission, 2002), has both Archean and Proterozoic domains. The
oldest Precambrian rocks are >2500 Ma, and extends across western Côte d’Ivoire through Liberia,
Sierra Leone and into southern Guinea (Figure 16).

The Regional geology in West Africa comprises:

 Archaean basement, the Man Shield - non-outcropping and tectonised after the Liberian Orogeny
(2500Ma).

 The Birimian Supracrustals, which are superimposed on the Man Shield, and occur throughout West
Africa. In Ghana, the sequence consists of six volcano-sedimentary belts separated by sedimentary
basins.

 The belts and basins are oriented into a general northeast trend by the Eburnean Orogeny (2.19 – 1.98
Ga; Perrouty at al., 2012). The Eburnean structures are the locus of extensive and impressive lode gold
mineralisation (including the mineralisation at Konongo).

 Unconformably overlying the Archaean and Palaeoproterozoic rocks are younger sedimentary basins.
The eastern half of Ghana is dominated by the Neoproterozoic Volta Basin, a thick sequence of post-
structural siliciclastic sediments which unconformably overlie the Birimian rocks.

The Birimian is divided into an Upper and Lower sequence. These are also termed the Sefwi Group and
Kumasi Group respectively. Stratigraphy and geochronology are summarised in Figure 7. The belt's
genesis is generally related to two phases of the Eburnean orogeny 2.19–1.98 Ga (Perrouty, et al., 2012).
Timing and subdivision of the development of the Birimian, the timing of mineralisation and intrusion
events are the subject of debate, with 3 to 6 deformation events proposed (Allibone et al. (2002a),
Feybesse et al. (2006) , Perrouty et al. (2012). The lower sequence is a series of volcanic belts and
derived sediments. The upper sequence is dominated by sediments. Intrusives are emplaced during and
after the main structural phases.

Gold mineralisation is associated mainly with the latest structural events. Timing is proposed as syn-
structural (Oberthür et al. (1994), Blenkinsop et al. (1994) and Perrouty et al. (2012)) or late-structural
brittle-ductile (Allibone et al. (2002b)). Feybesse et al. (2006) and Berge (2011) present further models.

The Upper Birimian (Figure 15, Figure 16) is dominated by sedimentary rocks and with significantly less
igneous activity.

Post-Birimian sediments (which may be coeval with the late phases of the Birimian Supracrustals, and
only occur in the southern belts in Ghana) are termed the Tarkwa Group, or Tarkwaian. The sediments

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are characterised by conglomerates and mature sediments. They are known to host placer gold
deposits, associated with conglomerate horizons or within shears and fold axes cutting the Group

The belt's genesis is generally related to two phases of the 2.19–1.98 Ga Eburnean orogeny (Perrouty, et
al., 2012).

Post-depositional geology includes two phases: the syn-tectonic emplacement of Cape Coast-type
intermediate intrusives, and the late structural emplacement of Dixcove-type hornblende-bearing
intermediate intrusives. Dixcove-type intrusives are restricted to the volcano-sedimentary belts (and
are referred to as Belt-type intrusives). Cape Coast-type intrusives generally occur within the
sedimentary basins (and are termed Basin-type). Both types of intrusives, Dixcove- and Cape Coast-type,
include gold mineralisation.

Figure 15: Stratigraphy of the Birimian

Structurally, the Eburnean Orogeny is associated with NNW-SSE shortening, which thrusts the Lower
Birimian over the Upper Birimian, developing and thrust and fold belt. Late transpression is interpreted
to have a close association with gold mineralisation.

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Figure 16: West African Regional Geology (Adapted from Olson et al 1992)

Gold mineralisation, particularly in Ghana, is generally concentrated in narrow structural corridors of 10

to 15 km width in the transition zones between the volcanic belts and the sedimentary basins (Leube, et
al, 1990). However, major structurally controlled gold deposits also occur within the intervening
sedimentary basins

All of the Birimian Supergroup has been extensively deformed and metamorphosed to greenschist or
amphibolite facies. This deformation resulted from the Eburnean orogenic event, which peaked at 2100
Ma (Minerals Commission, 2002, Perrouty, et al., 2012). The latter phases of this event correspond to
widespread granitoid intrusions especially within the highly deformed sedimentary basins. Again, this
type of metamorphism is characteristic of a greenstone terrain including the late-stage granitic
intrusion.

Of note in Ghana is the Tarkwaian Group, which consists of a distinctive metasedimentary sequence that
occurs along the Ashanti Gold Belt. This group hosts significant palaeoplacer style gold deposits in the

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Tarkwa district of Ghana. This sedimentary gold is derived from the erosion of the primary greenstone
/granite rock sequences.

5.1.2 Geology of Ghana

The geology of Ghana can be divided into four areas.
(1) To the north and southwest, the area of Paleoproterozoic metamorphosed granite-greenstones that
includes the volcano-sedimentary rocks of the Birimian Supergroup and Tarkwaian Group.
(2) To the south east, the area of meta-sediments and gneisses of the Mesoproterozoic to
Neoproterozoic, Pan-African, Togo and Dahomeyan Mobile Belts (Figure 16) and
(3) To the east, area of relatively un-deformed Neoproterozoic to Palaeozoic sediments forming the
Volta Basin (Figure 16), and
(4) Localized onshore and offshore basin sediments of Palaeozoic and Mesozoic age also occur on the
coast.
In-situ gold mineralisation in Ghana is confined to the Birimian and Tarkwaian Groups, or in structures
cutting intrusives. The Birimian and Tarkwaian, consist of metamorphosed volcanic, volcaniclastic and
sedimentary rocks with a strong north-northeast striking tectonic fabric. The Birimian occurs as north-
northeast to south-southwest striking volcanic belts up to 40 km wide separated by meta-sedimentary
filled basins up to 100 km wide. The volcanic belts are dominated by volcanic and sub-volcanic rocks and
volcaniclastic sediments of tholeiitic basaltic (81%), andesitic (16%) and dacitic (3%) composition. The
meta-sediments of the intervening basins comprise turbiditic greywackes and argillites with similar
chemistry to the volcanic rocks of the belts. Igneous rocks in the Lower Birimian (Sefwi Group) do not
demonstrate sub-aqueous textures (e.g. pillows structures).

Syn- and post-tectonic granitoids intruded both the metasediments and metavolcanics of the Birimian
Supergroup as a result of the Eburnean Orogeny. The granitoids can be broadly grouped into two types:
namely (1) Basin type (or Cape Coast-type) and (2) Belt type (or Dixcove-type).

Basin type granitoids have intruded the meta-sedimentary basins. They are characterised as are S-type
granites (formed by partial melting of sedimentary protolith) are mostly of granodiorite to granite
composition. The Basin granitoids were emplaced mostly during the Eburnean Orogeny, between 2116
Ma and 2088 Ma. The timing is variable, as are the effects of the orogenic event.

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Figure 18: Schematic of the pre-compressional Birimian

deposition

Note that the colours between images do not

correlate. And the relationship to the Tarkwaian is not
Figure 17: Regional Geology of southern Ghana depicted (it is interpreted as being deposited after the
onset of orogenesis (Eburnean).

Belt type granitoids have intruded the volcanic and volcano-sedimentary belts. The Belt-type granitoids
of southern Ghana, which are similar to I type granites, are most commonly of diorite to granodiorite
composition. The Belt-type granitoids were emplaced earlier as subvolcanic plutonism late in the
development of the Birimian greenstone belts, between 2179 Ma and 2136 Ma and endured the
Eburnean Orogeny in full.

Uplift and erosion, prior to the final stages of deformation, resulted in the deposition of intracratonic
sediments of the Tarkwaian Group, which unconformably overlie the Birimian Supergroup (Figure 17,
Figure 18). The contact between the Tarkwaian and Birimian is tectonic and may represent migration of
the Tarkwaian along major thrusts.

The Ashanti Belt, one of the southern-most of the volcano-sedimentary belts, includes the Konongo
Gold Project (Figure 17). The Ashanti belt hosts an estimated 250Moz of gold resource. Past/present
gold reserves in excess of 60 M oz at an average grade of 8 g/t Au have been delineated within this
corridor (Resolute LTD 2001). Much of the lode gold mineralisation is focused within a 5km zone on the
western margin and is related to the principal thrust zone). Identified deposits in this structural position
include the Obuasi Mine, Bogosu, Prestea and Konongo (located 60km NE of Obuasi).

The geological development of the lower Birimian in Ghana appears dynamic. The volcano-sedimentary
belts are interpreted to include the co-magmatic emplacement of mafic dykes and sills and the extrusion
of mafic flows, and felsic tuffs. Deposition of immature sediments (volcaniclastic sediments or
greywackes) derived from the emerging volcanic pile occurs, and sometimes dominates, the lithologies.

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Periods of lesser igneous activity are characterised by the development of graphitic or carbonaceous
shales and turbidites. Cessation of volcanic and hypabyssal activity and quiescent conditions manifests
as subaqueous chemical sediments and graphitic shale. At Konongo, the chemical sediments occur near
the upper contact of Lower Birimian, and include manganiferous horizons.

5.1.3 Local Geological Setting

Re-interpretation of the existing geophysical data and surface mapping of structure indicates that the
principal shear at Konongo lies to the west of the historic focus of exploration. Interpretation of deep
structure suggests that the basement geometry may have an effect on both the structure of the
supracrustals (the Birimian and Tarkwaian rocks) and possibly control the fluid pathways focusing
mineralisation. The Konongo licence area includes tectonised rocks of the Upper Birimian, Lower
Birimian and Tarkwaian Groups.

The principal structure (the Ashanti Shear) runs approximately along the margin of the Upper Birimian
and Lower Birimian, and is highlighted in the apparent conductivity data. This is a deep-seated
southeast-dipping structure, with interpreted northwest-dipping back thrusts daylighting to the east of
this structure. There are minor structural splays into the Upper Birimian, one of which, the Kyekyewere
trend, is a 1300m long shallow drilling anomaly running east of, and parallel to, the main structure
(Figure 19). The main structure is steeply east-dipping. It includes a number of regularly spaced arsenic
anomalies along its strike and is highly prospective for Ashanti-type gold.

The Lower Birimian sequence on the concession occurs as two limbs of a fold. The west limb is
immediately east of the principal structure as and is thrust northwest over the sediment dominated
Upper Birimian (Kumasi Group). The eastern limb occurs in the east of the tenement. The volcano-
sedimentary pile (Lower Birimian or Sefwi Belt) is characterised by a series of west dipping geological
domains and west-dipping structures. Lithologies are dominated by meta-volcaniclastic and meta-
sedimentary rocks with minor mafic and intermediate volcanics, intrusives and pyroclastic rocks.
Sediments include graphitic siltstones which generally take up strain within the sequences and typically
occur proximal to mineralisation. Structures are interpreted as back-thrusts off the main shear. Splayed
shears and faults throughout these domains indicate wrenching or transpressional movement.
Mineralisation is associated with the interpreted, deepest-seated back-thrusts. The interpretation is
supported by orientation of lithologies in outcrops, pits and trenches, as well as interpreted geophysical
dips. The shears on the Konongo lease targeted by historic mining occur proximal to the contact with the
Tarkwa Group, and are interpreted as steeply northwest-dipping back thrusts off the main shear (Figure
19).

Upper Birimian (or Asankragwa Group or Kumasi Basin) rocks are not exposed on the property, and only
minor drilling has focused on testing them. Lithologies include various siltstones and sandstones and
intercalated carbonaceous to graphitic siltstones. The best tested areas dip moderately northwest. No
volcanics have been described in the rocks. The Upper Birimian occurs exclusively in the far west of the
tenement.

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Early, deep structures trend east-west across the northern margin of the Kurofa lease. These structures
appear to be associated with an early sequence of faults and structures, likely related to the Archaean
nucleus beneath the Proterozoic supracrustals, and frequently manifest as kinks in the surface geology.
This is interpreted as oblique ramping of thrust over a deeper controlling structure – a structural
situation that introduces geological complication and the potential to create the required dynamics for
mineralised fluid channelling. The review of the deep architecture of to the east of the syncline keel
highlights further potential. Exploration in the area, which straddles to boundary of the eastern limb of
Lower Birimian, has been historically deprecated because of lesser geochemistry results. However, the
interpretation indicates that the geology may be influenced by a second deep-seated shear, and
therefor represent another high-order target. The east limb is essentially a structural repeat of the
geometry of the west-limb.

The Tarkwaian rocks occur as an in-folded synclinal structure flanked to the northwest and southeast by
the Lower Birimian volcanics and sills and immature volcaniclastic sediments. The fold structure is
interpreted to have locked up during folding and sheared along lithological contacts. The Tarkwaian is
dominated by dirty, arkosic sediments. The Banket Conglomerate, which hosts the mineralisation at
Tarkwa, occurs on the property but has proven to be discontinuous and unmineralised to date. The
Tarkwaian rocks are notable for their mineralisation, which occurs as stock worked vein arrays, so the
potential for high tonnage mineralisation in the Tarkwaian is relatively high. A number of structures are
identifiable in the Tarkwaian and the core of the syncline is the second most significant geochemical
gold-anomalous zone on site.

Figure 19: Prospect geology

S-type (Cape Coast Intrusives) and I-type (Dixcove Intrusives) occur within the concession (Figure 20,
Figure 21). The I-type granites are pre- to syn- structural. The S-Type granites have post-peak through
post-structural emplacement timing. The Dixcove-types granodiorites host gold mineralisation. At
Konongo, the Dixcove type intrusives occur within the structural keel of the main synform and are

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mineralised. The structure imparts a chloritic anastomosing shear matrix throughout the granodiorite.
The shears are preferentially mineralised on the margins of the Dixcove Granites.

The Juaso batholith, a Cape Coast type granodiorite occurring 10 km south east of Konongo, is the only
outcropping granitoid in the area. The intrusive superimposes an increase in metamorphic grade near
the Konongo mines from lower greenschist to almandine-amphibole amphibolite facies. Cape Coast
granites occur in the southeast of the property and appear to exploit deep structures. They are not
mineralised.

Minor granodiorite dykes post-date quartz veining and gold mineralisation. Diorite stocks outcrop in the
north eastern part of the concession as well developed radial dyke swarms and sheeted zones which
post-date the Obenemase sulphide mineralisation but may be contemporaneous with Tarkwaian
deposition. At Obenemase, diorite and lamprophyre dykes are emplaced along axial planes or parallel to
axial plane foliation, and displace mineralisation. Lamprophyres occur only in the Obenemase A mine
and form the last stage of intrusion, truncating earlier dolerites (Porter, 2006).

Geology generally strikes to the north-east with an overturned western limb about the main syncline.
The syncline, and most stretching and intersection cleavages plunge moderately to steeply northeast,
although southwest plunges have been observed. The structural relationship between the east limb of
the Lower Birimian and the Tarkwaian is uncertain. There is no field evidence to conclude if the Birimian
rocks are folded with a conformable contact or represent an additional west verging thrust contact.
Slightly oblique magnetics at the boundary of the two units suggests at least some structural
component.

The rocks are generally lower greenschist facies, locally overprinted with an amphibolite grade thermal
overprint proximal to the granites.

The historic mining targets at Konongo occur on or adjacent to two shear zones – the western Odumase
Shear and the eastern Zongo Shear. These shears are separated by up to 400m. The Zongo Shear is
proximal to the contact with the Tarkwaian and the Odumase Shear occurs at a lithological boundary
observed in geophysics data and multi-element XRF data. Evidence of anastomosing splays between the
two mineralised shears is observed, some with high grade zones developed. Both these main shears are
interpreted as basal back-thrusts off the east-dipping shear at the thrust contact between the Upper
and Lower Birimian. A third shear can be traces in the soils data, occurring 100-200m west of the
Odumase Shear. The only place where the shear in known to be significantly mineralised is at Kyereben
West, north of the Boabedroo deposits. Mineralisation is also focused on the core of the regional
syncline, occurring as either stock works in the arkosic metasediments of adjacent to Dixcove type
granodiorites. Manganese mineralisation is observed in both limbs of the Lower Birimian and has been
the subject of minor research. The manganese appears to be spatially proximal to interpreted extrusive
plutonic rocks with higher magnetic responses (in geophysics) and also associated with gold
mineralisation. No further understanding of the noted relationship is available.

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Gold in quartz vein mineralisation is best developed proximal to the Boabedroo and Zongo Shears,
which can be traced 12 km to the northeast from Konongo.

Figure 20: Schematic geology, Konongo

Figure 21: Prospect geology and regional cross section.

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5.2 Mineralisation

5.2.1 Deposit type

The deposits at Konongo are typical examples of orogenic gold deposit. The ‘type’ deposit for this style
of mineralisation is the Obuasi Mine, beneath the namesake town 60km southwest of Konongo on the
same structure. Obuasi is one of the largest orogenic gold deposits in the world having produced
approximately 32 Moz. Other deposits of this type in Ghana include Damang, Prestea and Tarkwa. The
deposits are typified by strong structural control: short strike lengths, persistent plunge continuity,
silicification, and proximity to a regional structure – the Western margin of the Sefwi Group rock in the
Ashanti Belt. These deposits are generally associated peak- to post-peak reactivated quartz veining and
variable selvages of sulphide-hosted gold (pyrite and/or arsenopyrite).

Orogenic gold deposits account for around one-third of the gold that is mined worldwide. They are
generally gold-only systems. The deposits formed in actively evolving orogenic belts and are hosted in
regionally metamorphosed and intrusive igneous rocks and structurally deformed sedimentary rocks. As
a deposit class they are almost unique in that they form at relatively great pressures of between about
1.5 kbar to 5 kbar, hence at depths in the crust of between 4 km and 15 km. Although they form at
moderately high temperatures, the temperatures of formation are lower than many magmatic-
hydrothermal deposits and are most typically between 300⁰C and 450⁰C. They are most commonly
hosted in rocks metamorphosed to the greenschist facies, in which incipient dehydration of the protolith
mobilises fluids, sometimes mobilizing gold also. Where they occur, they are often abundant and
widespread throughout the host belt and typically cluster into camps.

Typical Ashanti area mineralisation features quartz vein systems that display a complex geometry and
are commonly associated with extensive disseminated sulphides. The vein systems usually appear to be
related to regional northeast-southwest trending deformation corridors along the margins of Birimian
greenstone belts and adjacent meta-sedimentary basins – a 5-10 km corridor of thrusting and back-
thrusting along the northwest verging thrust system that juxtaposes the Kumasi Group and the Sefwi
Group. The most favourable host rocks are usually inter-bedded argillite, greywacke and volcaniclastic
units frequently adjacent to high strain zones (frequently sheared graphitic horizons). On the larger
scale, mineralisation is generally deposited in the transitional zone between the belts and basins – areas
with developed structural fluid conduits and geology transitional between the volcanic belts and basins.
These transitional zones may also contain a variety of interbeds, chemical sediments (dominated by
graphite and manganese), and carbonate rich units. Structurally, the deposits occur on deep-seated,
high-angle, near contact boundary faults that have both transcurrent shear and oblique components,
and which frequently display several splay and parallel structures. Gold deposits occur within structural
dilatational zones as both sulphidic and carbonaceous quartz reefs, usually in association with
disseminated arsenic and/or iron sulphides.

Over 80% of Ghana’s current (and historic) gold production is derived from Birimian metasediments,
usually broadly described as phyllites and tuffs. The major historic mines such as Obuasi, Prestea,
Bogosu and Konongo, occur on or immediately adjacent to the Ashanti greenstone belt’s lithological
contact with the Kumasi Basin metasediments. The remaining 20% of Ghana’s gold is hosted by belt type

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granitoids (Ayanfuri, Bibiani), as small deposits in Birimian lavas, or detrital deposits in the Tarkwaian
‘Banket’ conglomerate (Tarkwa, Iduapriem and Teberebie). Hydrothermal stockwork mineralisation also
occurs within Tarkwaian quartzite and dolerites at Damang.

The principal characteristic of the Ashanti deposits can be summarised as follows (after Minerals
Commission 2002):
 Located on, or close, to the lithological contact between metavolcanics and metasediments.
 Spatially related to deep-seated, high-angle wrench faults, which have a strike extent exceeding
100 km. Cross-cutting northwest to southwest-trending faults have also exerted an influence on
the location of gold remobilised from the main zones.
 Gold is hosted in quartz veins, which may occur as en-echelon arrays or as laminated veins or in
late arsenic sulphide phases. Grade-width characteristics persist virtually unchanged to depths
exceeding 1 km. The veins broadly parallel the regional foliation, but locally cross-cut the
foliation.
 Disseminated sulphides, such as pyrite, pyrrhotite and arsenopyrite, are common in wall rocks
and as selvages to veining.
 Several generations of quartz veining are common and gold is seemingly associated with the
later phases.
 Mineralisation is spatially associated with graphitic phyllites and manganiferous sediments.
 Mineralogy is simple with a strong positive correlation between gold and arsenopyrite.
Accessory minerals include pyrite, chalcopyrite, pyrrhotite, and bornite.
 Strong silicification is common, accompanied by carbonate alteration. Sericite, reported
elsewhere in the Ashanti belt is poorly developed at Konongo. Tourmaline may also be present
but is a trace occurrence at Konongo, if at all.
 Granitoids may or may not be spatially associated with mineralisation.

5.2.2 Mineralisation
Mineralisation at Konongo occurs as either:
 mesothermal lode gold associated with quartz veins (with variable amounts of associated
(arsenopyrite-dominated) sulphides or
 late, disseminated, arsenopyrite exploiting pre-existing structural controls and preferred rock-
types.

Vein-hosted mineralisation is generally quartz-dominated and ranges from internally structureless and
massive, to brecciated and into coarsely banded or laminated veins. Veining ranges from discrete veins
through bulk stockwork or sheeted vein systems.

Alteration haloes up to a few tens of metres are commonly developed around ore zones. Alteration is
frequently preferentially partitioned into specific lithologies or shear structures, particularly in
association with metasediments. Alteration associated with disseminated sulphide mineralisation is
carbonate - silica – sericite +/- pyrite. Carbonate is pervasive and dominated by ankerite (an iron-bearing
species). The alteration is observed to be metasomatic, and manganese and magnesium are depleted

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(generally chlorite destruction) proximal to higher grade mineralisation. They are generally zoned
laterally away from the vein or ore zone with different alteration assemblages indicating increasing
degrees of metasomatism. Metasomatism is obvious because of the lack of chlorite in the
mineralisation. Chlorite is observed to occur as a prograde component of the regional metamorphic
assemblage. Sericite is generally poorly developed, rarely forming dominant (poker-chip) cleavages. The
alteration at Konongo is notable for limited hydrolysis and sericite - compared to many orogenic gold
deposits - is weakly developed. Instead, carbonates (generally ankerite) dominate the alteration
assemblage. The low water activity has been noted regionally in the Ashanti Belt (Schmidt Mumm 1997)
and may be peculiar to the Birimian. Potassic alteration accompanies the highest grade ores, and only
occurs immediately adjacent to the reefs. Silicification can be strongly developed, particularly in
mineralised zones and in graphitic shales on major structures. However, silicification in graphitic
sediments is rarely gold-bearing, but may represent a mineralisation conduit.

Sulphides in mineralisation are observed to range from 1-5%, with a good correlation to carbonate
alteration and silicification. Sulphide minerals are typically present in both veins and alteration haloes.
Sulphides at Konongo include rhombic and acicular arsenopyrite, at least two phases of pyhrotite and
pyrite. Pyrite and rhombic arsenopyrite are interpreted as early sulphide phases, locally dilated and
infilled with quartz-carbonate material. Pyhrotite (>1% except in graphitic shears and siltstones (>3%))
occurs as irregular splays and disseminated blebs controlled by the main fabric and minor structures.
Acicular arsenopyrite enjoys a strong correlation to gold mineralisation. Acicular arsenopyrite occurs to
5%, but typically less. The mineralisation is latest structural, often occurring with random orientations
throughout the mineralised zones. The sulphide mineralisation is interpreted to be late-structural, with
disseminated needle-like arsenopyrite precipitating into previously deformed structures or preferred
lithologies.

Free gold is only hosted in the veins – the target of all historical mining. Gold also strongly correlates to
the late acicular arsenopyrite phase, as shears, coatings and inclusions in the sulphides.

More typical mesothermal lode gold systems occur in the southern (Odumase) areas. Disseminated
sulphide mineralisation is better developed in the north of the property, particularly Obenemase and
Kwakawkaw (Dominy 2014a). Preferred host lithologies vary from target to target but are dominated by
sedimentary packages adjacent to structures. Some structural control is preserved in the sulphides, but
is weakly developed and likely post-peak structural. An additional phase of arsenopyrite mineralisation
may occur to the south end of the camp, where foliation parallel arsenopyrite occurs.

Individual ore shoots within this complex shear system have a defined strike length of less than 400m,
but remain (where tested) open down plunge below 800m vertical. Comparison with analogue deposits
in the Ashanti Belt (Prestea and Obuasi ore shoots which have plunges to depths of 1,900m and 1,800m
respectively) indicate that deeper targets (800m +) are a realistic target at Konongo.. All known ore
shoots at Konongo are open at depth.

Previous underground mining at Konongo focused on 1-5 m wide quartz veins in which gold is generally free-
milling and can be extracted by conventional gravity concentration and cyanide leaching methods. Drilling has

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shown that refractory gold mineralisation associated with the sulphide halos around the quartz reefs remains in
situ. There has been no campaign mining or development targeting of sulphide-hosted gold mineralisation at
Konongo, even when mining included underground operations (up to 1986). Resolving the metallurgy of the
sulphide ore could increase the ounces per vertical meter by as much as 40% ( Resolute Ltd, 2001).

6 Exploration Activities
6.1 Exploration Overview
Intensive artisanal gold workings pre-1900’s extend throughout the Konongo leases. In 1901, during the
“Jungle Rush”, Europeans discovered high grade quartz reef/vein style mineralization at Obenemase,
and later Konongo.

Between 1903 and 1983 several periods of sustained underground mining occurred in the Konongo
region. A total of 2.84 million tonnes of ore was processed to produce 1.45 M oz of gold, at a recovered
grade of 15.7 g/t gold.

In 1986, the State Gold Mining Corporation of Ghana (“SGMC”) was granted a 125 square km mining
lease over the Konongo project area for a term of 30 years. In 1988, a joint venture between SGMC and
North Queensland Company Limited (“NQC”) of Australia was established to treat oxide ore at
Obenemase.

Between 1988-1992, the joint venture company, Southern Cross Mining Limited (“SCM”), heap leached
a total of 852,000 tonnes of ore for 86,295 oz gold at a recovered grade of 3.15 g/t gold. Poor recoveries
(<60%) and insufficient oxide ore reserves resulted in termination of mining and the joint venture in
1992.

In 1994, Obenemase Gold Mines Limited ("OGM") executed an Acquisition Agreement with SCM, SGMC,
NQC and the Government of Ghana, to purchase the 125 square km Konongo Gold Concession for a
consideration of US$8.2 million in cash/shares.

In 1995, following the purchase of a second hand CIP oxide plant (320,000 t/a) from Aurora Australia,
OGM commenced open pit mining at Boabedroo, Apan, Atunsu, Aserewa, and Obenemase (see Figure
3). Between 1995 and 1997, OGM treated 614,000 tonnes of ore grading 2.96 g/t for 58,500 oz gold.
Mining halted in 1997 due to insufficient oxide ore and poor gold recoveries, which saw operating cost
increase from a low of US$112/oz gold in June 1996 to US$397/oz gold in June 1997.

Between 1903 and 1997 a total of 4,349,000 tonnes of ore is estimated to have been treated from the
Konongo concession for 1,648,210 oz gold, at a recovered grade of 11.79 g/t gold.

In 1998, RML acquired the property. Economics saw them drop the tenement in 2002, after attempting
to attract a JV or sale. A pre-feasibility study carried out by RML indicated good potential for the

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definition of significant sulphide resources and encouraging metallurgical recoveries from Obenemase
mineralization by flotation, pressure oxidation and cyanide leaching.

In December 2002, the Owere ML’s were acquired from the Government of Ghana by Talos Ghana Ltd
(Talos). Talos did not undertake any exploration or development work on the project.

In February 2004, Talos entered into a joint venture agreement with AFG to form Owere Mines Ltd
(Owere). Mwana (then African Gold Plc) completed several exploration programs at the Project
consisting of regional soil geochemistry, trenching and a combination of diamond core and reverse
circulation drilling.

RC drilling programs largely focused on the Boabedroo South prospect where the primary objective was
to investigate the continuity and trend of mineralisation at the Boabedroo South prospect along the
Odumase – Boabedroo mineralised system, as well as to confirm/extend mineralisation intersected in a
parallel system to the east. Drilling was designed to test the continuation of mineralisation to about
150m depth and to collect sufficient data to enable the near surface oxide resource to be estimated.
Signature Metals commenced work at the Project in May 2009 and carried out diamond drilling (11
holes for 3,043 metres), RC drilling (96 holes for 9,116 metres), Aircore drilling (131 holes for 2,874
metres), and trenching (6,025 metres). A draft mining study, based on remnant oxide potential was
commenced. The plant at Obenemase was rehabilitated and operational in May 2011.

The Old Konongo Tails Dam (also termed the Leopard Tails Dam) contains the waste product from the
processing of underground mining at Konongo. It was drilled by Signature on a grid varying between
25m x 25m and 25m x 50m.

Liongold Corporation acquired 74% of Signature Metals in March 2012 (since increased to 78%). The
mining of tails was suspended and two oxide resources, at Boabedroo South Extended and Kyereben
West were the subject of trial mining. Poor economics saw these trial projects suspended in the first
quarter of 2013.

In 2012-2013 drilling has included a 66,000m regional AC program, focussed on geophysical and
geological targets identified from geophysics and geochemistry, commenced in 2012 (Figure 15). Drilling
was as closed fences on 300m spaced lines. Anomalous results (>0.25g/t Au in 4m composites) were re-
split and the line spacing halved.

A resource drilling program targeting sulphides was also commenced in 2013, focussed on the
Obenemase Deposits (Dominy and van Lente, 2014a). The work included RC precollars for deeper
diamond holes. All targets were shallower than 300m vertical depth and included infill and step-out
drilling. Resource drilling Step-outs were 40m on open mineralisation.

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Figure 22: All drilling, Konongo.

In January 2013, Liongold Corporation, in a strategic review of operations, decided to re-focus efforts
onto the sulphide-hosted ore potential at Konongo and commenced a technical life of mine study
(Scoping Study) focused onto accelerating the assessment of sulphide the gold mining underground
potential within the lease.

Since March 2014, nine Diamond Drilling (DD) holes were completed for 1,510.8m. Reverse Circulation
(RC) drilling completed 15 holes for 1,661m. Holes were pre-collared with Reverse Circulation (RC)
drilling. RC drilling completed 36 holes for 3,613m. Significant drilling results are summarised in Table 8
(RC and DD) and are detailed in Section 6.1.3 – Drilling.

Since Liongold acquired the property, approximately 103,000 metres have been drilled. Drilling includes:
• 22,315.8m of surface diamond drill (DD),
• 16,031m. of surface Reverse Circulation (RC) drilling, and
• 66,000m of Air Core (AC) drilling.
The most recent drilling phase was concluded in mid-May 2014, finishing a step-out program to test
mineralisation to 300m vertical (0mRL).

Currently, two sulphide targets are the focus of additional resource work – a shallow zone of high grade
sulphide mineralisation directly beneath the historic Obenemase A Lode pit and a high grade sulphide
zone identified beneath the Boabedroo South Extended pit. Both areas require metallurgical review and
may require additional surface drilling to demonstrate mining potential. The work is expected to
continue over 8-15 months. Oxide potential at Akyenase and at Obenemase is also being reviewed in a
similar timeframe.

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Positive results for the development of these targets will revive the option to follow up on other gold
targets identified by historic drilling. All other identified targets are sulphide mineralisation.

Figure 23: Geology, magnetics and soil geochemistry

Historically, exploration occurred concurrently with mining, and was focused on the two parallel shear
zones (and subsidiary shears) hosting the majority of known gold mineralisation. The shears, separated
by 300-500m, are the western Boabedroo Shear and the Eastern Zongo Shear. Both host structurally
controlled gold deposits and generally include arsenopyrite associated with the mineralisation or as part
of the alteration assemblage. Several other exploration targets have been identified on the property
using multiple techniques (and generations of technology) over several decades in combination with
iterations of geological and structural interpretation. Exploration includes geophysical surveys, soil
sampling and trenching, as well as regional Aircore, RAB and RC drilling programs.

Recorded methods used during exploration include:

 Geophysical methods (magnetics, VTEM and radiometrics).
 Geochemical methods (soils).
 Diamond core drilling (resource definition).
 Reverse circulation (RC) drilling (resource definition).
 Air core drilling and trenching.

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6.2 Exploration Methods

6.2.1 Geophysics and Remote sensing

Geophysical techniques were used for prospecting as early as 1935 and have continued to be used up to
the present day. Many are pre-digital data and are known only because of historic references. Raw data
and plots have not been located on site. Historic surveys (before 1980) include ground electrical
methods, ground magnetics and some airborne geophysics.

Most recent surveys have been were conducted as regional surveys by Fugro. Heliborne surveying
included ternary radiometrics, magnetics and VTEM. 1,246 line kilometres of detailed helimagnetic/EM
data flown by Aerodat in 1995.

In 2012, Fathom Geophysics was engaged by Owere Mines to apply our suite of enhancement filters and
semi‐automated interpretation routines to the 2009 VTEM survey data collected over the Konongo
project area in Ghana (Figure 13). The survey was flown as part of a larger EU funded survey with a line
spacing of 400m and a direction of 130°. Magnetic data collected in 1995 as part of a heli-borne
magnetic & EM survey flown by Aerodat was also filtered and enhanced as the line spacing was 200m
and the data were of good quality and complimented the VTEM data (Figure 23).

Figure 24: Geophysical reinterpretation, Konongo

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The magnetic and electromagnetic (EM) data collected in 2009 over Konongo and surrounds have been
filtered and auto‐interpreted by Fathom Geophysics to extract features important for target generation
and focused ongoing exploration; such a NE trending shears and NW cross-faults; lithological contacts,
possible dilation and closing zones along the conductive units, location of intrusives and highly
conductive zones. A lithological and structural interpretation using the products generated was
completed (Figure 24).

Remote sensing at the Konongo Site has not been attempted. Thick vegetation (>70%) precludes the
methodology as an effective exploration tool.
The major surveys for which records have been located are:

 1935: Electrical survey carried out by the Electrical Prospecting Company of Sweden;

 1946: Ground magnetics at Kwakawkaw;

 1956: A magnetic variometer survey north of the Nanwa Gold Mine;

 1959‐60: Vertical magnetic intensity survey over known reefs;

 1960: Aeromagnetic traverses flown by Hunting Surveys Ltd. with flight lines of 1/3 mile;

 1967: Electromagnetics (Turam) and ground magnetics; and

 1973: Resistivity survey at Nanwa (extensions to Obenemase A & B lodes). Report by D. Hastings
of the University of Science and Technology at Kumasi.

Figure 25: flight lines, 2005 regional geophysics survey, Aerodat.

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6.2.2 Geochemistry
Geochemical sampling has been conducted as several programs over the entire Konongo Gold Project.
Traditional soil sampling has been employed. However, the methodology has not been documented.
The exception is the most recent program, multi-element XRF sampling in 2012 (Figure 26).

Over 500 line kilometres of sampling (>19,273 sample points) with conventional soil sampling programs.
During the 1970's, State Gold Mining Company carried out orientation geochemical surveys,
demonstrating the presence of significant arsenic anomalism at surface. A geochemical sampling
program commenced in November 1990 based on sample grid of 800m by 30m, covering the Tarkwaian
contact and uppermost Birimian volcanic belt. Numerous gold‐arsenic anomalies were detected in
Birimian and Tarkwaian rocks but follow‐up was limited. Signature Metals followed up the soils program
in 2009 and 2012, covering the extents of the Konongo and Kurofa Licences.

Samples have been taken throughout the Konongo Gold Project as multiple phases of work spanning
several decades. Early programs focused on the mine structures were gold-only soil surveys. Subsequent
surveys were also assayed for arsenic.

Early work included gold-only assays and was based on 600m by 30m sampling grids. Follow up infill
sampling reduced sampling to 300m line spacing. Subsequent phases of sampling included gold and
arsenic geochemistry. It was also based on the same grid spacing.

In 2013, analysis with field portable XRFs was conducted as a repeat of the western grid to assess
polymetallic anomalism. 4400 points were taken on a 300m by 30m sample spacing and tested for 33
elements.
All data is stored in the geodatabase on site.

Figure 26: Geochemical soil sampling programs

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6.2.3 Drilling
Extensive underground exploration drilling was carried out through the life of the Konongo mines to
maintain a reserve base ahead of production, but few records of this work have been preserved.
Similarly, the records of systematic surface exploration are fragmentary. A major database and data
capture exercise was conducted in 2001 by Resolute Mining Ltd and in 2009 by GeoBase (see Data entry
and validation) and data capture is complete from at least this time.

Historical drilling has focused on two main targets centred on the depth continuity of the historic mining
centres at Obenemase and Odumase, and shallow drilling along the Main Shears hosting the majority of
known mineral resources. Away from the major mining centres, the depth of drill testing rarely exceeds
150m vertical, either along known shears or at regional targets.

To date, drilling has included:

Aircore: 77,171m, RAB: 19,236.2m, RC: 228,767.98m DD: 74,595.42m

6.2.4 Sampling
6.2.4.1 Standard Operating Procedures and Manuals
Signature has Standard Operating Procedures (SOP) and manuals for most of the site practices. These
are reviewed internally and edited as required. Edits are preserved and prior copies archived.

Internal reviewed and deemed to be generally reasonable. Operational SOPs are presented as Table 7.

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Table 7: Standard Operating Procedures, Signature Metals

Version Update Due SOP Title SOP Description
001 October-15 4.0.001 SOP Template Template for all SOPs
002 October-15 4.2.001 CICO - The link between SOP’s and QAQC. Why SOPs are important
003 October-15 4.2.002 Introduction to Quality Control An introduction to QC.
SOPs
001 October-15 4.1.001 SOP Owere images Naming and styles for images
003 October-15 4.1.002 SOP Crop Compensation Process to control crop compensation and interaction with farmers

001 October-15 4.1.003 SOP Drill hole and sample naming nomenclature Standardised drill hole and sample IDs
001 October-15 4.1.004 SOP RC Drilling and Sampling Running an RC rig
001 October-15 4.1.005 SOP Scheduling (safety) Ensuring correct call-in procedures are maintained, and appropriate
response is in place.
001 October-15 4.1.006 SOP Soil Geochem Soil geochemistry program execution
001 October-15 4.1.007 SOP Niton XRF Analyser Using FPXRF for multielement analysis
001 February-15 4.1.008 SOP External Tails Sampling Due diligence of external tails sources
001 October-15 4.1.009 SOP Standards Blanks and Duplicates How to use standards and blanks in field programs
001 October-15 4.1.010 SOP Sample Chain of Custody Ensuring that samples are monitored and accounted for at all times from
field to lab
001 October-15 4.1.011 SOP Field and Data sign-off A final check list for ALL data. Important!
001 October-15 4.1.012 SOP Preparing Standards from CRM Bulk Packs Ensuring standards and blanks prepared on site are not contaminated or
mislabelled
001 October-15 4.1.013 SOP Diamond Drilling and Sampling Field operations with diamond rigs
001 October-15 4.1.014 SOP Trenching Field requirements to trench properly
001 October-15 4.1.015 SOP Diamond Core Sampling How to sample core
001 October-15 4.1.016 SOP Pre- and Post-Drilling Requirements Making sure field work is prepared properly and that post-field checks and
remediation are addressed
001 October-15 4.1.017 SOP Core Cut Sheet Make sure diamond core sample sheets are correct when they go to the
saws.
001 October-15 4.1.018 SOP Holy Hand Grenade How to properly use a Holy Hand Grenade
002 October-15 4.1.019 SOP Bulk Density Determination What is required to ensure SG data is correct
001 October-15 4.1.020 SOP Aircore Drilling and Sampling How to run an AC rig
001 October-15 4.1.021 SOP Machine Time Keeping Ensuring contract machinery costs are properly controlled.

001 October-15 4.1.022 SOP Stream Sampling Streams program requirements

001 October-15 4.1.023 SOP Downhole Survey Data QA for downhole data and data control requirements

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001 October-15 4.1.024 SOP Vehicles Documentation of vehicle use

001 October-15 4.1.025 SOP Data Updates Requests for data, and subsequent database update.
001 October-15 4.1.026 SOP Monthly Data Exports Standard products required for report writing
001 October-15 4.1.027 SOP Scanning What to do and where to save data
001 October-15 4.1.028 SOP Recovery Recording recovery and RQD data
001 October-15 4.1.029 SOP Data Management Controlling data on site
001 October-15 4.1.030 SOP Logging Codes, requirements, software to log core
March-16 4.1.031 SOP Wireframing Methodology to produce standard wireframes.
001 October-15 4.2.001 SOP Grid Transformations Surpac Standardised grid transformations at Owere
001 October-15 4.2.002 SOP Survey Methodology and Reporting Methodology for survey field work
001 October-15 4.2.003 SOP Survey
001 October-15 4.2.004 SOP Rig Alignment how to line up a rig.
001 October-15 4.2.005 SOP Volume calculation Measuring volumes or volume change.

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6.2.4.2 Diamond Core Sampling

Work conducted by Signature has been documented as an SOP (Table 7). Standard operating procedures
for historic work are unavailable. However, partial information regarding procedures is preserved in
statutory reporting.

Sampling intervals were marked out on DD core and the core was cut in half on the electric diamond
blade core saw, where the cut is made 3 mm to the side of the orientation line with the half core portion
that contains the line being kept in the tray and stored and the second portion broken up for assay (RSG,
2006).
Work conducted by Signature has been documented as an SOP. Diamond drill core samples have
variable sample interval widths, based on observed geological boundaries and variation in the nature of
mineralisation. The minimum sample interval is 0.3 m and the maximum sample interval is 1.0 m.
Reported intervals are composites of adjacent samples, which may include up to 2.0 m of internal
dilution (grades less than 1.0g/t Au) and do not include any external dilution. All reported intersections
have a weighted average grade greater than 1.0g/t. Reported interval widths are down whole widths.
No top-cut has been applied. Samples sent to the laboratory are NQ half core samples, split using a
diamond saw and cut based on the orientation line. To minimize bias, alternate halves of the cores were
submitted for assay, irrespective of observed geology and mineralisation. Samples are submitted to an
internationally accredited laboratory in Ghana (ALS Kumasi). Sample security is observed throughout
the drilling and submission process.

6.2.4.3 Reverse Circulation Sampling

RC work conducted by Signature has been documented as an SOP (Table 7). Standard operating
procedures for historic work are unavailable. However, partial information regarding procedures is
preserved in statutory reporting.
RC samples are sampled as 1 m intervals, irrespective of observed geology. Reported intervals are
composites of adjacent samples, which may include up to 2 m of internal dilution (grades less than
1.0g/t Au) and do not include any external dilution. All reported intersections have a weighted average
grade greater than 1.0g/t. Reported interval widths are down whole widths. No top-cut has been
applied. Samples sent to the laboratory are 1/8th riffle split samples, split using a three tier riffle splitter.
Samples are submitted to an internationally accredited laboratory in Ghana (ALS Kumasi). Sample
security is observed throughout the drilling and submission process. Samples are pulverized and a 60g
charge is analysed by Fire Assay. Unmarked QA/QC samples are inserted regularly within the sample
sequence (one of each in 20m) by the Company using certified reference samples and blanks, usually
sourced from AMIS in South Africa. Duplicate samples are generated during the sampling process in the
field and included in the sample sequence ALS Kumasi conducts internal QA/QC checks, which are made
available to the company. Assay integration and validation is monitored using proprietary software, Datashed, a
product developed and maintained by Maxwell Geoservices. All reported assays are certified and are
supported by certified results supplied by ALS Kumasi.

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6.2.4.4 Aircore Sampling

No Aircore drilling was conducted during the reporting period. Historic AC work conducted by Signature
has been documented as an SOP (Table 7). Standard operating procedures for historic work are
unavailable. However partial information regarding procedures is preserved in historic statutory
reporting.

The most recent AC drilling program was conducted by African Mining Services using two Drill Rig
Australia RAB 160 rigs. Holes were drilled towards the across lithologies at minus 60 degrees and drilled
to refusal. Holes were generally drilled as closed fences on lines spaced at 150m. Infill drilling lines
reduced line spacing to 75m. Samples were taken on 1m intervals and split through a three tier (1/8 th)
riffle splitter, then combined as 4m composite samples before submission for assay. Samples were
assayed at a certified laboratory (ALS Kumasi) by fire assay (AAS26). Certified results were returned and
correct chain of custody was observed. Four meter composites with anomalous gold results (>0.25g/t
Au) were re-split and submitted as 1m intervals. All results are down whole intercept thicknesses.

Anomalous AC assays reported are 4m composite samples. Exceptions (and the interval thickness) are
indicated in the “samples” column. 4m composite samples are reported where the composite grade is
greater than 0.25g/t Au. 4m composites results less than1g/t Au include no internal dilution and
consecutive samples have not been combined as single interval.

Samples are analysed by 50g Fire Assay method at internationally accredited laboratories in Ghana.

6.2.4.5 Trench Sampling

No trench sampling programs occurred during the reporting period. Historic trenching conducted by
Signature has been documented as an SOP (Table 7). Standard operating procedures for historic work
are unavailable. However partial information regarding procedures is preserved in statutory reporting.

Trench samples are collected at 1-meter intervals and care was taken to take a consistent ~4kg sample
from a cut perpendicular to observed structure. The trenches were logged for geology, structure and
graphic logging mapping) of the trench completed prior to sampling. Sample sheets were prepared,
annotated bags laid out based on meter marks were added from a common reference point at the
western or southern end of the trench. Specific information on the bed-rock type was recorded, and,
where there was any doubt whether the trench had exposed bedrock, a comment was made. Standards,
blanks and duplicate samples were introduced at 1 in every 20 samples for quality control, the sample
for QAQC indicated by the logging geologist. Sampling the floor was discontinued and only both sides
(preferentially the northern side) of the trench were sampled. Location of sample intervals was
indicated on the walls with spray paint and each interval photographed for reference. Samples were
collected in plastic bags and marked with alphanumeric tickets and marker pen.

6.2.4.6 Soil Sampling

A 1,300 point soils program was completed during the reporting period. The methodology for soils
conducted by Signature has been documented as an SOP (Table 7). Standard operating procedures for
historic data are not available. Soils sampling at Owere is conducted by three man teams taking samples

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every 30m on lines spaced 300m apart. The technique has minimal environmental impact. No lines are
cut – the teams navigate with GPS. At each soil sample site, a 20cm diameter hole is dug to the bottom
of the soil B horizon (the base of the root systems). Duplicates are collected in the field by quartering a
collected sample on a clean sample bag. The sample is taken from the field for analysis at an accredited
laboratory, or by field portable XRF for multi-element requirements.

6.2.4.7 Sample Preparation

There are few records on sampling and assaying procedures prior to Signature taking ownership of the
project. Sampling techniques were most recently reviewed in February 2014 resource estimate as part
of the Obenemase resource drilling (RSCMME, 2014). The review is current. Snowden also checked all
the data in 2014. Documentation was supplied to Snowden by Signature. Some material presented here
is drawn from Sterk (2014).

For all Signature sampling programs, samples were prepared on-site. Chain of custody was observed.

Sampling (e.g. RC and trench) was carried out at the collection site. Core samples were bagged at the
core yard after logging and cutting. All samples received alpha-numeric tickets and were placed in plastic
bags. The primary ~2-5 kg samples are received by the laboratory and include standards and blanks.
Samples were weighed, with those over ~4 kg undergoing riffle splitting. Coarse rejects were retained.
Samples were then dried for 24 hours at 85ºC. All samples were pulverised using an LM5 pulveriser for 6
to 10 minutes. Grind checks were undertaken every 40 samples. The pulp was split in the pulveriser
bowl by using a scoop. The resulting ~400 g pulp sub-sample is placed into a paper bag for further
analyses. Pulp residues are stored for two months and then discarded. The ~400 g pulp sub-sample is
further split by scooping into a measured 50 g charge for fire assay. The pulp residue is returned to
Signature and stored. Signature stores all pulp residues on site. RSCMME catalogued all pulps and coarse
rejects stored on site.

A summary of the sample flow-sheet is given in Figure 27.

Dominy (2014a, 2014b) notes that the sample preparation and assay used methods are reasonable. It
notes that they are not optimised for coarse gold, which may be present. Splitting of pulps by scooping
is poor practice, promoting various errors such as extraction error and grouping and segregation error.
Riffle splitting of the entire sample is the best option. Where an LM5 is used, it is noted that it is difficult
to remove the pulp efficiently due to their design.

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Figure 27: sample preparation.

6.2.5 Chemical Analysis

Samples are assayed by a 50 g charge for regional samples and 60g charge for resource samples.
Analysis is by fire assay with aqua regia digest and AAS finish (0.01 g/t Au detection limit). An audit of
the ALS Laboratories has not been conducted. Snowden notes that the assay used methods are
reasonable. It notes that they are not optimised for coarse gold, which may be locally present.
Method precision is reported by the lab as +/- 10%, and the reporting range is 0.01-100ppm.

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6.2.6 Quality Assurance and Quality Control

An independent quality assurance quality control (QAQC) report was prepared for the Aserewa, Apan,
Atunsu and the Boabedroo deposits in 2009 (DataGeo, 2009a). The raw drill hole database shows that
only the Boabedroo and Obenemase deposits contain data collected by Signature.
The QC data analysed in the report included:
 assay repeats
 pulp duplicates
 field duplicates
 certified reference materials (CRMs)
 blanks.
Signature used ALS laboratory for sample preparation and analysis.
Blanks and CRMs were inserted within samples every 20 m, while repeats were inserted every 10m. The
CRMs used were purchased from Geostats Pty Ltd and the blank material was collected from the Labadi
beach in Accra (DataGeo, 2009a).
The QAQC report showed good accuracy, with a slightly negative bias for the CRMs and moderate
precision in the repeats, however poor precision was observed in the field duplicates. The blanks had a
few failures.

The Obenemase D report (DataGeo, 2010) reviewed results for the QC samples inserted within the assay
data collected by Signature. The QC samples included assay repeats, field duplicates, CRMs and blanks.
The report comments that ‘a great number’ of the blanks inserted in RC samples consignments plotted
above the upper limit, while blanks submitted with DD samples showed better results (DataGeo, 2010).
Of 12 submitted CRMs, eight did not have certified information as they were no longer listed in the
supplier’s catalogue. Only four CRMs could therefore be analysed. This reduced the representivity of the
CRMs assessed in the dataset. Of the four CRM’s, only one (G 900-5, with medium to high grade) had a
substantially higher standard deviation compared to the certified standard deviation value for both RC
and DD samples The assay repeats and field duplicates for RC were reported to have shown good
precision (DataGeo, 2010).

6.2.7 Sample Security

Sample security is observed on-site. Samples are prepared either at the sampling site and returned to a
centralised facility each day. Drilling sites and the central facility have a 24 hour security presence.
Samples are periodically trucked to ALS Kumasi, transported by ALS. The sample batch is signed over to
the company driver who signs the triplicate submission sheet on departure from site. The laboratory
generates and sends a receipt on delivery, delivered by email to management.

6.3 Exploration Results

6.3.1 Exploration Results Overview
A drilling program was suspended on May 12, 2014, following the completion of drill testing targets to
300m vertical at Obenemase A, B and R. No additional drilling has occurred following this program.

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A soil sampling program within the Kurofa Prospecting Lease (P6/296) totalling 1,300 points was
completed in December 2014.
Significant work on site has focused on reviewing structural, geological and mineralisation data, as well
as validating and checking all datasets for exploration targets. Campaign review and digitizing of historic
paper maps and plans has continued

6.3.2 Exploration Drilling

Drilling from April 2014 was focused on step-out drilling at Obenemase, and contributes to the revised
Mineral Resource at Obenemase (Section 8). Drilling targeted Obenemase A, B and D Lodes, as well as
Obenemase R Zone. The drilling is presented as Figures 28-31.

Best drilling results include:

13.54m at 4.92g/t Au from 164.46m (OBADD0056) – Obenemase A
7.6m at 6.47g/t Au from 288.45m (OBDDD0065) – Obenemase A
11.09m at 1.83g/t Au from 307.45m (OBDDD0065) – Obenemase A
3.69m at 5.4g/t Au from 334.06m (OBADD0056) – Obenemase A
6.02m at 6.41g/t Au from 174.36m (OBBDD0057) – Obenemase R
5m at 3.96g/t Au from 182m (OBADD0056) – Obenemase R
5.3m at 7.78g/t Au from 325.3m (OBDDD0053) – Obenemase R
9m at 4.08g/t Au from 52m (OBDRC0060) – Obenemase D
4.79m at 4.62g/t Au from 145.94m (OBDDD0058) – Obenemase D

A complete list of drilling results is presented as Table 8.

Results were encouraging, and demonstrate that:

 The Obenemase A Lode mineralisation remains open at 300m depth over a strike length of
500m.
 Obenemase R links the shear hosting Obenemase B to the shear hosting Obenemase D, which
are parallel and 300m apart. The plunge extent of Obenemase R has been traced 550m to the
northeast, beneath the surface expression of Obenemase A Lode.
 Obenemase D has similar structural controls to Obenemase A and B and drilling has intersected
the mineralisation at 100m vertical. The mineralisation remains open in all directions, but is
most likely to be continuous down-dip and down-plunge to the northeast.

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Figure 28: Plan of drilling showing long section traces for Figures 11, 12 and 13.

Figure 29: Long Section OBA-OBA' (see Figure 23) showing holes targeting Obenemase A Lode

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Figure 30: Long Section OBB-OBB' (see Figure 23) showing holes targeting Obenemase B Lode

Figure 31 : Long Section OBD-OBD' (see Figure 23) showing holes targeting Obenemase B Lode

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Table 8: Significant DD and RC drilling results, year ending March 2015

Hole ID East North RL Azimuth Dip Hole Depth From To Interval (m) Au (g/t) Target
OBADD0048 702460 739128 284 305 -60.7 313.5 250.36 252.28 1.92 1.61 Obenemase A Lode
262.97 265.1 2.13 2.37 Obenemase A Lode
283.19 283.93 0.74 1.25 Obenemase A Lode
286.54 288.22 1.68 1.81 Obenemase A Lode
OBADD0049 702214 739322 297 111 -59.1 330 322.11 323.15 1.04 1.25 Obenemase R Zone
OBNDD0051 702323 738881 268 310 -61.2 271.8 Obenemase A Lode
OBBRC0052 702229 739430 294 309 -68.8 198 abandoned
OBDDD0053 702229 739430 294 107 -55.8 346.4 184.6 184.9 0.3 2.15
325.3 330.6 5.3 7.78 Obenemase R Zone
OBNRC0054 702373 738991 277 308 -66 198 Obenemase R Zone
OBADD0055 702198 739286 300 110 -63.4 355.5 2 3 1 1.29 Obenemase R Zone
147 148 1 3.94 Obenemase A Lode
313.61 314.74 1.13 1.62 Obenemase R Zone
317.4 319.92 2.52 3.93 Obenemase R Zone
323.64 329.97 6.33 1.37 Obenemase R Zone
OBADD0056 702409 739111 287 308 -54.9 349.4 107 108 1 1.39 Obenemase A Lode
115 116 1 4.28 Obenemase A Lode
164.46 178 13.54 4.92 Obenemase A Lode
182 187 5 3.96 Obenemase A Lode
202.2 205.58 3.38 2.25 Obenemase A Lode
334.06 337.75 3.69 5.4 Obenemase R Zone
OBBDD0057 702213 739135 281 306 -65 241.5 174.36 180.38 6.02 6.41 Obenemase R Zone
OBDDD0058 702103 739155 281 305 -59.3 172.6 123.06 125.71 2.65 3.84 Obenemase D Lode
145.94 150.73 4.79 3.27 Obenemase D Lode
158.71 162 3.29 4.42 Obenemase D Lode
OBDRC0059 702081 739122 286 307 -60.5 90 Obenemase D Lode
OBDRC0060 702068 739107 289 304 -60.5 140 52 61 9 4.08 Obenemase D Lode
70 76 6 2.92 Obenemase D Lode
OBARC0061 702562 739346 290 308 -61.2 138 pre-collar*
OBDRC0062 702083 739121 286 310 -60.2 67 Obenemase D Lode
ASWRC0063 698037 734991 251 138 -55.1 55 Aserewa
ASWRC0064 697958 734942 246 139 -59.4 120 114 115 1 3.08 Aserewa
OBDDD0065 702346 739570 298 110 -62.2 358.4 102 115 13 7.7 graphitic shear
124 132 8 6.34 graphitic shear
288.45 296.05 7.6 6.47 graphitic shear
307.45 318.54 11.09 1.83 Obenemase A Lode
343.64 344.26 0.62 1.53 Obenemase A Lode
347.22 350.22 3 2.01 Obenemase A Lode
OBDRC0066 702374 739599 295 110 -62.1 146 pre-collar*
OBDRC0067 702339 739668 291 108 -57.6 168 pre-collar*

Diamond drill core samples have variable sample interval widths, based on observed geological boundaries and
variation in the nature of mineralisation. The minimum sample interval is 0.3 m and the maximum sample
interval is 1.0 m. Reported intervals are composites of adjacent samples, which may include up to 2.0 m of
internal dilution (grades less than 1.0g/t Au) and do not include any external dilution. All reported intersections
have a weighted average grade greater than 1.0g/t. Reported interval widths are down hole widths. No top-cut
has been applied. Samples sent to the laboratory are NQ half core samples, split using a diamond saw and cut
based on the orientation line. To minimize bias, alternate halves of the cores were submitted for assay,
irrespective of observed geology and mineralisation. Samples are submitted to an internationally accredited
laboratory in Ghana (ALS Kumasi). Sample security is observed throughout the drilling and submission process.
Samples are pulverized and a 60g charge is analysed by Fire Assay. Unmarked QA/QC samples are inserted
regularly within the sample sequence (one of each in 20m) by the Company using certified reference samples and
blanks sourced from AMIS in South Africa. Duplicates are designated by Signature, and are generated as a
second 60g charge from the original sample. ALS Kumasi conducts internal QA/QC checks, which are made

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available to the company. Assay integration and validation is monitored using proprietary software, Datashed, a
product developed and maintained by Maxwell Geoservices. All reported assays are certified and are supported
by certified results supplied by ALS Kumasi.
RC samples are sampled as 1 m intervals, irrespective of observed geology. Reported intervals are composites of
adjacent samples, which may include up to 2 m of internal dilution (grades less than 1.0g/t Au) and do not include
any external dilution. All reported intersections have a weighted average grade greater than 1.0g/t. Reported
th
interval widths are down hole widths. No top-cut has been applied. Samples sent to the laboratory are 1/8 riffle
split samples, split using a three tier riffle splitter. Samples are submitted to an internationally accredited
laboratory in Ghana (ALS Kumasi). Sample security is observed throughout the drilling and submission process.
Samples are pulverized and a 60g charge is analysed by Fire Assay. Unmarked QA/QC samples are inserted
regularly within the sample sequence (one of each in 20m) by the Company using certified reference samples and
blanks, usually sourced from AMIS in South Africa. Duplicate samples are generated during the sampling process
in the field and included in the sample sequence ALS Kumasi conducts internal QA/QC checks, which are made
available to the company. Assay integration and validation is monitored using proprietary software, Datashed, a
product developed and maintained by Maxwell Geoservices. All reported assays are certified and are supported
by certified results supplied by ALS Kumasi.
NSA – no significant Assay. ANR – Assays not returned. Co-ordinates use datum WGS84 and projection
transmercator UTM30. Coordinates are determined using a differential GPS. Results reported in italics (and
prefixed ‘including’ are subsets of the previous assay, and are sub-intervals within the larger intercept which have
a significantly elevated gold grade when compared to the weighted average grade.

6.3.3 Kurofa Soils Program

In December 2014, a 1,300 point soils program to infill the gaps in the geochemistry database over the
Kurofa Prospecting Lease was concluded. Results are not yet available. Samples have been collected on
a 30 x 300m grid throughout the Kurofa Prospecting Lease (Figure 22) and test all interpreted known
and geophysics-interpreted structures and lithologies which demonstrate mineralisation potential.
Results are not available.

Figure 32: 2014-2015 soils program

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6.4 QAQC Results

Most of the historic QC data collected at Konongo was poorly captured or implemented. Preservation or
migration of that data into a project database was poorly applied. Most QAQC data available for review
comes from activities postdating 2010. Methodologies are poorly preserved and may not have been in
place. Some details can be pieced together from historic reports and memorandums. QC data available
at Konongo includes:
 Blanks.
 Certified reference materials (CRMs)
 Field duplicates
 Laboratory assay repeats
 Laboratory pulp duplicates

RSCMEE undertook a thorough review of all historical data in 2013 and compiled a detailed QAQC report
on their findings. A summary of their work is presented in appendix two.

The 2015 mineral resource estimations are based upon data reviewed and validated by RSCMEE.

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7.0 Mineral Processing and Metallurgical Testing

7.1 Overview
The existing CIL plant located on the Konongo mining lease area, close to the Obenemase pit, was
operational between 1995 and 1999 with a nominal capacity of 320,000 tpa. The plant was designed to
process oxide ore from open pits only, effectively demonstrated by recent mining of oxide ore in open
pits by SCM and OGM.

The sulphide-ore potential was recognised during the years of surface mining operations. Gold recovery
from transitional and sulphide ores would require installation of alternative processes, as the gold in the
sulphide ore was found to be refractory with poor recoveries achieved by direct cyanidation. As a result
some test work was conducted in the 1990’s and provided some process design information for the
treatment of the refractory gold.

Based on limited test work, the sulphide ore is considered refractory. Metallurgical test work has been
undertaken at various times in order to determine the most optimal method of gold recovery. OGM
carried out the most recent test work program which has mainly included investigations of pressure
oxidation.
The bulk of the metallurgical samples were obtained from the Obenemase deposit, with a lesser amount
from Santreso and Konongo tailings dam.

The Metcon report highlights that the initial recoveries achieved using conventional cyanide leaching on
the refractory ores are poor (4.7-6.8%) increasing with rougher flotation (83.7 to 90.2%). Table 9
summarises results achieved.

The BacTech test work was conducted on flotation concentrate samples received from Metcon and
demonstrated that gold recoveries of between 95 % and 99 % could be achieved from the concentrate.
By contrast, cyanidation of the non-oxidised concentrate achieved gold recovery of only 42 %.

7.2 Metallurgical Test work

7.2.1 Oxide Ores
Bottle roll tests completed in 1985 indicated recoveries of 95% to 97% on Obenemase oxide ore at
grades between 12.3 g/t Au and 15.7 g/t Au. Column leach tests on 5 g/t Au Obenemase oxide ore gave
recoveries of 68% to 88% after 24 hours and 88% after 10 days. On this basis, Signature used a heap
leach recovery of 85% for mine planning.

In 1995, following the purchase of a second hand CIP oxide plant (350,000 tpa) from Aurora Australia,
OGM commenced open pit mining at Boabedroo, Apan, Atunsu, Aserewa, and Obenemase. Between
1995-1997, OGM treated 614,000 tonnes of ore grading 2.96 g/t for 58,500 oz gold. Mining halted in
1997, due to insufficient oxide ore and poor gold recoveries, which saw operating costs escalate from a
low of US$112/oz gold in June 1996, to US$397/oz gold in June 1997.

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7.2.2 Sulphide Ores

The following reports address treatment of refractory ores at Konongo:

 SF Rayner, Metcon Laboratories, Metallurgical development test work on Obenemase gold ore
refractory gold flotation, March 1997.
 JC Horston, MT Gold Ltd, Konongo Tailings, 20 June 1985.
 Lycopodium, Carbon Stripping Process for the Konongo Gold Project, December 1994.
 T Williams, BacTech (Australia) Ltd, Bacterial Oxidation for Ghana Gold Limited of an
Arsenopyrite Concentrate, October 1996.
 KJ Henley, Amdel, Mineralogical Examination of Ghana Gold (Obenemase) Flotation Products, 7
March 1997.

Test work designed to test bacterial oxidation of the Konongo sulphide (primary) ore was carried out by
OGM in 1996. Recoveries of 95% and 99% were reported following cyanide leaching of an oxidised
concentrate (with 42% by cyanide leaching only). A high acid consumption was noted due to high
concentrations of carbonate in the ore. It was found that the carbonate floated with the graphite and
some sort of beneficiation process to suppress or isolate graphite during flotation would be required.

As part of the pre-feasibility study, RML provided at 2 t bulk sample of sulphide ore from the
Obenemase deposit to AMMTEC Australia for pilot plant flotation and associated test work. Gold
extraction levels for both direct cyanidation and CIL cyanidation were both poor at 28%, with little
improvement by fine grinding. Minimal gold (up to 6%) was recoverable by gravity methods.

Flotation results suggested that the rougher cleaner concentrate and a portion of the scavenger cleaner
concentrate (SCC) would constitute the primary product for downstream oxidation treatment
procedures. The remainder of the SCC was planned to report to the two tail streams for treatment at
the existing CIL plant at Obenemase. Overall gold recovery within the flotation concentrate was 88%.

Pre-treatment and cyanidation produced recoveries of between 82% and 92% using the Lee process
and94% using acid pressure oxidation. Bio-oxidation evaluation test work was not completed. It was
found that flotation concentrates can be successfully pressure oxidised with or without acid addition to
give cyanide recoveries from the oxidised concentrates of between 92% and 94%. It was determined
that overall possible recovery of gold from sulphide ore by CIL treatment of pressure oxidised
concentrate would be around 88%. In addition, a further 3% would be recoverable from CIL treatment of
the flotation tails to give an overall recovery to bullion of over 91%.

Four composites of sulphide ore from Obenemase A lode were prepared from 8 diamond drill holes.
Bond Ball Mill Work Indices (BWi) via the Comparative Method were performed on these composites.
The resulting average work index of 13.75 kwh/t was applied in the RML pre-feasibility study.

Test work and operations history show that Obenemase ore has a good prospect for being processed.
Given the presence of primary sulphide ore some challenges exist. Further test work will be required.
There is no information regarding sample selection for metallurgical test work or how metallurgical
domains have been determined.

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7.2.2.1 Metcon Laboratories 1997

The Metcon report highlighted that the initial recoveries achieved using conventional cyanide leaching
on the refractory ores were poor, with Table 9 reflecting the summarised results achieved, and
demonstrating good recovery to a rougher flotation concentrate.

The test work showed that there was insufficient free gold for a viable cyanide leach process and
recovery of gravity gold was not considered sufficiently efficient. As a result the only potentially viable
option would be flotation recovery of the gold bearing minerals, followed by an oxidation stage to break
down the sulphides, before recovering the gold through conventional cyanide leaching.

It was found though that the flotation concentrate contained significant amounts of carbonate,
requiring acid addition during oxidation and thus impacting on the process economics.

It is also significant to note that even at reasonably good recoveries; more than 10 % of the total gold
would be lost to tails. Head assays for the samples tested are shown in Table 9..

Table 9: Metcon Au recoveries achieved using different processing options [Dominy et al 2014c].

Process %Au recovery

range
Amalgamation (free gold) 4.7 to 6.8
Gravity concentration 51.2 to 60
Cyanide leaching 32.3 to 42.2
Rougher flotation 83.7 to 90.2

Table 10: Metcon sample head assays

Test work included:

 sample analysis
 grinding trials
 direct cyanide leaching
 flotation response of each ore zone
 flotation response of a composite sample
 cyanidation of flotation products.

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Leach tests of the flotation products from the composite sample produced the results as shown in Table
10, with the mass pull to the cleaner concentrate approximately 3.7 %. Mass pull to concentrate for the
various tests ranged from 2.6 % to 7%.

The final two composite sample tests produced concentrate at a mass pull of 3.7 % and contained:
 112 g/t Au
 21 % S
 12 % As
 22.6 % Fe
 2.4 % C.
These samples were submitted for bioleaching tests at BacTech.

The rougher tails and cleaner tails subjected to further cyanide leaching achieved gold recoveries of 47.8
% and 14.9 % respectively as shown in Table 10. The Metcon report further proposes that these
recoveries should be added to the overall recoveries, which may be appropriate, however Snowden
recommends that this be confirmed through a cost benefit study of retreating the tails.

Table 11: Flotation products leach test results

7.2.2.2 BacTech
The BacTech test work was conducted on flotation concentrate samples received from Metcon and
demonstrated that gold recoveries of between 95 % and 99 % could be achieved from the concentrate.
By contrast, cyanidation of the non-oxidised concentrate achieved gold recovery of only 42 %.

Bacterial oxidation tests were set up in 1.5 litres stirred, aerated reactors, maintained at a temperature
of 45°C. The pH was monitored and controlled by adding calcium carbonate slurry or sulphuric acid, as
required. The tests were further operated at 10 % w/v pulp density and were inoculated with a
moderate thermophilic culture. Samples were taken on a regular basis and at completion of the tests
the content of the reactors was filtered and the residues dried. The dried residue was split and analysed
both before and after an acid/alkaline wash. Both the washed and unwashed fractions were submitted
for cyanidation to determine gold recovery after the bacterial leach. Assays of the feed concentrate are
shown in Table 12.

Bacterial oxidation tests were conducted at a pH controlled at 1.5, with two tests conducted where the
initial pH was at 2.5, but was allowed to vary afterwards in that no further acid was added to control the
pH at acidic levels. It was interesting to note that without pH control the pH continued to increase up to

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7.8, at which stage no oxidation of sulphides was observed, but precipitation of As and Fe did take place.
Acid was then added to reduce the pH back to 2.5.

The tests set up at a pH of 1.5 had an acid demand of approximately 255 kg/t of concentrate and
achieved maximum As and Fe release after 426 hours.

Table 12 shows the gold recoveries of three different tests conducted at BacTech, clearly showing that
gold recovery was significantly increased by and oxidative pre-treatment stage. Substantial further
increases after an acid / alkali wash suggests that precipitates formed during bacterial oxidation
occluded the gold and rendered it unavailable for cyanide leaching.

This may require acid addition prior to inoculation and the test report recommended further test work
to optimise that process.

Table 12: Bioleach tests head assays

Table 13: Gold recoveries at BacTech after different treatment options

7.2.2.3 Amdel mineralogy

Mineralogical analysis of the flotation products demonstrated that:
Sulphides were predominantly arsenopyrite and pyrite.
Carbonates were predominantly dolomite with subordinate calcite.
Silicates were predominantly chlorite and quartz with minor muscovite and plagioclase.

7.3 Mineral Processing Design

The current plant is optimised to an oxide ore feed. The dominant component of the current
Obenemase resource is primary sulphide ore (88%). Previous test work has determined that a possible
recovery of gold from sulphide ore by CIL treatment of pressure oxidised concentrate would be around

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88%. In addition, a further 3% could be recoverable from CIL treatment of flotation tails to give an
overall recovery to bullion of over 91%. Further test work is required to investigate the options of either
upgrading the current plant or building a separate sulphide plant.

The Owere processing plant employs a direct cyanidation method to treat gold bearing ore. It has an
annual capacity of 325,000t. Processing facilities currently available can handle only oxidized free-milling
ores. The main stages followed are crushing, milling, gravity, leaching, adsorption, elution,
electrowinning, smelting and bullion (Figure 33).

The 250 t per hour crushing plant unit is mobile and consists of three crushers; a primary jaw crusher, a
secondary cone crusher and a tertiary cone crusher. Maximum feed size of the primary crusher is
approximately 100 cm, with output from the tertiary crusher at -6 mm. The final product is fed to the
mill by means of front end loader through a bin which has a feed gate to control tonnes desired. Dust
suppression is employed.

The milling circuit is a single ball mill in closed circuit with the hydrocyclone underflow stream. The mill
is designed to grind between 50 and 60 t per hour at a power of 380 kW to 400 kW. The classified
overflow is trashed and sized screened, and advanced to the leaching circuit.

A 5% to 10% portion of the cyclone underflow is fed to the gravity circuit, into a single Knelson
concentrator. The gravity separator concentrate is refined by tabling. The concentrate is forwarded for
smelting. The tails are returned to the mill for regrinding.

The leaching and adsorption circuits are arranged in series, dissolving the solid gold and the subsequent
picking of the soluble gold on to activated carbon. An exclusive conditioned leaching takes place in five
contactor type tanks (46.56 m3 each). Cyanide, lime and dissolved oxygen are introduced at this stage to
initiate and facilitate leaching. This is followed by a second train, made up of four cylindrical vessels
(383.3 m3 each) for adsorption purposes. Activated carbon is introduced to the last tank and
conventionally advanced forward. The loaded carbon is then lifted for stripping as it moves counter
currently to the slurry direction at the first tank.

The elution process has a single pressure vessel used for both acid treatment and stripping. The
enclosed pressure column is a two tonne facility and operates under the Zadra system.
The electrowinning cell is sequenced with the elution process. The resulting steel wool sludge is calcined
and smelted to produce gold bullion.

During the period October 2012 to January 2013 the plant processed 113,240 t at 1.1 g/t Au (recovered)
for 4,174 oz Au. During this period the mean plant availability was 93% (91% to 95%). It yielded a mean
gold recovery of 67%, ranging from 44% to 81%.

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Figure 33: Processing flow sheet, Konongo

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8.0 MINERAL RESOURCE ESTIMATES

8.1 Summary of Mineral Resources
The Mineral Resources, as of May 2015, for the Obenemase A and B Deposit are shown in Table 14.
st
Table 14: Obenemase A and B deposit by Material Type, Mineral Resource as of May 1 2015

Gross attributable Net attributable to Lion Gold

Mineral
to Licence Contained gold
type 53.80%
in total mineral
JORC category (gold) Tonnes Grade Tonnes Grade Change in ounces resource
from previous (oz Au)
(g/t (g/t reported update
(t) (t)
Au) Au) (%)
Indicated Oxide 164,000 3.4 88,000 3.4 0 18,000
Inferred Oxide 9,000 2.9 5,000 2.9 0 1,000
Total Oxide 173,000 3.4 93,000 3.4 0 19,000
Indicated Transition 325,000 4 175,000 4 0 42,000
Inferred Transition 22,000 3 12,000 3 0 2,000
Total Transition 347,000 3.9 187,000 3.9 0 44,000
Indicated Sulphide 2,845,000 3.8 1,531,000 3.8 0 348,000
Inferred Sulphide 1,475,000 3.8 794,000 3.8 16 178,000
Total Sulphide 4,321,000 3.8 2,325,000 3.8 5 526,000
TOTAL All 4,841,000 3.8 2,604,000 3.8 4 589,000

Mineral Resources are reported at 0.5 g/t Au, 0.7 g/t Au and 1.0 g/t Au cut-off for oxide, transitional and sulphide
respectively. Note: Mineral Resources which are not Ore Reserves do not have demonstrated economic viability. No
Ore Reserves are defined at Obenemase. The estimate of Mineral Resources may be materially affected by
environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues. It is uncertain if
further exploration will result in upgrading the Inferred Mineral Resource to an Indicated or Measured Mineral
Resource category. Tonnage is reported in metric tonnes (t), grade as grams per tonne gold (g/t Au) and contained
gold in troy ounces (oz Au). Tonnages rounded to the nearest 1,000 t. Ounces rounded to the nearest 1,000 oz Au.
Figures may not compute exactly due to rounding. In 2009, Signature acquired a 70 % interest in the project from
African Gold PLC via the acquisition of their 70 % ownership of Owere Mines Ltd. In March 2012, LionGold acquired
a 77 % ownership in Signature. The net attributable to LionGold is thus 53.8 %.

The Mineral Resources, as of May 2015, for the Other Konongo Deposits are shown in Table 15, below.

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st
Table 15: Konongo Other Deposits, Mineral Resources as of May 1 2015

Gross attributable Net attributable to Lion Gold

to Licence
Contained
53.80%
gold in total
JORC Change in
Deposit Tonnes Grade Tonnes Grade mineral
category ounces resource
from (oz Au)
(g/t (g/t previous
(t) (t)
Au) Au) reported
update (%)
Inferred 731,000 2.3 393,000 2.3 0 55,000
Apan
Total 731,000 2.3 393,000 2.3 0 55,000
Inferred 409,000 3.3 220,000 3.3 0 43,000
Aserewa
Total 409,000 3.3 220,000 3.3 0 43,000
Inferred 285,000 3.6 153,000 3.6 0 33,000
Boabedroo North
Total 285,000 3.6 153,000 3.6 0 33,000
Inferred 447,000 2.2 241,000 2.2 0 32,000
Boabedroo South
Total 447,000 2.2 241,000 2.2 0 32,000
Inferred 1,841,000 3 991,000 3 0 178,000
Boabedroo South Extension
Total 1,841,000 3 991,000 3 0 178,000
Inferred 686,000 1.8 369,000 1.8 8 40,000
Obenemase D
Total 686,000 1.8 369,000 1.8 8 40,000
TOTAL All 4,399,000 2.7 2,367,000 2.7 1 381,000

All Mineral Resources have been depleted by the latest available mining surfaces and underground mining volumes.
The north eastern portion of Obenemase D has been removed, since it overlaps with the Obenemase A and B
deposit in that area. Resources are reported at 0.5 g/t Au cut-off for oxide and transitional and 1.0 g/t Au cut-off
for sulphide. Note: Mineral Resources which are not Ore Reserves have not demonstrated economic viability. No
Ore Reserves are defined at these deposits. The estimate of Mineral Resources may be materially affected by
environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues. Tonnage is
reported in metric tonnes (t), grade as grams per tonne gold (g/t Au) and contained gold in troy ounces (oz Au).
Tonnages rounded to the nearest 1,000 t. Ounces rounded to the nearest 1,000 oz Au. Figures may not compute
exactly due to rounding. In 2009, Signature acquired a 70% interest in the project from African Gold PLC via the
acquisition of their 70% ownership of Owere Mines Ltd. In March 2012, LionGold acquired a 77% ownership in
Signature. The net attributable to LionGold is thus 53.8%.

8.2 General Description of Mineral Resource Estimation

In May 2015 SEMS undertook a Mineral Resource estimate for the A and B lodes of the Obenemase
deposit and the zone referred to as Obenemase D within the Konongo Mining Lease, utilising all
exploration drilling completed as of March 31st 2015. SEMS also reviewed existing mineral resource
estimates for the Apan, Aserewa and Boabedroo (North, South, and South Extension) deposits, referred
to as the ‘Other Deposits’.
The Mineral Resource estimate has been prepared using guidelines compliant with the 2012 Joint Ore
Reserves Committee of Australasia (JORC) reporting code, and has been managed by SEMS Competent

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Persons. All work was carried out using Datamine software. The drilling data has been verified in
accordance with standard QA-QC procedures.

A total of thirty one (31) drill holes have been completed by Signature at Konongo since the previous
mineral resource estimation in February 2014, of which twenty nine (29) holes (17 diamond core and 14
reverse circulation RC) relate to the Obenemase deposit and have been considered in the latest mineral
resource estimate. The total drilling database for Obenemase A and B now comprises over 1,500 holes,
excluding underground sampling and trenching.

The mineralised portion of the Obenemase A and B deposit covers a strike length of 1,100 m, and
extends to depths of over 300 m. Current drilling and mineral resource delineation has focused on fresh
rock. Near surface oxidised material has been largely mined out. Exploitation is likely to be through a
combination of open pit and underground methods.

Modelling of the mineralised zones was achieved by sectional digitising of the mineralised outlines from
sections, at an average spacing of 20 m. These have been created using geology and structure, to be
representative of the continuation of the mineralisation. A nominal 0.5 g/t Au cut-off, with a maximum
of 2m below cut-off, were used in defining mineralisation. End sections were normally extrapolated half
the section spacing. Mineralisation continuity down dip is particularly strong and modelling was
extrapolated up to 60 m down dip from drill intersections dependent on supporting sections and the
strength of intersections. Mineralisation has been modelled to a maximum depth of 310m below
surface.

The digitised mineralised outlines were used for support in the creation of mineralised wireframes. A
block model was created from the mineralised wireframes to which attributes such as grade, density,
oxidation state and classification are assigned.

Gold grades for the reported mineral resource model have been determined using ordinary kriging, and
the resulting resource is classified as both indicated and inferred. Historical open pit and underground
mining has been depleted from the model.

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A lode

D lode
B lode

Figure 34: Obenemase Deposit drill-hole locations showing: hole traces (yellow) with mineralised intersections (warm
colours represent higher grades), recent holes (pink), approximate modelled zone boundary (orange), and previously mined
pit surface outline (blue dashed)

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8.3 Mineral Resource Estimate, May 2015

8.3.1 Obenemase A & B
The combined Inferred and Indicated Mineral Resource estimate for the Obenemase A and B deposit is
4,841,000 t at an average grade of 3.8 g/t Au for 589,000 oz Au.

8.3.1.1 Mineral Resource Input Data

The following data was received from Owere in May 2015:
Drill hole database “20150316 Database ALL.accdb” (MS Access format), comprising collars,
surveys, assays, and lithologies for all drill holes drilled up to May 2014

Mineral resource wireframe and block models, and geological and structural wireframe models,
from the previous mineral resource estimations by RSCMME and Snowden

Topographic DTM model

Density determinations
The drill-hole files were validated and imported into Datamine, and a final de-surveyed drill-hole file
created. The data was very clean (ie no ‘from-to’ sequencing errors). The wireframe and DTM model
files were imported into Datamine and checked for consistency. The Snowden mineral resource block
model was a Datamine file and was examined to identify key fields and variables used to control the
mineral resource reporting.
All drill-hole data has previously been the subject of a rigorous data validation exercise undertaken by
RSCMME during 2012 and 2013. No new issues were detected by SEMS. Assays with negative, below
detection value were reset to a very small positive number.
The cut-off date for data is the date of the last drilling which was May 2014.

8.3.1.2 Geological Interpretation

Obenemase mineralisation occurs near the northern end of the Konongo Mining Lease, located on the
western limb of a regional syncline at the contact between the Lower Birimian and Tarkwaian. An S1
foliation is interpreted as parallel to bedding (S0) which places the Obenemase A & B mineralisation on
the limb of a closed to isoclinal F1 fold. Mineral and intersection lineations plunge 40° to 70° to the
northeast.

The Obenemase mineralised system comprises two, fabric-parallel, mineralised shears located 300m
apart at surface. The two shears both occur at lithological boundaries. An oblique, north-plunging, late
structure is interpreted to connect the two shears.

Mine sequence stratigraphy from east to west includes:

A footwall carbonaceous banded siltstone, grading into a graphitic shale,
Obenemase A Lode shear position.
Volcaniclastic siltstone and sandstones with subordinate intermediate and felsic volcanics and
sub-volcanics which volcaniclastic units preferentially host mineralisation.
Mafic volcanics (tholeiites)

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Obenemase D Lode shear position

A second sequence of carbonaceous banded siltstone (which is locally mineralized).

Mineralisation consists of a dolomite-silica+/-albite alteration assemblage and arsenopyrite-silica+/-

pyrhhotite+/-pyrite mineralisation. Alteration is notable for the relative lack of hydrosilicates
(muscovite-sericite). Gold grades correlate strongly with arsenopyrite. Mineralisation is either closely
associated with the bounding shear structures or is stratabound, with significant preferential
mineralisation into volcaniclastic siltstones. In all cases, the acicular arsenopyrite is disseminated (1-5%)
and, despite following particular folded geology, is randomly oriented and post-peak to late-structural.

Mineralisation occurs as two discrete lodes on the eastern shear – Obenemase A Lode and Obenemase
B Lode. These lodes have parallel northeast plunges and grades are observed to be elevated where
second order structures form flexures in the geology. Both lodes are hosted in volcaniclastic units.

Obenemase R Zone (Figure 35) is a northeast pitching late zone of mineralisation which rolls from
northwest dipping in the south through northeast dipping further north. The mineralisation is late (but
penecontemporaneous with A, B and D mineralisation)

Figure 35: Obenemase A, B, D and R. Oblique view, looking south (UTM).

RSCMME constructed the mineralised geological interpretation from detailed models of lithology and
structure. Snowden largely concurred with the interpretations but made minor updates. SEMS has
reviewed the Snowden interpretations and found them to be satisfactory.

SEMS has extended the geological interpretations to include information from recent drill holes, based
on the underlying principles developed by RSCMME. Although modest in extent, the mineralised
extensions result from several new intersections that are additional to the existing mineralised model,

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and demonstrate continuity of mineralisation either at depth or laterally. In some cases this has resulted
in upgrading of the previous mineral resource classification.

Figure 36 shows the interpreted extension on the R-zone of the Obenemase B lode.

Figure 36: Geological interpretation for R-Zone of Obenemase B lode

8.3.1.3 Data analysis and geostatistics

Both RSCMME and Snowden completed detailed data and statistical analyses. The main findings were:
- a low coefficient of variation
- very modest amount of grade “outliers”, such that grade top-cutting does not need to be
rigorously applied, and does not have a significant effect on the average grade.
- poor correlation of the diamond drill-hole data set to Trench, BODH and Underground data sets,
such that all the later data sets have been excluded from mineral resource estimation
- RC and DD samples showed no correlation bias and were used in the mineral resource
estimation

Sample data from the recent drilling was found to conform to the above analyses, with no top-cutting
required.
The average sample length for drill hole samples was 1.4m (average 1.2 m for assays above cut-off), and
therefore samples were composited to 1.0 metre prior to statistical analysis and for later grade
estimation.
SEMS has used the same density values to those used by RSCMME and Snowden in their mineral
resource estimates: 1.90 t/m³ for oxide, 2.8 t/m³ for transition and 2.82 t /m³ for sulphide material.

These density values were determined by RSCMME in 2013 from 14,310 measurements collected from
historical full, half and quarter core. Measurements were obtained by a ‘standard wet - dry approach’,

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no wax was applied as most samples had hardly any porosity. RSCMME did not dry the core in an oven
as they considered exposure to sun light was sufficient.

It should be noted that SEMS considers the density values used for transitional ore to be slightly higher
than those generally encountered in Birimian shear hosted gold deposits.

A summary of the statistical results for the recent data (within mineralised envelopes) is show in table
16.
Table 16: Summary statistics of selected 1m composites inside mineralised envelopes.

Description Number No. of Missing Values Min Max Mean Var SD CoV
(g/t) (g/t) (g/t)
All selected composites 1,445 41 0.01 35.0 2.8 16.1 4.0 1.4

8.3.1.4 Domaining
The primary domaining used is based on weathering profiles defined by core logging, which are
separated into the following domains:
- Oxide
- Transitional
- Sulphide
RSCMME created a number of search orientation domains in order to control grade interpolation, made
more difficult due to the deposits folded nature. Snowden used a different method to handle search
orientation and did not create search orientation domains.

SEMS created spatial search domains in a similar fashion to RSCMME for controlling search orientations,
mainly based on wireframe orientation which should provide a reasonable fit to mineralisation strike
and dip. However, given the high degree of structural complexity present and frequent directional
changes only broad base search domains are warranted.

Due to the relatively small amount of oxide material, Snowden combined oxide and transitional domains
together for mineral resource estimation purposes.

It should be noted that the metallurgical behaviour of transitional ore is likely to be different to that of
oxide ore. SEMS recommends that future mineral resource estimates separate oxide and transitional
ore domains.

8.3.1.5 Variography
Both RSCMME and Snowden developed in-depth variograms and detailed kriging estimation
parameters. SEMS has reviewed the processes by which the variography has been derived as well as the
resultant outputs and is of the opinion that they are good representations of the data. SEMS agrees with
the model block size, discretisation, search ranges, and sample composite parameters as determined by
Snowden.

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8.3.1.6 Estimation
Ordinary kriging was used to estimate grade into blocks using search parameters determined by the
variography and the one metre sample composites. The block model was been defined within the
geographical limits of the mineralised wireframe. A parent block size of 10 x 10 x 10 metres was used
with sub-blocking up to a factor of 3 used to accurately model the often narrow mineralised boundaries.

Blocks that fell outside of the first pass ellipsoid were re-estimated in two further passes, each with
successively relaxed search ellipsoids (factor of 1.5), and flagged for later classification at lower levels.
Minimum sample numbers for interpolation were initially set to 10 but were reduced where subsequent
passes were necessary.

Table 17: Block model parameters.

Min Max Range Cell Size Cell No.

East 9630 10380 750 10 75
North 9115 10595 1480 10 148
RL -140 340 480 10 48

Table 18: Grade estimation parameters.

Parameter Value
Assay top cut (g/t) 35
Strike direction (0) 350
Dip (0) ave 85
Pass 1 Search Radius x (m) 30
Pass 1 Search Radius y (m) 40
Pass 1 Search Radius z (m) 25
Min No. samples 10
Max No. samples 40

8.3.1.7 Validation
Validation consisted of visually comparing the model grades against the original composite data. Visual
validation of block grades by section showed a good fit to the sample data. Extensive validation
techniques were carried out by both RSCMME and Snowden, indicating similar results. SEMS has
reviewed all these validations and agrees with the results.

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Figure 37: Model Validation - Drill-hole sample grades versus model grades

8.3.1.8 Classification
The data density, data reliability and data quality, and continuity of mineralisation and structure in areas
where drill holes are heavily developed, determine how the mineral resource can be classified into areas
of a particular level of confidence. Although the deposit is structurally complex the density of data is
high and separation of holes is particularly close.

After reviewing the classification approaches of RSCMME and Snowden, SEMS has maintained the
Snowden classification but has reclassified (upgraded) some inferred areas where new drilling
information has demonstrated a higher degree of continuity than before. SEMS considers that this is a
relatively conservative classification but is appropriate.

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Figure 38: Mineral resource wireframe model and drill-hole traces showing primary lode (brown) and secondary lode (green)
(looking NE).

8.3.1.9 Reported Mineral Resources

The Obenemase A and B lode Mineral Resources are reported in Table 19. All depletion surfaces from
surface and underground mining have been taken into account. Mineral Resources are reported at cut-
off grades of 0.5 g/t, 0.7 gt, and 1.0 g/t for oxide, transition, and sulphide respectively.

Taking into account the grade, quantity, and characteristics of the Obenemase A and B lode mineral
resources, SEMS considers there are reasonable prospects for the eventual economic extraction of the
mineralised zones, by a combination of surface and underground mining.

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Table 19: Obenemase A and B Mineral Resources, 1 May 2015

Indicated Inferred Total

Material Tonnes Grade Oz's Tonnes Grade Oz's Tonnes Grade Oz's
(g/t) (g/t) (g/t)
Oxide 164,000 3.4 18,000 9,000 2.9 1,000 173,000 3.4 19,000
Transition 325,000 4.0 42,000 22,000 3.0 2,000 347,000 3.9 44,000
Sulphide 2,845,000 3.8 348,000 1,475,000 3.8 178,000 4,321,000 3.8 526,000
Total 3,334,000 3.8 408,000 1,507,000 3.7 181,000 4,841,000 3.8 589,000

Grade-tonnage curves for the modelled mineral resources, using variable Au cut-off increments, are
presented in Figure 399. It should be noted that this does not represent a mineral resource statement
and is only to illustrate sensitivity of block model resources to block cut-off grade:

st
Table 20: Obenemase A and B deposit by Material Type, Mineral Resource as of May 1 2015

CATEGORY Material Type Cut-off Grade (g/t Au) TONNAGE1 GRADE CONT'D GOLD1
(Tonnes) (g/t Au) (oz)
Indicated Oxide 0.5 164,000 3.4 18,000
Inferred Oxide 0.5 9,000 2.9 1,000
Total Oxide 0.5 173,000 3.4 19,000
Indicated Transition 0.7 325,000 4.0 42,000
Inferred Transition 0.7 22,000 3.0 2,000
Total Transition 0.7 347,000 3.9 44,000
Indicated Sulphide 1.0 2,845,000 3.8 348,000
Inferred Sulphide 1.0 1,475,000 3.8 178,000
Total Sulphide 1.0 4,321,000 3.8 526,000

TOTAL All 0.5-1.0 4,841,000 3.8 589,000

st
Table 21: Obenemase A and B deposit by JORC Category, Mineral Resource as of May 1 2015

CATEGORY TONNAGE1 GRADE CONT'D GOLD2

(Tonnes) (g/t Au) (oz)
Indicated 3,334,000 3.8 408,000
Inferred 1,507,000 3.7 181,000
Total 4,841,000 3.8 589,000

1
Note: Totals may not add exactly due to rounding
2
Note: Totals may not add exactly due to rounding

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Obenemase A & B -- Grade - Tonnage Curve

6.00 12

5.00 10
Tonnage (Mt)

4.00 8

Grade (g/t Au)

3.00 6

2.00 4

1.00 2

0.00 0
0.5 1.5 2.5 3.5 4.5 5.5 6.5 7.5
Cutoff Grade (%)
Tonnes (Mt) Grade

Figure 39: Grade-tonnage curves for the modelled resources.

8.3.2 Obenemase D
The Obenemase D Lode mineralisation occurs 300m to the northwest of the Obenemase A and B Lode
mineralisation and the structure is interpreted as parallel. The plunge directions, mineralisation and
alteration at Obenemase D are similar to those at Obenemase A and B although mineralisation at
Obenemase D Lode extends into banded sediments. Mineralisation has been drill tested 100m from
surface and remains open at depth.

Obenemase R Zone (Figure 40) is a northeast pitching late zone of mineralisation which rolls from
northwest dipping in the south through northeast dipping further north. The mineralisation is late (but
penecontemporaneous with A, B and D mineralisation).

R Zone mineralisation links the Obenemase A Lode structure to the Obenemase D Lode structure. The
northeast plunging mineralisation has been demonstrated to continue beyond historic faulting
interpreted to truncate the Obenemase B Lode mineralisation in the north, and plunges beneath and
parallel to the Obenemase A Lode.

SEMS reviewed the Snowden mineral resource estimate for Obenemase D based upon six drill holes
completed by Owere during the twelve months preceding May 2015.

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Figure 40: Obenemase A, B, D and R. Oblique view, looking north-west (UTM).

The Obenemase D lode consists of four physically separate deposits along strike, parallel to and west of
the Obenemase A and B lodes. SEMS reviewed the drilling for Obenemase D lode and has revised the
geological interpretation for a deposit near the southern end of the lode where the recent drilling has
taken place, over a strike length of 200m. The interpretation consists of a number of steeply dipping or
sub-vertical lenses. Figure 41 shows the interpreted mineralised envelope and drill-hole data.

Figure 41: Geological interpretation for Obenemase D lode, looking north (UTM).

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8.3.2.1 Data Analysis and Geostatistics

SEMS completed a detailed data and statistical analysis. The main findings are:
- a low coefficient of variation

- very modest amount of grade “outliers”, such that grade top-cutting does not need to be
rigorously applied, and does not have a significant effect on the average grade.

- poor correlation of the diamond drill-hole data set to Trench, BODH data, such that all the later
data sets have been excluded from resource estimation

- RC and DD samples showed no correlation bias and were used in the resource estimation

Densities used were 1.52 for oxide, 2.51 for transition, and 2.75 for sulphide material, which were the
densities used previously by DataGeo.

Data analysis showed a statistically normal population with minimal outliers. A modest top-cut of 15 g/t
Au was applied, affecting two samples.

A summary of the statistical results for the revised geological interpretation (within mineralised
envelopes) is show in Table 22.
Table 22: Summary statistics of selected 1m composites inside mineralised envelopes.

Description Number No. of Missing Values Min Max Mean Var SD CoV

(g/t) (g/t) (g/t)

All selected composites 351 0 0.01 22.4 2.6 7.8 2.8 1.1

8.3.2.2 Domaining
The primary domaining used is based on weathering profiles defined by core logging, which are
separated into the following domains:
- Oxide
- Transitional
- Sulphide
SEMS created spatial search domains for controlling search orientations, mainly based on wireframe
orientation which should provide a reasonable fit to mineralisation strike and dip. For the Obenemase D
lode, mineralisation is primarily sub-vertical and north-striking, resulting in relatively simplified search
domains.

Due to the relatively small amount of transition material, oxide and transitional domains were combined
together for mineral resource estimation purposes.

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8.3.2.3 Variography

Variograms were not available from the previous work conducted by DataGeo. Due to the similarity of
the deposits, SEMS used Obenemase A and B lode parameters as a starting point and modified these as
required based on differences in drill sample density and data orientation to develop appropriate model
block size, discretisation, search ranges, and sample composite parameters.

8.3.2.4 Estimation
Inverse Distance Squared was used to estimate grade into blocks using the search parameters
determined above and the one metre sample composites. The block model was been defined within the
geographical limits of the mineralised wireframe. A parent block size of 2.5 x 10 x 2.5 metres was used
with sub-blocking up to a factor of 2 used to accurately model the often narrow mineralised boundaries.

Blocks that fell outside of the first pass ellipsoid were re-estimated in two further passes, each with
successively relaxed search ellipsoids (factor of 1.5), and flagged for later classification at lower levels.
Minimum sample numbers for interpolation were initially set to 8 but were reduced where subsequent
passes were necessary.

Table 23: Block model parameters.

Min Max Range Cell Cell

Size No.
East 9650 10005 355 2.5 142
North 9190 10390 1200 10 120
RL 0 370 370 2.5 148

Table 24: Grade estimation parameters.

Parameter Value
Assay top cut (g/t) 15
Strike direction (0) 350
Dip (0) ave 85
Pass 1 Search Radius x (m) 30
Pass 1 Search Radius y (m) 35
Pass 1 Search Radius z (m) 20
Min No. samples 8
Max No. samples 30

8.3.2.5 Validation
Validation consisted of visually comparing the model grades against the original composite data. Visual
validation of block grades by section showed a good fit to the sample data.

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Figure 42: Model Validation - Drill-hole sample grades versus model grades, Obenemase D lode

8.3.2.6 Classification
Snowden classified the Obenemase D Lode as inferred and SEMS is of the opinion that this classification
is appropriate.

8.3.2.7 Reported Mineral Resources

The Obenemase D lode Mineral Resources are reported in Table 25. All depletion surfaces from surface
and underground mining have been taken into account. Mineral Resources are reported at cut-off
grades of 0.5 g/t for oxide and transition, and 1.0 g/t for sulphide.

Taking into account the grade, quantity, and characteristics of the Obenemase D lode mineral resources,
SEMS considers there are reasonable prospects for the eventual economic extraction of the mineralised
zones, primarily by surface mining.

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Table 25: Obenemase D Mineral Resources, 1 May 2015

Indicated Inferred Total

Material Tonnes Grade Oz's Tonnes Grade Oz's Tonnes Grade Oz's
(g/t) (g/t) (g/t)
Oxide - - - 267,000 1.3 12,000 267,000 1.3 12,000
Transition - - - 123,000 1.9 8,000 123,000 1.9 8,000
Sulphide - - - 296,000 2.1 20,000 296,000 2.1 20,000
Total - - - 686,000 1.8 40,000 686,000 1.8 40,000

This represents an increase of 8% or 3,000 ounces on the mineral resources reported for Obenemase
D Lode in March 2014.

8.4 Other Konongo Deposits

Mineral Resource estimations for the other Konongo deposits were carried out during the period 2010 –
2012 by DataGeo. Snowden undertook a detailed review of the mineral resource estimates in July 2014
making a number of revisions. SEMS has reviewed the work of Snowden and accepted their
reassessment. SEMS has not created any new models and has not revised the Mineral Resource
estimation.

There have been no material changes to the Apan, Aserewa and Boabedroo (North, South and South
Extension) deposits during the twelve month period preceding March 2015.

8.4.1 Mineral Resource input data

Mineral Resource estimations were based on the following data received from Owere:
Drill hole database “20150316 Database ALL.accdb” (MS Access format), comprising collars,
surveys, assays, and lithologies for all drill holes drilled up to May 2014

Mineralised resource wireframe and block models, in Surpac format, from the previous mineral
resource estimations by DataGeo

Topographic DTM models

8.4.2 Geological Interpretation

The Other Deposits at Konongo are typical Birimian, shear hosted gold deposits similar to those of
Obenemase A, B & D.

Mineralisation within the Konongo Gold Project is dominated by structure-controlled mesothermal lode
gold systems and oxide deposits developed by weathering of near-surface mineralisation. Oxide
deposits are restricted to weathered rock. The weathering profile is generally developed to 30-40m
below surface, but is developed as deep as 80m above some lithologies.

Two styles of mineralisation occur in fresh rock - a disseminated sulphide phase and a quartz vein phase.
Mineralisation is best-developed in second-order folds and adjacent to high strain shears, is steeply
plunging and is open at depth at all deposits within the Konongo Gold Project. Kinks and splays in the
structures are also associated with increased mineralisation.

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Sulphide-related gold mineralisation is strongly associated with arsenopyrite. Minor pyrite and rare
chalcopyrite occur. Free gold occurs on fractures in sulphides as well as rimming sulphides, and as
inclusions within the sulphides. Arsenopyrite has been interpreted to occur in two phases, both
demonstrated to be gold mineralised. Recent testing indicates that the younger arsenopyrite is strongly
mineralised, presenting a new interpretation for targeting.

Alteration is dominated by carbonates, chiefly dolomite +/-ankerite, which forms a wide halo around the
veins. Potassic alteration (localised biotite or weakly-developed sericite) occur as wall rock alteration
and adjacent to veining. Sodic alteration is associated with late, sulphidic mineralisation. Stronger
potassic and sodic alteration accompanies the highest grade ores and can be used to discriminate
individual ore lenses.

Host rocks play an important role in the mineral systems. Much of the sulphidic mineralisation has clear
structural - stratabound controls. The principal mineralised lithology is fine-grained subunits within
immature volcaniclastic sediments and tuffs. Basaltic and andesitic lithologies frequently occur,
bounding the mineralised zones. Graphitic argillites are also present, and clearly preferentially partition
strain (and related fluids)

Structure within the Project is dominated by an overturned isoclinal fold parallel to the regional north-
east structural trend. Dips are steeply towards the northwest. A later folding event has resulted in the
development of a series of en-echelon folds oblique to the main trend.

8.4.2.1 The Apan Deposit

The Apan mineralisation occurs 500m along strike from mineralisation at Boabedroo North and is hosted
within the Odumase-Boabedroo Shear. The Apan mineralisation is a likely outlier of the Boabedroo
mineralisation.

Southern Cross mined the oxide ore at Apan in the 1990s by open pit methods. Recorded production
was 0.55Mt at 5.3g/t. There is no strong geological control on the distribution of gold mineralisation at
Apan. Mineralisation at Apan is generally steeply dipping with short, straight NE trending strike extents
over limited distances.

8.4.2.2 The Aserewa Deposit

The Aserewa mineralisation is located 1,800 metres northeast of the Akyenase North shaft. During 1996,
two small open pits, Aserewa North and South, produced 161,000 tonnes of ore at 2.3 g/t gold (Mawson
1997). Mineralisation occurred in a steep westerly dipping suite of sediments comprising basal
conglomerates overlain by quartzite’s and then fine grained metasediments hosting carbonaceous shale
bands

Gold mineralization is associated with arsenopyrite, pyrite and lessor pyrrhotite and is hosted by
siliceous zones underlying sheared and faulted carbonaceous shales in the metasediments. The
metasediments are basically metamorphosed arenaceous rocks containing upward fining cycles of

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arkoses, greywackes and thin dark grey shales. With depth, however, the sediments become more
uniform in grain size and more quartzose. Bedding is harder to identify as foliation becomes stronger.

The sediments tend to be well foliated particularly in the vicinity of the carbonaceous shale units. Here,
chlorite and ankerite alteration is ubiquitous. Additional zones of silicification located below the lower-
most shale unit usually correspond to good sulphide mineralization.

Carbonaceous Shales are black, very finely laminated, fine grained carbon (graphite) shale bands varying
in thickness, from 20cm to 5m and occur about 20m above the quartzite or conglomerate contact. The
shales are hosted by the metasediments.

The lower-most portions of the shales are all strongly sheared, while the upper areas are brecciated
(faulted) and intruded by irregular white quartz veins. The thick shale bands often contain a central
portion of strongly altered metasediments. Between 1 large or 4 thinner shale bands occur in the
Aserewa area.

Quartzite is a fine to medium grained dark grey unit, well foliated with little evidence of bedding
remaining. Cross-foliation breaks tend to show black concoidal fracturing which in reverse circulation
(RC) drill holes have been logged as fine grained dolerite. The upper quartzite portions are finely
interlayered with metasediment while the lower-most portions contain grit and pebble layers.
Alteration and sulphide mineralization is generally poorly developed.

The conglomerates are a strongly foliated polymictic pebble-hosted conglomerate becoming less
foliated with depth, and thence more recognisable. It essentially forms the base of an upward-fining
sedimentary package in the Aserewa area. No alteration or sulphide mineralization was recognised in
these intersections.

STRUCTURE:
Foliation measurements of core are assumed to be related to the regional trend. All shear zones have
core angles parallel to foliation. Very few shear zones exhibited slicken-sliding that could be recognised
as either strike or dip movements. Most shearing occurs in the metasediments close to and within the
carbonaceous shales.

Faulting and brecciation are only seen in the carbonaceous shales where it is closely associated with
randomly orientated quartz veining and pyrite mineralization. Again, movement appears to be parallel
to regional trend.

MINERALIZATION:
Disseminated specks and blebs of pyrite occur throughout the metasediment where there has been
chlorite and ankerite alteration, which is usually proximal to the carbonaceous shales and shearing. The
carbonaceous shales host pyrite as streaks, trains and accumulations along foliation and fault planes.
Pyrite content often reaches as much as 6% while minor arsenopyrite may occur as tiny needles
disseminated along the lower areas of the shale. Concentrations of both pyrite and arsenopyrite border
the quartz veins in the shale bands.

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The siliceous alteration zones occurring below the lower shale bands in the metasediments are
particularly important hosts of sulphide mineralization, which is often in quantities of up to 4%.
Dominant arsenopyrite occurs as needles and euhedral laths up to 2mm in size, disseminated unevenly
in zones paralleling foliation. Lesser amounts of pyrite and pyrrhotite occur as specks, trains of blebs
and accumulations streaked out along foliation planes. Better gold grades are found in arsenopyrite
dominant sulphide mineralisation.

WEATHERING:
The Aserewa area is overlain by at least 3m of red-brown laterite with clay. Beneath the laterite, is
about 50m of total weathering represented by maroon to yellow saprolite, sometimes exhibiting relict
bedding, especially in carbon-rich areas.

8.4.2.3 The Boabedroo Deposit

The Boabedroo mineralisation occurs to the south of the Konongo Mining Lease in an area which
includes (from southwest to northeast) Obenemase, Boabedroo (South Extended, South, North) Apan
and Atunsu. A parallel shear, 300m to the southeast, hosts the Zongo, Akyenase, Akyenase Central and
Aserewa mineralisation.

Historic mining at Boabedroo includes underground and open cast methods. Underground mining of the
mineralisation at Boabedroo commenced in 1906 and continued almost continuously through 1986.
Mining ceased, still in free-milling ore, due to infrastructure and maintenance breakdown. The
underground workings are developed to level 16 (849m). In the mid-1990’s, Southern Cross Minerals
mined the oxide ore overlying Boabedroo. In 2012, Owere mined a thin oxide cap from Boabedroo
South Extended. Sulphide-hosted gold was, historically, not the target of underground mining,
presumably because of poor recoveries associated with its refractory metallurgy.

Historic production from Boabedroo underground is estimated at 0.748Mt at 20.8g/t Au from historic
production figures. The mining is reported to have exclusively targeted the free-milling gold in quartz
(and presumably the immediate margins of the quartz veins. Subsequent drilling in historic mining areas
demonstrates that sulphide haloes to the historic stopes remains in-situ. Historic mining of the
Boabedroo open pits (Boabedroo North and Boabedroo South) mined returned historic production of
3.10Mt at 1.6g/t Au. Oxide mining of the Boabedroo South Extended mineralisation in 2012 mined and
processed 297,911 t of oxide ore to yield 11,663 oz Au. The recovered grade was 1.2 g/t Au, from a head
grade of 1.7 g/t Au. During the period mill recovery averaged 71%, ranging from between 50% to 81%.
The geology at Boabedroo is dominated by meta-sediments. Mineralisation is principally hosted within a
siltstone package which is approximately 100m true thickness. The host stratigraphy, which is locally
carbonaceous and occasionally graphitic, includes minor tuffs occur in the geology. The footwall is
similar, but interpreted to include a greater meta-sandstone and lesser meta-siltstones. The geology
includes some lithologies attributed to the Tarkwaian (quartz-rich through arkosic coarse sandstones.
These are interpreted as structural slices intercalated with the Birimian “dirty” meta-sediments. The
hanging wall is also dominated by meta-sandstones (volcaniclastic sandstones).

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Structural interpretation identifies three structures. S0 and S1 are sub-parallel, with mean planes are at
88-319 and 88-147 respectively –a 4 degree difference in strike. Structural data is asymmetric, and is
interpreted to place the host package is the limb of an early, east verging, west-dipping isoclinal fold.
The variation within the S0 and S1 may prove important, providing a mechanism to generate the
southwest plunging structural control observed in historic mining. S2, as at Obenemase, is oblique and
intersects prior fabrics with a northeast plunging intersection cleavage.

Figure 43: Odumase- Boabedroo Shear. Long section, looking northeast, showing historic mining drives and pits.

8.5 Interpretations and Conclusions

The mineral resource estimation to date for OML’s Konongo Gold Project Obenemase A and B
lodes shows a deposit hosting 589,000 ounces at an average grade of 3.8 g/t, in the indicated
and inferred categories.
The deposit is a narrow vein, steeply dipping structure having a strike length of 1,000m and
extending up to 300 metres beneath the topography surface. It remains open at depth and
laterally in places.
Gold mineralisation within the mineral resource is predominantly hosted by volcaniclastic
siltstones and sandstones, with gold being associated with alteration and having a low nugget
effect.
The mineral resource has been classified as a combination of indicated and inferred, without a
measured category. This is largely due to uncertainties in grade and structural continuity, which
may be a function of the limited drilling to date.
SEMS is of the opinion that the Obenemase deposits and the other deposits have potential for
extensions to their existing mineral resources, which may be delineated with further drilling.
SEMS is not aware of any external factors such as environmental, socio-economic, legal, etc that
could have a material effect on the mineral resource estimate. The area is an historical mine
site, and eventual economic extraction, if warranted, is likely to be by underground mining,
lessening environmental impacts, potentially contributing to employment within the area

9 Ore Reserves
There are currently no Ore Reserves at the selected prospects.

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10 Mining
There are currently no Mining activities at the selected prospects.

11 Processing
There is currently no processing of ore within the Konongo Gold Project. An operational processing
plant exists on the Mining Lease, which is summarised in Section 7.

12 Infrastructure
12.1 Mine Infrastructure
The infrastructure at Konongo was refurbished by Signature for commencement of operations in
May 2011. Mining activities were suspended in March 2013, and the facility placed on care and
maintenance. Mine infrastructure includes:
A 320,000 t per annum capacity plant. The plant has been refurbished in anticipation of
commencement of tailings reprocessing, and is fully operational. The plant is under lease from
the State Gold Mining Company.

A 100,000 litre oxygen plant under contract from Air Liquide.

A 100 t per hour capacity Parker mobile crusher.

Eight kilometres of haul roads running the length of the main shear. The haul road is well
maintained and functional.

An existing Tailings Storage Facility (“TSF”) with 70,000 BCM remaining capacity and approvals in
place for a 3m raise (303,000 m3). A new facility to the north of the existing TSF is in advanced
planning, requiring geotechnical drilling to complete required geotechnical data (Cooper &
Assoc. 2011).

Supporting infrastructure (leased from the State Gold Mining Company). Supporting
infrastructure on site includes: administration block, staff bungalows, mosque, assay laboratory
(not operational) security office, welfare office, archives, workshop, power house, compound
settlement, football field, primary school, senior staff club house, lawn tennis club and junior
staff club house.

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Figure 44: Existing and proposed Tails Storage Facilities (TSFs)

12.2 Power
Owere has an existing bulk power supply agreement with the Volta River Authority for electrical power.
The 145 Kva transmission lines cross the tenements. Grid Company (GridCo) and the Electricity Company
of Ghana (ECG) have 11 Kva sub-stations on the lease, located near the administration block.
Transformers provide 440V three-phase power to the site. ECG is currently constructing an 11 Kva
dedicated line to service the plant.

12.3 Water
Processing water for the plant is sourced from the Obenemase A pit. Potable water is sourced from the
mains water supply or Apan pit. Three water bores have been drilled to augment supply, but are yet to
be commissioned.

12.4 Transport
Eight km of haul roads run the length of the tenements. The haul road is well maintained and functional.
The Konongo-Agogo road, which is sealed, runs parallel to (and the entire length of) the concessions.

12.5 Staffing
There is currently 78 staff employed on the project. This includes 4 expatriate members. Beyond the
security team, the largest department is that of Exploration which employs 4 professional staff
(geologists, surveyors and data spatial data manager) and 12 samplers. There are also two contractors in
the geology department.

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12.6 Accommodation
The junior staff quarters are located within 500 m of the administration block. It occupies an area of
about 1.35 ha and contains 40 units. Each unit has six single rooms (181 rooms in total) with the kitchen,
washroom and toilet facilities shared among the residents. The last rows of houses are situated about
25 m from the edge of the Boabedroo North Pit, which is to the north-west. There are 51 additional
quarters for nurses, security, and other auxiliary staff. All buildings are in good structural condition.

Senior staff bungalows are located and interspersed around the office area. There are 23 bungalows,
some of which are detached and others semi-detached. A unit consists of 2 to 3 bedrooms. Other
facilities for the senior staff include a clubhouse, swimming pool, football field and a tennis court. A
good road network interlinks these facilities. The boundaries of the office and the residential areas are
not fenced because they are spread too far apart. There are three control posts, and the main one
leading to the Konongo Township is manned round the clock by security personnel.

13 Social, Environmental, Heritage and Health and Safety Management

13.1 Social Management
Owere has a community policy which integrates its business operations and values with the interests of
all stakeholders including investors, customers, employees, the community and the environment. The
policy aims to continually improve company relationships, based on communication, recognition of
culture and heritage. It operates in consultation with host communities, government authorities and
other organisations.

The company understands its responsibility to identify and facilitate opportunities for employment,
training and business relationships directly and through our contractors and suppliers.

13.2 Environmental Management

Company management is committed to policies and responsible operating practices which promote the
conservation or enhancement of the natural and social environments in which the company operates.
The mine has policies which promote a culture of environmental responsibility, provides resources,
personnel and training to develop employees and build competencies related to the environment.

The mine operations work against a rehabilitation plan and endeavour to adhere to the environmental
schedule attached to, and condition of, the mining permit. The company monitors environmental effects
of its operations and its compliance with legal requirements and our environmental policies.

13.3 Heritage Management

Prior to the commencement of work at Konongo, Owere conducted a heritage assessment. The
information was incorporated into the Corporate Social Responsibility policy, which includes the
requirement for Owere to operate sympathetically and responsibly near culturally sensitive areas.

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The data is based on a field survey of the archaeological and cultural heritage resources survey within
the concession area and the surrounding communities. The field investigation was done over a period of
nine days during February 2009. In all, fifteen town/village settlements were surveyed.

The report provided a baseline for assessing the significance of heritage resources and for their
sustainable management. It also provides solutions for effective Corporate Social Responsibility and
alternatives strategies for community development initiatives in the concession area.

13.4 Health and Safety Management

The company places great emphasis on continually improving the health and safety. The key driver for
health and safety management in the company is the aspirational goal of “Zero Harm”, an accident free
workplace environment. Owere has developed an Occupational Health and Safety Management System,
a framework that allows the company to consistently identify and control its health and safety risks,
reduce the potential for accidents, aid legislative compliance and improve overall performance. The
standard is based on OHSAS 18001:2007 to enable easier integration of environmental system into one.
Key areas of the OHS management system include:
 risk management and safe work method statements
 occupational health and safety training
 site safety rules
 incident management
 measured performance improvement

14 Market Studies and Contracts

The mine is currently not operating. There are no contracts in place to sell gold. Once production
recommences, there is no expectation that the sale of gold will be problematic.

15 Financial Analysis
The mine is currently not operating, so no financial analysis is appropriate.

16 Risk Assessment
A risk assessment has been undertaken to identify of risks identified for the Obenemase, Boabedroo,
Apan and Aserewa mineral resource estimates. Risks have been assessed on the basis of likelihood of
occurrence, and on the consequence of an event occurring. Tables 27, 28, 30 and 31 define the
categories used to assess likelihood, consequence, and risk rating. Risks have been assessed on the basis
of likelihood of occurrence, and on the consequence of an event occurring. Table 29 defines the
categories used to assess likelihood, consequence, and risk rating.

The downgrading of mineral resources effectively reduces risk on the project. Risk is assessed as the
consequence of not downgrading the historic resources and addressing identified technical issues.

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Table 26: Categories and definitions used to assess likelihood.

Consequence

Insignificant
This assessment should not be considered fully

Moderate
comprehensive, but represents important risks that must be
addressed in future studies. All risks listed are manageable

Severe

Minor
Major
and can be mitigated, if adequate consideration and active
planning is established. In addition, policies and procedures
are to be implemented for a successful reinstatement of
resource status. 5 4 3 2 1
Almost Certain >95% 5 25 20 15 10 5
Probability

Likely 60-95% 4 20 16 12 8 4
Possible 30-60% 3 15 12 9 6 3
Unlikely 5-30% 2 10 8 6 4 2
Rare <5% 1 5 4 3 2 1

Table 27: Risk consequence

Consequence Definition
Low financial loss (<US$1M) of total assets; no injuries; less than one
Insignificant 1 day loss of production capability; no environmental impact
Medium financial loss (US$1-10M) of total assets; minor injury to one or
two persons; minor loss of plant resulting in 1 day to 1 week loss of
production capability; on-site environmental release immediately
Minor 2 contained without long-term detrimental effect
High financial loss (US$10-20M) of total assets; serious injury to multiple
persons; moderate loss of plant resulting in 1 week to 3 month loss of
production capability; on-site environmental release contained with
Moderate 3 assistance without causing long-term detrimental effect
Major financial loss (US$20-50M) of total assets; death or serious injury
to multiple persons; extensive loss of plant resulting in 3-6 months loss
of production capability; off-site environmental release with
Major 4 detrimental effect or on-site release with detrimental effect
Very large financial loss (>US$50M) of total assets; death or serious
injury to multiple persons; major loss of plant resulting in >6 months
loss of production capability; toxic environmental release off-site with
Severe 5 serious detrimental effect

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Table 28: Risk probability

Probability Definition
Event might occur only in exceptional circumstances (theoretical) or is unlikely
Rare 1 to occur
Event could occur at some time (conceivable but rare); about or less than 1
Unlikely 2 event every 10 years
Event might occur at some time (conceivably); less than 1 event per 5 years but
Possible 3 more than 1 event per 10 years
Event will probably occur in most circumstances (should); about or less than 1
event per year but more than
Likely 4 1 event per 5 years
Almost Event is expected to occur in most circumstances (easily); more than 1 event
Certain 5 every year

Apan, Aserewa and Boabedroo carry an overall “high” risk. This risk principally relates to geological and
grade variability, which should be resolved upon further drilling. Additionally, the historical sampling
protocols and QAQC results show a ‘medium’ to medium-high” risk due to lack of documentation and/or
acceptable QAQC results. Metallurgical test work is required to lower the current “medium”
metallurgical risk pertaining to the refractory nature of the primary-sulphide ore. Most issues can be
ameliorated through additional drilling, test work and economic studies. None are considered “fatal” to
the project, but lead to the resource classification of Inferred being used for these resources.

The Obenemase resource estimate carries an overall “medium” risk. This risk principally relates to
geological and grade variability, which should be resolved upon further drilling. Metallurgical test work
is required to lower the current “medium” metallurgical risk pertaining to the refractory nature of the
primary-sulphide ore.

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Table 29: Risk table, downgraded prospects.

Resource Factor Risk Comment

Apan Bulk density Low The current oxide, transition and primary-sulphide values are reasonable and based on estimates
of density in each domain. Some local bias may exist where the proportions of host rock versus
quartz and sulphides change - variability is unlikely to be greater than ±10%. Bulk density test
work on existing cores will improve risk analysis at Apan.

Apan Sample representivity Low-Medium In-situ sample representivity is likely to be reasonable given the minimal coarse-gold nature of
the mineralisation.
Apan Sample collection, Medium Sample types used to inform the resource were dominantly diamond drill core. A standard
preparation and preparation approach was used to support fire assays. Historical protocols not verified.
assaying

Apan QAQC High-Medium Historical and recent QAQC indicates reasonable assay quality, but there is a lack of high quality
and representative CRMs, blank and duplicate results - from the field and from the laboratory.
Some earlier programs showed CRM results that were on the border of acceptable. Additionally,
historical programs variably lack duplicates and/or blanks.

Apan Geological data and High General geological control is reasonable, but on variably spaced drill sections. It is noted that
model some interpretations do not match grade along drillholes. There is little understanding of small
scale local continuity issues which control variability of tonnes and grade. Best resolution of
geological continuity and ore zone complexity is only gained after development.

Apan Grade estimate High The grade estimate bears uncertainty due to sampling and data uncertainties. The current
estimate generally relies on a global grade for each domain based on relatively wide-spaced data.
No local estimate is possible. Estimation block size is variable and is not based on QKNA. The
application of cut-off grades is problematic. The ID2 with top-cut grade interpolation approach is
sub-optimal. Same search ellipse applied across all deposits.

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Apan Tonnage estimate High The current global estimate bears uncertainty due to issues with input data. Block size makes the
application of cut-off grades problematic.
Apan Resource up-rating Medium Resource up-rating will be based on further drilling and/or development. There is scope to
and addition to increase the total resources through along strike and down-dip potential. Further drilling is
resource base required. There are no guarantees that resource upgrade will occur or that additional resources
will be found.

Apan Economic Medium-High No Ore Reserves are defined. The project has appropriate infrastructure in place. It is also noted
factors/reasonable that the historical pits are currently full of water. These will require dewatering and appropriate
prospects of treatment/discharge in place prior to any mining operation. A Scoping Study (Dominy 2014c)
economic extraction concludes that the Konongo resources have reasonable prospects for eventual economic
extraction as an open pit operation. A scoping study is required to investigate

Apan Metallurgy/Mineral High The current plant is optimised for oxide ore. The majority of the Obenemase A and B resource is
processing primary-sulphide ore. Previous limited historical test work indicates that the primary-sulphide
ore is refractory and requires special treatment. Further test work is required to prove
extractability. Metallurgical test work on the style of mineralisation is not thorough requires
significant additional test work

Apan Accuracy of the High The accuracy of the grade and tonnage estimate for the Inferred Mineral Resources is considered
resource estimate to be within ±40-80% globally based on general experience of this style of mineralisation.
Additional ‘high’ risk factors (see earlier) increase this global resource risk.

Apan Social, legal, political Low These risks are considered to be low, given the relatively stable and developed nature of Ghana.
and environmental The country has a long history of gold mining. Signature has a mining lease in place and has been
risk operating without issue for a number of years.

Aserewa Bulk density Low The current oxide, transition and primary-sulphide values are reasonable and based on core
measurements. Some local bias may exist where the proportions of host rock versus quartz and
sulphides change - variability is unlikely to be greater than ±10%. Although some bulk density
work has been completed, more thorough sampling would be beneficial.

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Aserewa Sample representivity Low-Medium In-situ sample representivity is likely to be reasonable given the minimal coarse-gold nature of
the mineralisation.
Aserewa Sample collection, Medium Sample types used to inform the resource were dominantly diamond drill core. A standard
preparation and preparation approach was used to support fire assays. Historical protocols not verified.
assaying

Aserewa QAQC High-Medium Historical and recent QAQC indicates reasonable assay quality. Some earlier programs showed
CRM results that were on the border of acceptable. Additionally, historical programs variably lack
duplicates and/or blanks. QAQC data is not complete and additional test work is required.

Aserewa Geological data and High General geological control is reasonable, and drill section spacing is 20m for most of the
model resource. It is noted that some interpretations do not match grade along drillholes and that the
geological controls are not well established. There is lesser understanding of small scale local
continuity issues which control variability of tonnes and grade. Best resolution of geological
continuity and ore zone complexity is only gained after development.

Aserewa Grade estimate High The grade estimate bears uncertainty due to sampling and data uncertainties. The current
estimate generally relies on a global grade for each domain based on relatively wide-spaced data.
No local estimate is possible. The application of cut-off grades is problematic. The ID2 with top-
cut grade interpolation approach is sub-optimal. Same search ellipse applied across all deposits.

Aserewa Tonnage estimate High The current global estimate bears uncertainty due to issues with input data. Block size makes the
application of cut-off grades problematic.
Aserewa Resource up-rating Medium Resource up-rating will be based on further drilling and/or development. There is scope to
and addition to increase the total resources through along strike and down-dip potential. Further drilling is
resource base required. There are no guarantees that resource upgrade will occur or that additional resources
will be found.

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Aserewa Economic Medium-High No Ore Reserves are defined. The project has appropriate infrastructure in place. It is also noted
factors/reasonable that the historical pits are currently full of water. These will require dewatering and appropriate
prospects of treatment/discharge in place prior to any mining operation. A scoping study (Dominy 2014c)
economic extraction concludes that the Konongo resources have reasonable prospects for eventual economic
extraction as an open pit operation. A scoping study was completed in 2014 (Dominy 2014c) to
investigate, but focused only on the Obenemase and Boabedroo mineralisation. Aserewa is
considered as potential 'upside' in this model

Aserewa Metallurgy/Mineral Medium-High The current plant is optimised for oxide ore. The majority of the Obenemase A and B resource is
processing primary-sulphide ore. Previous limited historical test work indicates that the primary-sulphide
ore is refractory and requires special treatment. Further test work is required to prove
extractability. Metallurgical test work on the style of mineralisation is not thorough requires
significant additional test work

Aserewa Accuracy of the High The accuracy of the grade and tonnage estimate for the Inferred Mineral Resources is considered
resource estimate to be within ±40-80% globally based on general experience of this style of mineralisation.
Additional ‘high’ risk factors (see earlier) increase this global resource risk.

Aserewa Social, legal, political Low These risks are considered to be low, given the relatively stable and developed nature of Ghana.
and environmental The country has a long history of gold mining. Signature has a mining lease in place and has been
risk operating without issue for a number of years.

Boabedroo Bulk density Low The current oxide, transition and primary-sulphide values are reasonable and based on core
measurements. Some local bias may exist where the proportions of host rock versus quartz and
sulphides change - variability is unlikely to be greater than ±10%. Bulk densities for all available
drill core has been completed, more thorough sampling in mineralisation would be beneficial.

Boabedroo Sample representivity Low-Medium In-situ sample representivity is likely to be reasonable given the minimal coarse-gold nature of
the mineralisation.
Boabedroo Sample collection, Medium Sample types used to inform the resource were dominantly diamond drill core. A standard
preparation and preparation approach was used to support fire assays. Historical protocols not verified.
assaying

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Boabedroo QAQC High-Medium Historical and recent QAQC indicates reasonable assay quality. Some earlier programs showed
CRM results that were on the border of acceptable. Additionally, historical programs variably lack
duplicates and/or blanks. Duplicates and laboratory repeats are compromised by
oversampling in very low grade rocks.

Boabedroo Geological data and High General geological control is reasonable, but on variably spaced drill sections. It is noted that
model some interpretations do not match grade along drillholes. There is lesser understanding of small
scale local continuity issues which control variability of tonnes and grade. Best resolution of
geological continuity and ore zone complexity is only gained after development.

Boabedroo Grade estimate High The grade estimate bears uncertainty due to sampling and data uncertainties. The current
estimate generally relies on a global grade for each domain based on relatively wide-spaced data.
No local estimate is possible. Estimation block size is variable and is not based on QKNA. The
application of cut-off grades is problematic. The ID2 with top-cut grade interpolation approach is
sub-optimal. Same search ellipse applied across all deposits.

Boabedroo Tonnage estimate High The current global estimate bears uncertainty due to issues with input data. Block size makes the
application of cut-off grades problematic.
Boabedroo Resource up-rating Medium Resource up-rating will be based on further drilling and/or development. There is scope to
and addition to increase the total resources through along strike and down-dip potential. Further drilling is
resource base required. There are no guarantees that resource upgrade will occur or that additional resources
will be found.

Boabedroo Economic Medium No Ore Reserves are defined. The project has appropriate infrastructure in place. It is also noted
factors/reasonable that the historical pits are currently full of water. These will require dewatering and appropriate
prospects of treatment/discharge in place prior to any mining operation. A Scoping Study (Dominy 2014c)
economic extraction concludes that the Konongo resources have reasonable prospects for eventual economic
extraction as an open pit operation. A scoping study was completed (Dominy 2014c) and
determined reasonable prospects of economic extraction. The study (with 30-50% variability in
metrics) was based on mining Obenemase and Boabedroo.

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Boabedroo Metallurgy/Mineral Medium-High The current plant is optimised for oxide ore. The majority of the Obenemase A and B resource is
processing primary-sulphide ore. Previous limited historical test work indicates that the primary-sulphide
ore is refractory and requires special treatment. Further test work is required to prove
extractability. Metallurgical test work on the style of mineralisation is not thorough requires
significant additional test work

Boabedroo Accuracy of the High The accuracy of the grade and tonnage estimate for the Inferred Mineral Resources is considered
resource estimate to be within ±40-80% globally based on general experience of this style of mineralisation.
Additional ‘high’ risk factors (see earlier) increase this global resource risk.

Boabedroo Social, legal, political Low These risks are considered to be low, given the relatively stable and developed nature of Ghana.
and environmental The country has a long history of gold mining. Signature has a mining lease in place and has been
risk operating without issue for a number of years.

Obenemase Bulk density Low The current oxide, transition and primary-sulphide values are reasonable and based on core
measurements. Some local bias may exist where the proportions of host rock versus quartz and
sulphides change - variability is unlikely to be greater than ±10%.

Obenemase Sample representivity Low-Medium In-situ sample representivity is likely to be reasonable given the minimal coarse-gold nature of
the mineralisation and the reasonable quality of QAQC assessment.
Obenemase Sample collection, Low-Medium Drilling, sample type, sample preparation and assay methods used were industry standard.
preparation and Sample types used to inform the resource were dominantly diamond drill core. A standard
assaying preparation approach was used to support fire assays. Some variation of methods with historical
data imparts some errors.

Obenemase QAQC Medium Historical and current QAQC indicates reasonable assay quality. Some earlier programs showed
CRM results that were on the border of acceptable. Additionally, historical programs variably lack
duplicates and/or blanks and frequently lack laboratory repeats and duplicates. SOPs are in place
and current, but this can only be confirmed from 2009.

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Obenemase Geological data and Low-Medium General geological control is reasonable on 15-30 m drill sections. Knowledge of historical
model development and modern drilling aids interpretation. There is lesser understanding of small-
scale local continuity issues which control variability of tonnes and grade. Best resolution of
geological continuity and ore zone complexity is only gained after development.

Obenemase Grade estimate Medium The grade estimate bears some uncertainty due to a moderate nugget effect, sampling and data
uncertainties. The current estimate generally relies on a global grade for each domain based on
relatively wide-spaced data. No local estimate is possible. Estimation block size is broadly
appropriate to the drill spacing, but does not relate to any SMU size. The current block size of 10
m by 10 m by 10 m gives a tonnage of 2,800 t per block in primary-sulphide ore. The application
of cut-off grades is problematic. The OK with top-cut grade interpolation approach is reasonable.
The search ellipse is controlled by variography.

Obenemase Tonnage estimate Medium The current global estimate is reasonable, given that volume is based on a 3D model constrained
by drill data and geological interpretation. Estimation block size and cut-off grade application as
noted previously has effect on tonnage.

Obenemase Resource up-rating Medium Resource up-rating will be based on further drilling and/or development. There is scope to
and addition to increase the total resource at Obenemase A and B through along strike and down-dip potential.
resource base Further drilling is required. There are no guarantees that resource upgrade will occur or that
additional resources will be found.

Obenemase Economic Medium-High No Ore Reserves are defined. The project has appropriate infrastructure in place. It is also noted
factors/reasonable that the historical pits are currently full of water. These will require dewatering and appropriate
prospects of treatment/discharge in place prior to any mining operation. A Scoping Study (Dominy 2014c)
economic extraction concludes that Obenemase A and B have reasonable prospects for eventual economic extraction
as an open pit operation. A scoping study (Dominy 2004c) concludes reasonable prospect of
economic extraction if Obenemase is mined in conjunction with Boabedroo (with 30-50% errors
in mining metrics).

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Obenemase Metallurgy/Mineral Medium The current plant is optimised for oxide ore. The majority of the Obenemase A and B resource is
processing primary-sulphide ore. Previous limited historical test work indicates that the primary-sulphide
ore is refractory and requires special treatment. Further test work is required to prove
extractability.

Obenemase Accuracy of the Low The CP believes the accuracy of the grade and tonnage estimate for Indicated Mineral Resources
resource estimate to be within ±20-30% globally based on this style of mineralisation. Similarly, the accuracy of the
grade and tonnage estimate for the Inferred Mineral Resources is considered to be within ±30-
50% globally based on this style of mineralisation (orogenic lode gold).

Obenemase Social, legal, political Medium These risks are considered to be low, given the relatively stable and developed nature of Ghana.
and environmental The country has a long history of gold mining. Signature has a mining lease in place and has been
risk operating without issue for a number of years.

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17 Interpretation and Conclusion

The Konongo Gold Project straddles the prospective western margin of the Ashanti Belt in Southwest
Ghana. The property is named after the nearby town of Konongo (estimated population 40,000), and
is approximately 200 km by road northwest of Accra and approximately 55 km east of the major
regional centre of Kumasi.

Obenemase, Boabedroo, Apan and Aserewa are all mineral resource zones within the Konongo Gold
Project and contain historical open pit and underground mine workings. The Konongo Gold Project
comprises two leases totalling 163 km²; a Mining Lease which is valid to 2023 and a Prospecting
Licence which must be renewed every two years, conditional on a 50% statutory reduction in surface
area.

The estimated mine production between 1903 and 1997 is 1.6 Moz Au at 11.8 g/t Au. Historic mining
focused almost exclusively on free-milling gold in laminated quartz vein systems. Since 2012,
Signature has completed a total of 17,479 m of drilling and 1,293 m of exploration trenching within
the Obenemase deposit.

Two styles of mineralisation are described at Konongo, an early quartz vein phase and a later
disseminated sulphide phase. Gold mineralisation is associated with early veins, arsenopyrite, pyrite,
and rare chalcopyrite. Gold occurs as quartz vein hosted mineralisation and as fracture-fill,
interstitial mineralisation in sulphides. Quartz veins are 0.5 m to several meters wide and display
evidence of repeated shearing and resealing. Laminated quartz is common, often with included wall
fragments. Disseminated sulphide mineralisation appears to be lithologically controlled and forms
wide zones around quartz veins or adjacent to main structures.

SEMS updated the Konongo Gold Project Mineral Resource estimates for the period ending 31st
March 2015 for the Obenemase A, B & D deposits. The mineral resource updates are based upon a
campaign of diamond core drilling completed by Owere during the twelve month period from April
2014 to March 2015.

SEMS reviewed the Mineral Resources for Apan, Aserewa and Boabedroo and are of the opinion that
there have been no material changes to these three deposits since those reported for the period
ending 31st March 2014 (Dominy and van Lente 2014b).

All mineral resources estimates reported by SEMS for the period ending 31st March 2015 are
classified in accordance with the JORC Code 2012. The overall mineral resource risk is defined as
“medium” which reflects the need for further drilling and the undertaking of an economic study.

Drilling of Obenemase A and B deposits during 2014 has permitted the estimation of an Indicated
and Inferred Mineral Resource containing 589,000 oz Au which represents a 4% or 25,000 ounce
increase on the mineral resources reported for the period ending 31st March 2014. The 2015 mineral
resource estimation used statistical and spatial analysis, three domains were defined. These were
principally based on ore type, including oxide, transitional and primary ore. All domains were
estimated using Ordinary Kriging.
Drilling of Obenemase D during 2014 permitted the estimation of an Inferred Mineral Resource
containing 40,000 oz Au which represents an 8% or 3,000 ounce increase on the mineral resources

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reported for the period ending 31st March 2014. The 2015 mineral resource estimation used
statistical and spatial analysis, three domains were defined. These were principally based on ore
type, including oxide, transitional and primary ore. All domains were estimated using Inverse
Distance Squared (ID2).

The Apan, Aserewa and Boabedroo Mineral Resources remain unchanged from those reported for
the period ending 31st March 2014 and include a total Inferred Mineral Resource containing 378,000
oz Au. Based on geological logging, three domains were defined in each of these deposits. These
were principally based on weathering, including oxide, transitional and primary ores. All domains
were estimated using inverse distance squared (ID2) with a top-cut.

A Scoping Study completed in July 2014 (Dominy et al 2014c) concluded that there are reasonable
prospects for eventual economic extraction from the Obenemase A, B and D deposits as well as the
Boabedroo North and South deposits within the Konongo Gold Project. The other mineral resources
were not included in the Scoping Study.

The Obenemase mineral resources carry an overall “medium” risk. This risk principally relates to
geological and grade variability, which should be resolved upon further drilling. Metallurgical
testwork is required to lower the current “medium” metallurgical risk pertaining to the refractory
nature of the primary-sulphide ore. Most issues can be ameliorated through additional drilling,
metallurgical testwork and economic studies. None are considered “fatal flaws” to the project.

Apan, Aserewa and Boabedroo mineral resources have a “high” risk. This risk principally relates to
geological and grade variability, which should be resolved upon further drilling and review of data.

18 Recommendations
Resulting from the mineral resource estimations completed by SEMS in 2015 for the Konongo Gold
Project the following recommendations are proposed for the Obenemase A & B deposit:
External verification of density values used in the mineral resource model, especially those
assigned to the transitional ore.

Allocation of density values to mineral resource blocks in a gradational range between oxide
and transitional ore and between transitional and sulphide ore.

Further geological and structural studies to guide the delineation of improved mineralisation
wireframes. This will assist future drill planning especially for extensions of the Obenemase A
lode at depth and the position of Obenemase B lode.

Drilling is required within the existing mineral resource to:

 Upgrade Inferred category to Indicated category – infill drilling.

 Covert unclassified material to Mineral Resource status – extensional drilling sub

0mRL.
Resulting from the mineral resource estimations completed by SEMS in 2015 for the Konongo Gold
Project the following recommendations are proposed for the Obenemase D deposit:
Further geological and structural studies to guide the delineation of improved mineralisation
wireframes and geological interpretations. This will assist future drill planning.

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Drilling is required within the existing mineral resource to upgrade Inferred category to
Indicated category – infill drilling.

Resulting from the Scoping Study completed in 2014 the following recommendations are
proposed:
Additional metallurgical testwork on the refractory, sulphide ore to better understand the
Project’s processing options.

Additional drilling to provide geotechnical information and metallurgical samples.

Due to QAQC issues with historical data, all remaining diamond core or pulps should be
reanalysed.

Continue the validation of historical data and incorporate uncaptured historical data into the
Project database.

Refine and expand the Scoping Study to:

 Include all the Mineral Resources within the Konongo Gold Project

 Review underground mining options for higher grade ore shoots

 Assess the viability of an open pit mining option within the Konongo Mining Lease
 Incorporate longer-term planning to exploit known, deep, quartz vein-hosted, free
milling gold.

 Focus on bringing the Project datasets to a standard that will facilitate a Pre-
Feasibility Study.

Assess exploration targets outside the current mineral resources that lie on known
structures that are interpreted to control mineralisation.

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19 References
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CRM Report No WA95/095.

Allibone, A. et al., 2002a. Structural controls on gold mineralization at the Ashanti Gold Mine,
Obuasi, Ghana. Society of Economic Geologists Special Publication, January, Volume 9, p. 65–93.

Allibone, A. et al., 2002b. Timing and structural controls on gold mineralization at the Bogoso gold
mine, Ghana, West Africa. Economic Geology, December, Volume 97, p. 949–969.

Allibone, A., McCuaig, T. C., Harris, D., Etheridge, M., Munroe, S., Byrne, D., Amanor, J., Gyapong, W.,
2002a. Structural Controls on Gold Mineralisation at the Ashanti Deposit, Obuasi, Ghana. Society of
Economic Geologists, Special Publication 9, p. 65-93.

Allibone, A., Teasdale, J., Cameron, G., Etheridge, M., Uttley, P., Soboh, A., Apiah-Kubi, J., Adanu, A.,
Arthur, R., Mamphey, J., Odoom, B., Zuta, J., Tsikata, A., Pataye, F., and Famiyeh, S., Lamb., E.,
2002b. Timing and Structural Controls on Gold Mineralisation at the Bogoso Gold Mine, Ghana, West
Africa. Economic Geology, 97, p. 949-969.

Ball P. 2009. Signature Metals Limited Atunsu – Mineral Resource Model 21st October 2009. Internal
report. GEOdata.

Ball P. 2009a. Signature Metals Limited - Atunsu North Prospects Update 1 – Drill data 16th Sept
2009. Internal report.

Ball P. 2009b. Signature Metals Limited - Atunsu Prospects Resource Update 3 – Atunsu
Mineralisation Model update, southern and northern extensions and Statistics 22nd Sept 2009.

Ball P. 2009c. Signature Metals Limited QAQC Investigations Aserewa, Apan, Atunsu and Boabedroo
Deposits October 2009. Internal report.

Berge, J., 2011. Paleoproterozoic, turbidite-hosted, gold deposits of the Ashanti gold belt
(Ghana,West Africa): Comparative analysis of turbidite-hosted gold deposits and an updated genetic
model. Ore Geology Reviews, Volume 39, pp. 91–100.

Blenkinsop, T., Schmidt Mumm, A., Kumi, R. & Sangmor, S., 1994. Structural geology of the Ashanti
gold mine. p. 23.

Cooper D. E. & Associates. 2011. Owere Mines Limited Konongo Gold Project Tailings Management
Design Report (including design drawings). (Unpublished Report).

DataGeo Geological Consultants (2009a). QAQC Investigations Aserewa, Apan, Atunsu and
Boabedroo

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Deposits, October 2009, pp 27.

DataGeo Geological Consultants (2009b). Apan & Atunsu Resource Update 2, pp 4.

DataGeo Geological Consultants (2009c). Aserewa Resource Update 1, pp 5.

DataGeo Geological Consultants (2009d). Boabedroo South Resource Update 3, pp 5.

DataGeo Geological Consultants (2010). Konongo Gold Project, Obenemase Deposit - D Lode,
Mineral Resource Report, November 2010, pp 55.

Dominy, S C and van Lente B, 2014a. Annual Qualified Persons Report for the Obenemase A
and B Lodes, Konongo Gold Project, Ghana - Year Ended 31 March 2014 - LionGold Corporation
Limited.

Dominy, S C and van Lente B, 2014b. Annual Qualified Persons Report for Selected Deposits,
Konongo Gold Project, Ghana - Year Ended 31 March 2014 - LionGold Corporation Limited.

Dominy, S, Muller H, Theron P and Priest J. 2014c. Owere Mines Ltd, Konongo Gold Project, Project
No. L582, Scoping Study, July 2014. (Unpublished Report).
Dominy, S C and Edgar, W B, 2012. Approaches to reporting grade uncertainty in high nugget gold
veins, Applied Earth Science, 121, pp 29-42.

Dominy, S C., Muller, H., Theron, P and Priest, J. 2014c. Owere Mines Limited Konongo Gold Project
Project No. L582 Scoping Study July 2014. 250pp.

Duchel, C W. 1996. OGM Quarterly Report, September 1996.

Ennih, N & Liégeois, J.P. (2008). The boundaries of the West African craton, with a special reference
to the basement of the Moroccan metacratonic Anti-Atlas belt. In: Ennih, N. & Liégeois, J.-P. (eds),
The Boundaries of the West African Craton. Geological Society, London, Special Publications, 297, pp
1–17.

Fabre, J. (2005). Géologie du Sahara occidental et central. Série/Reeks: Tervuren African Geosciences
Collection, MRAC Tervuren, Belgique, pp 572.

Feybesse, J. L., Billa, M., Guerrot, C. & Duguey, E., 2006. The paleoproterozoic Ghanaian province:
Geodynamic model and ore controls, including regional stress modeling. Precambrian Research,
Volume 149, p. 48.

Ghana Gold Mines Ltd. 1999. Information Memorandum May 1999. Internal report

Hastings, D., 1973. Resistivity Survey – Obenemase (Unpublished report).

K J Henley, K., H.1997. Mineralogical Examination of Ghana Gold (Obenemase) Flotation Products;
Metcon Laboratories. (Unpublished report).

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Hirdes W, Davis DW, Ludtke G and Konan G, 1996. Two generations of Birimian (Paleoproterozoic)
volcanic belts in northeastern Côte d’Ivoire (West Africa): consequences for the ‘Birimian
controversy’. Precambrian Research, 80: 173-191.

Jones C., Nicolls B. 2005. Competent Persons Report Prepared by RSG Global on behalf of African
Gold Plc and Canaccord Capital (Europe) Limited

JORC, 2012. Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves.

Leevers, D.G., 1973. Geochemical Orientation Survey – Obenemase. Unpublished report.

Leube A, Hirdes W, Mauer R and Kesse G O, 1990. The Early Proterozoic Birimian Supergroup of
Ghana and some aspects of its Associated Gold Mineralisation, Precambrian Research, 46: 139-165.

Liégeois J.P., Benhallou A., Azzouni-Sekkal A., Yahiaoui R., & Bonin B., (2005). The Hoggar swell and
volcanism: Reactivation of the Precambrian Tuareg shield during Alpine convergence and West
African Cenozoic volcanism. In: Foulger, G.R., Natland, J.H., Presnall, D.C., & Anderson, D.L., eds,
Plates, Plumes and Paradigms. Geol. Soc. Am. Spec. Pap. 388, pp 379–400.

Lycopodium Pty Ltd. 1994. Carbon Stripping Process for the Konongo Gold Project. (Unpublished
Report).

Mawson S. A. 1997. Geology – Aserewa Diamond Drilling. (Unpublished Report).

Minerals Commission, 2002. Gold Deposits of Ghana. Written by Grifis RJ, Barning K, Agezo FL and
Akosah FK, Printed by Graphic Evolution Limited. Minerals Commission, c/o P.O. Box M248,
Cantonments, Accra, Ghana, 431p.

Obenemase Gold Mines. 1997. The Aserewa Project: Mining, Geology and Reserves. (Unpublished
Report).

Oberthür, T. et al., 1994. The Ashanti Gold Mine at Obuasi, Ghana: mineralogical, geochemical,
stable isotope and fluid inclusion studies on the metallogenesis of the deposit. Geologisches
Jahrbuch Reihe, pp. 34–192.

Olson, S.F., Diakit, K., Ott, L., Guindo, A., Ford, Ch.R.B., Winer, N., Hanssen, E., Lay, N., Bradley, R.
And Pohl, D.: Refional setting, structure and descriptive geology of the Middle Proterozoic Syama
gold deposit, Mali, West Africa. Econ. Geology, vol. 87, 1992, pp. 310-331.

Perrouty, S. et al., 2012. Revised Eburnean geodynamic evolution of the gold-rich southern Ashanti
Belt, Ghana, with new field and geophysical evidence of pre-Tarkwaian deformations. Precambrian
Research, Volume 204–205, p. 28.

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Perrouty, S. et al., 2012. Revised Eburnean geodynamic evolution of the gold-rich southern Ashanti
Belt, Ghana, with new field and geophysical evidence of pre-Tarkwaian deformations. Precambrian
Research, Volume 204–205, p. 28.

Porter, C., 2006. Blue Sky Upside Potential, Konongo and Kurofa Licence Areas, Ghana. SEMS
Exploration Services Limited. Unpublished report.

Rayner, S, F. 1977. Metallurgical Development Test work on Obenemase Gold Ore Refractory Gold
Flotation for Obenemase Gold Mines Limited; Metcon Laboratories. Unpublished.

Readford, M., 1997. Santreso Gold Deposit Resource Estimation. Snowden Consultants. Unpublished
report

Reidy, P. (2012). 2012 – Auralia – Konongo Gold Project_Ghana Competent Persons Report, 69 p.

Resolute Limited. 2001. Information Memorandum on the Konongo Gold Project, Ghana, West
Africa. Prepared for ABC Ltd. September, 2001

RSG Global Integrated Mining Solutions (2006). Obenemase Project, Database Review, Geological
Modelling, and Grade Estimation, 2006, pp 97.

Schlüter, T. (2008). Geological Atlas of Africa – With Notes on Stratigraphy, Tectonics, Economic
Geology, Geosites and Geoscientific Education of Each Country. Springer-Verlag Berlin Heidelberg.
2nd Edition, pp

Schmidt Mumm, A, Oberthur, T., Vetter, U and Blenkinsop, T.G. 1997. High CO2 content of fluid
inclusions in gold mineralisations in the Ashanti Belt, Ghana: an new category of ore forming fluids?.
Mineralium Deposita, 32: 107-118. Springer-Verlag.

Signature (2010). Feasibility Report Konongo Project, pp 26.

Signature (2012). Quarterly Activities Report, 19 pp.

Sinclair C. 2004, Aserewa Drilling Proposal. (Unpublished Report).

Sterk, R, 2014. Obenemase Project - Technical Report and Resource Estimation of the Obenemase
Deposit, Ghana, Unpublished report by RSC Mining and Mineral Exploration for Signature Metals Ltd.
pp 128.

Tremlett, C.P., 1952(a). Geological Surveys of Lyndhurst Concessions in the Gold Coast. Mine and
Quarry Engineering May 1952pp 149-155.

Tremlett, C.P., 1952(b). Lyndhurst Concessions in the Gold Coast – Detailed Geological Survey. Mine
and Quarry Engineering June 1952pp 183-188.

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Van Lente, B. 2013. Signature Metals Limited, Konongo Gold Project, Project No. L 563, Independent
Resource review of the Konongo Deposits, December 2013. Snowden. (Unpublished Report)

Williams, T and Miller, P. C. 1996. Bacterial Oxidation for Ghana Gold Limited of an Arsenopyrite
Concentrate; BacTech (Unpublished Report).

Wright, J.B., 1985. Geology and Mineral Resources of West Africa. Springer, p. 43.

Youbi, N., Ernst, R., Sőderlund, U., Bertrand, H., Doblas, M., El Hachimi, H., Kouyaté, D., Soulaimani,
A., Hafid, A., Ikenne, M. and Chaham, K. R. (2011). Large igneous provinces of the West African
Craton: The record preserved in regional dyke swarms. Source URL:
http://www.largeigneousprovinces.org/11may.

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20 Qualified Persons Statements

I, Simon Meadows Smith, confirm that I am a Competent Person for the Report and:

 I have read and understood the requirements of the 2012 Edition of the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code, 2012 Edition).

 I am a Competent Person as defined by the JORC Code 2012 Edition, having five years of experience
that is relevant to the style of mineralisation and type of deposit described in the Report, and to the
activity for which I am accepting responsibility.

 I am a Fellow of the Institute of Materials, Minerals and Mining which is a ‘Recognised Professional
Organisation’ (RPO) included in a list promulgated by the ASX from time to time.

 I have reviewed the Report to which this Consent Statement applies.

I am a full time employee of

SEMS Exploration Services Ltd, 17 Orphan Crescent, Labone, Accra, Ghana

and have been engaged by

Owere Mines Ltd

to prepare the documentation for

LionGold Corporation

on which the Report is based, for the period ended

st
31 March 2015

I have disclosed to the reporting company the full nature of the relationship between myself and the company,
including any issue that could be perceived by investors as a conflict of interest.

I verify that the Report is based on and fairly and accurately reflects in the form and context in which it
appears, the information in my supporting documentation relating to Exploration Targets, Exploration Results
and Mineral Resources.

th
Date: 30 May 2015

Professional Membership: FIMMM Membership Number: 49627

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I, Andrew Netherwood, confirm that I am a Competent Person for the Report and:

 I have read and understood the requirements of the 2012 Edition of the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code, 2012 Edition).

 I am a Competent Person as defined by the JORC Code 2012 Edition, having five years of experience
that is relevant to the style of mineralisation and type of deposit described in the Report, and to the
activity for which I am accepting responsibility.

 I am a Member of the Australasian Institute for Mining and Metallurgy

 I have reviewed the Report to which this Consent Statement applies.

I am a full time employee of

SEMS Exploration Services Ltd, 17 Orphan Crescent, Labone, Accra, Ghana

and have been engaged by

Owere Mines Ltd

to prepare the documentation for

LionGold Corporation

on which the Report is based, for the period ended

st
31 March 2015

I have disclosed to the reporting company the full nature of the relationship between myself and the company,
including any issue that could be perceived by investors as a conflict of interest.

I verify that the Report is based on and fairly and accurately reflects in the form and context in which it
appears, the information in my supporting documentation relating to Exploration Targets, Exploration Results
and Mineral Resources.

th
Date: 30 May 2015

Professional Membership: MAusIMM Membership Number: 100463

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I, Joe Amanor, confirm that I am a Competent Person for the Report and:

 I have read and understood the requirements of the 2012 Edition of the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code, 2012 Edition).

 I am a Competent Person as defined by the JORC Code 2012 Edition, having five years of experience
that is relevant to the style of mineralisation and type of deposit described in the Report, and to the
activity for which I am accepting responsibility.

 I am a Member of the Australasian Institute for Mining and Metallurgy

 I have reviewed the Report to which this Consent Statement applies.

I am a full time employee of

SEMS Exploration Services Ltd, 17 Orphan Crescent, Labone, Accra, Ghana

and have been engaged by

Owere Mines Ltd

to prepare the documentation for

LionGold Corporation

on which the Report is based, for the period ended

st
31 March 2015

I have disclosed to the reporting company the full nature of the relationship between myself and the company,
including any issue that could be perceived by investors as a conflict of interest.

I verify that the Report is based on and fairly and accurately reflects in the form and context in which it
appears, the information in my supporting documentation relating to Exploration Targets, Exploration Results
and Mineral Resources.

th
Date: 30 May 2015

Professional Membership: MAusIMM CP (Geo) Membership Number: 204572

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21 Glossary
Aircore: Drilling method employing a drill bit that yields sample material which is delivered to the
surface inside the rod string by compressed air.
Alluvial: Pertaining to silt, sand and gravel material, transported and deposited by a river.
Alteration: A change in mineralogical composition of a rock commonly brought about by reactions with
hydrothermal solutions or by pressure changes
Alteration: The change in the mineral composition of a rock, commonly due to hydrothermal activity.
Amphibolite facies: The set of metamorphic mineral assemblages (facies) which is typical of regional
metamorphism between 450-700°C.
Amphibolite: A metamorphic crystalline rock consisting mainly of amphiboles and some plagioclase.
Anticline: A fold in the rocks in which strata dip in opposite directions away from the central axis.
Antiformal: An anticline-like structure.
Archaean: Widely used term for the earliest era of geological time spanning the interval from the
formation of Earth to about 2,500 million years ago.
Arsenopyrite: A silvery-gray mineral consisting of an arsenide and sulfide of iron, chemical formula
FeAsS.
Au: The chemical element gold
Basalt: A dark, fine-grained volcanic rock of low silica (<55%) and plagioclase feldspar and pyroxene.
Biotite: A type of black mica.
Breccia: A rock made up of mainly angular fragments.
Breccia: A rock mass composed of large, angular fragments of preexisting rocks
Carbonate: A sediment formed from the organic or inorganic precipitation from aqueous solution of
carbonates of calcium, magnesium, or iron; e.g., limestone and dolomite.
Chalcopyrite: A bright brass-yellow copper-iron sulphide: CuFeS2.
Chalcopyrite: The mineral copper iron sulphide
Chlorite: Family of tetrahedral sheet silicates of iron, magnesium, and aluminum, characteristic of low-
grade metamorphism.
Clays: A fine-grained, natural, earthy material composed primarily of hydrous aluminium silicates.
Cleavage: A regular parting in rock formed as a result of compression. Typically seen in slate
Craton: Large, and usually ancient, stable mass of the Earth’s crust.
Development: Underground activity to access an orebody (vein) for evaluation and mining
Diamond (core) drilling: Method of obtaining a cylindrical core of rock by drilling with a diamond
impregnated bit. Produces a high quality sample

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Diamond drilling: A method of obtaining a cylindrical core of rock by drilling with a diamond-set or
diamond impregnated bit.
Dip/dipping: Angle and direction of steepest slope on a planar surface
Dolerite: A fine to medium grained intrusive mafic rock.
Dyke: Thin, sheet-like intrusion of magmatic (igneous) rock.
Electromagnetic (EM) survey: A geophysical survey technique where potential fields are measured
under the influence of an applied current.
Epigenetic: A hydrothermal event imposed upon rocks (usually by the hydrothermal phase of felsic
intrusions).
Facies: Changes in composition, mineral associations or crystallisation sequence brought about by
different depositional environments, increasing distance from source, or differing physical and chemical
parameters.
Fault: A fracture plane in rocks showing significant movement between the two sides
Felsic: Light coloured rocks containing an abundance of feldspars and quartz.
Ferruginous: Containing iron.
Foliation: The banding or lamination of metamorphic rocks as distinguished from stratification in
sedimentary rocks.
g/t: Grammes per tonne, used to express concentration of rare metals in rock. 1 g/t is equivalent to 1
ppm and 1,000 ppb
Gabbro: A coarse-grained mafic intrusive rock, which is low in silica and has relatively high levels of iron
and magnesium minerals.
Galena: The mineral lead sulphide
Geochronology: The dating and relative dating of geologic formations and events.
Grade: The relative quantity or percentage of mineral content. Gold grade is commonly expressed in the
terms: g/t - grammes per tonne, ppb – parts per billion, ppm – parts per million
Granite: A coarse-grained igneous rock containing mainly quartz and feldspar minerals and subordinate
micas.
Greenschist: A metamorphosed basic igneous rock which owes its colour and schistosity to abundant
chlorite.
Greenstone belt: A broad term used to describe an elongate belt of rocks that have undergone regional
metamorphism to greenschist facies.
Greywacke: A sandstone like rock, with grains derived from a dominantly volcanic origin.
Group: A major sequence of sedimentary rocks forming a distinctive unit by virtue of rocks and/or fossils

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present
Hinge zone: A zone along a fold where the curvature is at a maximum.
Hydrothermal: Hot water associated with thermal springs or felsic intrusive rocks.
Igneous: Rocks that have solidified from a magma.
In situ: In the natural or original position.
Indicated Mineral Resource: An ‘Indicated Mineral Resource’ is that part of a Mineral Resource for
which tonnage, densities, shape, physical, characteristics, grade and mineral content can be estimated
with a reasonable level of confidence. It is based on exploration, sampling and testing information
gathered through appropriate techniques from locations such as outcrops, trenches, pits, workings and
drill holes. The locations are too widely or inappropriately spaced to confirm geological and or grade
continuity but are spaced closely enough for continuity to be assumed
Inferred Mineral Resource: An ‘Inferred Mineral Resource’ is that part of a Mineral Resource for which
tonnage, grade and mineral content can be estimated with a low level of confidence. It is inferred from
geological evidence and assumed but not verified geological and/or grade continuity. It is based on
information gathered though appropriate techniques from locations such as outcrops, trenches, pits,
workings and drill holes which may be limited or of uncertain quality and reliability
Infill: Refers to sampling or drilling undertaken between pre-existing sample points.
Intermediate: A rock unit which contains a mix of felsic and mafic minerals.
Intrusions: A body of igneous rock which has forced itself into pre-existing rocks.
Isoclinal: A series of folds that dip in the same direction at the same angle.
JORC / the JORC Code: The Reporting Code of the Joint Ore Reserves Committee (of the Australian
Institute of Mining and Metallurgy, Australian Institute of Geoscientists and the Minerals Council of
Australia). The JORC Code 2012.
JORC: The Joint Ore Reserves Committee (Australia). The JORC Code for the classification and reporting
of mineral resources and ore reserves has now become an internationally accepted standard.
Laterite: Red residual soil developed in humid, tropical, and subtropical regions of good drainage.
Ma: An abbreviation for ‘million years ago’.
Ma: Millions of years
Mafic: Descriptive of rocks composed dominantly of magnesium, iron and calcium-rich rock-forming
silicates.
Magnetite: A naturally occurring magnetic oxide of iron (Fe3O4).
Mantle: The zone between the core and crust of the earth.

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Measured Mineral Resource: A ‘Measured Mineral Resource’ is that part of a Mineral Resource for
which tonnage, densities, shape, physical characteristics, grade and mineral content can be estimated
with a high level of confidence. It is based on detailed and reliable exploration, sampling and testing
information gathered through appropriate techniques from locations such as outcrops, trenches, pits,
workings and drill holes. The locations are spaces closely enough to confirm geological and grade
continuity
Meta-: A prefix meaning ‘metamorphosed’.
Metallogenic: Association of metal ores that is peculiar to a particular region, or period of time.
Metamorphic: A rock that has been altered by physical and chemical processes involving heat, pressure
and derived fluids.
Metamorphism: The process of recrystallisation of rock as result of increased temperature and pressure
Metasedimentary: A rock formed by metamorphism of sedimentary rocks.
Micron (μm): A measurement of distance – 1,000 μm is equivalent to 1 mm. A μm is 1 x 10-6 of a m
Mineral Resource: A technical term which is controlled in its use by the 2012 JORC Code. A ‘Mineral
Resource’ is a concentration or occurrence of material of intrinsic economic interest in or on the Earth’s
crust in such form, quality and quantity that there are reasonable prospects for eventual economic
extraction. The location, quantity, grade, geological characteristics and continuity of a Mineral Resource
are known, estimated or interpreted from specific geological evidence and knowledge. Mineral
Resources are subdivided, in order of increasing confidence, into Inferred, Indicated and Measured
categories. The words ‘ore’ and ‘reserves’ must not be used in describing Mineral Resources as the
terms imply technical feasibility and economic viability and are only appropriate when all relevant
Modifying factors have been considered
Mylonite: A compact, chert like rock without cleavage, produced by the extreme granulation and
shearing of rocks.
Nugget effect: A term that describes grade variability for samples at small distances apart (less than a
few cm). A low nugget effect (<20%) indicates minimal grade variation, whereas a high nugget effect
(>70%) indicates that grade is highly variable and potentially relatively unpredictable. Pure nugget effect
(100%) indicates an almost random grade distribution.
Olivine: An olive green magnesium-iron silicate (Mg,Fe)2SiO4, common in mafic and ultramafic igneous
rocks.

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Ore Reserve: A technical term which is controlled in its use by the 2012 JORC Code. An ‘Ore Reserve’ is
the economically mineable part of a Measured and/or Indicated Mineral Resource. It includes diluting
materials and allowances for losses, which may occur when the material is mined. Appropriate
assessments and studies have been carried out, and include consideration of and modification by
realistically assumed mining, metallurgical, economic, marketing, legal, environmental, social and
governmental factors. These assessments demonstrate at the time of reporting that extraction could be
reasonably justified. Ore Reserves are sub-divided in order of increasing confidence into Probable Ore
Reserves and Proved Ore Reserves
Ore shoot / shoot: A high grade zone within a mineral vein
Orogeny: Process by which mountain structures develop.
Paleoproterozoic: The first of the three sub-divisions (eras) of the Proterozoic occurring between 2500
to 1600 million years ago.
Pegmatite: An exceptionally coarse-grained igneous rock, with interlocking crystals, usually found as
irregular dykes, lenses or veins.
Percussion drilling (RC): Drilling method employing a repeated hammering action on a drill bit, also
known as Reverse Circulation (RC) drilling.
Peridotite: A general term for ultramafic igneous rocks dominantly consisting of dominant olivine,
subordinate clinopyroxene, and lacking feldspar.
Pluton: A body of igneous rock formed beneath earth surface by consolidation from magma.
Porphyry: An igneous rock of any composition that contains conspicuous phenocrysts (coarse crystals) in
a fine-grained groundmass.
Precambrian: All geologic time, and its corresponding rocks, before the beginning of the Palaeozoic
(from 570 Ma back).
Proterozoic: An era of geological time spanning the period from 2,500 million years to 570 million years
before present.
Pyrite: A very common iron sulphide mineral FeS2.
Pyrite: The mineral iron disulphide
Pyrrhotite: A magnetic iron sulphide mineral (complex structure, summary Fe7S8 formula).
QAQC (for sampling and assaying): There are two components to a QAQC system – quality assurance
and quality control. Quality assurance (QA) refers to the protocols and procedures, which ensure that
sampling and assaying is completed to the required quality. Quality control (QC), however, is the use of
control samples and statistical analysis to ensure that the assay results are reliable
Quartz: The mineral silicon dioxide

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Schist: A micaceous crystalline metamorphic rock having a foliated structure.

Sericite: A white or pale apple green potassium mica.
Shale: A fine grained, laminated sedimentary rock formed from clay, mud and silt.
Shear: Deformation resulting from stresses that cause contiguous parts of a body to slide relative to
each other in a direction parallel to their plane of contact.
Silica: Dioxide of silicon, SiO2, usually found as the various forms of quartz.
Stockwork: A mineral deposit consisting of a three-dimensional network of planar to irregular veinlets
closely enough spaced that the whole mass can be mined.
Stratigraphic: The arrangement of strata.
Strike slip: Movement parallel to the strike of a fault plane
Strike: The direction or trend taken by a structural surface.
Strike: Trend of an horizontal line on any geological plane
Sulphide minerals: Mineralisation characterised by compounds of metals and sulphur.
Sulphides: Minerals composed of metals combined with sulphur
Supergene: Oxidation, electrolytic and solution effects brought about by low temperature, ground-
water activity.
Syncline: A configuration of folded, stratified rocks in which rocks dip downward from opposite
directions to come together in a trough.
Synform: A fold whose limbs close downward in strata for which the stratigraphic sequence is unknown.
Tectonised: Rocks that have been deformed by movement of the crust.
Thrust: An overriding movement of one crustal unit over another.
Ultramafic: Igneous rock in which more than 90% of the minerals are ferromagnesian minerals.
Variogram: A graphic representation of spatial correlation between samples in a given orebody. The
variogram allows the calculation of the nugget effect and the sphere of influence of samples (the range)
Vein: A relative thin (millimetres to 10 m scale) sheet of quartz or other minerals cutting across pre-
existing rocks

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Appendix 1 JORC Table 1

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Table 1 Report – Section 1 Konongo Gold Project, Signature Metals

Sampling Techniques and Data JORC 2012

(Criteria in this section apply to all succeeding sections.)
Criteria JORC Code explanation Commentary
Sampling  Nature and quality of sampling (eg cut channels, random chips,  RC sampling is taken as 1m intervals collected in-line with a cyclone. Samples are split
or specific specialised industry standard measurement tools with a 3-tier riffle splitter to generate a representative 1/8th sample for submission.
techniques appropriate to the minerals under investigation, such as down Certified standards and Blanks (largely sourced from AMIS, South Africa) are inserted
hole gamma sondes, or handheld XRF instruments, etc). These into the sample sequence – at least one every 20m. Duplicates are resplits of the 1m
examples should not be taken as limiting the broad meaning of sample. All RC chips are geologically logged, and samples from each metre are stored
sampling. on site in chip trays. Logging and chip information is used to put returned assays into
geological context. Chain of custody is maintained from the field to the laboratory.
 Include reference to measures taken to ensure sample
representivity and the appropriate calibration of any For RC drilling, 2 and 3 kg is submitted to a certified laboratory. A 60gram charge is
measurement tools or systems used. pulverised for fire assay. Internal lab checks are reported to the company.

 Aspects of the determination of mineralisation that are  Diamond drilling is executed as Diamond core tails on RC pre-collars. The transition to
Material to the Public Report. core drilling is based on interpreted geology and expected mineralisation depth. Pre-
collars are generally not sampled. Core samples are taken based on changes in the
 In cases where ‘industry standard’ work has been done this observed geology, alteration and mineralisation. Laboratory samples are half-core,
would be relatively simple (eg ‘reverse circulation drilling was taken with a manual core saw. Certified standards and blanks are inserted into the
used to obtain 1 m samples from which 3 kg was pulverised to within the sample sequence, Standards, one of each is included within each 20m of
produce a 30 g charge for fire assay’). In other cases more sampling. The remaining half-core is kept on-site for reference and interpretation.
explanation may be required, such as where there is coarse gold Chain of custody is maintained from the field to the laboratory.
that has inherent sampling problems. Unusual commodities or
mineralisation types (eg submarine nodules) may warrant Minimum samples for Diamond Core are 0.3m; maximum sample length is 1.0m.
disclosure of detailed information. Samples are submitted to a certified laboratory. Samples Duplicates are indicated in the
sample sequence, and are taken as a second split from the pulverized half-core.
Samples are assayed by fire assay with a 60 gram charge. Additional check samples are
inserted by the laboratory - data that is made available to the company.

Drilling  Drill type (eg core, reverse circulation, open-hole hammer,  RC Rigs on-site are contracted from Global Exploration Services (GES) and include
rotary air blast, auger, Bangka, sonic, etc) and details (eg core SCHRAMM 480 and SCHRAM685. RC bit is 4 ¾ inch, face sampling hammer.
techniques diameter, triple or standard tube, depth of diamond tails, face-  Diamond Rigs are CORTECH-2010 rigs contracted from Global Exploration. Standard
sampling bit or other type, whether core is oriented and if so, by tube HQ and NQ are used, NQ is the dominant core size through mineralisation.
what method, etc).
Drill sample  Method of recording and assessing core and chip sample  RC chip recoveries are qualitatively and quantitatively recorded. Sample condition
recoveries and results assessed. (wet/dry/contaminated) is recorded. Weight of dry samples is recorded. Holes are

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recovery  Measures taken to maximise sample recovery and ensure prepared to ensure the hole remains open. Data is recorded in the geodatabase
representative nature of the samples. (migrated to Datashed). Auxiliary compressors are on-site to maximize the potential to
 Whether a relationship exists between sample recovery and return dry samples. Holes are cleared at the end of each rod and the cyclones are
grade and whether sample bias may have occurred due to cleaned at the end of each hole or as required. Methodology does not permit accurate
preferential loss/gain of fine/coarse material. assessment of bias due to fraction loss.
 Diamond Core recovery is based on the length of re-assembled core from each core
run. Recoveries are recorded in the geodatabase (Datashed). Recoveries are generally
in excess of 90%.

Logging  Whether core and chip samples have been geologically and  RC chips are logged by qualified geologists who have experience on the Project (or
geotechnically logged to a level of detail to support appropriate equivalent systems in other projects). Geology is logged based on 1m intervals. Logging
Mineral Resource estimation, mining studies and metallurgical is both qualitative (lithology, alteration, mineralisation, oxidation state) and
studies. quantitative observations (geology, alteration and mineralisation boundaries).
 Information is recorded using LogChief software, and entered into the geodatabase.
Whether logging is qualitative or quantitative in nature. Core  Core logging is both qualitative (lithology and alteration and mineralisation intensity,
(or costean, channel, etc) photography. oxidation state) and quantitative observations (structure, geological and alteration and
mineralisation boundaries), recorded in LogChief software, and entered into the
 The total length and percentage of the relevant intersections geodatabase. Geotechnical data (recoveries, SGs and density, fractures) are
logged. quantitatively logged. Structure is qualitatively and quantitatively logged (alpha/beta
measurements) and/or cradle readings for oriented core). Wet and dry photography is
taken for all drill core.
 100% of Diamond Core is geologically, structurally, geotechnically logged and
photographed.
 100% of RC drilling is geologically logged.
 Logging and geotechnical logging for RC and Diamond Drilling is considered to be of
sufficient detail to support Mineral Resource estimation, mining studies and
metallurgical
Studies.

Sub-  If core, whether cut or sawn and whether quarter, half or  RC sampling is taken as 1m intervals collected in-line with a cyclone. Samples are split
all core taken. with a 3-tier riffle splitter to generate a representative 1/8th sample for submission.
sampling  Diamond core is half-core prepared with a manual core saw. The methodology
 If non-core, whether riffled, tube sampled, rotary split,
techniques preserved the orientation line. Sampling of half-core is taken as alternate halves for
etc and whether sampled wet or dry.
and sample  For all sample types, the nature, quality and each sample. Samples are a minimum of 0.3m and a maximum of 1.0m. Intervals are
based on geology, alteration and mineralisation observed.
preparation appropriateness of the sample preparation technique.  Sample preparation for both RC and Diamond Drilling includes weighing, drying,
 Quality control procedures adopted for all sub-sampling crushing to 70% -2mm, split of 250g and pulverize to better than 85% passing 75
stages to maximise representivity of samples. micron (regarded to be industry standard for this style of mineralisation).
 Measures taken to ensure that the sampling is  SOPs (controlled documentation) for sample preparation, sample collection and sample
representative of the in situ material collected, including submission are held on site. Staff training is implemented and reviewed. A number of

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Criteria JORC Code explanation Commentary

for instance results for field duplicate/second-half SOPs remain pre-sign-off, but all are in place and in use.
sampling.  Analysis of duplicate data taken from RC and core sampling indicates that sample size is
 Whether sample sizes are appropriate to the grain size of appropriate for the grain size and nature of the mineralisation being sampled.
the material being sampled.
Quality of  The nature, quality and appropriateness of the assaying  Gold grades are determined at ALS Kumasi for ore grade Au by fire assay and AAS using
assay data and laboratory procedures used and whether the a 60 gram nominal sample weight. Method precision is reported by the lab as +/- 10%,
technique is considered partial or total. and the reporting range is 0.01-100ppm. The technique produces a total result.
and
 For geophysical tools, spectrometers, handheld XRF  No geophysical techniques are used.
laboratory instruments, etc, the parameters used in determining the  Quality control includes the insertion of certified reference materials (standards and
tests analysis including instrument make and model, reading blanks) into the sample sequence by the company. Duplicates are generated from field
times, calibrations factors applied and their derivation, samples. The laboratory inserts check samples into each work order and reports the
etc. results. The laboratory monitors and reports milling statistics.
 Nature of quality control procedures adopted (eg  Regression for duplicates is 0.8083- repeatability is good.
standards, blanks, duplicates, external laboratory checks)  No new assays were returned during the Quarter. Historic CRM data returned
and whether acceptable levels of accuracy (ie lack of throughout the program does not show a systematic bias. Minor calibration drift is
bias) and precision have been established. observed in some standards. Blanks checks are statistically sound. Precision is
appropriate. No material bias is observed.

Verification  The verification of significant intersections by either  Documented verification of intersections has not been completed. It will form a part of
of sampling independent or alternative company personnel. a scoping study review currently in progress. Grades, however, correlate to qualitative
 The use of twinned holes. observation of alteration and mineralisation in samples.
and
 Documentation of primary data, data entry procedures,  Twinned holes have not been drilled.
assaying data verification, data storage (physical and electronic)  Data is stored as electronic and paper copies. Electronic data is stored in its source
protocols. format, both on on-site servers and by the service provider. On-site servers are backed
 Discuss any adjustment to assay data. up weekly. Geological sampling data is entered into a Datashed database, which
includes proprietary data validation checks to ensure field sampling information is
correct. Returned assay data are stored as certified PDF copies and imported from text
files provided by the laboratory. Certified QAQC files are also provided by the
laboratory as PDF and text files.
 No adjustments are made to the assay data.

Location of  Accuracy and quality of surveys used to locate drill holes  Collar positions are determined with a TOPCON DGPS. Down hole surveys are captured
data points (collar and down-hole surveys), trenches, mine workings using an NQ Ori Kit 800. An orientation is taken every three metres and reliability is
and other locations used in Mineral Resource estimation. gauged on the number of subsequent reading for which the core orientation can be
 Specification of the grid system used. extrapolated down hole. RC and Diamond core surveys use a Proshot Dual (CTKIT100)

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Criteria JORC Code explanation Commentary

 Quality and adequacy of topographic control. unit taken on 30m intervals down hole.
 All reported results are reported in WGS84 UTM30N.
 Mining related data is captured with Differential GPS, including mine workings,
locations and required topography.
 Regional DTM is from GeoEye, with X and Y accuracy of 0.5m and Z accuracy of 4m. The
survey was captured in December 2012. More accurate DTMs are generated using a
Total Station, which has millimetre precision.

Data  Data spacing for reporting of Exploration Results.  Regional RC collars are spaced on 40m section spacing and target mineralisation
intercepts at 30m and at 50m vertical depths. The drilling follows up on regional
spacing Aircore drilling which is spaced on 300m, 160m or 80m line spacing. The section
 Whether the data spacing and distribution is sufficient to
and spacing is appropriate to assess and interpret geology and mineralisation. Drilling
establish the degree of geological and grade continuity
distribution azimuths are generally oriented toward 136, perpendicular to the regional fabric, and
appropriate for the Mineral Resource and Ore Reserve dipping at -60 degrees. Where increased geological and mineralisation control is
estimation procedure(s) and classifications applied. established, azimuths and dips are adjusted for each individual target.
 Diamond Drilling is also based on 40m line spacing, closed to 20m where continuity of
 Whether sample compositing has been applied. geology or mineralisation is insufficient to generate appropriate geological and grade
continuity for Mineral Resource estimates. At Obenemase, hole azimuths are generally
at 120 or 300 degrees, perpendicular to the dominant local orientation. Dips vary
based on the orientation of the target mineralisation. Data generated is consistently
appropriate for Inferred Mineral Resource classification.
 The maximum sample interval for RC and Diamond Drilling is 1m. Reported results are
composited. Composites are required to return a weighted average grade greater than
1g/t, include no more than 2m of consecutive internal dilution no external dilution.

Orientation  Whether the orientation of sampling achieves unbiased  First pass RC drilling of regional prospects includes scissored holes to minimize the
of data in sampling of possible structures and the extent to which potential for biased drill orientations. Trenching and/or dozer cuts are used to assess
this is known, considering the deposit type. the fabric of the in-situ geology and further constrain program hole orientation.
relation to
 If the relationship between the drilling orientation and
geological the orientation of key mineralised structures is  Diamond Drilling targeting well-tested historical mineralisation is oriented to best test
structure considered to have introduced a sampling bias, this the mineralisation, within the constraints of possible surface collar locations. The
should be assessed and reported if material. potential of drilling down-dip of mineralisation is assessed based on interpretation of
ore geometries and the orientation of the dominant fabric in recovered core.
 No bias has been recognized from the orientation of drilling data.

Sample  The measures taken to ensure sample security.  Drill sites have allocated security personnel. Samples are removed from the field to the
site bag farm, which also has allocated security personnel. Samples taken from site are

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Criteria JORC Code explanation Commentary

security signed-off by the driver sent from the laboratory with required sample submission
documents. Sample receipts are emailed to the company on receipt of the samples at
the laboratory.

Audits or  The results of any audits or reviews of sampling  No external audits have been conducted.
reviews techniques and data.

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Table 1 Report – Section 2 Konongo Gold Project, Signature Metals

Reporting of Exploration Results JORC 2012

(Criteria listed in the preceding section also apply to this section.)
Criteria JORC Code explanation Commentary
Mineral  Type, reference name/number, location and ownership  The Konongo Gold Project (Signature Metals 70%) comprises two leases totalling
tenement and including agreements or material issues with third 195km2, a Mining Lease (749/03) and a Prospecting Lease (PL6/296). All work during
parties such as joint ventures, partnerships, overriding the Quarter was conducted within the Mining Lease, which is valid through 2023.
land tenure royalties, native title interests, historical sites, There are no known physical material issues.
status wilderness or national park and environmental settings.  The mining lease is valid through 2023. The 2014 operating licences for the ML and PL
 The security of the tenure held at the time of reporting have not been delivered as at the time of submission. Both are submitted. There are
along with any known impediments to obtaining a no known impediments to the ML. The PL licence is conditional on acceptance of the
licence to operate in the area. annual report submitted in June 2014.
 Tenements are presented as Figure 10.

Exploration  Acknowledgment and appraisal of exploration by other  Operating since 1903, extensive underground exploration was undertaken
done by other parties. throughout the life of the Konongo mines but few records of this work have been
preserved. Similarly the records of systematic surface exploration are also
parties
fragmentary.
 Geophysical techniques were used for prospecting as early as 1935 and have
continued to be used up to the present day, including regional VTEM and heli-
magnetics flown by Fugro in 1995.
 Geochemical surveys have been an effective tool in locating mineralisation. In the
early 1950's a large, detailed geochemical survey was completed on the concessions.
A geochemical sampling programme commenced in November 1990 based on
sample grid of 800 m by 30 m. Polymetallic soils were carried out in the 1970’s.
 SCML commenced exploration on the concession in 1987, initially to assess the oxide
ore resources in the Obenemase A deposit.
 With mining having commenced in 1988, regional exploration was curtailed and
exploration focused on defining further mineable resources.
 In 1991, diamond drilling below the Obenemase A pit indicated the persistence of
sulphide mineralisation. Further holes were drilled in 1992 and 1993 by SCML to
provide sufficient control for resource assessment of the sulphide mineralisation.
 OGM carried out a number of exploration programs from 1994 to 1999 within the
Konongo Mining Lease, and the adjacent Kurofa Prospecting Lease, concurrent with

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Criteria JORC Code explanation Commentary

open pit mining at Boabedroo, Apan, Atunsu, Aserewa, and Obenemase.
 During 1998, all known exploration and development information was sorted,
validated and entered into a Microsoft Access database.
 Following the formation of Owere Mines Limited, Mwana (then African Gold Plc)
completed several exploration programs at the Project consisting of regional soil
geochemistry, trenching, diamond core and reverse circulation drilling, focussed on
the Boabedroo South prospect.
 Signature Metals commenced work at the Project in May 2009 and carried out
Diamond Drilling, RC drilling, aircore drilling and trenching of greenfield and
brownfield targets through early 2012, focused mainly on oxide potential throughout
the Project.
 Signature also targeted the historic Konongo Tails, commencing mining in 2011.
 Liongold acquired the Project in May 2012 and has refocussed the operation to
assess the sulphide potential. Work has focused on the Obenemase Deposits, seven
other prioritised brownfield prospects and regional geophysical/geochemical targets.

Geology  Deposit type, geological setting and style of  The Konongo Project is located on the western margin of the Ashanti Gold belt – a
mineralisation. Proterozoic volcanic and sedimentary pile tectonised and mineralised in the
Eburnean Orogeny (2100Ma). Most of the deposits hosted in the belt are structurally
controlled mesothermal lode gold deposits or sheared, mineralised, syn-structural
intrusives.

Drill hole  A summary of all information material to the  Significant intercepts, with tabulated collar, down hole and survey details are is
understanding of the exploration results including a presented in the Quarterly if the hole has been drilled or assays returned during the
Information period. No results meet this criteria for the March Quarter 2015.
tabulation of the following information for all Material
drill holes:
o easting and northing of the drill hole collar
o elevation or RL (Reduced Level – elevation above sea
level in metres) of the drill hole collar
o dip and azimuth of the hole
o down hole length and interception depth
o hole length.
 If the exclusion of this information is justified on the
basis that the information is not Material and this
exclusion does not detract from the understanding of
the report, the Competent Person should clearly explain

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Criteria JORC Code explanation Commentary

why this is the case.
Data  In reporting Exploration Results, weighting averaging  Reported results (Table 2) are composites of returned assay results. Reported
techniques, maximum and/or minimum grade weighted average grades are greater than 1g/t Au over 1m. Internal dilution up to 2
aggregation consecutive metres is included. No external dilution is included. No top cut is applied.
truncations (eg cutting of high grades) and cut-off
methods grades are usually Material and should be stated. Intercept widths are down hole distances.
 Notably higher grades in an intercept are included as a subset of the interval. They
 Where aggregate intercepts incorporate short lengths
are prefixed ‘including’ and the grade is approximately an order of magnitude greater
of high grade results and longer lengths of low grade than the weighted average (e.g. 6.7m at 8.31g/t from 286.5m, including 0.6m at
results, the procedure used for such aggregation should 24.6g/t Au from 287m).
be stated and some typical examples of such  No metal equivalent grades are used.
aggregations should be shown in detail.
 The assumptions used for any reporting of metal
equivalent values should be clearly stated.
Relationship  These relationships are particularly important in the  Diamond drilling at Obenemase targets two distinct orientations of mineralisation –
between reporting of Exploration Results. sub-vertical lodes and sub-horizontal lodes.
 If the geometry of the mineralisation with respect to the  Sub-vertical lodes include Obenemase A Lode, Obenemase B Lode and Obenemase A
mineralisation
drill hole angle is known, its nature should be reported. Lode North, each interpreted and modelled as steeply northwest dipping
widths and  If it is not known and only the down hole lengths are mineralisation. The Lodes are targeted with holes oriented perpendicular to the
intercept reported, there should be a clear statement to this regional trend of mineralisation, with azimuths at either 120 or 300 degrees and dips
lengths effect (eg ‘down hole length, true width not known’). of 45-70 degrees. Azimuths of 120 degrees are drilled when possible, as they have a
more oblique intersection angle with interpreted lodes (approximately 60 degrees).
Drill holes targeting mineralisation from the east (i.e. drilling west) may return sub-
parallel intersections with mineralisation hosted in second order folds.
 Sub-horizontal mineralisation (R Zone mineralisation) is targeted with drill hole with
azimuths of 120 or 300 degrees, but dips are often steeper, angled at 60-80 degrees.
The intercept angle between drill hole and lode is between 60 and 80 degrees.

Diagrams  Appropriate maps and sections (with scales) and  Figures showing the distribution and relationship between reported grades are
tabulations of intercepts should be included for any presented for each Lode or Prospect discussed in the text.
significant discovery being reported These should
include, but not be limited to a plan view of drill hole
collar locations and appropriate sectional views.
Balanced  Where comprehensive reporting of all Exploration  Comprehensive reporting has been possible. All significant results for the reporting
Results is not practicable, representative reporting of period are included.
reporting
both low and high grades and/or widths should be
practiced to avoid misleading reporting of Exploration

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Criteria JORC Code explanation Commentary

Results.
Other  Other exploration data, if meaningful and material,  There are no additional material geological observations that are not discussed in the
should be reported including (but not limited to): text.
substantive
geological observations; geophysical survey results;
exploration geochemical survey results; bulk samples – size and
data method of treatment; metallurgical test results; bulk
density, groundwater, geotechnical and rock
characteristics; potential deleterious or contaminating
substances.
Further work  The nature and scale of planned further work (eg tests  Planned further work is conditional on budgets and continued successes and will.
for lateral extensions or depth extensions or large-scale  Continue to test the Obenemase Group of deposits on 40m sections and 40m step-
step-out drilling). outs to identify the extents of mineralisation to a vertical depth of 300m. The
 Diagrams clearly highlighting the areas of possible principal targets at Obenemase are:
extensions, including the main geological - the R Zone mineralisation
interpretations and future drilling areas, provided this - the Obenemase North Lode mineralisation, and
information is not commercially sensitive. - the down dip extents of the A Lode mineralisation.
 Complete the Scoping Study assessing the sulphide potential of key prospects and
deposits within the Project.
 Continue to target regional oxide and sulphide prospectivity with RC drilling at
Prospects identified with Aircore Drilling in 2012/2014.

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Table 1 report – Section 3 Konongo Gold Project, Signature Metals

Estimation and Reporting of Mineral Resources JORC 2012

(Criteria listed in section 1, and where relevant in section 2, also apply to this section.)
Criteria JORC Code explanation Commentary
Database  Measures taken to ensure that data has not been  Geological and sampling information is stored in Datashed. RSC audited and reviewed
integrity corrupted by, for example, transcription or keying the database in 2013 and made corrections and recommendations to Owere Mines..
errors, between its initial collection and its use for  Several basic checks were carried out at the start of the project to broadly investigate
Mineral Resource estimation purposes. the quality of the location data. Visual validation through sectional investigations
 Data validation procedures used. yielded a large amount of spurious issues ranging from “floating” drill holes, high
grade holes crossing below-detection holes, high-angle changes in geological and/or
grade continuity where it would be expected to occur at low angles, etc. Verification
also included the checking of hard-copy source data with digital data in the database
and re-surveying of data points in the field.
 Local grid conversion parameters were recalculated and original coordinates revised
 117 collars were relocated and resurveyed and compared against grid back-
calculations. These were targeted based on drilling campaign to identify systematic
errors. 3 campaigns between 1965 and 1998 required corrections.
 Validation of corrections to azimuth and dip data were cross checked against original
data and own-hole surveys (dip and azimuth); collars were re-excavated and check-
surveyed.
 Topographic control was assessed by comparison to high resolution DTM data
acquired in 2012.
 Digitised historic data was checked by comparing identified relict structures
(generally shafts) against historic grid data and grid data conversions.
 These issues were addressed in the database and the data received by SEMS from
Owere Mines for the Resource estimation did not show any significant discrepancies

Site visits  Comment on any site visits undertaken by the  A site visit was undertaken by Mr Joe Amanor and Mr Andrew Netherwood of SEMS
Competent Person and the outcome of those visits. between 5th and 6th May 2015. This included visiting all the open pit workings,
 If no site visits have been undertaken indicate why this locations of the most recent drilling, reviewing field geology, and reviewing and
is the case. discussing drilling procedures and sampling methods (no field work was in progress).
 The field visit included inspecting drill core and facilities at the core shed. Technical
facilities were visited with database storage, document archives, and general facilities
witnessed.

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Criteria JORC Code explanation Commentary

 Flooding of all mined out pits was noted.

Geological  Confidence in (or conversely, the uncertainty of ) the  The surface topography was obtained from satellite data by Owere Mines in
interpretation geological interpretation of the mineral deposit. December 2012. The profile and the collar positions agree with one another. It is
 Nature of the data used and of any assumptions made. noted that the satellite DTM show the recent water table in the pit and does not
 The effect, if any, of alternative interpretations on reflect the deepest mining level. Depth measurements were taken and the
Mineral Resource estimation. Obenemase A pit surface was updated accordingly. The geology, weathering profiles
 The use of geology in guiding and controlling Mineral and mineralised envelopes were modelled by RSC (2013/2014) based on drill hole
Resource estimation. data (grades, weathering and lithology.
 The factors affecting continuity both of grade and  The geology model benefitted from: The establishment of core library for continuity,
geology. Shared logging and initial dual logging of holes to ensure consistent interpretation.
Then complete re-logging of all drill core, with a core of campaign loggers.
 Logging was migrated to propriety software (Maxwell Logchief) to further constrain
geology and control logging drift. Logs were assessed in Geovia Surpac for geological
coherence.
 Systematic capture of structural data from new and historic drill core to constrain
plunges, fold interpretation, etc.
 Re-logging, in conjunction with improved spatial control permitted more coherent
and consistent interpretation of lithology and structure, mineralisation and grades.

Dimensions  The extent and variability of the Mineral Resource  The Obenemase Mineral Resource varies in depth between 300 m RL and -25 m RL
expressed as length (along strike or otherwise), plan with a maximum depth of 315 metres below natural surface. The mineralisation is
width, and depth below surface to the upper and lower open at depth (below 0mRL) over a strike length of 700m. The ore envelopes
measure a strike length of 1,000 m along the longest axis, in the north-south
limits of the Mineral Resource.
direction, and an average plan width of 10 m west-east, in its shortest axis and
occupy a volume of 2.78 Mm3.

Estimation  The nature and appropriateness of the estimation  Estimation used ordinary kriging which is appropriate for the style of mineralization
and technique(s) applied and key assumptions, including with low nugget and variance, and appropriate domaining. Variograms were modeled
treatment of extreme grade values, domaining, for Au for oxide & transitional ore and for sulphide ore. Domaining by oxidation state
modelling interpolation parameters and maximum distance of was applied. Orientation domains were applied where there were significant
techniques extrapolation from data points. If a computer assisted variations in dip or dip direction, with maximum searches ranges limiting the
estimation method was chosen include a description of influence of distant samples on a progressive basis in addition to variogram ranges.
computer software and parameters used. Sample numbers used in the estimation used a minimum of 10 and maximum of 40
 The availability of check estimates, previous estimates samples, search distances from 25-50m, and search orientations orientated according

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and/or mine production records and whether the to main mineralization trends.
Mineral Resource estimate takes appropriate account of Mineralised zones were modeled on a 0.5 g/t Au cut-off. 1m composites within the
such data. mineralized zones were used in a geostatistical study to determine search
 The assumptions made regarding recovery of by- parameters, block sizes, and sample numbers. Datamine software was used for the
products. estimation.
 Estimation of deleterious elements or other non-grade  The mineral resource estimate takes account of two recent previous estimates by
variables of economic significance (eg sulphur for acid RSCMME and Snowden. RSCMME (2014) completed an estimate for Obenemase A
mine drainage characterisation). and B during February 2014. The mineralisation, weathering surface and underground
 In the case of block model interpolation, the block size in stope and development wireframes validated and constructed by RSCMME were
relation to the average sample spacing and the search reviewed and used by SEMS. Stope location data, drawing on underground plan view
employed. sections, long sections and drill hole intersection data were used to critically assess
 Any assumptions behind modelling of selective mining depletion. There are many drill holes that have penetrated old stopes and drives and
units. these indicate that the average stope thickness is 1.5m
 Any assumptions about correlation between variables.  No by-products have been identified.
 Description of how the geological interpretation was  No estimates were made of elements other than gold.
used to control the resource estimates.  Block parent sizes were 10 mE x 10 mN x 10 mRL. Selective sub-blocking was down to
 Discussion of basis for using or not using grade cutting a minimum of 1m. Grade interpolation was based on the parent block size with 3
or capping. discretisation units in each direction. This compares with an average sample spacing
 The process of validation, the checking process used, the of 20m in section, and an average of 10m vertically.
comparison of model data to drill hole data, and use of
 Selective mining units were not specifically addressed
reconciliation data if available.
 No correlation between any variables was assumed.
 The geological interpretation was the primary basis of the resource estimate. The
main control on mineralisation is a combination of lithology and structure. Economic
mineralisation is predominantly hosted within a sediment package consisting of
siltstones and sandstones. The geological model now accurately shows the important
boundaries to this sediment package. RSCMME in particular conducted an intensive
exercise into the creation of a sound geological model using all available lithological
and structural information, which became the foundation for resource estimation.
 Statistical analyses from histograms and log-probability graphs showed only limited
outliers indicating that higher grades are part of the natural mineralized population.
However top-cutting is still a necessary component of the resource estimation. Top-
cutting was applied to limit the influence of very high grades which visual analysis
showed tend to be more isolated. Top cuts applied were: 26 g/t Au (oxide and
transitional), and 35 g/t Au (sulphide).

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 Slicing analysis, visual inspection and average comparisons between the model and
composites were done. All three methods showed the estimates to be represented
well by the composites.
 The interpolated block model was validated through visual checks, a comparison of
the mean de-clustered composite and block grades, and through the generation of
section validation slices.
 1 m composites were used in a geostatistical study to determine search parameters,
block sizes, and sample numbers. (Variography and Quantitative Kriging
Neighbourhood Analysis - QKNA) that enabled Ordinary Kriging (OK), controlled by
dynamic anisotropy, to be used as the interpolation method.
 Historic Mineral Resource estimation lacks information on mined ore. The
Obenemase deposit has been mined underground as well as at surface and
production figures are not complete. Overall depletion figures were compiled by
several authors and used to reconcile Mineral Resource estimations. Sulphide ore was
mined by Nanwa Mines up until 1953 and reported in Annual Reports, however only
mill figures were reported, not actual stope grade.

Moisture  Whether the tonnages are estimated on a dry basis or  Moisture content was determined during the specific gravity measurements.
with natural moisture, and the method of determination
of the moisture content.
Cut-off  The basis of the adopted cut-off grade(s) or quality  The cut-off grade used to create the mineralized boundaries was 0.5 g/t Au, which
parameters parameters applied. allowed for Mineral Resources are reported at cut-off grades of 0.5g/t for oxide,
0.7g/t for transition and 1.0g/t for primary based on operating cost and recovery
data.

Mining  Assumptions made regarding possible mining methods,  It is assumed that Obenemase A and B would be mined by open pit. The current
factors or minimum mining dimensions and internal (or, if resource base is 300 m below topography, which may not be fully achievable by open
applicable, external) mining dilution. It is always cut operation. Deeper high grade lodes may prove amenable to underground mining.
assumptions necessary as part of the process of determining  Mining is assumed to be completed with traditional truck and shovel methods with
reasonable prospects for eventual economic extraction small to medium size mining equipment. Mined material from Obenemase A and B
to consider potential mining methods, but the will be transported from the pit to the ROM (or nearby RoM stockpiles) with mining
assumptions made regarding mining methods and trucks. Waste will be dumped by mining trucks to storage locations near the pit.
parameters when estimating Mineral Resources may  For underground mining it is assumed this would be developed from the bottom of
not always be rigorous. Where this is the case, this mined out pits. The Obenemase A and B mineralisation has several controls for width
should be reported with an explanation of the basis of and orientation. Different mining methods may be applicable. Areas that are

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the mining assumptions made. relatively wide and relatively steeply dipping would be amenable to open stoping
(subject to geotechnical constraints); other areas that are narrower but still steeply
dipping may be amenable to shrinkage or bench retreat stoping or an Avoca or
modified Avoca method. Some of the narrower areas that are not so steeply dipping
could probably be exploited with a top-down cut and fill method.

Metallurgical  The basis for assumptions or predictions regarding  Based on the data of earlier test work conducted during the 1990s, the sulphide
factors or metallurgical amenability. It is always necessary as part material is highly refractory and, as a result, an oxidation pre-treatment stage will be
of the process of determining reasonable prospects for required.
assumptions eventual economic extraction to consider potential  Metallurgical test work by previous operators shows that overall gold recovery to a
metallurgical methods, but the assumptions regarding flotation concentrate can be expected to be around 88% and process pre-treatment
metallurgical treatment processes and parameters and cyanidation produced recoveries of between 82% and 92%. In the modern plant,
made when reporting Mineral Resources may not only oxide processing has been undertaken. The primary-sulphide ore (shown to be
always be rigorous. Where this is the case, this should refractory in nature) will require a specialised plant circuit.
be reported with an explanation of the basis of the  There is only limited test work data available for the sulphide material and no data for
metallurgical assumptions made. the minor amount of transitional material. Preliminary testing has given a recovery of
gold via acid pressure oxidation at 94%. Further metallurgical sampling and test work
is required to support design work.

Environmen-  Assumptions made regarding possible waste and  The Konongo Project was granted an EPA permit in March 2012, which includes the
tal factors or process residue disposal options. It is always necessary exploration work at Obenemase.
as part of the process of determining reasonable  The existing TMF has up to 18 months projected capacity.
assumptions prospects for eventual economic extraction to consider  The Project has conducted preliminary work for a new TMF, with a footprint of 18Ha.
the potential environmental impacts of the mining and In 2011 geotechnical work was conducted on the new site by Wardell Armstrong
processing operation. While at this stage the International (WAI). Design of the TMF was undertaken by D E Cooper and Associates
determination of potential environmental impacts, (Pty) Ltd and drawings dated December 2011 were issued to OML for review.
particularly for a greenfields project, may not always be  Drawings are still marked preliminary and not issued for construction. The new TMF
well advanced, the status of early consideration of these design has been based on a maximum volumetric storage of 4 Mt of tailings over an
potential environmental impacts should be reported. eight year mine life with an unlined (in-situ compaction) valley fill impoundment.
Where these aspects have not been considered this
 The EPA grants environmental authorisation to projects via an Environmental Permit
should be reported with an explanation of the
(EP), based on the findings of the EIS. Even with the provision of a Mining Lease,
environmental assumptions made.
individual activities must be licensed with an EP. The project description within an EIS
is very specific and relates directly to a specific EP. Any amendment or addition to a
project description requires an EP.
 Within 18 months of commencing operations, mines are expected to submit and
obtain approval for their EMP.

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 Within 24 months of obtaining an EP, mines are required to obtain an Environmental
Certificate from the EPA, which confirms commencement of operations, obtaining of
other relevant approvals, compliance with the EMP, and submission of required
annual reports.
 The WRC may grant a water right and/or a water use permit. It is assumed, but
unclear, that the issuance of a water use permit results in a water right (the right to
use water for a particular use and according to the permit conditions).

Bulk density  Whether assumed or determined. If assumed, the basis  A default specific gravity (SG) of 1.9 g/cm³ was applied to oxide ore, and 1.7 g/cm3 to
for the assumptions. If determined, the method used, oxide waste. These values have been assumed, based on numerous reports by
whether wet or dry, the frequency of the previous authors and operators. For transitional and sulphide material, over 13,000
density measurements were undertaken by Owere Mines from the transitional and
measurements, the nature, size and representativeness
sulphide core samples. These values were estimated into the model. The results
of the samples.
averaged 2.80 g/cm³.
 The bulk density for bulk material must have been The method used was the standard wet-dry method, the material was dry when
measured by methods that adequately account for void measured, and the frequency of sampling was 20m downhole. Samples are
spaces (vugs, porosity, etc), moisture and differences considered highly representative.
between rock and alteration zones within the deposit.
 Discuss assumptions for bulk density estimates used in
the evaluation process of the different materials.
Classification  The basis for the classification of the Mineral Resources  The material was classified at Indicated and Inferred. The classification is based on
into varying confidence categories. the drill hole density, the number of samples and the search distance applied to
 Whether appropriate account has been taken of all estimate each block. Classification wireframes were created in plan view sections of
relevant factors (ie relative confidence in tonnage/grade 10 m intervals. Areas were wire framed as Indicated where drill hole and sample
estimations, reliability of input data, confidence in spacing was generally within 25 m (X) by 25 m (Y) by 10 m (Z).
continuity of geology and metal values, quality, quantity  Inferred wireframes were created for areas where the drill hole and sample grid
and distribution of the data). spacing was at least 50 m (X) by 50 m (Y) by 10 m (Z). Additionally, for blocks to be
 Whether the result appropriately reflects the Competent classified as either Indicated or Inferred, a general geological continuity should be
Person’s view of the deposit. shown. This was determined by the variography and the search volumes calculated
from the variogram ranges. Three search volumes were used, orientated along the
strike, dip direction and the angle of dip of the orebody.
 Blocks that were estimated within the primary search volume, generally show
geological continuity. Blocks estimated within the secondary search volume, cannot
be classified as Indicated, but at the most as Inferred.


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Audits or  The results of any audits or reviews of Mineral Resource  No third party review has been undertaken
reviews estimates.

Discussion of  Where appropriate a statement of the relative accuracy  The CPs believe the accuracy of the grade and tonnage estimate for Indicated Mineral
relative and confidence level in the Mineral Resource estimate Resources to be within ±20-30% globally based on general experience of this style of
using an approach or procedure deemed appropriate by mineralisation. Similarly, the accuracy of the grade and tonnage estimate for the
accuracy/ the Competent Person. For example, the application of Inferred Mineral Resource is considered to be within ±30-50% globally based on
confidence statistical or geostatistical procedures to quantify the general experience of this style of mineralisation.
relative accuracy of the resource within stated  No simulation studies have been undertaken to quantify accuracy.
confidence limits, or, if such an approach is not deemed  No well-documented production from the primary-sulphide ore is available to
appropriate, a qualitative discussion of the factors that validate the estimate.
could affect the relative accuracy and confidence of the
estimate.
 The statement should specify whether it relates to
global or local estimates, and, if local, state the relevant
tonnages, which should be relevant to technical and
economic evaluation. Documentation should include
assumptions made and the procedures used.
 These statements of relative accuracy and confidence of
the estimate should be compared with production data,
where available.

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Appendix 2: QAQC Report

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