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Spanish Mountain
British Columbia, Canada

Economics based on 2012 Preliminary Economic Assessment Using Resource Update Released In July 2012*


(Latest Resource Update Released in April 2014 is Not Reflected in the PEA)

Years 1-3
Life of Mine 14.4 years
Average Annual Gold Production  (ounces)
268,000
197,000
Total Cash Cost (US $ per ounce)
$526
$774
Operating Cost ($ per tonne milled)
$10.68
$10.68
Gold Recovery
90%
88%
Average Gold Grade of Ore Processed
0.70 g/t
0.48g/t
Strip Ratio
1.3 
2.3
Initial Capital Cost ($ millions)
$756 M
Sustaining capital
$168m
Mine Size (tonnes per day)
40,000


Project Leveraged to Gold Price (From PEA)


Price
NPV @ 5%
IRR
Payback
$1,350
$226m
10%
7.5 years
$1462 Base Case (3 year trailing)
$454m
15%
4.4 years
$1,716
$887m
23%
2.7 yeras


Capital Expenditure Requirements


Pre-Production Capital
US$ (millions)
Overall Site
19.9
Open Pit Mining
127.7
Handling
54.3
Process
168.1
Tailings and Water Management
69.7
Environmental
11.9
On-site Infrastructures
56.5
Off-site Infrastructures
16.1
Project Indirects
129.0
Owner's Costs
16.6
Contingencies
86.1
PEA Total
755.9


Mining Costs


Operating Cost
US$/tonne milled
Mining
5.19
Process
4.45
Tailings
0.04
G&A
0.58
Offsite costs (incl royalty)
0.42
Total
10.68


NPV & IRR-Sensitivity to Gold Price from PEA*
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Cash flow-Sensitivity to Gold Price from PEA*
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* See Cautionary Note Number 1