Title Page HIGH RIVER GOLD MINES LTD the Bissa Asset, Burkina Faso

Title page

HIGH RIVER GOLD MINES LTD

The Bissa Asset, Burkina Faso, NI 43 101 Technical Report

July 2012

HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

TABLE OF CONTENTS

1 SUMMARY...... 1 1.1 Introduction...... 1 1.2 Project Location, Accessibility and Climate...... 1 1.3 History...... 1 1.4 Property Ownership...... 2 1.5 Property Description...... 2 1.6 Geology and Mineralisation...... 2 1.7 Exploration and Drilling...... 3 1.8 Mineral Resource & Mineral Reserves...... 3 1.9 Mining ...... 7 1.10 Mineral Processing...... 7 1.11 Environmental Studies ...... 7 1.12 Economic Analysis...... 8 1.13 Conclusions and Recommendations...... 9 2 INTRODUCTION ...... 11 2.1 Purpose of the Technical Report...... 11 2.2 Independent Consultants...... 11 2.3 Personal Inspections of the Bissa Gold Project...... 12 2.4 Units and Currency...... 13 3 RELIANCE ON OTHER EXPERTS...... 14 4 PROPERTY DESCRIPTION AND LOCATION...... 15 4.1 Introduction...... 15 4.2 Location...... 15 4.3 Licences and Tenure...... 15 4.4 Environmental Obligations...... 20 5 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE, SEISMICITY AND PHYSIOGRAPHY ...... 21 5.1 Accessibility ...... 21 5.2 Physiography...... 21 5.3 Climate ...... 21 5.4 Local Resources and Infrastructure...... 21 6 HISTORY ...... 23 6.1 Burkina Faso Gold History ...... 23 6.2 Project History ...... 25 7 GEOLOGICAL SETTING AND MINERALISATION...... 26 7.1 Geological Setting ...... 26 ZT61-1100/MM696 Final V6.0 Page ii July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

7.1.1 Regional Geology...... 26 7.1.2 Project Geology...... 27 7.2 Mineralisation...... 30 7.3 Other Permits ...... 34 7.3.1 Bouly...... 34 7.3.2 Gougre...... 36 7.3.3 Labola ...... 39 7.3.4 Guibare ...... 45 7.3.5 Zinigma ...... 45 7.3.6 Sakou ...... 46 7.3.7 Yimiougou...... 46 7.3.8 Mane...... 47 7.3.9 Noungou ...... 47 7.3.10 Tyegana...... 47 8 DEPOSIT TYPE...... 49 8.1 Introduction...... 49 8.2 Bissa Group Property ...... 49 9 EXPLORATION...... 50 9.1 Bissa Gold Deposit...... 50 9.2 Sampling Method and Approach ...... 50 9.2.1 Trenching Samples ...... 50 9.2.2 Reverse Circulation Drilling Samples...... 51 9.2.3 Core Drilling Samples...... 51 9.3 Other Permits & Exploration Summary...... 52 10 DRILLING ...... 54 10.1 Bissa Group Property ...... 54 10.2 Drilling Summary (January-August 2011)...... 54 11 SAMPLE PREPARATION, ASSAYING, SECURITY ...... 56 11.1 Sample Preparation & Analysis...... 56 11.2 Density and Specific Gravity Determinations...... 56 11.3 Bouly QA/QC...... 57 12 DATA VERIFICATION...... 61 12.1 Introduction...... 61 12.2 Bissa...... 61 13 MINERAL PROCESSING AND METALLURGICAL TESTING ...... 62 13.1 Introduction...... 62 13.2 Bissa Testworks (Genivar Raport, June 2010)...... 62 13.3 Metallurgical Testing of Gougré Deposit Samples...... 62

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13.3.1 Bissa Gold SA...... 62 13.3.2 Wardell Armstrong International...... 66 13.4 Metallurgical Testing of Zinigma Deposit Samples...... 70 13.4.1 Introduction ...... 70 13.4.2 Testwork ...... 71 14 MINERAL RESOURCE ESTIMATES...... 74 14.1 Introduction...... 74 14.2 Mineral Resource Estimation at Bissa Gold Deposit...... 74 14.2.1 Topography...... 74 14.2.2 Sample Database...... 75 14.2.3 Mineralised Zone Interpretation...... 76 14.2.4 Geostatistics...... 79 14.2.5 Block Model ...... 83 14.2.6 Grade Estimation...... 84 14.2.7 Model Validation...... 85 14.2.8 Resource Classification...... 85 14.2.9 Resource Evaluation...... 86 14.3 Other Mineral Resource Estimations at Adjacent Exploration Areas in Bissa...... 87 14.3.1 Introduction ...... 87 14.3.2 Bouly...... 88 14.3.3 Gougre ...... 102 14.3.4 Liliga...... 114 14.3.5 Bissa Sud ...... 121 14.3.6 Labola ...... 125 14.3.7 Zinigma ...... 135 14.4 Conclusion ...... 141 15 MINERAL RESERVE ESTIMATES...... 142 15.1 Introduction...... 142 15.2 Bissa Gold Deposit...... 142 15.2.1 Pit Optimisation Parameters...... 142 15.2.2 Pit Optimisation Results...... 143 15.2.3 WAI Reserve Estimation ...... 144 15.3 Gougre WAI Mineral Reserve Estimate...... 145 15.3.1 Pit Optimisation Parameters...... 146 15.3.2 Pit Optimisation and WAI Mineral Reserve Estimation...... 146 16 MINING METHODS ...... 148 16.1 Introduction...... 148 16.2 LOM Mining Schedule ...... 148

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16.3 Mining Operations ...... 149 17 RECOVERY METHODS ...... 150 17.1 Introduction...... 150 17.2 Crushing...... 150 17.3 Grinding...... 150 17.4 Carbon-in-leach Circuit...... 151 17.5 Elution ...... 151 17.6 Electrowinning...... 152 17.7 Refining...... 152 17.8 Carbon Regeneration ...... 153 17.9 Tailings Disposal...... 153 18 PROJECT INFRASTRUCTURE...... 154 19 MARKET STUDIES AND CONTRACTS ...... 160 20 ENVIRONMENTAL STUDIES, PERMITTING, AND SOCIAL OR COMMUNITY IMPACT ...... 161 20.1 Environmental and Community Context...... 161 20.2 Summary of Project Status and Activities ...... 161 20.2.1 Introduction ...... 161 20.2.2 Bissa Mine Camp...... 162 20.2.3 Processing Plant Area...... 162 20.2.4 Tailings Area...... 163 20.3 Environmental Effects and Management...... 163 20.3.1 Introduction ...... 163 20.3.2 Waste Management...... 163 20.3.3 Water Effluents and Management...... 165 20.3.4 Emissions to Air...... 166 20.3.5 Soil Management ...... 166 20.3.6 Biodiversity ...... 166 20.3.7 Hazardous Materials Storage and Handling...... 167 20.4 Permitting...... 167 20.5 Community Effects and Management ...... 168 20.5.1 Land and Community...... 168 20.5.2 Community Resettlement and Compensation...... 168 20.5.3 Community Development...... 170 20.6 Health and Safety, Security and Emergency Preparedness and Response ...... 171 20.7 Mine Closure and Rehabilitation ...... 171 21 CAPITAL AND OPERATING COSTS ...... 173 22 ECONOMIC ANALYSIS ...... 175 22.1 Introduction...... 175

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22.2 Life of Mine Assumptions and Input Data...... 175 22.3 Bissa Financial Model...... 177 23 ADJACENT PROPERTIES ...... 181 24 OTHER DATA AND INFORMATION...... 182 25 INTERPRETATION AND CONCLUSIONS...... 183 26 RECOMMENDATIONS ...... 186 27 REFERENCES ...... 187

FIGURES

Figure 4.1: Location of Bissa in Northeastern Burkina Faso ...... 15 Figure 4.2: Bissa Group Permits (Source: HRG presentation)...... 16 Figure 4.3: Taparko-Bouroum and Bissa Group Permits (Source: HRG presentation)...... 18 Figure 4.4: HRG Licence Position, 2011 (HRG)...... 19 Figure 7.1: Regional Geology of West Africa ...... 26 Figure 7.2: Detailed Geology of the Bissa Area (SRK 2006) ...... 28 Figure 7.3: Geology & Exploration Works - Bissa Hills Project (SRK 2006) ...... 29 Figure 7.4: Main Deposits of the Bissa Hill Area ...... 30 Figure 7.5: Surface Plan of the Bissa Hill Deposit...... 31 Figure 7.6: Bissa Hill Section 9880E...... 31 Figure 7.7: Bissa South Extension - Section 8740E...... 32 Figure 7.8: Bissa Southwest, Section 9100E ...... 33 Figure 7.9: Zone 51, Section 7100E ...... 34 Figure 7.10: Vertical RAB Drilling; Mean Au ppb over the Entire Drill Hole ...... 35 Figure 7.11: Gougre Chargeability with Overlain 2007 Drill Results ...... 36 Figure 7.12: Longitudinal Section of Main Target Zone at Gougre ...... 38 Figure 7.13: Location of Labola - Southwest Burkina Faso...... 39 Figure 7.14: Labola Structure and Selected Drill Results...... 40 Figure 7.15: Section 6800N through Labola...... 42 Figure 7.16: Principal Mineralised Zones at Labola...... 44 Figure 11.1: Assay Results for Standard Control Samples...... 59 Figure 11.2: Assay Results for Duplicate Control Samples ...... 59 Figure 11.3: Assay Results for External Control Samples ...... 60 Figure 13.1: Gougré Drill Hole Locations ...... 64 Figure 14.1: Plan View of Topographic Survey of Bissa Area...... 75 Figure 14.2: Isometric view looking down towards the north east of Directional Control Strings at Boken area...... 77

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Figure 14.3: Typical vertical cross section through Boken looking North East of indicated mineralisation model at 0.3 g/t Au cut-off. Legend refers to drillholes only...... 78 Figure 14.4: South West to North East Sectional View through the Mineralised Zone Block Model Showing Weathering Surfaces ...... 79 Figure 14.5: Plan View of Three Major Mineralised Zones at Bissa...... 80 Figure 14.6: Normal Histogram of Au in Zone 2...... 81 Figure 14.7: Log-Histogram for Au in Zone 2...... 81 Figure 14.8: Log-probability plot for Au in Zone 2 ...... 82 Figure 14.9: Variogram Models for Zone 2 Saprolite, Saprock and Fresh Rock combined ...... 83 Figure 14.10: Example Swath Plot; Group 2 Along Strike...... 85 Figure 14.11: Spatial Distribution of Bouly Drilling by Type ...... 89 Figure 14.12: North West to South East Cross-Section Through the Bouly Deposit showing the Mineralised Zone (red) and Barren Zones (black) Determined by 0.3g/t Au Cut-Off, and Weathering Horizons...... 92 Figure 14.13: Plot of Tonnes v Grade for Indicated Resource ...... 102 Figure 14.14: Plan View of Topographic Survey of Gougre Area with Collar Locations in Black ...... 103 Figure 14.15 : Isometric view looking north of topography DTM and Directional Control Strings.... 105 Figure 14.16: Typical vertical cross section of indicated mineralisation model at 0.5g/t Au cut-off. Legend refers to drill holes only...... 106 Figure 14.17: South West to North East Sectional View through Mineralised Zone Block Model Showing Weathering Surfaces ...... 107 Figure 14.18: Normal Histogram of Au in Mineralised Zone ...... 108 Figure 14.19: Log-Histogram of Au assays within mineralised zones...... 108 Figure 14.20: Log Probability Plot of Au in Mineralised Zone...... 108 Figure 14.21: Variogram Model for Gougre Transitional Zone...... 110 Figure 14.22: Variogram Models for Gougre Fresh Rock ...... 110 Figure 14.23: Example Swath Plot along strike in the Fresh Rock ...... 112 Figure 14.24: Example Swath Plot along strike in the Transitional...... 112 Figure 14.25: Plan View of Constructed Topographic DTM of Liliga Area and Collar Locations...... 115 Figure 14.26: Variogram model for Au at Liliga ...... 118 Figure 14.27: Plan View of Constructed Topographic DTM of Bissa Sud Area and Collar Locations . 121 Figure 14.28: Location of Diamond Drillholes (blue) and RC Drillholes (red) at the Labola Deposit . 126 Figure 14.29: Au Mineralisation Wireframes (View Looking North West)...... 127 Figure 14.30: Experimental Variograms and Variogram Models for Au...... 131 Figure 14.31: Plan View of Constructed Topography of Zinigma Area and Collar Locations ...... 136 Figure 14.32: Isometric View looking North of Mineralised Zone Wireframe based on a cut off grade of 0.3g/t Au with drillhole traces ...... 137 Figure 14.33: Downhole and Directional Variogram Models for Mineralised Zone ...... 138

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Figure 14.34: Example SWATH plot by Northing ...... 140 Figure 15.1: 3D View of WAI Optimised Pit...... 144 Figure 18.1: Basic Planned Process Plant Infrastructure for Bissa Hill Open Pit...... 157 Figure 18.2: Accommodation Infrastructure Planned for Bissa Hill...... 158 Figure 18.3: General Proposed Infrastructure at Bissa Hill...... 159 Figure 22.1: Bissa Sensitivity Analysis...... 179

TABLES

Table 4.1: Licence Status held by HRG Exploration, Burkina Sarl and Jilbey Burkina Sarl...... 17 Table 10.1: Summary of Bissa Exploration Campaigns used in Resource Estimation ...... 54 Table 10.2: Summary of Drilling Activities (January - August 2011) ...... 55 Table 11.1: Bissa Gold Project Specific Gravity* Database...... 57 Table 11.2: Frequency and Type of Control Samples...... 58 Table 13.1: Bissa Gold Metallurgical Samples...... 63 Table 13.2: Bottle Roll Leach Test Results ...... 66 Table 13.3: WAI Metallurgical Sample ...... 67 Table 13.4: Grind Size Kinetic Cyanide Leach Results...... 67 Table 13.5: Cyanide Strength Kinetic Cyanide Leach Results ...... 68 Table 13.6: Diagnostic Leach Results...... 69 Table 13.7: Carbon Adsorption Results ...... 70 Table 13.8: Bottle Roll Leach Test Results Zinigma Au Deposit ...... 72 Table 14.1: Standard Statistics for Raw Au by Zone...... 82 Table 14.2: Densities ...... 84 Table 14.3: Summary of Kriging Plan...... 84 Table 14.4: Bissa Mineral Resource Estimate – Total in-situ Resources OK – Whole Deposit –...... 87 Table 14.5: Weathering Coding...... 92 Table 14.6: Statistics for Samples...... 93 Table 14.7: Statistics for Samples Falling within the Modelled Orebody by Type...... 94 Table 14.8: Statistics for Samples Falling within the Modelled Orebody by Weathering ...... 94 Table 14.9: Effect of Top-Cutting on Bouly Dataset...... 95 Table 14.10: Statistical Analysis Showing Effect of Sample Compositing on Au...... 96 Table 14.11: Specific Gravity Measurements ...... 97 Table 14.12: Summary of Kriging Plan...... 98 Table 14.13: Statistical Analysis Showing Effect of Estimation Method on Au_ppm...... 99 Table 14.14: Bouly Mineral Resource Estimate (WAI, 01 January 2012) ...... 100 Table 14.15: Bouly Mineral Resource Estimate – Comparison with Prior Estimate ...... 101 Table 14.16: Summary of Gougre Exploration Campaigns...... 104

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Table 14.17: Standard Statistics for Raw Au by Weathering Zone...... 109 Table 14.18: Summary of Kriging Plan...... 111 Table 14.19: Gougre Mineral Resource Estimate – Total in-situ Resources...... 114 Table 14.20: Summary of Liliga Exploration Campaigns...... 116 Table 14.21: Basic Statistics for Au in Selected Samples...... 117 Table 14.22: Search Parameters for Liliga Grade Estimation...... 119 Table 14.23: Liliga Mineral Resource Estimate – Total in-situ Resources - OK ...... 120 Table 14.24: Summary of Bissa Sud Exploration Campaign and Assay Database...... 122 Table 14.25: Basic Statistics for Au in Selected Samples by Zone...... 122 Table 14.26: Summary of Estimation Plan...... 124 Table 14.27: Bissa Sud Mineral Resource Estimate – Total in-situ Resources Inverse Distance Weighting (WAI, 01 January 2012)...... 125 Table 14.28: Statistical Analysis for All Au Samples by Sample Type...... 127 Table 14.29: Statistical Analysis for Samples Intercepting the Mineralisation Wireframes...... 128 Table 14.30: Summary of Top Cuts Applied...... 129 Table 14.31: Statistical Analysis for All Au Samples Intercepting the Mineralisation Wireframes Following Top Cutting...... 129 Table 14.32: Statistical Analysis for Samples Intercepting the Mineralisation Wireframe Following Compositing (1m Composite) ...... 130 Table 14.33: Summary of Block Model Prototype Parameters...... 132 Table 14.34: Summary of Estimation Parameters...... 132 Table 14.35: Comparison of Global Average Grades...... 133 Table 14.36: Labola Resource Estimate (WAI, January 2012)...... 135 Table 14.37: Summary of Zinigma Exploration Campaigns ...... 136 Table 14.38: Densities from Bissa Deposit...... 139 Table 14.39: Summary of Kriging Plan...... 139 Table 14.40: Zinigma Mineral Resource Estimate – Total in-situ Resources OK...... 141 Table 15.1: WAI Pit Optimisation Parameters ...... 142 Table 15.2: Pit Slope Parameters ...... 143 Table 15.3 Bissa Deposit Open Pit Optimisation Results...... 144 Table 15.4: Bissa Open Pit Mineral Reserves as of 01 January 2012 ...... 145 Table 15.5: Bissa Reserve Pit Summary (WAI, 01 January 2012) ...... 145 Table 15.6: WAI Pit Optimisation Parameters ...... 146 Table 15.7: Gougre Open Pit Mineral Reserves as of 01 January 2012 (WAI)...... 147 Table 16.1: Bissa Deposit LOM Mining Schedule (WAI 2012)...... 148 Table 18.1: Plant Items Purchased for Mining...... 156 Table 21.1: Summary of Capital and Operating Cost Estimates ...... 174 Table 22.1: Bissa Life of Mine Financial Model Assumptions and Input Data ...... 176

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Table 22.2: Bissa Financial Model (All Figures are Given in US$ ‘000) ...... 178 Table 22.3: Summary of Bissa Key Financial Indices ...... 179 Table 22.4: Bissa Sensitivity Analysis (US$M) ...... 179

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1 SUMMARY

1.1 Introduction

The Bissa Asset in Burkina Faso is owned by High River Gold Mines Ltd (“HRG”), a Canadian based gold mining company with producing mines and advanced exploration projects in Burkina Faso and Russia. This technical report (Technical Report) has been prepared for HRG by, or under the supervision of, qualified persons, within the meaning of National Instrument 43-101 Standards of Disclosure for Mineral Projects (NI 43-101) in support of HRG’s disclosure of scientific and technical information

1.2 Project Location, Accessibility and Climate

The Bissa gold deposit is located approximately 85km north of Ouagadougou, the Capital City of Burkina Faso. The Bissa Group Property is accessible via Route Nationale 22, a sealed road, connecting Kongoussi to Ouagadougou. Travel time from Ouagadougou is about 1½ hours. The airport at Ouagadougou has flight connections to the major cities in Europe.

The climate is characterised by a wet season extending from June to September with the heaviest rains in August, and mean annual rainfall between 400 and 600mm. Typical daytime temperatures range from 25°C in December to 45°C in May, decreasing about 10°C at night.

1.3 History

Exploration work was initiated by previous operators during the 1990’s leading to the discovery of a small, near surface gold resource at Bissa Hill. In 2004, Jilbey Burkina acquired an option on the Bissa and Zandkom permits and conducted extensive verification of the historical work. Further exploration programmes followed in 2004, (Jilbey Burkina - resampling and drilling to verify historical data), 2005-2006, 2007 and 2008 (Jilbey Burkina and HRG – trenching and RC and core drilling). Following the successful takeover of Jilbey Burkina in September 2005, High River resumed drilling on the Bissa Group Property and over 31,000m of drilling were completed.

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1.4 Property Ownership

HRG owns the mining permit of Bissa Gold through its 90% subsidiary Bissa Gold SA, the remaining 10% carried interest in Bissa Gold SA is held according to the law by the State of Burkina Faso. The Bissa Gold exploitation permit, which includes areas that were previoulsy part of the Namtenga exploration permit, was obtained in June 2011 and valid for 20 years.

1.5 Property Description

Bissa is an advanced gold exploration project and Bissa group permits are underlain by volcano-sedimentary rocks on the northeast edge of the Boromo greenstone belt, part of the extensive lower Proterozoic Birimian greenstone belts of the West African craton. More particularly, the Bissa Hill deposit is located within the Sabce shear zone, a regional structure which extends for more than 30km on the property. Gold mineralisation is associated with sulphide mineralisation and quartz veining hosted in a strongly altered, deformed sedimentary package. The main zone of mineralisation forms a northeast trending tabular body steeply dipping to the north.

1.6 Geology and Mineralisation

The Bissa Hills area lies in the early Proterozoic Birimian Greenstone Belt of the West African Craton and occurs on the northeast portion of the Boromo greenstone belt. The dominant geological features in this area include the Kogkoundi Granodiorite, an elongated northeast- southwest felsic intrusion and the Sabce deformation zone with a large linear chain of gold- in-soil anomalies located along its northwest margin. The volcano-sedimentary sequence comprises mafic to intermediate volcanic and clastic sedimentary rocks, the contact between the two being characterised by a thin and discontinuous quartz-pebble conglomeratic sub-unit.

Exploration work on the Bissa and Zandkom deposits has led to the delineation of a number of near surface gold deposits that have been traced by trenching and drilling over a strike length of approximately 5km. The gold mineralisation consists of disseminated sulphides, sulphide stringers, quartz veining and attendant hydrothermal alteration and quartz breccia bodies developed in highly strained sedimentary and volcanic rocks, loosely sub-parallel to the dominant foliation fabric of the Sabce shear zone.

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1.7 Exploration and Drilling

After the discovery of Bissa deposit, exploration works have been carried out in the area. The exploration database between 1998 and 2011 for the Bissa-Zandkom Project comprises 167 trenches (~15,395m), 244 core boreholes (~33,310m) and 1178 reverse circulation boreholes (~105,868m).

HRG has ownership of many other exploration permits in Burkina Faso, data provided by HRG in September 2011 has summarised the activities during the first eight months of 2011 below.

1.8 Mineral Resource & Mineral Reserves

The Mineral Resource and Mineral Reserve estimate presented in this Technical Report have been prepared in accordance with the guidelines of the JORC Code (2004), however for consistency the term Mineral Reserve has been used. It should be noted that for the purpose of this Technical Report the terms Ore Reserve and Mineral Reserve have the same meaning.

WAI has estimated resources for the Bissa project which can be summarised as follows at a variety of gold cut-off grades:

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Bissa Resource Estimate (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Ore Type Laterite/Saprolite/Transition/Fresh Cut Off Grade (g/t) 0.3 0.5 1.0 1.5 Tonnage (kt) 2,208 1,964 1,396 1,082 Au (g/t) 2.24 2.47 3.17 3.73 Measured kg 4,947 4,851 4,425 4,038 Metal oz 159,039 155,966 142,251 129,814 Tonnage (kt) 72,194 61,789 26,741 12,573 Au (g/t) 1.09 1.21 1.84 2.56 Indicated kg 78,691 74,765 49,203 32,187 Metal oz 2,529,989 2,403,742 1,581,923 1,034,838 Tonnage (kt) 74,402 63,753 28,137 13,656 Measured + Au (g/t) 1.12 1.25 1.91 2.65 Indicated kg 83,638 79,616 53,628 36,225 Metal oz 2,689,028 2,559,708 1,724,174 1,164,652

Tonnage (kt) 25,249 19,651 7,042 2,852 Au (g/t) 0.91 1.05 1.66 2.33 Inferred kg 22,977 20,634 11,689 6,645 Metal oz 738,714 663,393 375,807 213,639

Two other important exploration properties lie within a few kilometres of Bissa that will benefit from its development. In particular, the hard ore from Gougré is likely to provide additional feed to the Bissa plant.

Bouly, which lies to the southeast of Bissa, appears to represent a large, low grade gold- copper porphyry, whilst Gougré which lies to the southwest of Bissa appears to be shear related.

WAI has undertaken resource estimations for both targets:

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Bouly Mineral Resource Estimate (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Applied Cut Off Grade 0.6 Tonnage (kt) 0 Au (g/t) - Measured kg 0 Metal oz 0 Tonnage (kt) 9,037 Au (g/t) 0.84 Indicated kg 7,625 Metal oz 245,139 Tonnage (kt) 9,037 Measured + Au (g/t) 0.84 Indicated kg 7,625 Metal oz 245,139

Tonnage (kt) 32,150 Au (g/t) 0.75 Inferred kg 24,127 Metal oz 775,673

Gougré Resource Estimate (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Cut Off Grade 0.5 1.0 1.5 2.0 Tonnage (kt) 3,044 2,468 1,669 1,080 Au (g/t) 1.90 2.16 2.60 3.07 Indicated kg 5,785 5,335 4,338 3,314 Metal oz 185,997 171,509 139,473 106,554 Tonnage (kt) 3,044 2,468 1,669 1,080 Measured Au (g/t) 1.90 2.16 2.60 3.07 + kg 5,785 5,335 4,338 3,314 Indicated Metal oz 185,997 171,509 139,473 106,554

Tonnage (kt) 3,121 1,862 947 528 Au (g/t) 1.39 1.83 2.41 2.96 Inferred kg 4,352 3,410 2,282 1,566 Metal oz 139,922 109,644 73,367 50,360

Other resource estimates have been made for the more advanced exploration projects. At Zinigma, the following resource has been defined:

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Zinigma Resource Estimate (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Cut Off Grade 0.5 1.0 1.5 2.0

Tonnage (kt) 3,687 1,854 839 361 Au (g/t) 1.17 1.60 2.06 2.51 Inferred kg 4,317 2,959 1,725 904 Metal oz 138,792 95,150 55,465 29,071

The Labola deposit is not the part Bissa Gold Project despite the fact that Labola property and its resource estimatition are mentioned in this technical report. Labola permit lies in the southwest of Burkina Faso approximately 5 hours’ drive from the capitol Ouagadougou.

Geologically, the zone extends for at least 11km and mineralisation comprises a series of parallel/sub-parallel quartz veins, trending north-northeast and generally steeply dipping, hosted within a metasedimentary suite.

The area is characterised by a profusion of artisanal workings, some of which are on an industrial scale. Limited exploration work to date has defined an Inferred resource:

Labola Resource Estimate (WAI, March 2011) (in accordance with the guidelines of the JORC Code (2004) Inferred Cut Off Grade (g/t) Tonnes (kt) Density (t/m3) Au Grade (g/t) Metal Au (oz) 0.4 1,231 2.4 1.22 48,136 0.6 905 2.4 1.48 42,927 1.0 481 2.4 2.09 32,272 2.0 163 2.4 3.43 17,950 3.0 68 2.4 4.84 10,552 4.0 35 2.4 6.17 7,027

WAI has used its own resource estimate to provide an optimised reserve and mine schedule for the operations.

Using a US$1,250/oz gold price and a series of agreed Key Performance Indicators, the following reserve applies:

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Bissa Open Pit Mineral Reserves as of 01 January 2012 (WAI, COG=0.9g/t Au) (in Accordance with the Guidelines of the JORC Code (2004) Ore/Rock Type Ore (kt) Au (kg) Au (g/t) Weathered Proven 114 294 2.57 Weathered Probable 10,742 18,655 1.74 Fresh Proven 1,365 4,031 2.95 Fresh Probable 16,807 30,304 1.80 Weathered Proven and Probable 10,856 18,949 1.75 Fresh Proven and Probable 18,172 34,335 1.89 Total Proven and Probable 29,028 53,284 1.84 Waste* (kt) 159,989 Note- Mining Factors of 6% Dilution and 97% Mining Recovery applied. *Waste is given inclusive of Inferred material, which is also treated as waste

1.9 Mining

The operation at Bissa envisages open pit mining at an annual rate of approximately 3- 4Mtpa, utilising drill & blast with a truck and shovel approach to ore and waste haulage.

1.10 Mineral Processing

A CIL process route was proposed for the Bissa mine at a nominal rate of 1.4Mtpa (from the Genivar 2009 study), although the new design target throughput is nearer to 4Mtpa.

The proposed crushing circuit consisted of a primary crusher followed by Semi-Autogenous Grinding (SAG) mill and Ball mill. The crushed material would then be leached in the CIL circuit in a series of agitator tanks and the dissolved gold adsorbed on to activated carbon. The activated carbon would be recovered from the slurry by screening and directed towards an elution circuit. The leached slurry, at a density of 43% solids, would be sent via a pumping station to a tailings pond. Process water requirements were predicted to be in the order of 238m3/h.

1.11 Environmental Studies

The project is considered to be in compliance with national standards and is moving towards International Compliance.

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Some aspects of the mines Enviroment, Community Health and Safety (ECHS) planning will need to accommodate the expectations inherent in the revised International Finance Corporation Performance Standards (IFC PSs) due to be released in 2012, with increased emphasis on the climate change and social/community performance of mine sites.

In line with Bissa Gold’s aspirations to be an exemplar of good practice, HRG should consider developing an ICMC-compliant cyanide management plan for the site and an internationally- certified environmental management system, such as ISO14001.

In addition, HRG should improve its dust monitoring and control, particularly during the construction phase. A mine closure and rehabilitation plan will need further development to secure sufficient finance for the mine closure funding.

1.12 Economic Analysis

The WAI life of mine model results in a positive NPV at various discount rates and at various gold prices, as well as the relatively high internal rate of return at nominal input parameters. This shows that the reserves considered in the financial model are profitable for exploitation in the current economic environment. A summary of Bissa Key Financial Indices and sensitivity analysis are presented below.

Summary of Bissa Key Financial Indices NPV 5 (US$M) 338.7 NPV (US$M) 204.3 NPV 15 (US$M) 147.2 NPV 20 (US$M) 91.2 Internal Rate of Return 35% Pay-Back Period (Years) 3.0 Discounted Pay-Back Period (Years) 4.0

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Bissa Sensitivity Analysis

The deposit consists of a large gold ore resource. The fact that the key financial indices remain reasonably high given the conservative cost input parameters and recovery used in the models, shows good economic potential for the project.

1.13 Conclusions and Recommendations

The Bissa Hills area lies in the early Proterozoic Birimian Greenstone Belt of the West African Craton and occurs on the northeast portion of the Boromo greenstone belt. The gold mineralisation consists of disseminated sulphides, sulphide stringers, quartz veining and attendant hydrothermal alteration and quartz breccia bodies developed in highly strained sedimentary and volcanic rocks, loosely sub-parallel to the dominant foliation fabric of the Sabce shear zone.

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The primary ore types are not being tested in the current programme of metallurgical testwork. The sulphide ore type for each deposit should be tested to at least obtain a preliminary indication of their processing characteristics.

HRG should improve its dust monitoring and control, particularly during the construction phase.

A mine closure and rehabilitation plan will need further development to secure sufficient finance for the mine closure funding.

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2 INTRODUCTION

2.1 Purpose of the Technical Report

The Bissa Asset in Burkina Faso is owned by High River Gold Mines Ltd (“HRG”) a Canadian based gold mining company with producing mines and advanced exploration projects in Burkina Faso and Russia. Its common shares (HRG) are traded on Toronto Stock Exchange (TSX).

This Technical Report has been prepared for HRG by or under the supervision of qualified persons within the meaning of NI 43-101 in support of HRG disclosure of scientific and technical information for the Bissa Asset in Burkina Faso.

2.2 Independent Consultants

Wardell Armstrong International (WAI) has provided the mineral industry with specialised geological, mining, and processing expertise since 1987, initially as an independent company, but from 1999 as part of the Wardell Armstrong Group (WA). WAI’s experience is worldwide and has been developed in the coal and metalliferous mining sector.

Our parent company is a mining engineering/environmental consultancy that services the industrial minerals sector from nine regional offices in the UK and international offices in Almaty, Kazakhstan, and Moscow. Total worldwide staff complement is now in excess of 400.

WAI, its directors, employees and associates neither has nor holds:

 Any rights to subscribe for shares in High River Gold Mines Ltd either now or in the future;  Any vested interests in any concessions held by High River Gold Mines Ltd;  Any rights to subscribe to any interests in any of the concessions held by High River Gold Mines Ltd, either now or in the future;  Any vested interests in either any concessions held by High River Gold Mines Ltd or any adjacent concessions; and

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 Any right to subscribe to any interests or concessions adjacent to those held by High River Gold Mines Ltd, either now or in the future.

WAI’s only financial interest is the right to charge professional fees at normal commercial rates, plus normal overhead costs, for work carried out in connection with the investigations reported here. Payment of professional fees is not dependent either on project success or project financing.

WAI undertook a technical due diligence of the Bissa exploration asset. This study considered all aspects of the mine from geology and resources in accordance with guidelines of JORC Code (2004), exploration potential, mining, processing, economics, and environmental and social issues.

A team of WAI consultants visited the Bissa area during the period 8-11 December 2009 as well as the office located in Ouagadaugou, 15-17 June 2010 for resource estimation, 06-09 September 2011, 21-25 November 2011 and 24-25 January 2012. During the site visits the WAI team inspected current exploration activities, discussed many aspects of the project with technical staff.

This report has been prepared to be filed on SEDAR by WAI in compliance with NI 43-101.

The author has relied upon information from HRG staff and internal reports covering the areas of previous exploration, infrastructure, environmental and legal matters.

2.3 Personal Inspections of the Bissa Gold Project

The below-listed qualified person conducted personal inspections of the Bissa Group Property:

 Phil Newall, BSc (ARSM) PhD (MCSM) CEng, FIMMM; has conducted several inspections since his first visit during the period 8-11 December 2009 when the project office and licences held by HRG were visited and the data from the HRG licences were reviewed for the preparation of a mineral resource estimation (January 2012), during the visit, Dr. Newall completed a review of and compiled information on logging, QA/QC, density, sampling and assays

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performed by HRG for the Taparko-Bouroum and Bissa Gold Projects. Further visits were conducted between 06-09 September 2011, 21-25 November 2011 and 24-25 January 2012. During which amongst other work all the target areas incorporated in the mineral resource estimation were visited.

2.4 Units and Currency

All units of measurement used in this report are metric unless otherwise stated. Tonnages are reported as metric tonnes (“t”), precious metal values in grams per tonne (“g/t”) or parts per million (“ppm”). Other references to geochemical analysis are in parts per million (“ppm”) or parts per billion (“ppb”) as reported by the originating laboratories.

Unless otherwise stated, all references to currency or “$” are to United States Dollars (US$).

Co-ordinate system for the Taparko-Bouroum and Bissa Assets are WGS 1984, Zone 30N and UTM Clarke 1880 elipsoid, Adindan Datum.

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3 RELIANCE ON OTHER EXPERTS

This technical report has been prepared by WAI on behalf of HRG. The information, conclusions, opinions, and estimates contained herein are based on:

 Information available to WAI at the time of preparing this Technical Report including previous Technical Reports prepared on Bissa Assets and associated licences within the project;  Assumptions, conditions, and qualifications as set forth in this Technical Report; and  Data, reports, and other information supplied by HRG and other third party sources.

The qualified persons have not carried out any independent exploration work, drilled any holes or carried out any sampling and assaying on any assets mentioned in the report.

For the purposes of this report, WAI has relied on ownership information provided by HRG. WAI has not researched property title or mineral rights for any HRG’s Assets in Burkina Faso and expresses no opinion as to the ownership status of the property. The description of the Property, and ownership thereof, as set out in this technical report, is provided for general information purposes only.

Except for the purposes legislated under provincial securities laws, any use of this report by any third party are at that party’s sole risk.

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4 PROPERTY DESCRIPTION AND LOCATION

4.1 Introduction

Bissa Gold is an advanced exploration and Bissa Gold SA, which owns exploitation permits, is owned 90% by HRG through High River Gold West African Ltd (HRGWA) and 10% is carried interest by the State of Burkina Faso.

4.2 Location

The Bissa gold deposit is located approximately 85km north of Ouagadougou, the Capital City of Burkina Faso (Figure 4.1).

Figure 4.1: Location of Bissa in Northeastern Burkina Faso

4.3 Licences and Tenure

For exploration purposes ‘Exploration Permits’ are granted upon the submission of an application, designated budget and schedule of work for the first year. This permit is issued for 3 years and can be renewed twice for consecutive periods of 3 further years. Activity ZT61-1100/MM696 Final V6.0 Page 15 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

must commence within 6 months and the permit applies to a maximum surface area of 250km2. Upon the second renewal, the area must reduce in size by one fourth and ultimately only contain the area of interest by the final application. A Exploration Permit can be upgraded to an Exploitation Permit upon application.

HRG owns f the exploitation permit of Bissa Gold through its 90% subsidiary Bissa Gold SA, the remaining 10% carried interest in Bissa Gold SA is help according to the law by the State of Burkina Faso. The Bissa Gold exploitation permit, which includes areas that were previously part of the Namtenga exploration permit, was obtained in June 2011 and valid for 20 years.

HRG has prepared a Feasibility Study (June 2010) for a CIL-based project to upgrade the recently expired Research Permit for Zandkom to an ‘Industrial Operating Permit’, or Exploitation Permit, in line with the requirements of the Mining Code.

The location of Bissa group permits is illustrated in Figure 4.2 below.

Figure 4.2: Bissa Group Permits (Source: HRG presentation)

Since 1996, High River Gold Mines Limited (HRG) has undertaken considerable exploration in the Taparko-Bouroum and Bissa areas and holds the rights to several other licences in the area, these are listed in Table 4.1 and illustrated in Figure 4.3 and Figure 4.4.

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Table 4.1: Licence Status held by HRG Exploration, Burkina Sarl and Jilbey Burkina Sarl No Permit Name Project no. Registered to Date Issued 1 Bissa Sud JLB-26 Jilbey Burkina SARL 03/07/08 2 Zinigma JLB-14 Kindo Adama (in process to be transfered to HRGE) 11/08/03 3 Barsa HRG-32 High River Gold Exploration Burkina SARL 16/08/06 4 Dyakolra HRG-36 High River Gold (West Africa) Ltd. 16/08/06 5 Yimiougou HRG-29 High River Gold (West Africa) Ltd. 22/08/05 6 Tyegana HRG-31 Kindo Adama (in process to be transfered to HRGE) 22/08/05 7 Labola HRG-17 High River Gold (West Africa) Ltd. 08/09/04 8 Gandi HRG-19 High River Gold (West Africa) Ltd. 08/09/04 9 Mango HRG-26 High River Gold (West Africa) Ltd. 12/09/05 10 Bangbara HRG-27 High River Gold (West Africa) Ltd. 12/09/05 11 Tanzaka HRG-28 High River Gold (West Africa) Ltd. 12/09/05 12 Baola II HRG40 High River Gold Exploration Burkina SARL 15/09/11 13 Noungou JLB-19 Jilbey Burkina SARL 04/10/05 14 Balbo HRG-30 High River Gold (West Africa) Ltd. 07/10/05 15 Baola HRG-22 High River Gold (West Africa) Ltd. 05/11/04 16 Nayiri HRG-23 High River Gold (West Africa) Ltd. 05/11/04 17 Zandkom II JLB-27 Jilbey Burkina SARL 09/12/09 18 Mané JLB-18 Jilbey Burkina SARL 19/12/05 19 Yeou HRG-21 High River Gold (West Africa) Ltd. 22/12/03 20 Sakou JLB-16 High River Gold Exploration Burkina SARL 22/12/03 21 Wayin HRG-37 High River Gold Exploration Burkina SARL 21/01/08 22 Raka JLB-06 Jilbey Burkina SARL 12/02/04 23 Nongo-Fayere HRG-08 High River Gold (West Africa) Ltd. 17/02/03 24 Namtenga JLB-05 Jilbey Burkina SARL 17/02/04 25 Gargo JLB-07 Jilbey Burkina SARL 17/02/04 26 Ankouma HRG-20 High River Gold (West Africa) Ltd. 25/02/04 27 Taranga HRG-09 High River Gold (West Africa) Ltd. 27/02/03 28 Tossé JLB-08 Jilbey Burkina SARL 02/03/04 29 Danfora HRG-39 GEP Mines 10/03/04 30 Tema JLB-12 Jilbey Burkina SARL 31/05/04 31 Zibtenga HRG-33 Sawadogo Idrissa 05/06/06 Note: HRG have applied to take back the Bissa permit which is expired in May 2011 (result pending)

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Figure 4.3: Taparko-Bouroum and Bissa Group Permits (Source: HRG presentation)

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Figure 4.4: HRG Licence Position, 2011 (HRG)

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4.4 Environmental Obligations

The project is considered to be in compliance with national standards and is moving towards International Compliance.

Some aspects of the mines need to be improved by HRG. Enviromental considerations relations to the Bissa project are discussed in details in Section 20 below.

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5 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE, SEISMICITY AND PHYSIOGRAPHY

5.1 Accessibility

Bissa Group Property is accessible via Route Nationale 22, a sealed road, connecting Kongoussi to Ouagadougou. Travel time from Ouagadougou is about 1½ hours. The airport at Ouagadougou has flight connections to the major cities in Europe. There is a railway from the port of Abijan, Cote d’Ivoire to Kaya, but the political instability in Cote d’Ivoire means that most of the freight destined for Burkina Faso arrives at Tema, Ghana. Freight for the project is trucked from Tema to Taparko (1,288km).

5.2 Physiography

The topography of the permit area is undulating, several low ridges with lateritic caps, where some gold deposits occur, rising approximately 100m above the flat semi-desert.

5.3 Climate

5.4 Local Resources and Infrastructure

The main exploration camp at Tanlouka remains as a field camp with limited containerised accommodation, a core cutting and storage facility and vehicle compound whilst at Kongoussi, a field office with core storage facility has also been established.

A new Mine Camp is currently being built to the southeast of Route Nationale 22 (RN22), although this is planned to be diverted as it crosses the orebody. Closer to the road, the site of the processing facility has now been levelled and condemnation drilling is well underway at the site of the TMF.

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Thus, access to the mining site will be from the east, using the diverted RN22 and a connection to the water reservoir, located approximately 18km to the east of the site is planned. The national power grid at Ouagadougou will be unable to supply power requirements for the mine, and it is anticipated that diesel powered generation on site will be used. Security measures for dealing with artisanal miners are in place.

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6 HISTORY

6.1 Burkina Faso Gold History

Burkina Faso is geologically rich. There has been substantial interest in mining, particularly gold mining, in Burkina Faso over the last 40 years, with the Poura region producing over 25t of gold. The government of Burkina Faso brought a new Mining Act into being in 2003, following which more than 30 companies have undertaken exploration in the country.

Some of the world's most prolific mines are on greenstone belts. These belts cover about 3,000,000km² of West Africa, making the area's exploration potential substantial. Burkina Faso currently accounts for 21% of West Africa's greenstone belt exposure. Thirteen international mining companies are currently active in this area.

SEMAFO operates gold mines in Burkina Faso and owns 90% of the Mana gold project, which is situated approximately 200km west of Ouagadougou. Mana is SEMAFO’s flagship mine and produced 114,900oz in the 9 months ending September 2009.

Etruscan Resources owns the Youga mine, which reached commercial production in July 2008. Youga, located on the 80km strike length of the Youga gold belt, is forecast to produce 88,000oz/year over almost seven years.

Cluff Gold achieved the final commissioning of its 78%-owned Kalsaka mine in 2009. This open-pit heap-leaching operation is forecast to produce 60,000oz.

Iamgold’s efforts are concentrated on its 90% owned Essakane property, which consists of 6 exploration permits. It is understood that Essakane contains in the region of 57Mt of Probable ore reserves.

High River Gold is developing the Taparko-Bouroum open-pit gold mine, and is also currently developing the Bissa gold project.

Volta Resources has been active in Burkina Faso since 2002. HRG now has eight properties covering three projects, namely the Gaoua copper-gold project, the Kampti-III project and the Titao project. Volta has signed an agreement to purchase 100% of Randgold’s interest in

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the Kiaka gold project where prefeasibility studies are currently underway. HRG hopes to report an updated resource estimate by the end of the first quarter 2012.

Riverstone Resources acquired its 1st gold project in Burkina Faso in 2004. HRG now has six promising projects, the flagship of which is the Karma project, consisting of four contiguous permits.

Avocet currently operates one gold mine, Inata in northern Burkina Faso, and has a pipeline of exploration projects in Burkina Faso and Guinea. The deposit at Inata presently comprises a Mineral Resource of 3.46 million ounces and a Mineral Reserve of 1.85 million ounces. Inata poured its first gold in December 2009 and produced approximately 167,000 ounces of gold in 2011.

Gryphon Minerals is currently exploring its 100%-owned Banfora project in the south-west. This project is located in a major gold-producing area, with the project consisting of six exploration licences over an area of 1,200km2.

Ampella Mining acquired five permits in the Batie West project in 2008. Aggressive exploration has revealed the multi-million ounce gold potential of this region, with six new gold discoveries.

Montreal-based Searchgold has recently acquired two new permits on the wholly-owned Dou-Taouremba project.

Goldplat entered into an agreement in December 2009 with Sanu Exploration (BVI) Limited, a wholly owned subsidiary of NGEX Resources Inc, to acquire Sanu's option over the 246km² Nyieme gold project in Burkina Faso. The Nyieme exploration licence includes known high- grade quartz vein structures, with drill core results showing up to 17.83g/t Au over 1m and 11.67g/t Au, over 5m.

In December 2010 Goldplat announced a maiden compliant with JORC guidelines resource at the first target of the project totalling 685,000t at 2.61g/t Au for 57,501oz Au of gold at a cut-off grade of 1.0g/t Au for all categories.

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Goldrush Resources' flagship project is the Ronguen gold deposit where, in early 2008, HRG defined an Inferred gold deposit of 249,000oz of gold (5.9Mt at a grade of 1.31g/t Au). Goldrush has also recently confirmed the presence of prospective targets at its Ouavousse permit.

Avion Gold acquired the Hounde Project from Avocet in October 2010. An initial Indicated and Inferred resource of 610,000oz Au of gold was reported, but drilling is ongoing - HRG hoped to increase the resource to over 1 Moz ounces by the end of 2011.

6.2 Project History

Exploration work was initiated by previous operators during the 1990’s leading to the discovery of a small, near surface gold resource at Bissa Hill.

Further exploration programmes followed in 2004, (Jilbey Burkina - resampling and drilling to verify historical data), 2005-2006, 2007 and 2008 (Jilbey Burkina and HRG – trenching and RC and core drilling).

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7 GEOLOGICAL SETTING AND MINERALISATION

7.1 Geological Setting

7.1.1 Regional Geology

The Bissa Hills lies within the early Proterozoic Birimian Greenstone Belt of the West Africa Craton (Figure 7.1). The area was deformed repeatedly between 2,400 to 1,200Ma, but has remained a relatively stable craton since. The Birimian rocks are bounded on the east and west by Infracambrian Pan-African mobile zones. Rocks have been metamorphosed to greenschist facies mineral assemblages.

Figure 7.1: Regional Geology of West Africa

The Birimian rocks are subdivided into an early and a late volcano-sedimentary sequence, each followed by an orogenic episode of folding and metamorphism (“Eburnean 1" and “Eburnean 2" orogenies). Gold deposits formed during the Eburnean 1 cycle are of the “syngenetic” type whilst during the Eburnean 2 cycle ongoing tectonic movements led to the development of shear zones of regional importance that were important source for many of the major West African gold deposits.

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The Bissa Hills gold deposit is interpreted as having been formed during this second orogenic episode.

7.1.2 Project Geology

The Bissa Gold Project occurs on the northeast portion of the Boromo greenstone belt (Figure 7.2). The dominant geological features in this area include the Kogkoundi Granodiorite, an elongated northeast-southwest felsic intrusion and the Sabce deformation zone with a large linear chain of gold-in-soil anomalies located along its northwest margin. The volcano-sedimentary sequence comprises mafic to intermediate volcanic and clastic sedimentary rocks, the contact between the two being characterised by a thin and discontinuous quartz-pebble conglomeratic sub-unit.

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Figure 7.2: Detailed Geology of the Bissa Area (SRK 2006)

Geology and Exploration Works of the Bissa site is shown in Figure 7.3 below.

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Figure 7.3: Geology & Exploration Works - Bissa Hills Project (SRK 2006)

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7.2 Mineralisation

Exploration work on the Bissa and Zandkom permits has led to the delineation of a number of near surface gold deposits that have been traced by trenching and drilling over a strike length of approximately 5km. The gold mineralisation consists of disseminated sulphides, sulphide stringers, quartz veining and attendant hydrothermal alteration and quartz breccia bodies developed in highly strained sedimentary and volcanic rocks, loosely sub-parallel to the dominant foliation fabric of the Sabce shear zone (Figure 7.4).

Figure 7.4: Main Deposits of the Bissa Hill Area

The principal areas of gold mineralisation are summarised below:

 At Bissa Hill, two elongated tabular auriferous bodies are located along the discontinuous quartz pebble conglomerate contact between clastic sedimentary rocks and mafic volcanic rocks and the mineralisation consists of quartz breccias and veins and sulphide-rich veinlet. It was traced by drilling over a strike length of approximately 900m to a depth of approximately 100m where it tapers off (from 60m at surface to 15m) and grades drop. The zone plunges 20° to the northeast. Borehole BS04-007 drilled to 63m, showed some high grade intersections including 20m @ 6.09g/t Au from 36- 56m.

 Figure 7.5 shows a detailed plan of the surface geology of Bissa Hill as well as notable mineralised intersections, whilst Figure 7.6 shows high-grade section 9880E which illustrates the generally steeply dipping, tapering mineralisation; ZT61-1100/MM696 Final V6.0 Page 30 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

 The Bissa South Extension (“Bissa SE”) area, which has a strike length of about 1.3km, represents the strike extension of the Bissa Hill deposit; however gold mineralisation (with some high grades >30g/t Au) is mainly developed in mafic schists to the southeast of the sedimentary-volcanic rock contact Figure 7.7 shows the complexity of the deformed mineralisation;

Figure 7.5: Surface Plan of the Bissa Hill Deposit

Figure 7.6: Bissa Hill Section 9880E

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Figure 7.7: Bissa South Extension - Section 8740E

 The Bissa Southwest (“Bissa SW”) area is situated to the west of Bissa Hill and Bissa SE; the gold mineralisation is related to weak to moderate hydrothermal alteration, developed along the sheared limbs of a train of folds affecting argillaceous and sandstone sub-units. An analysis of core from Bissa Southwest again showed some excellent intersections, albeit not as enriched a Bissa Hill e.g. borehole ZK05-061, which produced several intersections including 25m @ 1.01g/t Au (44-69m), 13.5m @ 1.25g/t Au (72.5-86m), 11m @ 1.06g/t Au (99-110m) and 13.5m @ 1.96g/t Au.

 Figure 7.8 shows Bissa Southwest Section 9100E which indicates that the mineralisation is associated with NE trending shears that intersect the synformal structures, commonly shearing off the limbs of minor folds;

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Figure 7.8: Bissa Southwest, Section 9100E

 The IO area is located to the southwest of Bissa SE and gold mineralisation occurs in mafic volcanic rock and forms a crescent shaped zone shallowly plunging to the northeast. This zone has recorded some spectacular drill intersections including 16m @ 17.6g/t Au (from 66-82m) with visible gold; and  Further to the southwest, Zones 51, 52 and 53 comprise gold mineralisation developed predominantly in mafic schists of volcanic origin over a broad area extending south of Bissa South Extension and Bissa Southwest to Imiougou village (Figure 7.9). Zone 51 which has a strike length of approximately 1.5km, is hosted in volcanic rocks, appears relatively thin and has a sub-vertical attitude, whilst Zone 52, which is also volcanic hosted, and also has a 1.5km strike length, has recently been extended by drilling.

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Figure 7.9: Zone 51, Section 7100E

Some 3km further to the southwest, the Boken area, which is partially off-set by NNE trending faults, has an estimated resource of approximately 300,000oz Au at 1.4g/t.

7.3 Other Permits

7.3.1 Bouly

The Bouly property is located in the 68.56km² Bissa gold exploitation permit to the southeast of Bissa Hill.

Preliminary works identified a circular soil anomaly about 4km2 in area (2.5km N-S x 2km E- W), with results of 320ppb Au (soil – maximum), 1.12 and 1.03g/t Au (two rock samples), and 0.57g/t Au (two trenches - maximum). A diamond core hole intersected 2.50g/t Au over 30.6m and had an average grade of 0.94g/t Au over 126m (complete hole).

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The bedrock comprises massive non-foliated porphyritic mafic metavolcanics, brecciated by younger porphyritic intrusive dykes and gold is associated with quartz-pyrite-chalcopyrite veinlets with potassic alteration along the vein walls.

However, the main results from the early work outlined a strong Au-Cu bedrock anomaly which continues under the alluvium into the Bissa permit to the southwest (Figure 7.10).

Figure 7.10: Vertical RAB Drilling; Mean Au ppb over the Entire Drill Hole

During 2009/10, the Bouly property has been further tested by a 60 holes programme of Air Core Drilling, on fences 80m apart, with holes 35-40m apart. The holes were drilled at 45° to 330°, with an average depth of about 80m, and totalling some 5,000m.

This work has indicated 15-20m of cover, and a depth of weathering of around 50m. Mineralisation appears open at depth and along strike.

During 2011, an additional 15 hole RC drilling programme has extended the Bouly mineralisation to the southwest at similar grades.

In addition, samples have been taken to Taparko Mine for preliminary process testwork to establish the amenability of Bouly oxide mineralisation to heap leaching. ZT61-1100/MM696 Final V6.0 Page 35 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

A preliminary resource estimate has been derived by WAI.

7.3.2 Gougre

The Gougre target (Figure 7.11), in the Gargo permit area, is coincident with a resistivity and chargeability gradient and appears to lie on the contact with a mafic volcanic. Gold mineralisation is associated with a strongly magnetic silicified unit cut by limonite-filled fractures and occurs in a zone constrained by two narrow intervals of intense fracturing.

Figure 7.11: Gougre Chargeability with Overlain 2007 Drill Results

Further exploration work has indicated three different geological controls:

 Sheared basalt with quartz veinlets;  Quartz stockwork hosted in undeformed metabasalt; and  Several small outcrops showing pervasive silica-pyrite.

a total of 24 rock samples were taken and 15 of them gave assay results >0.5g/t Au including 2 samples grading >10g/t Au (from the zone of pervasive alteration on the main outcrop). In

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addition, IP surveys along two different line directions NE-SW and NW-SE, were undertaken and results suggest that the stockwork zone on the main outcrop might have some continuity towards the SW, but probably does not continue on the NW side of the shear zone.

Most of the gold mineralisation at Gougre is hosted in pervasive silica-pyrite altered rocks associated with a ductile-brittle shear zone that forms the contact between the underlying and overlying metavolcanic units. The “Gougre fault” dips about 70°E and is only a few metres wide, yet it juxtaposes two lithological domains of contrasting metamorphic grade, (greenschist-amphibolite) implying a significant vertical component of displacement.

Minor significant mineralisation has been intersected in the hangingwall associated with hangingwall faults that probably merge with the main fault at depth.

Although mineralisation along the southern extension of the main zone is erratic, visual observation of the core suggested strong mineralisation was present all along the fault contact, which was successfully traced for a total distance of about 800m. Gold mineralisation at the main zone therefore has a geological/structural control that is not present along the northern and southern extensions.

In 2008, some 582m of infill drilling was undertaken along with 5 RAB profiles totalling some 2,331m from 55 holes.

This work established the results already known from previous works. In general, the deposit has been drilled down to 120m vertical, with holes between 40 and 20m apart. The thickness is variable, but in the main part varies between 5-30m, although it thins to the south.

Two holes, drilled in 2010, down to 180m, gave very encouraging results. Hole 55 gave 31m @ 3.2g/t (from 219-250m), whilst Hole 56 gave 85m @ 2.34g/t Au.

IP data from 2010 appears to indicate two structural corridors at depth (>200m), and the new planned drilling will test this.

A longitudinal section of the main target zone at Gougre is shown in Figure 7.12 below. ZT61-1100/MM696 Final V6.0 Page 37 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

Figure 7.12: Longitudinal Section of Main Target Zone at Gougre

Due to the importance of Gougre with respect to the development of the Bissa Mine (may act as a source of “hard” ore to blend with the Bissa “soft” ore), in 2011, HRG drilled another 21 core holes, totalling 4,256m, and 8 RC holes totalling 524m to increase the drilling density on the Central Zone to 40 x 40m. Assays are still awaited for this work.

Furthermore, a programme of 12 trenches was planned for 2011, but due to the impact of the rainy season, this was limited to 3 only (Trenches 2, 5 & 8).

Trench 5 exhibits numerous zones of highly silicified material surrounded by more weathered clay-rich metasediments and diorites.

The sampling method adopted in the trenches was to channel sample along the base using a rotary cutting tool. As with the drilling, no results are available due to the major bottleneck in sample preparation at the ALS laboratory in Ouagadougou.

In addition to the exploration work, HRG has also taken a large metallurgical sample from hole MT1 situated next to Trench 5. This hole was drilled vertically to 100m depth.

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7.3.3 Labola

The Labola deposit is not the part Bissa Gold Project despite the fact that Labola property and its resource estimatition are mentioned in this technical report . The Labola permit lies in the southwest of Burkina Faso, approximately 5 hours’ drive from the capitol Ouagadougou on generally good paved roads with the exception of a short section of laterite road to the field area.

The nearest town is Banfora, but the much larger city of Bobo-Dioulasso lies approximately 1 hour to the northeast of the site (Figure 7.13).

Figure 7.13: Location of Labola - Southwest Burkina Faso

A field camp and core storage facility has been established on the licence area, in September 2011, work had halted due to the rainy season, although it was expected to restart towards the month end.

One of the key features of the Labola property is the profusion of artisanal mining activity along the length of the structure exploiting the generally narrow, gold-bearing quartz veins. This work has become highly mechanised using leased Caterpillar excavators and loaders to stockpile the near surface oxide material.

Geologically, the zone extends for at least 11km (Figure 7.14), but may not be continuous over this distance. Mineralisation comprises a series of parallel/sub-parallel quartz veins,

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trending north-northeast and generally steeply dipping, hosted within a metasedimentary suite comprising sericitic, graphitic and chloritic schists, as well as some coarser units which are typically siltstones, sandstones, and more rarely grits. These metasediments are variably silicified.

Figure 7.14: Labola Structure and Selected Drill Results

Oxidation extends for up to 60-70m where limonite and hematite are seen, whilst below this in the primary mineralisation, pyrite and arsenopyrite are present. Gold is believed to be predominantly related to quartz.

White or grey-white quartz veins vary in size from a few millimetres up to tens of centimetres, rarely up to a metre or so. The overall width of the mineralised zone is also variable, but appears to be from 200-500m.

Since the property was acquired in 2004, HRG has undertaken considerable exploration including: ZT61-1100/MM696 Final V6.0 Page 40 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

 Survey work;  Lithogeochemistry;  Geological mapping at various scales;  Ground geophysics including IP and Magnetometry, and  RAB, RC and Core drilling

Due to the high degree of oxidation and relatively thick surficial cover (up to 10m), trenching has proved ineffective at Labola and has not been used.

In 2005, 18 RC holes were drilled primarily in the Central and Northern parts of the structure, along with detailed sampling of the artisanal workings. In addition, 48 RAB holes, spaced 15m apart (average depth 34m) were drilled along profile 3100N, although results from these holes were disappointing.

The results from the RC holes however, were encouraging. The best results were from LBR- 010 in the Central part of the zone which defined numerous mineralised zones between 20- 100m downhole (the hole ended in mineralisation), with values up to 11g/t Au over 4m.

Work continued at Labola during 2005-2007 including further geophysical studies (IP) and soil geochemistry. The results of this work defined a strong geophysical and geochemical coincident anomaly.

Thus, in 2008, further drilling was instigated, this time adopting a 24 holes core programme.

This work again produced encouraging results. For example, on Section 6800N (area Yarba - Figure 7.15), LBLC08-001 and LBLC08-023, drilled by N115 Mag were positioned to duplicate the hole RC LBR05-010. This they did, and LBLC08-001 in particular produced some interesting intersections of 3.3m @ 1.7g/t, 11.4m @ 1.01g/t, 6.5m @ 3.44g/t, 7.4m @ 4.49g/t, and 4m @ 1.82g/t. LBLC08-023, beneath LBLC08-001, showed a good single intersection of 9.1m @ 2.11g/t.

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Figure 7.15: Section 6800N through Labola

However, the main phase of work has, and is, taking place in 2010/11. Some 92 RC holes were drilled in 2010, and in 2011, up to end of August, a further 198 RC holes. A 30 holes core programme is planned with 7 drilled to date.

HRG is using 3 rigs for this work, two LongYear 44 rigs, contracted by DrillCorp Africa, and one RC rig from Forages. All holes are accurately surveyed and marked on the ground by concrete plugs.

For the RC samples, for every batch of 100, 3 ordinary blanks are inserted, 2 local sample blanks, 5 duplicates, 2 reject duplicates, 3 crushing duplicates, 2 grinding duplicates, and 2 standards. All samples were then sent to BUMIGEB for preparation before moving on to ALS for assay by fire analysis and AAS finish.

Some external control has also been implemented at the SOMITA laboratory at Taparko and results to date show good correlation. ZT61-1100/MM696 Final V6.0 Page 42 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

The core from DDH21 showed an intersection from 58-73m @ 2.58g/t Au comprising undifferentiated metasediments containing coarse pyrite and arsenopyrite shot through with clean white quartz veins which were mostly narrow (1-2cm), but with some larger ones (up to 10cm).

In addition to the drilling, HRG has also recently purchased satellite images covering the Labola permit from the consultant PhotoSat Information Ltd. based in Vancouver, Canada. These images have provided information on alteration, vegetation, structure and lithology. A LIDAR survey to help with artisanal workings identification has also been undertaken, but the results of this work are not yet available.

Thus, in summary, the works undertaken to date have defined a number of zones over the 11km length of the mineralised corridor (Figure 7.16).

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Figure 7.16: Principal Mineralised Zones at Labola

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7.3.4 Guibare

The Guibare prospect, approximately 15km southwest of the Bissa Hill main trend in the Zandkom II Permit, is currently the site of extensive orpailleur (artisanal small scale mining) activity including many small shafts and open workings, as well as a centralised processing facility.

Guibare geology comprises quartz-tourmaline veins in variably deformed mafic metavolcanics, bounded to the south by metasediments. The mineralisation may resemble the mineralisation at Bissa S Extension and at zones 51 and 52, but these areas lack the abundant tourmaline in quartz veins.

The Guibare/Karengatenga orpaillage sites were tested with 22 RC holes totalling 2,618m and all of the principal orpaillage targets were tested. Results from the west side of the pit showed no significant results from the 5 holes; however all four drill holes from the east side of the pit, intersected significant results.

Mineralised zone (zone 1) is interpreted to dip steeply, and therefore the interval grading 8.22g/t Au from 50-52m in hole 50 may represent a second mineralised zone (zone 2) ~60m north of zone 1, although this intersection may also suggest that the mineralised zone 1 is a flat vein.

It is, therefore, possible that a narrow high-grade resource could be defined along one (or potentially two) mineralised zone(s) over a minimum strike length of 200m and potential strike length of >500m.

7.3.5 Zinigma

In Zinigma Permit, and in particular the Zinigma orpaillage site where an 800 x 300m zone of disturbance was noted, trending approximately east-west. Individual pits are from 10 to 60m deep chasing generally narrow (<50cm) white quartz stringers.

The deformation zone which contains the mineralisation is hosted within felsic volcanics (schists) which are strongly weathered and show extensive kaolin, hematite and limonite in the altered zones. ZT61-1100/MM696 Final V6.0 Page 45 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

A recent (2010) RC drill programme (31 holes) has followed on from previous RAB and RC holes and has been able to define a low angle quartz-graphitic mineralised zone which does show continuity. Best results include 6m @2.19g/t, 12m @ 2.91g/t and 5m @ 5.39g/t Au.

7.3.6 Sakou

The Sakou orpaillage site comprises a series of east-west trending narrow (few centimetres) sub-vertical quartz veins hosted by mafic schists which have been exploited by local miners to a depth of >20m.

The site has been partially studies by soil geochemistry, RAB and RC drilling, with initial results good (35m @ 1.62g/t Au for example), but later infill disappointing indicating a complex structure.

However, the area shows numerous other gold showings, all of which are in need of follow- up.

7.3.7 Yimiougou

The Yimiougou orpaillage site within this permit encompasses some 300 x 50m in area and is located within the regional Yilatenga deformation zone.

This site has not been studied in detail by HRG, although previous works by Randgold had included 22 trenches and 9 core holes from which two narrow mineralised zones some 5- 10m wide, trending northeastwards and dipping to the southeast, had been discovered.

Individual quartz veins tend to be narrow, sulphide rich, and have produced some spectacular rock chip results such as 74g/t and 24g/t Au.

In addition, the Konkin orpaillage site was also visited which occupies an area of approximately 1000 x 10m, trending northeastwards. This appears to be one thin structure and therefore would appear to be of little interest.

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7.3.8 Mane

The Mane orpaillage site is composed of eight separate zones covering a large area, denoted M1 to M8. The sites tend to be concentrated along the contact of granite and metavolcanics with an approximate northwest-southeast trend. Dip of the vein material is not known, although from the pits on site, it is likely to be sub-vertical.

Rock chip sampling has produced some good sample results including an 11g/t Au value from the M5 zone.

7.3.9 Noungou

This polymetallic occurrence is an evidence of orpailleur activity was seen along with scattered copper oxide mineralisation at surface.

Surface rock chip data has provided some very high mineralised values including 15g/t Au and 1.66% Cu, although the true nature of the mineralisation has yet to be determined.

7.3.10 Tyegana

At the Tyegana orpaillage site, smoky quartz with tourmaline were seen within several sub- parallel structures, hosted by greenschists, trending east-west. The area of mineralisation appears to cover some 500 x 150m.

Mineralisation appears to be concentrated in the veins, but may also be present in the host rocks, probably as thin stringers.

Some trenching has been undertaken, although these have often not properly reached bedrock, except where more resistant quartz veins are present.

At the Nyoptenga orpaillage site which is some 500 x 25m in area, very thin (a few centimetres), sub-vertical quartz veins are seen, as well as wider (20cm) blue-grey quartz veins, probably representing one, east-west trending structure, dipping to the south. Sampling of the veins has produced values up to 11g/t Au.

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At the Soubeiga site, which extends for approximately 500 x 25m, two mineralised structures containing white quartz stringers have been identified, trending east-west and dipping to the north. Rock chip samples from vein material have given values up to 15g/t, whilst sampling of waste dumps has shown gold grades >1g/t, and thus there may be an opportunity for a metasomatic, low grade halo to the vein mineralisation.

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8 DEPOSIT TYPE

8.1 Introduction

Bissa Group Properties are underlain by geology considered to be similar to that of other Birimian-age volcano-sedimentary sequences. Hence, this region is considered prospective for orogenic gold deposits, which typically exhibit a strong relationship with regional arrays of major shear zones.

8.2 Bissa Group Property

The gold mineralisation is typically associated with regular networks of quartz veins containing subordinate amounts of carbonate, tourmaline, sulphides and native gold. In these deposits, the gold is typically free milling. Alternatively, the gold mineralisation can be also associated with disseminated sulphides in strongly deformed alteration zones. In the latter case, gold may be free milling but also refractory.

In Burkina Faso, the weathering is deep and typically results in extensive surface oxidation of bedrock to depths reaching more than 100m locally. In such areas, gold deposits typically comprise a surface oxide zone, an intermediate transition zone and a deeper fresh rock zone. Gold is typically free milling in the oxide zone.

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9 EXPLORATION

9.1 Bissa Gold Deposit

In June 2009 High River reported the results of a revised Mineral Resource evaluation completed by SRK Consulting (Canada) Inc. ("SRK"). The revised Mineral Resource estimate was prepared following the National Instrument 43-101 guidelines and incorporated new assay results from drilling and trenching performed by High River during 2007 and 2008. It was prepared to support conceptual mine design work currently being completed by engineering consultants GENIVAR ("GENIVAR") to evaluate the feasibility of an open pit mining and processing operation at Bissa. The revised Mineral Resource estimate by SRK was based on assay results derived from samples taken from 118 trenches (11,935m), 181 diamond drill holes (23,068m), and 462 reverse circulation drill holes (43,823m) completed over the period 2004 to 2008.

A total of 20,533m of RC drilling, 167m diamond drilling and 27,354m of RAB has been carried out at Bissa Gold Deposit during January and August of 2011.

9.2 Sampling Method and Approach

9.2.1 Trenching Samples

Trenches were excavated by hand or using a backhoe. Typically trenches reach depths varying between 1-4m. Potentially auriferous zones are determined visually by a geologist and sampled on 1m interval, or less depending on the lithology. All trench assay samples are collected underneath the lateritic cap by hand using chisels and a rock hammer. Channel samples are taken by chiselling a continuous grove approximately 0.15m above the toe of one wall of the trench. Sample size approximates HQ-diameter half-core. A rock saw is used to collect sample in very hard material like quartz on the floor of the trench. Assay samples are places in clean individual bags and average between three and four kilograms in size. Sample length varies between 0.3 and 1.6 metres, averaging approximately 1.03 metres.

Duplicate samples are also typically collected in trenches at regular intervals. Duplicate samples are collected by chipping an additional sample over the same length and width in order to duplicate original sample weight. ZT61-1100/MM696 Final V6.0 Page 50 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

9.2.2 Reverse Circulation Drilling Samples

Reverse circulation drill samples are collected directly from the drill rig cyclone at metre intervals in a white plastic knitted bag, and individually identified. Samples average approximately 30-40kgs in weight, increasing in weight with depth. Samples are collected for assaying directly on site. Each sample is weighed and a 2kg sample is split with a mechanical splitter. The subsample is marked and bagged on site. A duplicate sample is created at regular intervals from a second sample split using the same procedure and inserted in sequential order following the primary sample. Descriptive information on colour, alteration, oxidation state, lithology, structural features, etc, is recorded onsite. The sample rejects are replaced in the original bag, sealed and stored in a secure area at the project.

9.2.3 Core Drilling Samples

Core recovered from drilling is placed in clean wooden core boxes, where it is visually inspected for consistency and appropriately labelled and sealed for transfer to the core warehouse in Kongoussi or Tanlouka. Rock quality determinations, core recovery and core density are routinely measured after each drilling run directly at the drill site. Core recovery is measured as actual recovered core length against drill run length and recorded as a percentage. In general, core recoveries are very good in saprolite and fresh rock except near the surface in lateritic material. Density is measured on whole core using a volumetric method.

Upon delivery to the core warehouse, core boxes are opened and placed in sequential order for description by an appropriately qualified geologist. The description procedure involves collecting details information on colour, lithology, alteration, weathering, structure and mineralisation. Magnetic susceptibility is measured on core at regular intervals (usually 3m). Laterite and saprolitic soils are also characterised in terms of colour, composition cohesion, and moisture content. As part of the routine procedures specific gravity is measured at regular intervals on sun-dried core samples (0.05m in length) using a water immersion technique and paraffin coating.

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9.3 Other Permits & Exploration Summary

Preliminary results provided by HRG and not audited by WAI from the 2010 exploration programme are as follows:

 Group of Bissa-Kindo-Kaya permits. The main target Bouly is in the Bissa Gold exploitation permit which generated a number of positive intersections confirming continuity of low-grade gold-copper style mineralisation hosted by propylites after undeformed diorites;  Gougre in the Gargo permit has been tested by 5 DD holes for potential of deep levels. Only two holes are ready at the moment with relatively modest results. A final conclusion is awaited;  Banfora group of permits. The Labola property with an extensive vein suite has generated first assays with grades of 1-3g/t Au, per 1-4m intervals that provide a positive indication of the continuity of gold mineralisation. Mapping and soil sampling with ground IP gradient surveys at the Danfora and Labola permits will allow follow-up of this mineralisation; and  Ouaga group of permits. The Wayin property has revealed a very large north- south striking gold-copper anomaly in soils and in termite mounds with a total extent of more than 5km. Two RC profiles values between 0.5-1g/t Au, and with very impressive silver grades at the level 50-100g/t over approximately 100m. It seems that Wayin is a high volume/low grade silver- gold-copper porphyry target located in the outer portion of undeformed diorites subjected to propylitic alteration. The Mango property came up with a number of high grade intersections from quartz-tourmaline veins in diorites (e.g: RC-7 [email protected]/t Au, RC-8 [email protected]/t Au, RC-9 2m @22.65g/t Au). The Gandi property has revealed good intersections in trenches or in RC holes (best trench_29 gave [email protected]/t Au, RC-9 [email protected]/t Au) which mainly cross-cut two types of mineralisation: quartz veins and sulphide impregnation after altered aplite dykes.

Recently, HRG has met some problems with a shortage of drill rigs available in Burkina Faso, coupled with a long turnaround in the sample preparation and assaying.

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An exploration budget was estimated at US$24M of 2011, with the main part allocated to RC and DD drilling at the flagship properties of Nairy, Labola, Baola and Gougre.

For the Bissa deposit, a preliminary budget of US$5M has been allocated for infill, step out drilling, as well as for condemnation drilling in areas planed for infrastructure.

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10 DRILLING

10.1 Bissa Group Property

Bissa - Zandkom Feasibility Drilling - October-November 2009. In late September 2009, HRG initiated a field work campaign to gather enough data to complete a feasibility study on the Bissa – Zandkom orebody. This included some 15,900m RC drilling, 1,600m diamond drilling and 1,700m of trenching. New workings were emplaced either as infill (down to 20 or 40m) to upgrade data density/resource classification or to extend known mineralised zones.

The Bissa exploration database used in Resource Estimation comprises 167 trenches (~15,395m), 244 core boreholes (~33,310m) and 1178 reverse circulation boreholes (~105,868m), as shown in Table 10.1 below.

Table 10.1: Summary of Bissa Exploration Campaigns used in Resource Estimation Type Diamond Drilling Total Year 1998 2004 2005 2006 2007 2008 2009 2010 2011 Number 30 38 59 28 10 51 10 - 18 244 Min Length 42 26 61 76 107 57 135 - 150 654 Max Length 240 113 227 203 261 229 206 - 287 1766 Total Length 3372 2171 8840 4179 1650 7340 1734 - 4024 33310 Mean Length 112 57 150 149 165 144 173 - 224 1174 Type Reverse Circulation Year - 2004 2005 2006 2007 2008 2009 2010 2011 Number - 45 211 17 4 240 242 8 411 1178 Min Length - 20 50 58 87 10 24 97 15 361 Max Length - 102 162 132 138 137 130 120 198 1119 Total Length - 2614 23495 1859 468 20865 18248 893 37426 105868 Type Trenches Year - 2004 2005 2006 2007 2008 2009 2010 2011 Number - 40 33 4 3 41 38 1 7 167 Min Length - 20 20 100 180 52 25 150 51 598 Max Length - 60 224 135 240 216 131 150 109 1265 Total Length - 3661 2843 476 660 4662 2350 150 593 15395

10.2 Drilling Summary (January-August 2011)

HRG has ownership of many other exploration permits in Burkina Faso, data provided by HRG in September 2011 has summarised the activities during the first eight months of 2011 (Table 10.2). ZT61-1100/MM696 Final V6.0 Page 54 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

Table 10.2: Summary of Drilling Activities (January - August 2011) Group of Permits Permit Drilling (m) RC DD RAB Metres Holes Metres Holes Metres Holes Barsa Bissa (Liliga) 4,996 20 Bissa Sud 565 5 511 2 Gargo 579 5 4,649 26 Namtenga 1,809 15 0 Raka Tema Bissa-Kindo-Kaya Tosse Zandkom II, Sakou Zinigma Balbo Mane 1,558 39 2,870 69 Noungou 1,390 29 664 4 3,554 63 Yimiougou Ankouma Nayiri 11,683 90 Yeou Baola SudEst, Bouroum-Taparko Tanzaka Taranga Dyakolra Nongo-Fayere Gandi Mango Ouaga Wayin Tyegana Zibtenga Labola 22,042 198 994 7 Banfora Danfora Bissa Gold 20,533 203 167 1 27,354 570 Total 58,601 545 13,539 99 33,778 702

A budget for the second half of 2011 was estimated at around US$9M which comprise approximately 28,000m of core drilling and 43,000m of RC. This budget also includes airborne and ground geophysical surveys and interpretation as well as local groundworks.

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11 SAMPLE PREPARATION, ASSAYING, SECURITY

11.1 Sample Preparation & Analysis

High River staff uses industry best practices to collect, handle and assay trench and drilling samples from the Bissa Gold Project. Trenches and angled boreholes sample the Bissa gold mineralisation approximately normal to its strike and dip along sections spaced at between 20 and 80m.

Core assay samples were collected from half core sawn lengthwise or cut with a knife over intervals averaging 1m; sections of core were used to measure specific gravity at regular intervals using a volumetric method and a water immersion technique with wax coating.

11.2 Density and Specific Gravity Determinations

The determination of specific gravity is part of the comprehensive field procedures implemented by High River. Specific gravity is measured on representative core samples from each drill run. This ensures representative specific gravity data across all rock types irrespective of gold grade. Specific gravity is measured using two methods.

At the drill site, rock density is determined on wet whole core using a volumetric method based on measured length (0.1-0.6m), theoretical core diameter and weight. The length is determined as an average of three measurements. A total of 11,751 densities were recorded using the volumetric method which measures wet densities and does not provide a reliable estimate of the rock specific gravity; therefore these data were not considered for resource estimation.

After logging and sampling, a representative sun-dried core sample is selected from each drilling run. Each sample is individually marked and flagged in the drill log. Samples from each borehole are collated separately prior to testing. One of three reference quartz control sample (Qz2, Qz3 and Qz4) is inserted within each sample sequence on regular intervals to monitor scale calibration and instrumental drift. Quartz samples consist of plain quartz devoid of fractures and other gangue material.

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Specific gravity is measured at the core warehouse using a water immersion method. Each sample is weighed in air, then coated in wax and weighed in air and immersed and weighed in water. A total of 10,205 measurements were made on core samples (Table 11.1). After testing, each sample is carefully replaced at its original location in the core box. SRK examined core from several boreholes and no misplaced core was noticed. The water immersion method is considered by SRK to provide accurate estimates of variations in bulk specific gravity throughout the Bissa Gold Project.

Table 11.1: Bissa Gold Project Specific Gravity* Database Specific Gravity* Count Minimum Maximum Mean Laterite 213 1.46 3.12 2.37 Saprolite 6,013 0.77 3.46 2.3 Saprock 1,842 1.21 3.91 2.42 Fresh rock 2,137 1.01 3.66 2.74 Total 10,205 *Measured on core piece using a water displacement methodology and paraffin coating. Measurements aggregated for all auriferous zones. Anomalous values removed for calculation of mean.

The Abilab laboratories do not have recognised accreditation, but are part of the ALS Laboratory Group and implement quality assurance and quality control measures generally meeting international industry standards. Reverse circulation and core pulp samples were also submitted to ALS Chemex, Sudbury and SGS, Ouagadougou laboratories for check assaying. High River partly relied on the laboratory internal quality control measures, and also implemented strict external quality control measures consisting of inserting an appropriate frequency of control samples (blanks, field standards and certified reference standards).

11.3 Bouly QA/QC

Assay data for the Bouly project was acquired from the BIGS Global Laboratory in Ouagadougou in 2010. The SGS Laboratory in Ougadougou was used for external control. High River Gold Mines Ltd has a written procedure for collecting, handling, labelling and assaying drilling samples, which conforms to industry best practice.

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As shown in Table 11.2, High River internal quality control procedures specify use of field duplicates, blanks and certified reference standards to measure any bias in sampling or assaying.

Table 11.2: Frequency and Type of Control Samples Type Frequency Field duplicates 5% Blanks 3.3% Standard 2% External control 1%

WAI reviewed a single month’s QC data from the 2010 RC programme, and found that:

 Laboratory results for standards show no apparent drift, all being within one standard deviation of the certified values, see Figure 11.1. Where control standards failed, whole batches were reassayed;  There is a no contamination; only a single blank sample out of 150 had an assay value of 0.06ppm Au, all other blanks had assay values below 0.05ppm Au;  Assays of duplicates show some erratic results at low grades, see Figure 11.2, not reflected in the standards, and explained by the erratic behaviour of a few samples with coarse gold;  Assay results for the control samples sent to SGS show that the laboratory precision is excellent, see Figure 11.3; and  Where control samples have failed, batches have been reassayed.

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OxE74 0.68 0.66 0.64 0.62 Limit++

m 0.60 Limit+ p p

u 0.58 Au A 0.56 Limit- 0.54 Limit-- 0.52 0.50 1 2 3 4 5 6 7 8 9 10111213141516171819

Oxi54 2.10

2.00

1.90 Limit++

m Limit+ p p

1.80 ,

u Au A 1.70 Limit- Limit-- 1.60

1.50 1 2 3 4 5 6 7 8 9 10111213141516171819

OxK69 4.80

4.30

Limit++ 3.80 m Limit+ p p

u Au

A 3.30 Limit- Limit-- 2.80

2.30 1 2 3 4 5 6 7 8 9 10111213141516171819202122232425262728

Figure 11.1: Assay Results for Standard Control Samples

Repeatability of Duplicates 3.5

2.5 2

d 2 a u r A g

d m e p y p a 1.5 s s A

0.5

0 0 0.5 1 1.5 2 2.5 3 3.5 Assayed grade 1 ppm Au

Figure 11.2: Assay Results for Duplicate Control Samples

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0.7

0.6

0.5 e u l a 0.4 V

e t a c i

l 0.3 p e R 0.2

0.1

0 0 0.1 0.2 0.3 0.4 0.5 0.6

Sample Value

Figure 11.3: Assay Results for External Control Samples

WAI has not reviewed the analytical quality control measures taken in pre-2010 drilling programmes. However the 2010-11 RC and DDH programmes comprise the bulk of the database. WAI has only reviewed a sample of the analytical quality control data for the 2010-11 drilling programmes.

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12 DATA VERIFICATION

12.1 Introduction

Data verification information in the following sections is based on SRK technical reports, “Mineral Resource Evaluation, Bissa Gold Project, Burkina Faso, 18 June 2009.

12.2 Bissa

As part of their resource work, SRK conducted a series of routine verification procedures to ensure the reliability of the electronic data provided by High River Gold, and was of the opinion that the electronic data are reliable, appropriately documented and comprehensive.

In general, the performance of the control samples inserted with samples submitted for assaying is acceptable. Few potential failures identified in the dataset relate to sample mislabelling and these have been investigated by High River.

Ultimately, SRK was of the opinion that the analytical results delivered by Abilab are sufficiently reliable for the purpose of resource estimation.

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13 MINERAL PROCESSING AND METALLURGICAL TESTING

13.1 Introduction

The mineralisation of the various Bissa deposits is categorised into five different types, depending on the degree of weathering and oxidation. These are referred to as Laterite, Highly Weathered (HW), Moderately Weathered (MW), Slightly Weathered (SW) and Primary types.

13.2 Bissa Testworks (Genivar Raport, June 2010)

Genivar considered both Heap Leach and CIL process options in their PFS report which was based on treating 1.4Mtpa. The heap leach option has since been rejected.

13.3 Metallurgical Testing of Gougré Deposit Samples

13.3.1 Bissa Gold SA

13.3.1.1 Test Samples

A total of 10 samples of gold bearing mineralisation from the Gougré deposit were submitted to Bissa Gold SA in early 2011 for testing at their Taparko mine.

These samples represented material that had been extracted from exploration and infill drillholes between 2007 and 2010, details of which can be found below in Table 13.1.

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Table 13.1: Bissa Gold Metallurgical Samples Sample ID Head Grade Au (g/t) GGGC07-024 4.69 GGGC07-022 1.98 GGGC07-017 3.76 GGGC08-051 1.60 GGGC08-053 4.49 GGGC09-0056 12.66 GGGC10-0057 3.38 GGGC10-059 7.11 GGGC10-060 4.32 GGGC10-061 0.24 GGGC07-08 (Composite) 3.19 GGGC09-10 (Composite) 5.90

The location of each of the exploration drill holes relative to the deposit are shown below in Figure 13.1.

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Figure 13.1: Gougré Drill Hole Locations

In addition to the ten individual samples, two composites, one representing material extracted between 2007 and 2008 (GGGC07-08) and the other between 2009 and 2010 (GGGC09-10), were also prepared.

13.3.1.2 Bottle Roll Leach Testwork

Each of the 12 samples was subjected to a single accelerated bottle roll leach test in order to determine the amount of gold which could be extracted into solution by means of conventional cyanide leaching.

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The test procedure employed consisted of first grinding the samples, using a stainless steel laboratory ball mill, after which they were transferred into a 4L leach bottle. Taparko tap water was then added to achieve a pulp density of 42% solids and sufficient lime added to establish a pulp pH of approximately 10.5.

Sodium cyanide was then added to achieve a cyanide concentration of 40g/l following which the bottles were placed on a mechanical roller and turned for a total of 24 hours. Oxygen was also sparged through the pulp throughout the duration of the tests in order to maximise the dissolved oxygen content within the pulp.

Upon completion of the tests, a sample of the leach solution was extracted and submitted for chemical analysis in order to determine the gold content. The leach residues were then filtered, washed, dried and also submitted for chemical analysis in order to allow the total amount of gold extracted into solution to be balanced.

Samples of the leach solution were also titrated against silver nitrate in order to determine the amount of cyanide which had been consumed during the test.

Results of these leach tests are summarised below in Table 13.2.

The data showed that, after 24 hours of leaching, the total amount of gold recovered ranged from 85.0% to 97.3% with 10 of the 12 samples tested achieving gold recoveries in excess of 90%.

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Table 13.2: Bottle Roll Leach Test Results 80% Passing % Au extracted Reagent Consumption (Kg/t) Sample ID (µm) after 24 hours NaCN Lime GGGC07-024 80 96.80 1.19 1.33 GGGC07-022 80 93.00 1.34 1.42 GGGC07-017 90 91.97 1.29 1.30 GGGC08-051 100 90.26 1.13 1.44 GGGC08-053 110 88.53 1.25 1.43 GGGC07-08 (Composite) 94 92.06 1.53 1.43 GGGC09-0056 90 97.30 0.91 1.16 GGGC10-0057 80 93.70 1.79 1.49 GGGC10-059 90 95.10 1.39 1.15 GGGC10-060 100 91.50 1.43 1.44 GGGC10-061 50 85.00 1.15 1.21 GGGC09-10 (Composite) 82 95.20 1.29 1.29

However, as only a single gold recovery value was reported, it is not possible to determine whether the amount of gold that can be recovered can be increased by extending the leach residence time.

With respect to reagent consumption, the results showed that, on average, the samples consumed 1.31kg/t of sodium cyanide and 1.34kg/t of lime.

13.3.2 Wardell Armstrong International

13.3.2.1 Test Samples

A single sample of mineralisation from the Gougré deposit was submitted to Wardell Armstrong International (WAI) for metallurgical testing in September 2011.

The sample had been extracted from Drill Hole MT1 which had been drilled to a depth of 100m and was located next to exploration Trench 5.

Results of the chemical analysis performed on a representative sub-sample of material are shown below in Table 13.3.

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Table 13.3: WAI Metallurgical Sample Element Units Assay Au g/t 2.06 Ag g/t 0.30 Fe % 4.92 C % 0.75 S % 0.64

13.3.2.2 Kinetic Cyanide Leach Testwork

Kinetic cyanide leach tests were undertaken in order to explore the effect of variables such as grind size and cyanide concentration on leach performance.

Initially, a series of three tests were performed in order to identify the effect of grind size on

the amount of gold that could be recovered. Three 1kg samples of ore were ground to d 80’s of 150µm, 106µm and 75µm after which they were leached for 48 hours using a 1.0g/l cyanide solution which was maintained throughout the duration of the leach.

In addition to identifying the total amount of gold that could be recovered, samples of the leach solution were extracted at regular intervals throughout the tests and used to determine the rate at which the gold was leached into solution

Results of these tests are summarised below in Table 13.4.

Table 13.4: Grind Size Kinetic Cyanide Leach Results Grind Size % Au Extracted Reagent Consumption (Kg/t) (µm) 4 Hours 8 Hours 24 Hours 48 Hours NaCN Lime 150 61.1 69.1 75.2 80.3 0.68 0.21 106 88.7 93.3 94.4 94.5 0.84 0.13 75 58.1 73.8 92.3 93.6 0.75 0.22

The results indicated that whilst a reduction in grind size from 80% passing 150µm to 106µm resulted in a circa 15% increase in gold recovery to 94.5% after 48 hours, further reduction in the grind size to 80% passing 75µm resulted in no overall improvement in the total amount of gold recovered.

Furthermore, the data also suggested that, specifically for the two finest grind sizes, extending the length of the cyanide leaching was unlikely to provide any significant

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improvement in gold recovery given that there was very little increase in the amount of gold recovered between 24 and 48 hours.

In terms of reagents, all three tests showed low levels of consumption with, on average, 0.76kg/t of sodium cyanide and 0.19kg/t of lime consumed during the three tests.

Following completion of the kinetic cyanide leach tests to investigate the effect of grind size on leach response, a further test was undertaken in order to investigate the effect of cyanide solution strength.

This test, which was performed at the 75µm grind size, was conducted using the same methodology as that employed for the previous tests however; the strength of the sodium cyanide solution was reduced from 1.0g/l to 0.5g/l at which it was maintained.

Results of the test are shown below in Table 13.5. For comparison, results of the test performed using a 1.0g/l cyanide solution strength have also been reported.

Table 13.5: Cyanide Strength Kinetic Cyanide Leach Results NaCN Strength % Au Extracted Reagent Consumption (Kg/t) (g/l) 4 Hours 8 Hours 24 Hours 48 Hours NaCN Lime 1.0 58.1 73.8 92.3 93.6 0.75 0.22 0.5 68.4 87.6 92.9 93.7 0.83 0.30

The test results showed that the reduction in cyanide solution strength had no appreciable effect on the total amount of gold recovered with almost identical recoveries being achieved after both 24 and 48 hours.

Consequently it would appear that the lower strength cyanide solution can be used without the need to make alterations either to the grind size or leach residence time.

13.3.2.3 Diagnostic Leach Testwork

In addition to the kinetic cyanide leach tests, a sequential diagnostic leach was performed on a sample of the Gougré material in order to quantify the mineralogical distribution of gold within the ore.

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Initially, the amount of freely liberated gold was determined by performing a conventional

cyanide leach on material ground to a d80 of 106µm using a 1.0g/l sodium cyanide solution. Once completed, samples of both the leach solution and residue were taken and assayed for gold in order to enable the amount of gold leached into solution to be calculated.

The leach residue was then subjected to a cold acid leach using a 10% nitric acid solution after which it was again leached using a 1.0g/l cyanide solution. These results were then used to calculate the amount of gold associated with sulphide minerals.

Finally, the remaining leach residue material was roasted for 6 hours at 700 oC in order to decompose any carbonaceous material present within the sample. The sample was then leached for a third time using a cyanide solution in order to determine the amount of gold associated with carbonates.

Any gold remaining in the final residue after the three cyanide leaches was classified as encapsulated and therefore not recoverable by conventional leach processing techniques.

A summary of the results from the diagnostic leach test performed on the Gougré sample are shown below in Table 13.6.

Table 13.6: Diagnostic Leach Results Association Proportion total Gold (%) Free 94.5 In Sulphides 3.0 In Carbonates 0.3 Encapsulated 2.3

The results showed that the majority (94.5%) of the gold contained within the Gougré sample was free and as such, could be recovered by direct cyanide leaching. Of the remaining gold, 3.0% was associated with sulphide minerals with 2.3% encapsulated. Only 0.3% of the gold was associated with carbonaceous material.

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13.3.2.4 Carbon Adsorption Testwork

Following completion of the cyanide leach testwork, carbon adsorption testing was undertaken in order to determine the rate and equilibrium loading of gold and silver onto a sample of activated carbon.

The data was then used to calculate the amount of gold and silver that could be loaded onto the carbon at varying solution concentrations. A summary of these results are shown below in Table 13.7.

Table 13.7: Carbon Adsorption Results Equilibrium Carbon Gold Load (g/t) Equilibrium Carbon Silver Load (g/t) Equilibrium Solution Equilibrium Solution 1.0g/t 0.5g/t 0.2g/t 1.0g/t 0.5g/t 0.2g/t 1263 1820 2400 171 267 374

13.3.2.5 Bond Ball Mill Work Index Determination

A Bond Ball Mill Work Index determination was performed on a sample of the Gougré ore in order to provide an indication of the hardness of the ore with respect to grinding energy requirements.

Conducted according to a standard methodology at a closing size of 100µm the test showed the ore to have a work index value of 19.79 kWh/tonne which is classifiable as being hard to very hard.

13.4 Metallurgical Testing of Zinigma Deposit Samples

13.4.1 Introduction

Testing of material from the Zinigma deposit has, to date, been limited comprising exclusively of a small number of cyanide bottle roll tests.

These tests have shown that the material responds well to cyanide leaching with gold recoveries of up to 98.8% achieved after 24 hours. The tests were however, conducted using high cyanide levels and as such, further testing is required in order to verify that these

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recoveries can be maintained using lower cyanide levels, which will be more representative of commercial conditions.

As with the Gougré deposit, it is currently the intention of JLB that all material from the Zinigma deposit will be treated at the nearby Bissa processing plant, currently under construction, which is located approximately 50km by road to the south east.

Consequently, additional testing must also be performed in order to determine the overall suitability of the Bissa plant to treating material from the Zinigma deposit.

13.4.2 Testwork

A total of fifteen samples of gold bearing mineralisation from the Zinigma deposit were tested by Bissa Gold SA at their laboratory facilities at Taparko mine.

The samples represented three different mineralisation types consisting of:

 Saprolite – Metasediments;  Saprolite – Metavolcanics; and  Saprolite – Granodiorite.

Each of the fifteen samples was subjected to a single accelerated bottle roll leach test in order to determine the amount of gold which could be extracted into solution by means of conventional cyanide leaching.

The test procedure employed consisted of first grinding a 500g samples of material in a mill in order to achieve a particle size distribution of between 57% and 85% passing 75µm. The samples were transferred to a bottle and water added to achieve a pulp density of 45% solids.

Lime (50g/l) was then added in order to produce alkaline conditions within the pulp after which, sufficient sodium cyanide added to achieve a cyanide concentrate of 50g/l.

All tests were performed without the addition of carbon to the pulp to recover the gold.

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The bottles were then agitated for a period of 24 hours in order to maximise solution contact with the solids and promote leaching.

Samples of the leach solution were also titrated against silver nitrate in order to determine the amount of cyanide which had been consumed during the test.

Results of these leach tests are summarised in Table 13.8.

Table 13.8: Bottle Roll Leach Test Results Zinigma Au Deposit Back-Calculated Au Mineralisation % passing Residue Assay Sample ID Head Grade Recovery Type 75µm (ppm Au) (ppm Au) (%) 539401 73 2.24 96.2 0.086 539402 76 1.21 98.3 0.021 Saprolite 539403 77 2.46 98.0 0.048 Metasediments 539404 83 1.46 98.1 0.027 539405 73 3.15 97.4 0.083 539406 85 3.85 91.7 0.319 539407 80 4.36 89.6 0.453 Saprolite 539408 70 2.15 91.0 0.194 Metavolcanics 539409 69 3.21 95.4 0.147 539410 64 8.81 98.8 0.106 539411 65 2.20 86.8 0.290 539412 57 8.00 95.5 0.363 Saprolite 539413 68 9.39 97.1 0.270 Granodiorite 539414 71 1.81 85.0 0.272 539415 72 1.45 78.1 0.319

The results showed that after 24 hours of leaching, the total amount of gold recovered ranged from 78.1% for the Saprolite – Granodiorite, 539415 sample to 98.8% for the Saprolite – Metavolcanics, 539410 sample.

On average, the total amount of gold recovered across the fifteen samples was 93.1%. However, there was a clear variation in average gold recovery by mineralisation type.

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Results showed that the average gold recovered from the five Saprolite – Metasediment samples was 97.6%, reducing to 93.3% and 88.5% for the Saprolite – Metavolcanic and Saprolite – Granodiorite samples respectively.

Furthermore, the reporting of the results was such that only the total amount of gold recovered after 24 hours of leaching has been given. Consequently, it is not possible to determine whether either similar leach recoveries could be achieved from a shorter residence time or alternatively, higher gold recoveries from an increased residence time.

Overall, eleven of the fifteen samples achieved gold recoveries in excess of 90% and as such, it would appear that preg-robbing of the gold within solution is unlikely to be an issue when treating material from the Yargo deposit.

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14 MINERAL RESOURCE ESTIMATES

14.1 Introduction

14.2 Mineral Resource Estimation at Bissa Gold Deposit

Wardell Armstrong International (WAI) was commissioned by HRG to prepare a Mineral Resource estimate in accordance with the guidelines of the JORC Code (2004) for the Bissa Au deposit, Burkina Faso.

14.2.1 Topography

The topography used in this study is understood to be based on 3000 photos from a 2006 aerial survey and 14,000 points from a ground survey in 2008. Borehole collars subsequently surveyed were found generally to be within 30cm of the topographic surface constructed from the GPS survey. The survey comprises; the main Bissa area to the north east and separate the Boken area to the south west (Figure 14.1).

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Figure 14.1: Plan View of Topographic Survey of Bissa Area

14.2.2 Sample Database

Sample data are made up of diamond drillholes (~33,310m), reverse circulation drillholes (105,868m) and trenches (~15,395m). Drillhole sections are spaced between 20 and 40m apart.

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14.2.3 Mineralised Zone Interpretation

A cut-off grade of 0.3g/t Au has been chosen for subsequent interpretation and modelling work. The steps used in the mineralised zone interpretation and modelling are summarised below:

1) An additional 'mineralisation limit' wireframe model was also defined. This defined an approximate limit to mineralisation.

2) Existing cross-sections for the deposit were used to define directional strings down the centre of the principal mineralised structures. Two sets of strings were defined; along strike directional strings and across strike dip strings. Figure 14.2 below shows these directional control strings in isometric view for the Boken area. These strings were converted to vectors in the estimation process described below to define local dip and strike in order to control search ellipse orientation.

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Figure 14.2: Isometric view looking down towards the north east of Directional Control Strings at Boken area

3) The sample data were converted into 1m composites. The composites were then flagged if they were above the 0.3g/t Au cut-off level. A minimum of 1m above cut off was required for a composite to be included for modelling. A maximum of 1m internal waste was allowed for inclusion within multiple composites.

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4) Based on the flagged composites, and using the directional strings for controlling the dip and strike of the search ellipse, an indicator estimation was carried out using a 50m x 50m x 4m search ellipse (along strike x down dip x across strike) to estimate those areas inside the approximate mineralisation limit that are above cut-off grade for Au. A typical cross-section of the resultant interpretation is shown in Figure 14.3. The estimation, using nearest neighbour method, was carried out in to a block model rotated 50˚ to fit the general strike with block sizes of 1m x 10m x 5m (across strike x along strike x down dip). Blocks were flagged as being above or below cut-off and those below were deleted from the final model defining the mineralised zones.

Figure 14.3: Typical vertical cross section through Boken looking North East of indicated mineralisation model at 0.3 g/t Au cut-off. Legend refers to drillholes only.

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different weathering information and so in some cases a best fit was used for the editing of the wireframe surfaces. The surfaces provided separate the ore body into four units as shown in Figure 14.4. From surface they are; a zone of highly weathered laterite with a medium weathered saprolite, a slightly weathered saprock and unweathered fresh rock.

SW NE

Figure 14.4: South West to North East Sectional View through the Mineralised Zone Block Model Showing Weathering Surfaces

14.2.4 Geostatistics

The interpreted mineralised areas were split in to three zones based on similar trends in orientation of structure. The three zones are shown in Figure 14.5 below.

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Figure 14.5: Plan View of Three Major Mineralised Zones at Bissa

Samples were selected where they are located inside the interpreted mineralised zones. The sample data indicate approximately log-normal populations of Au grades within each of the mineralised zones with a small outlier population. As an example Figure 14.6, Figure 14.7 and Figure 14.8 show the normal histogram, log-histogram and log-probability plot for Zone 2. The standard statistics for each zone are shown in Table 14.1.

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Figure 14.6: Normal Histogram of Au in Zone 2

Figure 14.7: Log-Histogram for Au in Zone 2

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Figure 14.8: Log-probability plot for Au in Zone 2

Table 14.1: Standard Statistics for Raw Au by Zone Standard Log Zone No. Min Max Mean Variance Skewness CV Deviation Mean 1 11510 0.00 299.10 1.97 60.39 7.77 21.47 1.91 3.95 2 19583 0.00 87.30 1.39 9.11 3.02 8.69 1.46 2.17 3 7314 0.01 59.49 0.88 2.80 1.67 19.15 0.82 1.90

To identify the need for top cuts, the log probability plots and quantile distribution for each element were studied to identify the presence of any outlier values. Top cuts were applied to these outliers in order to reduce any undue influence during grade estimation. Values above the top cut value are reduced to that value. A value of 60g/t Au was selected for Zone 1, a value of 50g/t Au for Zone 2 and a value of 10g/t Au for Zone 3, the Boken area.

A 1.0 m composite sample length has been selected for all zones. Compositing gives a consistent level of support for geostatistical analysis.

Within each zone composites were coded by weathering state and populations were assessed independently for the variographic study. The laterites across all three zones were

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assessed independently. In Zone 1 the Saprock and Fresh rock populations were assessed together with the Saprolite independently. In Zone 2 and Zone 3 the Saprolite, Saprock and Fresh rock were assessed together.

Directional semi-variograms for the along strike, down dip and across strike directions were generated for Au in each of the zones and lithological groups using the composited samples. The nugget variances were modelled from average downhole variograms based on a 1.0m lag reflecting the downhole drillhole composite spacing. Figure 14.9 below is the variogram model for the Saprolite, Saprock and Fresh rock in Zone 2.

Figure 14.9: Variogram Models for Zone 2 Saprolite, Saprock and Fresh Rock combined

14.2.5 Block Model

The indicator block model was reset to a 5m x 10m x 5m parent block size whilst keeping the resolution defined during the indicator process. Density values were calculated from a density database by weathering type. Density values used were 2.19t/m 3 for Laterite, 2.03t/m3 for Saprolite, 2.31t/m3 for Saprock and 2.73t/m3 for Fresh rock (see Table 14.2).

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Table 14.2: Densities Number of Minimum Maximum Mean Weathering Zone Samples Laterite 267 1.14 2.95 2.18 Saprolite 7,087 1.07 3.31 2.03 Saprock 1,955 1.07 3.08 2.31 Fresh 2,902 1.57 3.69 2.73

14.2.6 Grade Estimation

Gold grades were estimated within the mineralised zones using ordinary Kriging as the main estimator. Alternative grades were also interpolated using inverse distance weighting and nearest neighbour estimations for validation purposes. The directional control settings defining the local variation in the strike and dip of the mineralised zone that were defined during the modelling process, were utilised during grade estimation. The dip and dip directions were used as vectors to interpolate dip directions and dip values into the block model. These orientations were subsequently used during grade estimation to orientate at the search ellipses independently for each block. This dynamic anisotropy procedure gives a more realistic reflection of the local variations in the strike and dip of the deposit. A summary of the Kriging plan is shown below in Table 14.3.

Table 14.3: Summary of Kriging Plan Group 1 Group 2 Group 3 Saprolite Saprolite Saprock Laterite Saprolite Laterite Saprock Laterite Saprock Fresh Fresh Fresh Search 1(along strike x down dip 53x53x53 21x13x10 38x14x9 46x46x46 42x29x42 50x50x50 80x61x38 x cross strike) Search 2 (along strike x down 80x80x80 30x20x15 57x21x14 69x69x69 63x45x63 75x75x75 120x90x57 dip x cross strike) Search 3 (along strike x down 150x150x150 63x39x30 114x42x27 138x138x138 126x87x126 150x150x150 240x180x114 dip x cross strike) Discretisation (x/y/z) 3/3/1 Min no. composites (search 4/4/1 1/2/3) Max no. composites (search 24/24/15 1/2/3) Max no. composites per hole 3/3/3 NB – 1) Each ore domain has been interpolated separately using only composites contained within that ore domain 2) Directional anisotropy has been used during interpolation to orientate at the search ellipses and reflect local variation in strike and dip

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14.2.7 Model Validation

A model validation process included the examination of block model versus composites, and the building up of a model grade profile, to compare average grades on vertical slices, as derived from the composites directly, as well as from interpolated model grades. An example Swath plot from this process is shown below in Figure 14.10.

Figure 14.10: Example Swath Plot; Group 2 Along Strike

14.2.8 Resource Classification

The resource classification for the Bissa deposit is in accordance with the guidelines of Australian Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves [JORC Code (2004)].

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Criteria for defining resource categories were also derived from the geostatistical studies. Key drillhole spacings for the allocation of resources by area can be summarised as follows:

 Measured resources - 20m x 20m (along strike and down dip) drillhole spacing within defined mineralised zones.  Indicated resources – 40m x 40m (along strike and down dip) drillhole spacing within defined mineralised zones.  Inferred resources – 80m x 80m (along strike and down dip) drillhole spacing within defined mineralised zones.

14.2.9 Resource Evaluation

The final block model was used as the basis for resource evaluation. Summary results of the evaluation of the in-situ resources are shown in Table 14.4 below, by rock type, for four different cut-off grade levels: 0.3g/t, 0.5g/t, 1.0g/t and 1.5g/t Au.

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Table 14.4: Bissa Mineral Resource Estimate – Total in-situ Resources OK – Whole Deposit – (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Ore Type Laterite/Saprolite/Transition/Fresh Cut Off Grade (g/t) 0.3 0.5 1.0 1.5 Tonnage (kt) 2,208 1,964 1,396 1,082 Au (g/t) 2.24 2.47 3.17 3.73 Measured kg 4,947 4,851 4,425 4,038 Metal oz 159,039 155,966 142,251 129,814 Tonnage (kt) 72,194 61,789 26,741 12,573 Au (g/t) 1.09 1.21 1.84 2.56 Indicated kg 78,691 74,765 49,203 32,187 Metal oz 2,529,989 2,403,742 1,581,923 1,034,838 Tonnage (kt) 74,402 63,753 28,137 13,656 Measured + Au (g/t) 1.12 1.25 1.91 2.65 Indicated kg 83,638 79,616 53,628 36,225 Metal oz 2,689,028 2,559,708 1,724,174 1,164,652

Tonnage (kt) 25,249 19,651 7,042 2,852 Au (g/t) 0.91 1.05 1.66 2.33 Inferred kg 22,977 20,634 11,689 6,645 Metal oz 738,714 663,393 375,807 213,639 Notes: 1. Mineral Resources are not reserves until they have demonstrated economic viability based on a Feasibility study or pre- feasibility study. 2. Mineral Resources are reported inclusive of any reserves. 3. The contained Au represents estimated contained metal in the ground and has not been adjusted for metallurgical recovery.

14.3 Other Mineral Resource Estimations at Adjacent Exploration Areas in Bissa

14.3.1 Introduction

In 2010, WAI revisited several of the exploration projects in the vicinity of Bissa with a view to preparing initial resource models in compliance with JORC Code (2004) guidelines.

This study resulted in resource models being prepared for Bouly, Gougre and Zinigma. Details of these are provided below.

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14.3.2 Bouly

The Bouly property is located in the Bissa Gold exploitation Permit to the southeast of Bissa Hill.

Preliminary works identified a circular soil anomaly approximately 4km2 in size (2.5km N-S x 2km E-W), with maximum soil sample results of 320g/t Au, two rock samples of 1.12 and 1.03g/t Au and two trenches with a maximum grade of 0.57g/t Au.

A diamond core hole drilled in 2004 intersected 2.50g/t Au over 30.6m and had an average grade of 0.94g/t Au over 126m (complete hole). Reverse air blast (RAB) drilling from 2004 and 2007 outlined a strong Au-Cu bedrock anomaly which continues under the alluvium into the Bissa permit to the southwest. The bedrock comprises massive non-foliated porphyritic mafic metavolcanics, brecciated by younger porphyritic intrusive dykes. Gold is associated with quartz-pyrite-chalcopyrite veinlets with potassic alteration along the vein walls.

A 60 hole programme of air core drilling during 2009/10, totalling some 5,000m, indicated 15-20m of cover, and a depth of weathering of around 50m. WAI derived a preliminary resource estimate from this data in July 2010.

Since the July 2010 estimation, additional data has been collected at Bouly:

 75 reverse circulation (RC) holes have been drilled;  15 new diamond drill holes (DDH) were drilled;  LIDAR airborne topographic survey has been flown; and  Collars of air core (AC) holes from the previous programme were resurveyed.

The additional drilling has increased the density of sampling in the main area of mineralisation so that an Indicated resource can be defined, and has extended the Inferred zone of Bouly mineralisation to the southwest.

14.3.2.1 Database Compilation

Drilling and trenching have both been carried out at Bouly. The sample data used during this resource estimate have been provided to WAI in Excel format and comprise: ZT61-1100/MM696 Final V6.0 Page 88 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

 Reverse Circulation drilling (RC);  Air Core drilling (AC); and  Diamond drilling (DDH).

The files contain individual worksheets for collars, drillhole surveys, assays, lithology and weathering that were imported into Datamine Studio 3 for the purpose of resource estimation. RAB drilling and trenching data which was provided to WAI in 2010 was included in the overall database.

Figure 14.11 shows the spatial distribution of sample type.

LIDAR airborne topographic survey data was provided in the form of a DTM file.

Holes were drilled on 80m sections in the central area of interest, increasing to 320m in the southwest. Hole spacing along the drill section profiles is 30 – 40m.

Figure 14.11: Spatial Distribution of Bouly Drilling by Type

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Air Core Holes (AC)

The database included 107 AC holes which were drilled to the north between 330° and 45° and sampled every metre. AC holes were drilled to depths of 50m to 90m. A total of 7,357 samples with Au assays are included in the database. The majority of the AC data is from holes drilled to the northeast of the main deposit and is excluded from this analysis; only 3,206 samples are located within the area of interest.

Reverse Circulation Holes (RC)

The database includes 77 RC holes which were drilled in 2010 and 2011 to the north orientated between 330° and 45° to depths of 100m to 150m. RC holes were sampled every metre. A total of 9,983 samples with Au assays are included in the database.

Diamond Drill Holes (DDH)

The database includes a total of 18 DDH. 15 DDH were drilled in 2010 to the north orientated between 330° and 45° to depths of 200m to 400m. A single DDH was drilled in 2004. Two DDH from 1996 are located several kilometres away from the Bouly deposit and are excluded from this analysis. Core was sampled according to lithology with a maximum sample interval of 1m. 4,672 samples with Au assays are included in the database.

RAB drilling

The database includes 231 RAB holes. Many RAB holes in the database have no corresponding date of drilling; the bulk of RAB holes were drilled in two campaigns in 2004 and 2007. RAB holes were drilled dipping at 45°, 50° and 55° orientated 330°N to depths between 18m and 105m. RAB drilling was sampled on various intervals ranging between 1- 3m. Over two thirds of the RAB drilling was done several kilometres from the area of interest, and only 1,158 samples with Au assays are included in this analysis.

14.3.2.2 Mineralised Zone Interpretation

A statistical analysis of the Bouly dataset was carried out to define a natural cut-off grade above which to define mineralisation. Log probability and log-histogram plots were ZT61-1100/MM696 Final V6.0 Page 90 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

generated for gold grades using the whole dataset. The log probability plots indicated an approximately log-normal population of gold grades. From the log-probability plot there appears to be a small break in population at a cut-off grade of approximately 0.3g/t Au.

Drill holes were examined in cross section and areas with gold grades above 0.3g/t were identified and digitised on each section. Drilling has intersected a mineralised zone which is 400m wide. Detailed drilling has proven this zone along 800m of strike, with a further 1km of strike covered by sparser drilling to the southwest. The mineralised zone appears to dip to the the southeast at around 30° and is up to 200m thick.

Several barren zones were identified within the mineralised zone. These are generally tabular and continuous from section to section, and parallel to the mineralised zone. Barren zones are 20 to 50m thick, and are locally complicated by folding or splitting. (See Figure 14.12)

The drillhole database contains information on weathering profiles. This was used to create DTMs of the individual weathering surfaces. The surfaces created separated the ore body into four units as shown in Figure 14.12.

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Figure 14.12: North West to South East Cross-Section through the Bouly Deposit showing the Mineralised Zone (red) and Barren Zones (black) Determined by 0.3g/t Au Cut-Off, and Weathering Horizons

Wireframes were generated from the digitised sections and a new block model created. The drillhole samples contained within the area modelled were selected for further data processing. The samples were coded according to location within digitised wireframes and by weathering as shown in Table 14.5.

Table 14.5: Weathering Coding Code Weathering 1 Unweathered Fresh Rock 2 Slightly Weathered Transitional Zone 3 Medium Weathered Saprock 4 Highly Weathered Saprolite 5 Completely Weathered Laterite

14.3.2.3 Database Compilation

Prior to inclusion of all the sample data into one sample file for use in the grade estimation, it was necessary to first ensure that there was no bias by one or more of the sample

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methods. The sample data was reviewed as a shown in Table 14.6. The sample sets are broken down by sample type.

Table 14.6: Statistics for Samples Number Sample Field of Min Max Range Mean Variance StdDev Skewness Kurtosis Type samples AC Au_PPM 7357 0.005 27.8 27.795 0.46 0.441 0.66 17.07 563.12 DDH Au_PPM 4664 0.005 16.68 16.675 0.45 0.446 0.67 12.06 220.70 RAB Au_PPM 3369 0.005 46 45.995 0.22 0.746 0.86 44.86 2,343.90 RC Au_PPM 9972 0.005 169 168.995 0.32 3.085 1.76 89.41 8,536.37 TR Au_PPM 866 0.01 2.32 2.31 0.15 0.036 0.19 5.09 37.04

The statistical analysis shows that all sample types display similar population trends. The RC data shows a low mean grade and a high variance compared with the diamond drillhole data. 63% of RC drilling data comes from the widely spaced fences in the southwest of the property. There is no diamond drilling in this area. The area is characterised by small high- grade zones and locally variable grades. If data from this area are excluded, the RC data has a similar mean and variance to the diamond drilling data (mean of 0.40g/t Au and variance of 0.194.)

It is therefore the opinion of WAI that no individual or combined set of sample types exert undue bias. For the purpose of geostatistical evaluation and grade estimation the complete set of sample types can be applied.

14.3.2.4 Sample Data Processing

Statistical Analysis

Statistical analysis has been carried out on samples within the modelled area to identify any potential bias that may be present within the data (Table 14.7).

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Table 14.7: Statistics for Samples Falling within the Modelled Orebody by Type Std Type Field n Min Max Range Mean Variance Skewness Kurtosis Dev AC Au_ppm 2303 0.005 21.8 21.80 0.77 0.53 0.73 12.53 312.07 DDH Au_ppm 2922 0.005 16.68 16.68 0.61 0.62 0.79 11.16 173.19 RAB Au_ppm 617 0.02 9.79 9.77 0.53 0.36 0.60 8.81 112.51 RC Au_ppm 4250 0.005 169 169.00 0.56 7.12 2.67 59.63 3,742.37

If sample populations display a positive skew due to the presence of high grade outlier values then top-cutting maybe necessary to remove the high grades. Outlying high grade values can exert significant bias on grade estimation, as they may contain a high proportion of the database’s contained metals.

Table 14.8 also shows sample statistics within the modelled orebody, but by weathering type.

Table 14.8: Statistics for Samples Falling within the Modelled Orebody by Weathering Std `` Field No Min Max Range Mean Variance Skewness Kurtosis Dev 1 Au_ppm 1,590 0.005 11.1 11.10 0.54 0.21 0.46 9.70 185.26 2 Au_ppm 1,532 0.005 4.54 4.54 0.50 0.13 0.37 3.49 23.99 3 Au_ppm 2,709 0.005 30.7 30.70 0.62 0.87 0.93 16.58 442.67 4 Au_ppm 4,064 0.005 21.8 21.80 0.66 0.55 0.74 12.12 257.06 5 Au_ppm 197 0.005 169 169.00 1.30 143.60 11.98 13.91 191.67

Decile Analysis

WAI performed a decile analysis on samples falling within the modelled orebody to ascertain any need for top-cutting. It was determined that top-cutting would be necessary to reduce the influence of values outside the general population for the mineralised zone. Top-cuts were determined using the log-probability plots combined with quantile analysis.

The effects of top-cutting are shown in Table 14.9 below.

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Table 14.9: Effect of Top-Cutting on Bouly Dataset o o Top-cut N of Mean grade before Mean grade Weathering N of Field value samples top cut after top cut Code samples g/t Au affected g/t Au g/t Au 1 Au_ppm 1590 5.22 1 0.54 0.53 2 Au_ppm 1532 2.98 2 0.50 0.50 3 Au_ppm 2709 11.2 2 0.62 0.62 4 Au_ppm 4064 10.2 3 0.66 0.65 5 Au_ppm 197 2.73 1 1.30 0.46 1 Ag_ppm 1143 17.5 4 1.17 1.13 2 Ag_ppm 1198 7.25 2 0.93 0.83 3 Ag_ppm 1635 9.38 2 0.90 0.88 4 Ag_ppm 1739 13.8 7 1.04 0.96 5 Ag_ppm 75 8.85 2 1.65 1.53

Missing Assays

The assay database contained absent values. Only about 60% of samples were assayed for Ag, Cu and Ni in addition to Au. For samples with no Ag assay, the Ag values have been recorded as absent values in the database.

96 sample intervals in the database within the modelled area have no recorded value for Au, although the intervals have lithologies logged and some have sample numbers recorded. For the purposes of this analysis, it has been assumed that these represent unmineralised intervals, and the Au value has been set to nil.

There are 19 intervals with absent Au values which represent missing intervals due to core loss. The majority are from depths of less than 5m. Since much of the overburden does contain gold, these intervals cannot be assumed to be unmineralised, and therefore these have been left as absent values in the database.

Compositing

Ideally all samples should be a similar sample length to provide equal support. Compositing of the samples is necessary to provide an equal level of support for all samples and is important for the geostatistics and subsequent resource estimation. Compositing of samples of different length can bias the geostatistics and resource estimation. For the purpose of the estimation, a 1m composite length was applied. The 1m composite length was a compromise selected to reduce the impact on samples by minimising the number of ZT61-1100/MM696 Final V6.0 Page 95 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

samples that would be split and the number of samples that would be combined. Statistical analysis has been carried out to ascertain the impact of the compositing exercise, see Table 14.10.

Table 14.10: Statistical Analysis Showing Effect of Sample Compositing on Au Weathering No of Std Min Max Mean Variance Skewness Kurtosis code samples Dev Database 1,592 0 5.22 0.53 0.16 0.39 4.43 36.11 1 Composite 1,532 0 5.22 0.53 0.14 0.38 3.94 29.5 to 1m Database 1,553 0 2.98 0.49 0.12 0.35 2.59 11.84 2 Composite 1,546 0 2.98 0.49 0.12 0.35 2.64 12.35 to 1m Database 2,731 0 11.2 0.61 0.53 0.73 7.76 88.2 3 Composite 2,966 0 11.2 0.61 0.56 0.75 7.54 79.87 to 1m Database 4,076 0 10.2 0.65 0.4 0.64 6.66 73.7 4 Composite 4,812 0 10.2 0.63 0.34 0.58 6.19 69.5 to 1m Database 197 0.005 2.73 0.46 0.15 0.39 3.05 12.8 5 Composite 238 0.005 2.73 0.45 0.14 0.37 3 12.59 to 1m

Data Processing Summary

The statistical analysis of the Bouly sample database is summarised below:

 AC, RAB and DDH have been included in the resource estimate;  Top-cutting was applied;  Absent values were converted to nil values as appropriate; and  A 1m composite interval has been applied to standardise sample length.

14.3.2.5 Variography

WAI undertook variography analysis to review the estimation and search parameters. Variography was carried out based on 1m composite intervals; variogram analysis was performed using Datamine Studio v3 software.

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14.3.2.6 Block Modelling

The model comprises a parent cell size of 40m x 20m x 5m with sub-cell splitting to a minimum block size of 20m x 5m x 5m where additional cell resolution is required. The model is rotated by -30° around the z axis so that the long axis of the model is aligned with the deposit strike.

14.3.2.7 Density

Specific gravity was measured on 1,187 core specimens during 2010 representing all rock types in the Bouly mineralised zone. For this resource estimate, average specific gravity values were calculated for each weathering horizon, and a statistical evaluation was made (Table 14.11 below.) For material logged as “completely weathered” (weathering code 5) only one measurement was made. Therefore the average specific gravity of the “heavily weathered” (weathering code 4) material was used.

Table 14.11: Specific Gravity Measurements Weathering Number of Minimum Maximum Mean Standard Deviation Zone Samples 1 491 1.34 3.02 2.668 0.151 2 260 1.91 3.05 2.617 0.174 3 303 1.67 2.98 2.429 0.212 4 and 5 132 1.06 2.52 2.160 0.188

With little in the way of inherent rock porosity, the specific gravity data may be directly translated into bulk density estimates.

14.3.2.8 Grade Estimation

Grade estimation was carried out using Ordinary Kriging (OK) as the principal interpolation method. Inverse Power of Distance Cubed (IPD) and Nearest Neighbour (NN) methods were also used for comparative purposes.

Grade Estimation Plan

The estimation process was run in three passes according to three search radii, each one progressively larger than the last. The three search radii and the sample constraints are ZT61-1100/MM696 Final V6.0 Page 97 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

shown in Table 14.12. For these three passes, the estimation was constrained to search for composites from three separate octants, with a maximum of four composites in any one octant as shown in Table 14.12. A fourth and final pass was run without octant constraints.

Table 14.12: Summary of Kriging Plan Weathering Zone 1 2 3 4 5 42.5m x 40m x 100m x 25m x 60m x 5m Search 1 (along strike x down dip x cross strike) 5m x 5m x 12m x 40m 8mx 10m x 20m 31m 20m Search 2 (axis multiplying factor) x2.5 x4 x10 x4 x4 Search 3 (axis multiplying factor) x8 x20 x32 x20 x14 Discretisation (x/y/z) 2/2/2 Min no. composites (search 1/2/3) 8/5/3 Max no. composites (search 1/2/3) 15/15/15 Minimum Octants to be filled 3 Minimum Composites per Octant 1 Maximum Composites per Octant 4 Max no. Composites per Hole 2 NB – 1) Each zone has been interpolated separately using only composites contained within that zone. 2) A fourth search was run with the same axis multiplying factor as Search 3, but with no minimum octants to be filled.

14.3.2.9 Validation

A statistical and visual assessment of the block models was undertaken to assess the robustness of the grade estimations within each weathering horizon and to ensure that the grade estimates and search radii were acceptable. The model validation methods carried out included a visual assessment of grade, global statistical grade validation and SWATH plot (model grade profile) analysis. The SWATH plot analysis considers a swath or strip through the model and is described below.

Visual Assessment of Grade Estimation

A visual comparison of composite sample grade and block grade was conducted in plan view and cross section. Visually the model was generally considered to spatially reflect the composite grades.

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Global Statistical Grade Analysis

The global mean Au grades for the block models generated by each estimation method were compared with the mean Au grade for the drillhole database, as shown in Table 14.13.

Table 14.13: Statistical Analysis Showing Effect of Estimation Method on Au_ppm Mean Au_ppm Weathering Composited drillhole Ordinary Nearest Inverse Distance Zone database Kriging Neighbour Cubed 1 0.53 0.51 0.51 0.51 2 0.49 0.50 0.49 0.50 3 0.61 0.52 0.54 0.52 4 0.63 0.49 0.49 0.49 5 0.45 0.49 0.44 0.43

SWATH Analysis

SWATH plots have been generated from the model by averaging both the composites and blocks along northings and eastings. The dimensions of each panel are controlled by the dimensions of the block size. Each estimated grade should exhibit a close relationship to the composite data upon which the estimation is based.

Validation Summary

Globally no indications of significant over or under estimation are apparent in the models nor were any obvious interpolation issues identified. From the perspective of conformance of the average model grade to the input data, WAI considers the models to be a satisfactory representation of the drill hole sample data used and an indication that the grade interpolation has performed as expected.

14.3.2.10 Resource Classification

The resources of the Bouly mineralised zone are classified in accordance with the guidelines of the Australian Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves [JORC Code (2004)]. Criteria for defining resource categories were also derived from geostatistical studies.

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Based on the above WAI has assigned Mineral Resource classifications of Indicated and Inferred in accordance with the guidelines of the JORC Code (2004).

 Indicated resources were based on a sample spacing of less than 80m x 35m along and across strike and with a minimum of 8 samples required from a minimum of 2 drillholes.  Inferred resources were those resources which were estimated but did not fulfil the criteria for Indicated classification.

14.3.2.11 Resource Estimate

The grades in the final resource block model were derived from drill hole sample composites based on Ordinary Kriging for Au.

Table 14.14 shows the WAI resource estimate for Bouly, dated 01 January 2012.

Table 14.14: Bouly Mineral Resource Estimate (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Applied Cut Off Grade 0.6 Tonnage (kt) 0 Au (g/t) - Measured kg 0 Metal oz 0 Tonnage (kt) 9,037 Au (g/t) 0.84 Indicated kg 7,625 Metal oz 245,139 Tonnage (kt) 9,037 Measured + Au (g/t) 0.84 Indicated kg 7,625 Metal oz 245,139

Tonnage (kt) 32,150 Au (g/t) 0.75 Inferred kg 24,127 Metal oz 775,673 Notes: 1. Mineral Resources are not reserves until they have demonstrated economic viability based on a Feasibility study or pre-feasibility study. 2. Mineral Resources are reported inclusive of any reserves. 3. The contained Au represents estimated contained metal in the ground and has not been adjusted for metallurgical recovery.

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14.3.2.12 2010 and 2012 Resource Comparison

A comparison of the previous 2010 estimate and the 2012 estimate detailed in this report is shown in Table 14.15. The increased drilling density has allowed the previously drilled mineralised zone to be reclassified from Inferred to Indicated. A newly defined mineralised zone to the southwest has been classified as Inferred.

Table 14.15: Bouly Mineral Resource Estimate – Comparison with Prior Estimate Previous Estimate Current Estimate Cut Off Grade 0.6 0.6 Tonnage (kt) - 9,037 Au (g/t) - 0.84 Indicated kg - 7,625 Metal oz - 245,139 Tonnage (kt) 9,607 32,150 Au (g/t) 0.82 0.75 Inferred kg 7,877 24,127 Metal oz 253,261 775,673 Notes: 1. Mineral Resources are not reserves until they have demonstrated economic viability based on a Feasibility study or pre-feasibility study. 2. Mineral Resources are reported inclusive of any reserves. 3. The contained Au represents estimated contained metal in the ground and has not been adjusted for metallurgical recovery.

14.3.2.13 Grade-Tonnage Analysis

A grade-tonnage curve for all Indicated resources is shown in Figure 14.13. The curve shows that the Indicated resource is particularly sensitive to cut-off grade between 0.3 and 0.8g/t Au.

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AU_OK v Tonnes for Indicated Resource 20,000 4.5

18,000 4

16,000 3.5

14,000 3 f f o

12,000 - 0 t 0 u c 0 2.5

1 e x v

10,000 o e b n a

n 2 e o d T

8,000 a r G 1.5 6,000

1 4,000

2,000 0.5

- 0 0.5 1.0 1.5 2.0 2.5 3.7 Cutt-off Grade g/t

Figure 14.13: Plot of Tonnes v Grade for Indicated Resource

14.3.3 Gougre

14.3.3.1 Resource Estimation

Wardell Armstrong International (WAI) was commissioned by HRG to prepare a Mineral Resource estimate in accordance with the guidelines of the JORC Code (2004) for the Gougre Au deposit, Burkina Faso. The work completed during this project can be summarised as:

14.3.3.2 Topography

Topography has been provided by HRG as wireframes in AutoCAD format generated from a LIDAR survey. The file was imported to Datamine Studio 3® with no edits. A plan view of the topography digital terrain model (DTM) for Gougre is shown in Figure 14.14 split in to 2m contours with borehole collar locations overlain for reference. A check was carried out of borehole collar elevations against the topography DTM. The collar elevations were found to match the topography and no corrections were applied. The topography is generally flat lying with a low hill near the northern end of the deposit and a ridge to the east running roughly north to south.

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Figure 14.14: Plan View of Topographic Survey of Gougre Area with Collar Locations in Black

14.3.3.3 Sample Database

A total of 17,682m of diamond drilling and 515m of trenching has been carried out at Gougre. In addition 342 RAB holes with a total depth of 13,737m and an average depth of 40m are included in the database but most of these are located off the axis of the ore body and as such were discounted from the following work. Drilling at Gougre is generally orientated at approximately 226° at the south east end of the deposit and at 177° at the North West end of the deposit. These directions are roughly across the strike of the deposit to pick up the mineralised zones. A summary of the different drilling campaigns is shown in Table 14.16.

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Table 14.16: Summary of Gougre Exploration Campaigns Type Diamond Drilling Trenches Year 2004 2007 2008 2009 2010 2011 2004 2007 Number 1 48 6 3 5 53 3 3 Min Length 72 34 58 69.5 254 30 20 35 Max Length 72 235 172 262 492 477 20 245 Total Length 72 5227 582 584 2042 9176 60 455 Mean Length 72 109 97 195 408 173 20 152

14.3.3.4 Mineralised Zone Interpretation

A cut-off grade of 0.5g/t Au has been chosen for subsequent interpretation and modelling work. This is considered to be an appropriate grade level in terms of what might also qualify as ore for heap leach purposes. The steps used in the mineralised zone interpretation and modelling are summarised below:

1) An additional 'mineralisation limit' wireframe model was also defined. This defined an approximate limit to mineralisation.

2) Existing cross-sections for the deposit were used to define directional strings down the centre of the principal mineralised structures. Two sets of strings were defined; along strike directional strings and across strike dip strings. Figure 14.15 below shows these directional control strings in isometric view. These strings were converted to vectors in the estimation process described below to define local dip and strike in order to control search ellipse orientation.

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Figure 14.15 : Isometric view looking north of topography DTM and Directional Control Strings

3) The sample data was converted into 2m composites. The composites were then flagged if they were above the 0.5g/t Au cut-off level. A minimum of 2m above cut off was required for a composite to be included for modelling. A maximum of 2m internal waste was allowed for inclusion within multiple composites.

Based on the flagged composites, and using the directional strings for controlling the dip and strike of the search ellipse, an indicator estimation was carried out using a 80m x 50m x 2m search ellipse (along strike x down dip x across strike) to estimate those areas inside the approximate mineralisation limit that are above cut-off grade for Au. A restriction was put in place to the south and west to ensure a limit at the confining fault structure. A typical cross-section of the resultant interpretation is shown in Figure 14.16. The estimation, using nearest neighbour method, was carried out in to a block model rotated 318˚ to fit the general strike with block sizes of 1m x 10m x 5m (across strike x along strike x down dip). Blocks were flagged as being above or below cut-off and those below were deleted from the final model defining the mineralised zones.

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Figure 14.16: Typical vertical cross section of indicated mineralisation model at 0.5g/t Au cut-off. Legend refers to drill holes only.

Surfaces representing weathering layers across the deposit were supplied by High River Gold for the 2010 mineral resource estimate. These surfaces were modified in line with the logging data from the 2011 holes. In some areas adjacent holes were logged with very different weathering information and so in some cases a best fit was used for the editing of the wireframe surfaces. The surfaces provided separate the ore body into four units as shown in Figure 14.17. From surface they are; a zone of highly weathered saprolite with occasional completely weathered laterite samples, a medium weathered saprock, a slightly weathered transition zone and unweathered fresh rock.

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Figure 14.17: South West to North East Sectional View through Mineralised Zone Block Model Showing Weathering Surfaces

14.3.3.5 Geostatistics

All diamond drillhole and trench samples in the supplied database were selected for further data processing. The samples were coded by oxidation state; laterite/saprolite, saprock, transition or fresh rock and whether the samples were located inside or outside the mineralised zone block model defined as described above. Statistical analysis has been carried out on the samples to identify any potential bias that may be present within the data. This analysis has been carried out by:

 Globally  Sampling campaign (by year); and  Sampling method (diamond drillholes vs. trench samples);

The normal histogram, log-histogram and log-probability plot showing Au grade of those samples defined as being within the mineralised zone block model are shown in Figure 14.18, Figure 14.19 and Figure 14.20 and standard statistics are shown Table 14.17. Inside ZT61-1100/MM696 Final V6.0 Page 107 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

the mineralised zone the raw Au samples shown a roughly log normal distribution with a positive skew.

Figure 14.18: Normal Histogram of Au in Mineralised Zone

Figure 14.19: Log-Histogram of Au assays within mineralised zones

Figure 14.20: Log Probability Plot of Au in Mineralised Zone

Samples are coded by weathering zone and the population spreads exhibited by all weathering states generally show a similar population through the middling grades but because of differences in variance and mean grade the weathering zone would be used as a keyfield for assigning both density and for sample selection during estimation as laid out below. The standard statistics for Au assays by weathering code are shown in Table 14.17. ZT61-1100/MM696 Final V6.0 Page 108 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

Table 14.17: Standard Statistics for Raw Au by Weathering Zone Standard Log Rock Type No. Min Max Mean Variance Skewness CV Deviation Mean Saprolite 48 0.01 3.71 0.68 0.63 0.79 2.31 0.85 1.16 Saprock 76 0.02 5.40 1.07 1.73 1.32 2.04 1.19 1.24 Transition 230 0.01 12.80 1.82 7.14 2.67 2.16 2.32 1.46 Fresh 1671 0.01 25.10 1.86 6.44 2.54 3.06 2.35 1.37

To identify the need for top cuts, the log probability plots and quantile distribution for each element were studied to identify the presence of any outlier values. Top cutting was not carried out as the analysis indicated a single population spread without any significant outlier values. A 1.0m composite sample length has been selected, representing the most common sample length within the mineralised zone, to give a consistent level of support for analysis.

Directional semi-variograms for the along strike, down dip and across strike directions were generated for Au in the Fresh rock and the Transition Zone using drillhole and trench 1.0m composited data. The nugget variances were modelled from average downhole variograms based on a 1.0m lag reflecting the downhole drillhole composite spacing.

The calculation of robust directional experimental variograms for the transitional zone was not possible due to insufficient sample pairs but an interpretable omnidirectional experimental variogram was calculated. The directional variograms for the fresh rock were orientated on axis after rotation of 107˚ around the Z axis and 10˚ around the Y axis. The fitted model variograms are illustrated in Figure 14.21 for the Transition zone and in Figure 14.22 for the Fresh rock.

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Figure 14.21: Variogram Model for Gougre Transitional Zone

Figure 14.22: Variogram Models for Gougre Fresh Rock

14.3.3.6 Block Model

A volumetric block model was set up with a 1m x 10m x 5m block size. The model is rotated 318˚ around the Z axis. Density values were calculated from a density database by weathering type. Density values used were 2.34t/m3 for Saprolite, 2.55t/m3 for Saprock, 2.75t/m3 for Transition zone and 2.78t/m3 for Fresh rock.

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14.3.3.7 Grade Estimation

Gold grades were estimated within the mineralised zones using ordinary Kriging as the main estimator for the transitional and fresh rock. Alternative grades were also interpolated using inverse distance weighting and nearest neighbour estimations for validation purposes. The directional control settings defining the local variation in the strike and dip of the mineralised zone that were defined during the modelling process were utilised during grade estimation. The dip and dip directions were used as vectors to interpolate dip directions and dip values into the block model. These orientations were subsequently used during grade estimation to orient the search ellipses independently for each block. This dynamic anisotropy procedure gives a more realistic reflection of the local variations in the strike and dip of the deposit. A summary of the kriging plan is shown in Table 14.18.

Table 14.18: Summary of Kriging Plan Saprolite/Saprock Transition Fresh Search 1(along strike x down dip x 33m x 33m x 33m 22m x22m x 22m 54 x 26 x 7m cross strike) Search 2 (along strike x down dip x 50m x 50m x 50m 33m x 33m x 33m 81m x 39m x 10m cross strike) Search 3 (along strike x down dip x 66m x 66m x 66m 66m x 66m x 66m 100m x 100m x 100m cross strike) Discretisation (x/y/z) 2/2/1 2/2/1 2/2/1 Min no. composites (search 1/2/3) 6/6/1 6/6/1 6/6/1 Max no. composites (search 1/2/3) 24/24/15 24/24/15 24/24/15 Minimum Octants Filled 4/4/1 4/4/1 4/4/1 Minimum Composites to fill an 1/1/1 1/1/1 1/1/1 octant Maximum Composites Per Octant 3/3/3 3/3/3 3/3/3 Max no. composites per hole 3/3/3 3/3/3 3/3/3 NB – 1) The ore domain has been interpolated using only composites contained within that ore domain 2) Directional anisotropy has been used during interpolation to orient the search ellipses and reflect local variation in strike and dip

14.3.3.8 Model Validation

A model validation process included the examination of block model versus composites, and the building up of a model grade profile, to compare average grades on vertical slices, as derived from the composites directly, as well as from interpolated model grades. An example of the Swath analysis is shown in Figure 14.23 along strike in the Fresh rock and in

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Figure 14.24 for the along strike direction in the transitional rock (where only blocks estimated in the first two estimation passes are used for the calculation). These plots are constructed on 40m profiles and the coordinate values refer to the rotated block model coordinate system.

Figure 14.23: Example Swath Plot along strike in the Fresh Rock

Figure 14.24: Example Swath Plot along strike in the Transitional (first 2 search passes only)

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14.3.3.9 Resource Classification

The resources of the Gougre deposit are classified in accordance with the guidelines of the Australian Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves [JORC Code (2004)].

Criteria for defining resource categories were also derived from the geostatistical studies. Key drillhole spacings for the allocation of resources by area can be summarised as follows:

 Measured resources - No measured resources were assigned at Gougre.  Indicated resources – 40m x 40m (along strike and down dip) drillhole spacing within defined mineralised zones.  Inferred resources – 80m x 80m (along strike and down dip) drillhole spacing within defined mineralised zones.

14.3.3.10 Resource Evaluation

The final block model was used as the basis for resource evaluation. Summary results of the evaluation of the in-situ resources are shown in the table below, for four different cut-off grade levels: 0.5g/t, 1.0g/t, 1.5g/t and 2.0g/t Au.

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Table 14.19: Gougre Mineral Resource Estimate – Total in-situ Resources (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Cut Off Grade 0.5 1.0 1.5 2.0 Tonnage (kt) - - - - Au (g/t) - - - - Measured kg - - - - Metal oz - - - - Tonnage (kt) 3,044 2,468 1,669 1,080 Au (g/t) 1.90 2.16 2.60 3.07 Indicated kg 5,785 5,335 4,338 3,314 Metal oz 185,997 171,509 139,473 106,554 Tonnage (kt) 3,044 2,468 1,669 1,080 Measured + Au (g/t) 1.90 2.16 2.60 3.07 Indicated kg 5,785 5,335 4,338 3,314 Metal oz 185,997 171,509 139,473 106,554

Tonnage (kt) 3,121 1,862 947 528 Au (g/t) Inferred 1.39 1.83 2.41 2.96 kg 4,352 3,410 2,282 1,566 Metal oz 139,922 109,644 73,367 50,360 Notes: 1. Mineral Resources are not reserves until they have demonstrated economic viability based on a Feasibility study or pre- feasibility study. 2. Mineral Resources are reported inclusive of any reserves. 3. The contained Au represents estimated contained metal in the ground and has not been adjusted for metallurgical recovery.

14.3.4 Liliga

14.3.4.1 Topography

The topographic DTM used in this study was constructed from LIDAR data supplied by HRG. Figure 14.25 below is a plan view of the topographic DTM with borehole collar positions and 2m contours overlain. The area is gently undulating with low hills to the west.

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Figure 14.25: Plan View of Constructed Topographic DTM of Liliga Area and Collar Locations

14.3.4.2 Sample Database

Exploration at Liliga consists of 5,582m of diamond drilling (19 holes), 1,666m of RC drilling (13 holes) and 2,321m of trenching (13 trenches) all split over several different exploration campaigns. At the time of the production of this resource estimate 10,259 assays were available. Table 14.20 below is a summary of the exploration and the information contained in the database used during the production of this resource estimate.

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Table 14.20: Summary of Liliga Exploration Campaigns Type Diamond Drilling RC Drilling Trenches Year 1997 2011 2004 2011 1996 2004 2006 Number 10 9 2 11 10 1 2 Min Length 200 180 100 84 71 235 90 Max Length 350 323 100 150 308 235 160 Total Length 3053 2529 200 1466 1836 235 250 Mean Length 305 281 100 133 184 235 125 Assays 3179 3061 200 1453 1826 266 274

14.3.4.3 Mineralised Zone Interpretation

The steps used in the mineralised zone interpretation and modelling are summarised below:

1) An additional 'mineralisation limit' wireframe model was also defined. This defined an approximate limit to mineralisation.

2) Trends of mineralisation above cut-off grade were used to define directional strings down the centre of the principal mineralised structures. Two sets of strings were defined; along strike directional strings and across strike dip strings.

3) The sample data was converted into 2m composites.

4) The composites were then flagged if they were above the 0.5 % Au cut-off level. A minimum of 4m above cut off were required for a composite to be included for modelling; this equates to approximately 2m of true thickness based on average drillhole angle. A maximum of 2m internal waste was allowed for inclusion within multiple composites.

5) Based on the flagged composites, and the directional strings for dip and strike, an indicator estimation was carried out using a 50m x 50m x 5m search ellipse (along strike x down dip x across strike) to estimate those areas inside the approximate mineralisation limit that are above cut-off grade for Au. Around isolated composites

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above cut-off grade the search radius was limited to 37.5m x 37.5m x 5m. The estimation, using nearest neighbour method, was carried out into an unrotated block model with block sizes of 1m x 5m x 2m (across strike x along strike x down dip).

14.3.4.4 Geostatistical Analysis

Samples were coded based on their locations relative to the mineralised domains defined as described above. All samples falling within the defined mineralised zones based on the Au cut-off grade were selected for further processing.

Statistical analysis has been carried out on the samples to identify any potential bias that may be present within the data. An approximately log-normal population was found for Au. The basic statistics for Au by mineralised zone are listed in Table 14.21.

Table 14.21: Basic Statistics for Au in Selected Samples Log Coefficient Standard Estimate of Field Number Min Max Mean Variance Deviation of Mean Variation Au 1067 0.01 151.6 1.67 36.68 6.06 1.42 3.63

To identify the need for top cuts, the log probability plots and quantile distribution for each element were studied to identify the presence of any outlier values. Samples above this top curt limit were reduced to the top cut value. At Liliga a top cut value of 35 g/t Au was applied. The overwhelming majority of samples are 2m in length and so a composite length of 2m was chosen for further processing in order to give a consistent level of support for geostatistical analysis.

Directional semi-variograms Au were generated for the along strike, across strike and down dip directions using the composited and top cut data. Nugget variances were modelled from average downhole variograms based on a 2m lag distance reflecting the drillhole composite spacing. The resultant experimental variograms and model are shown below in Figure 14.26.

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Figure 14.26: Variogram model for Au at Liliga

14.3.4.5 Block Model

A cell size of 4m x 10m x 4m (across strike x along strike x down dip) was selected for estimation and the indicated model created as described above was reset to these cell dimensions using Datamine’s SLIMOD process.

Density values were not supplied by HRG and no lithology data is yet included within the sample database. A blanket density of 2.7t/m³ was applied across the whole block model.

14.3.4.6 Grade Estimation

Grade estimation was carried out using Ordinary Kriging (OK) as the principle interpolation method. Inverse Power of Distance Squared (IDW2) and Nearest Neighbour (NN) were also used for comparative purposes for each element. The OK method used estimation parameters defined by the variography. The estimation was performed on mineralised material domains defined during the domaining process described above and only drillhole composites contained within a domain were used in the grade estimation of that domain.

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For the mineralised zones the OK estimation was run in a three pass kriging plan, the second and third passes using progressively larger search radii to enable the estimation of blocks unestimated on the previous pass.

The directional control settings defining the local variation in the strike and dip of the mineralised zones that were defined during the domaining process were used during estimation. The dip and dip directions were used as vectors to interpolate dip directions and dip values into the block model. These orientations were subsequently used during grade estimation to orientate the search ellipses independently for each block. This dynamic anisotropy procedure gives a more realistic reflection of the local variations in the strike and dip of the deposit. For estimation the deposit was split in to the two limbs of the anticline. A summary of the kriging plan is shown in Table 14.22.

Table 14.22: Search Parameters for Liliga Grade Estimation Search Parameter Au Ellipse Search Radii 1 (m) – across strike 10 Search Radii 2 (m) – along strike 25 Search Radii 3 (m) – down dip 25 1st Minimum Composites 4 Maximum Composites 12 Minimum Drill Holes/Cross Cut 2 Search Radii 1 (m) – across strike 10 Search Radii 2 (m) – along strike 50 Search Radii 3 (m) – down dip 50 2nd Minimum Composites 4 Maximum Composites 6 Minimum Drill Holes/ Cross Cut 2 Search Radii 1 (m) – across strike 10 Search Radii 2 (m) – along strike 100 Search Radii 3 (m) – down dip 100 3rd Minimum Composites 1 Maximum Composites 6 Minimum Drill Holes/ Cross Cut 1

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14.3.4.7 Model Validation

A model validation process included the examination of block model versus composites, and the building up of a model grade profile, to compare average grades on vertical slices, as derived from the composites directly, as well as from interpolated model grades. The results of this work show good correlation between the model and composite values.

14.3.4.8 Resource Classification

Due to the lack of sample information and the difficulty in assessing the continuity of mineralisation as a result of this, the Liliga deposit was classified as inferred at this time.

14.3.4.9 Resource Evaluation

The final block model was used as the basis for resource evaluation. Summary results of the evaluation of the in-situ resources are shown in Table 14.23 below, for four different cut-off grade levels: 0.5g/t, 1.0g/t, 1.5g/t and 2.0g/t Au.

Table 14.23: Liliga Mineral Resource Estimate – Total in-situ Resources - OK (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Cut Off Grade 0.5 1.0 1.5 2.0 Tonnage (kt) 4,155 2,571 1,385 809 Au (g/t) 1.52 1.99 2.67 3.34 Inferred kg 6,315 5,117 3,698 2,703 Metal oz 203,047 164,505 118,890 86,905 Notes: 1. Mineral Resources are not reserves until they have demonstrated economic viability based on a Feasibility study or pre-feasibility study. 2. Mineral Resources are reported inclusive of any reserves. 3. The contained Au represents estimated contained metal in the ground and has not been adjusted for metallurgical recovery.

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14.3.5 Bissa Sud

14.3.5.1 Topography

The topographic DTM used in this study was constructed from LIDAR data supplied by HRG. Figure 14.27 below is a plan view of the topographic DTM with borehole collar positions and 2m contours overlain. The area is gently undulating with a shallow valley feature to the north east.

Figure 14.27: Plan View of Constructed Topographic DTM of Bissa Sud Area and Collar Locations

14.3.5.2 Sample Database

Exploration at Bissa Sud consists of 3,217m of RC drilling (25 holes) all of which were drilled in 2011. At the time of the production of this resource estimate 1890 assays had been returned from 15 of these holes. Table 14.24 below is a summary of the exploration and the information contained in the database used during the production of this resource estimate. ZT61-1100/MM696 Final V6.0 Page 121 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

Table 14.24: Summary of Bissa Sud Exploration Campaign and Assay Database Number Min Max Average Type Year of Holes Length Length Length Number of Assays RC 2011 25 100 150 129 1890

14.3.5.3 Mineralised Zone Interpretation

A cut-off grade of 0.3g/t Au has been chosen for subsequent interpretation and modelling work. This is considered to be an appropriate grade level in terms of what might also qualify as ore for heap leach purposes. Based on a cut-off grade of 0.3g/t Au, three separate mineralised zones have been identified and wireframes constructed for each. The mineralised zones have a general dip towards the south east. In general, the mineralised zones were not extrapolated more than 50m beyond any individual drillhole intersections. The individual mineralised zone wireframes have all been tested for open edges, shared surfaces and crossovers and all have been verified correctly.

14.3.5.4 Geostatistical Analysis

Statistical analysis has been carried out on the samples to identify any potential bias that may be present within the data. An approximately log-normal population was found for Au.

Table 14.25: Basic Statistics for Au in Selected Samples by Zone Log Coefficient Standard Estimate of Zone Number Min Max Mean Variance Deviation of Mean Variation 1 18 0.06 2.00 0.51 0.22 0.47 0.53 0.91 2 52 0.13 2.64 0.66 0.25 0.5 0.66 0.75 3 40 0.02 5.18 1.06 0.99 1.00 1.14 0.94

To identify the need for top cuts, the log probability plots and quantile distribution for each element were studied to identify the presence of any outlier values. Top cuts were not applied at Bissa Sud as no outliers were deemed to be present. The overwhelming majority

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of samples are 1m in length and so a composite length of 1m was chosen for further processing in order to give a consistent level of support for geostatistical analysis.

A variographic study was not carried out on the Bissa Sud deposit dataset due to an insufficient number of sample pairs available for robust experimental variogram calculation.

14.3.5.5 Block Model

A volumetric block model was set up within the mineralised zone wireframes with a 1m x 10m x 5m (across strike x along strike x vertical) block size. The block model was rotated 24ᵒ around the Z axis to better fit the mineralised zone geometry. Density values were not supplied by HRG and no lithology data are yet included within the sample database. A blanket density of 2.7t/m3 was applied across the whole block model.

14.3.5.6 Grade Estimation

Gold grades were estimated within the mineralised zones using inverse distance weighting as the main estimator. Alternative grades were also interpolated using nearest neighbour estimation for validation purposes. The estimation was performed on mineralised material domains defined during the domaining process described above and only drillhole composites contained within a domain were used in the grade estimation of that domain.

For the mineralised zones the inverse distance estimation was run in a three pass plan, the second and third passes using progressively larger search radii to enable the estimation of blocks unestimated on the previous pass. A summary of the estimation plan is shown below in Table 14.26.

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Table 14.26: Summary of Estimation Plan Search 1(along strike x down dip x cross strike) 30m x 30m x 5m Search 2 (along strike x down dip x cross strike) 45m x 45m x 7.5m Search 3 (along strike x down dip x cross strike) 60m x 60m x 10m Discretisation (x/y/z) 3/3/1 Min no. composites (search 1/2/3) 4/4/1 Max no. composites (search 1/2/3) 24/24/15 Minimum Octants Filled 2/2/1 Minimum Composites to fill an octant 1/1/1 Maximum Composites Per Octant 3/3/3 Max no. composites per hole 3/3/3

14.3.5.7 Model Validation

A model validation process included the examination of block model versus composites, and the building up of a model grade profile, to compare average grades on vertical slices, as derived from the composites directly, as well as from interpolated model grades. The results of this work show good correlation between the model and composite values.

14.3.5.8 Resource Classification

Due to the lack of sample information and the difficulty in assessing the continuity of mineralisation as a result of this, the Bissa Sud deposit was classified as Inferred at this time.

14.3.5.9 Resource Evaluation

The final block model was used as the basis for resource evaluation. Summary results of the evaluation of the in-situ resources are shown in Table 14.27 below, for four different cut-off grade levels: 0.3g/t, 0.5g/t, 1.0g/t and 1.5g/t Au.

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Table 14.27: Bissa Sud Mineral Resource Estimate – Total in-situ Resources Inverse Distance Weighting (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Cut Off Grade 0.3 0.5 1.0 1.5 Tonnage (kt) 721 568 168 47 Au (g/t) 0.83 0.94 1.39 1.89 Inferred kg 599 534 234 90 Metal oz 19,249 17,179 7,520 2,878 Notes: 1. Mineral Resources are not reserves until they have demonstrated economic viability based on a Feasibility study or pre-feasibility study. 2. Mineral Resources are reported inclusive of any reserves. 3. The contained Au represents estimated contained metal in the ground and has not been adjusted for metallurgical recovery.

14.3.6 Labola

WAI has produced a resource estimate for the Labola deposit based on exploration works carried out up until 2011 and has been modelled and estimated using CAE Studio 3 (formerly Datamine) software.

14.3.6.1 Sample Database

A sample database was provided to WAI in Excel format, including diamond drillholes and reverse circulation (RC) drillholes. Data provided included drillhole collar positions, down holes survey measurements and assay results.

Diamond Drillholes and RC Drillholes

Data were provided by HRG to WAI in Excel format. The complete database comprises 28 diamond drillholes and 317 RC drillholes with 38,672 sample intervals all of which have assays for Au. The distribution of the Labola diamond drillholes and RC drillholes is shown in Figure 14.28.

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14.3.6.2 Geological Interpretation

Mineralisation was wireframed using a natural cut-off grade (COG) of 0.2g/t Au based on analysis of the sample dataset. Figure 14.29 below shows the Au mineralisation wireframes. Where mineralisation was only defined by a single drillhole or extended through non mineralised zones, the geological interpretation was not considered to be robust and the mineralisation was not wireframed. WAI recommends that further drilling is carried out to better define the mineralised zone. Where mineralisation margins are bounded by drillholes with blank intervals (non-tested drillhole intervals) the mineralisation envelope was pinched out based on half drillhole spacing from the last drillhole.

Figure 14.28: Location of Diamond Drillholes (blue) and RC Drillholes (red) at the Labola Deposit

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DEP 1

DEP 3 DEP 2

DEP 5 DEP 4

Figure 14.29: Au Mineralisation Wireframes (View Looking North West)

14.3.6.3 Database Compilation

Prior to inclusion of all the sample data into one sample file for use in the grade estimation, it was first necessary to ensure there was no bias by one or more of the sample methods.

The samples were coded by drillhole type where STYPE is:

 1: Diamond drillholes; and  2: RC drillholes.

Table 14.28: Statistical Analysis for All Au Samples by Sample Type Std Coefficient STYPE Min Max Range Mean Variance Skewness Kurtosis Dev of Variance 1 0.005 65.4 65.395 0.21 3.6 1.9 25.93 774.49 9.05 2 0.005 65.2 65.195 0.12 1.07 1.03 37.45 1835.83 8.58

The results show the sample types display similar population distributions. Table 14.28 shows the diamond drill holes have a higher mean grade than samples obtained from the reverse circulation drillholes. The higher mean grades of the diamond drillholes reflects the

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concentration of diamond drillholes in the NE of the deposit, whereas RC drill holes are spread throughout the deposit intercepting some low grade zones, and in some cases not intercepting any mineralisation, giving a lower mean grade. Based on this analysis there is no evidence of bias between the two sample types and all sample types were subsequently applied for the resource estimation.

14.3.6.4 Sample Data Processing

All sample data contained within the ore zone wireframes were selected for further data processing. The samples were coded by orebody number.

Statistical Analysis

Statistical analysis has been carried out on samples within the mineralised wireframes to identify any potential bias that may be present within the data (Table 14.29).

If sample populations display a positive skew due to the presence of high grade outlier values then top-cutting maybe necessary to remove the high grades. Samples generally exhibit a log normal distribution which is positively skewed due to the presence of high grade outlier values.

Outlying high grade values can exert significant bias on grade estimations as they may contain a high proportion of the database’s contained metal.

Table 14.29: Statistical Analysis for Samples Intercepting the Mineralisation Wireframes Std Skewne Coefficient DEP Min Max Range Mean Variance Kurtosis Dev ss of Variance 1 0.005 27.5 27.495 1.49 10.38 3.22 5.36 32.77 2.16 2 0.04 2.79 2.75 0.68 0.46 0.68 1.78 2.43 1 3 0.06 20.2 20.14 1.2 9.68 3.11 5.17 26.28 2.59 4 0.06 4.71 4.65 0.78 0.61 0.78 2.88 10.49 1 5 0.005 12.2 12.195 1.37 6.03 2.46 3.35 10.48 1.8

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14.3.6.5 Decile Analysis and Top-Cutting

Decile analysis was performed to ascertain any need for top-cutting. Based on the decile analysis and the Au probability plots, a top cut was applied to DEP 1, DEP 3, DEP 4 and DEP 5 (summarised in Table 14.30).

Table 14.30: Summary of Top Cuts Applied DEP Top Cut Applied Number of Samples Top-cut Percentage of Samples 1 20 3 <1% 2 None - - 3 4 2 3% 4 3 1 2% 5 4 3 6%

Next, statistical analysis was carried out on samples within the mineralised wireframes to identify any potential bias that may be present within the data (Table 14.31).

Table 14.31: Statistical Analysis for All Au Samples Intercepting the Mineralisation Wireframes Following Top Cutting Std Coefficient DEP Min Max Range Mean Variance Skewness Kurtosis Dev of Variance 1 0.005 20 19.995 1.44 8.36 2.89 4.76 25.36 2.01 2 0.04 2.79 2.75 0.68 0.46 0.68 1.78 2.43 1 3 0.06 4 3.94 0.76 0.73 0.86 2.49 6.09 1.13 4 0.06 3 2.94 0.75 0.41 0.64 1.85 3.64 0.85 5 0.005 4 3.995 0.97 1.07 1.03 1.84 2.47 1.06

Missing Assays

There were no absent values for drillhole samples within the mineralisation wireframe.

Compositing

To give each sample in the database equal support for variography and subsequent estimation it is necessary to composite samples to a given length. The sample dataset was reviewed with regards to sample length. The sample mean length for each of the zones was 1.00m.

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For the purpose of the estimation a 1m composite length was applied to give equal support to the sample dataset. Table 14.32 shows the effect of sample compositing.

Table 14.32: Statistical Analysis for Samples Intercepting the Mineralisation Wireframe Following Compositing (1m Composite) Std Coefficient of DEP Min Max Range Mean Variance Skewness Kurtosis Dev Variance 1 0.005 20 19.995 1.42 7.96 2.82 4.90 27.13 1.99 2 0.04 2.79 2.75 0.68 0.46 0.68 1.78 2.43 1.00 3 0.06 4 3.94 0.76 0.73 0.86 2.49 6.09 1.13 4 0.06 3 2.94 0.75 0.41 0.64 1.85 3.64 0.85 5 0.005 4 3.995 0.97 1.07 1.03 1.84 2.47 1.06

Data Processing Summary

The statistical analysis of the Labola deposit sample database is summarised below:

 All sample types intercepting mineralisation display similar population distributions, therefore a database combining all sample types has been used for the estimation;  A top cut has been applied to DEP 1, DEP 3, DEP 4 and DEP 5 to remove outlier values and normalise the dataset;  There were no absent values for drillhole samples within the mineralisation wireframe; and  A 1m composite interval has been applied to standardise sample length.

14.3.6.6 Variography

Variographic analysis was performed using CAE Studio 3 software. Three structured spherical models were applied to the anisotropic variograms for the along strike, down dip and across strike orientations. Due to limited sample density, variograms were not produced for individual ore lenses.

Variogram Parameters

Directional semi-variograms for the along strike, down dip and downhole directions were generated using drillhole and channel sample composite data. ZT61-1100/MM696 Final V6.0 Page 130 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

Variography Interpretation

The principal direction of continuity was selected from the generated experimental semi- variograms. The three orthogonal orientations represented the predominant along-strike, down-dip and cross-strike directions. An experimental variogram and subsequent variogram model for the deposit overall is shown in Figure 14.30.

Figure 14.30: Experimental Variograms and Variogram Models for Au

14.3.6.7 Block Modelling

A summary of the parameters used in the model prototype is shown in Table 14.33. A parent cell size of 50m x 5m x 1m (along strike x across strike x vertical) was selected. Sub cell splitting to a minimum block size of 6.25m x 0.625m x 0.125m has been used to fill this deposit. The block model was aligned along strike (022°).

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Table 14.33: Summary of Block Model Prototype Parameters Property Direction Metres (m) X 320667 Model Origin Y 1185565 Z 125 X 1 Parent Cell Size Y 50 Z 5 X 906 No. of Cells Y 116 Z 49

14.3.6.8 Density

For the current resource estimate a wet density value of 2.4t/m3 was used. WAI recommend that future works include calculation of moisture content and dry density values; such work will be required in order to develop the resource beyond an Inferred classification.

14.3.6.9 Grade Estimation

Grade estimation was carried out using Inverse Power Distance (IPD3) cubed as the principal estimation method. Nearest Neighbour (NN) was also carried out for comparison purposes. Ordinary Kriging (OK) was not carried out due to the limited sampling density which prevented robust variogram models being fitted to the experimental variograms.

Sub-cells received the same estimate as the parent cell. A summary of the estimation parameters for the Labola deposit is shown in Table 14.34.

Table 14.34: Summary of Estimation Parameters Search 1(x/y/z) 10/50/5 Search 2 (x/y/z) 20/100/10 Search 3 (x/y/z) 50/250/25 Min no. composites (search 1/2/3) 3/3/5 Max no. composites (search 1/2/3) 15/15/15 Max no. composites per hole 3

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14.3.6.10 Validation

The model validation methods carried out included a visual assessment of grade, global statistical grade validation and a SWATH plot analysis whereby a section by section comparison of block grade versus sample grade by eastings and northings was undertaken.

Visual Assessment of Grade Estimation

A visual comparison of composite sample grade and block grade was conducted in cross section and in plan. Visually the model was generally considered to spatially reflect the composite grades; however smearing of the grade within the model was observed, contributed largely by the limited sample density.

Global Statistical Grade Validation

Statistical analysis of the block model was carried out to compare the mean sample grades against the mean weighted model grade. This analysis provides a check on the reproduction of the composite grades within the block model globally. Typically the mean grade of the block model should not be significantly different to that of the samples from which it has been derived. The mean block model grade for each zone and its corresponding mean composite grades are shown in Table 14.35. Model grades are for all Resources.

Table 14.35: Comparison of Global Average Grades Block Model Grades Ore Body Sample Composite Grades IDW3 Estimate NN Estimate DEP 1 1.42 1.30 1.31 DEP 2 0.68 0.62 0.67 DEP 3 0.76 0.92 0.90 DEP 4 0.75 0.67 0.66 DEP 5 0.97 0.86 0.82

SWATH Plot Analysis

Swath plots were generated on both easting and northing orientations. The analysis slices the model into sections and outputs an average grade for that section for both the model grade and the average sample composite grade. The swath plots show a reasonable correlation given the limited sample density. ZT61-1100/MM696 Final V6.0 Page 133 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

Validation Summary

From the perspective of conformance of the average model grade to the input data, WAI considers the model to be a satisfactory representation of the sample data used and an indication that the grade interpolation has performed as expected. In terms of conformance to the sample data WAI consider the IDW3 interpolation method to most closely represent the sample data. The resource estimate is therefore based upon the IDW 3 grade estimation.

As a general comment, the validations only determine whether the grade interpolation has performed as expected. Acceptable validation results do not necessarily mean the model is correct or derived from the right estimation approach. It only means the model is a reasonable representation of the data used and the estimation method applied.

14.3.6.11 Resource Classification

The resources of the Labola deposit are classified in accordance with the guidelines of Australian Code for Reporting of Exploration Results, Mineral Resources and Mineral Reserves [JORC Code (2004)].

Estimated resources were classified as ‘Inferred’ resources due to the limited sampling density, uncertainties regarding QA/QC and lack of data regarding dry density measurements.

14.3.6.12 Resource Estimate

The grades in the final resource block model were derived from all drilling sample composites and were based on the IDW3 estimate. The mineral resource estimate is shown in Table 14.36.

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Table 14.36: Labola Resource Estimate (WAI, January 2012) (in accordance with the guidelines of the JORC Code (2004) Inferred Cut Off Grade (g/t) Tonnes (kt) Density (t/m3) Au Grade (g/t) Metal Au (oz) 0.4 1,231 2.4 1.22 48,136 0.6 905 2.4 1.48 42,927 1.0 481 2.4 2.09 32,272 2.0 163 2.4 3.43 17,950 3.0 68 2.4 4.84 10,552 4.0 35 2.4 6.17 7,027

14.3.7 Zinigma

14.3.7.1 Resource Estimation

Wardell Armstrong International (WAI) was commissioned by HRG to prepare a Mineral Resource estimate in accordance with the guidelines of the JORC Code (2004) for the Zinigma Au deposit, Burkina Faso. The work completed during this project can be summarised as:

14.3.7.2 Topography

The topography used in this study was constructed from borehole collar positions as no full ground survey has been completed.

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Figure 14.31: Plan View of Constructed Topography of Zinigma Area and Collar Locations

14.3.7.3 Sample Database

The sample database is made up of 11,076m of RAB drilling, 6,223m of RC drilling and 183m of trenching.

Table 14.37: Summary of Zinigma Exploration Campaigns Type RAB Drilling RC Drilling Trenches Year 2007 2008 2004 2005 2009 2010 2004 2008 Number 114 96 7 2 21 32 3 1 Min Length 21 18 75 90 40 72 24.5 39 Max Length 58 69 130 111 114 126 59.7 39 Total Length 37 51 55 21 74 54 35.2 0 Mean Length 5867 5209 746 201 1887 3389 143.5 39

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14.3.7.4 Mineralised Zone Interpretation

The mineralised zone is interpreted as being shallowly dipping towards the south west with an average strike approximately east south east to west north west. The mineralised zone was constructed on a 0.3g/t Au cut-off.

Figure 14.32: Isometric View looking North of Mineralised Zone Wireframe based on a cut off grade of 0.3g/t Au with drillhole traces

14.3.7.5 Geostatistics

The sample data indicates an approximately log-normal population of samples within the defined mineralisation zone. A geostatistical study of 1.0m composites was carried out within the mineralised zone.

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Figure 14.33: Downhole and Directional Variogram Models for Mineralised Zone

14.3.7.6 Block Model

A volumetric block model was set up with a 10m x 10m x 5m block size. Density values were estimated using average density figures from the Bissa Au deposit using weathering type as a basis for comparison as no density calculations have been carried out at Zinigma.

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Table 14.38: Densities from Bissa Deposit Mean Density t/m3 from Bissa Weathering Zone Deposit Completely Weathered (CW) Laterite 2.18 Highly Weathered (HW) Saprolite 2.03 Medium Weathered (MW) Saprock 2.31 Unweathered (UW) Fresh Rock 2.73

14.3.7.7 Grade Estimation

Table 14.39: Summary of Kriging Plan Search 1(along strike x down dip x cross strike) 44m x 36m x 44m Search 2 (along strike x down dip x cross strike) 66m x 55m x 66m Search 3 (along strike x down dip x cross strike) 132m x 110m x 132m Discretisation (x/y/z) 3/3/1 Min no. composites (search 1/2/3) 6/6/1 Max no. composites (search 1/2/3) 24/24/24 Minimum Octants Filled 4/4/1 Minimum Composites to fill an octant 1/1/1 Maximum Composites Per Octant 3/3/3 Max no. composites per hole 3/3/3 NB – 1) The ore domain has been interpolated using only composites contained within the ore domain 2) Directional anisotropy has been used during interpolation to orient the search ellipses and reflect local variation in strike and dip

14.3.7.8 Model Validation

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Figure 14.34: Example SWATH plot by Northing

14.3.7.9 Resource Classification

Criteria for defining resource categories were derived from the geostatistical studies. Key drillhole spacings for the allocation of inferred resources were 66m x 55m (along-strike x down-dip).

14.3.7.10 Resource Evaluation

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Table 14.40: Zinigma Mineral Resource Estimate – Total in-situ Resources OK (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Cut Off Grade 0.5 1.0 1.5 2.0 Tonnage (kt) - - - - Au (g/t) - - - - Measured kg - - - - Metal oz - - - - Tonnage (kt) ---- Au (g/t) - - - - Indicated kg - - - - Metal oz - - - - Tonnage (kt) ---- Measured + Au (g/t) - - - - Indicated kg - - - - Metal oz - - - -

Tonnage (kt) 3,687 1,854 839 361 Inferred Au (g/t) 1.17 1.60 2.06 2.51 kg 4,317 2,959 1,725 904 Metal oz 138,792 95,150 55,465 29,071 Notes: 1. Mineral Resources are not reserves until they have demonstrated economic viability based on a Feasibility study or pre-feasibility study. 2. Mineral Resources are reported inclusive of any reserves. 3. The contained Au represents estimated contained metal in the ground and has not been adjusted for metallurgical recovery.

14.4 Conclusion

For Bissa resource estimates, a base case of gold cut of grade of 0.5g/t Au has been selected as representing the base case for the likelihood of viable economic extraction. Gold cut of grade of 0.4g/t Au has been used for Labola resource estimate.

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15 MINERAL RESERVE ESTIMATES

15.1 Introduction

15.2 Bissa Gold Deposit

15.2.1 Pit Optimisation Parameters

The metal price used for the pit optimisation was US$1,250/oz Au. The major Key Performance Indicators such as mining and processing costs, and other parameters, considered during the optimisation, have been supplied by HRG within the Feasibility Study, performed by Genivar. WAI has reviewed the Feasibility Study and technical data, obtained from HRG both during site visit and by request, and found the following technical and economical parameters to be the best suitable for the optimisation purposes (Table 15.1).

Table 15.1: WAI Pit Optimisation Parameters Parameter Units Value Metal Price (Au) US$/oz 1,250 Metal Price (Au) US$/g 40.19 Production rate ktpa 4,000 Discount Rate % 10 Dilution % 6 Mining Recovery Factor % 97 Mining Cost (Fresh Ore) US$/t 1.65 Mining Cost (Weathered Ore) US$/t 1.65 Mining Cost (Waste) US$/t 1.65 Ore Processing Cost (per t of processed ore) US$/t 13 Gold Recovery (Weathered and Fresh ore) % 90 G&A US$M/yr 18 Final Pitwall Angle Degrees Various for 4 regions Note: The actual mining costs are not available, therefore the Genivar estimates were used for optimisation purposes.

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One of the most crucial geotechnical parameters is the overall pit slope angle. The shallower the overall slope angle, the more waste cells that are included in the pit design. This has a great effect on the stripping ratio and hence economic viability. A detailed pitwall stability assessment was performed by Piteau Associates. WAI reviewed this study and separated the recommended slope angles into 4 groups; each of these groups have a set of estimated slope angles for weathered and fresh rock. A summary of the recommended slope angles used in the optimisation is given in Table 15.2 below.

Table 15.2: Pit Slope Parameters Area Azimuth Weathered Rock Fresh Rock 300 43 52 Zone 52a 0 43 52 120 37 40 180 40.5 49 110 38 52 170 37 48 230 37 51 Zone 51W 290 34 40 350 37 51 20 38 53 80 36 50 115 38 47 175 37 45 Zone 51E 265 37 40 Zone 53 295 36 45 355 37 40 85 39 47 280 37 47 340 41 53 Bissa South Ext. 10 37 40 Bissa Hill 70 41 53 Bissa SW 100 37 40 160 38 49 190 37 46

15.2.2 Pit Optimisation Results

The results of the WAI Base Case optimisation as calculated by NPV Scheduler® are presented in Table 15.3. The base case optimised pit shell 3D image is shown in Figure 15.1.

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Only the Measured and Indicated Mineral Resources were utilised in the optimisation as only these categories of Mineral Resources can become Mineral Reserves.

Table 15.3 Bissa Deposit Open Pit Optimisation Results (WAI 2012, COG=0.9g/t Au) Weathered Ore Au Grade Stripping Weathered Fresh Fresh Ore Rock Waste Au Ore Au Total (Total Ore, Ratio Ore Ore Au Grade (kt) (kt) (kg) Grade (kt) g/t) (t/t) (kt) (kt) (g/t) (g/t) 186,017 145,938 29,225 1.73 50,658 5.0 17,118 1.63 12,107 1.87 Note: 6% dilution and 97% mining recovery applied *Waste is given inclusive of Inferred material

Figure 15.1: 3D View of WAI Optimised Pit

15.2.3 WAI Reserve Estimation

Based on the described above open pit optimisation, WAI estimated Bissa open pit Mineral Reserves. Detailed results of this estimation are given in Table 15.4 below.

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Table 15.4: Bissa Open Pit Mineral Reserves as of 01 January 2012 (WAI, COG=0.9g/t Au) (in Accordance with the Guidelines of the JORC Code (2004) Ore/Rock Type Ore (kt) Au (kg) Au (g/t) Weathered Proven 114 294 2.57 Weathered Probable 10,742 18,655 1.74 Fresh Proven 1,365 4,031 2.95 Fresh Probable 16,807 30,304 1.80

Weathered Proven and Probable 10,856 18,949 1.75 Fresh Proven and Probable 18,172 34,335 1.89 Total Proven and Probable 29,028 53,284 1.84 Waste* (kt) 159,989 Note- Mining Factors of 6% Dilution and 97% Mining Recovery applied. *Waste is given inclusive of Inferred material, which is also treated as waste

A summary of the results is given in Table 15.5 below.

Table 15.5: Bissa Reserve Pit Summary (WAI, 01 January 2012) Ore (Mt) Waste (Mt) Strip Ratio Total Rock (Mt) 29.028 160 5.52 189 Note: Ore Cut Off of 0.9g/t Au applied Waste is given inclusive of Inferred material at ore grades

15.3 Gougre WAI Mineral Reserve Estimate

As a continuation of Mineral Resource modelling of the Gougre deposit, WAI has undertaken a pit optimisation using the Mineral Resource Block Model prepared by WAI and updated in January 2012. The model was depleted to contain only those Mineral Resources, which have not been extracted as of 01 January 2012. WAI used NPV Scheduler® software for the optimisation, applying conceptual financial and technical parameters, provided by HRG.

The NPV Scheduler® programme comprises three components, the ultimate pit shell generator, a push back generator and the optimising scheduler. The ultimate pit generator is the first stage of the optimisation process and utilises a Lerchs-Grossman algorithm to generate an economic open pit shell from the Mineral Resource block model based on the initial input parameters.

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The objective of this study was to obtain an optimised pit shell containing economically viable Mineral Resources, which therefore will provide an estimate of Mineral Reserves. The estimate of Mineral Reserves will form a basis for the mining schedule.

15.3.1 Pit Optimisation Parameters

The metal price used for the pit optimisation was US$1,250/oz Au. The key parameters, such as mining costs, processing costs and design factors, have been based upon HRG provided information and reviewed by WAI. These parameters are presented in Table 15.6.

Table 15.6: WAI Pit Optimisation Parameters Parameter Units Value Metal Price (Au) US$/oz 1,250 Metal Price (Au) US$/g 40.19 Selling Cost US$/g 3.2 Production Rate ktpa 750 Discount Rate % 11.2 Dilution % 6 Mining Recovery Factor % 97 Mining Cost (Ore and Waste) US$/t 6.53 Processing Cost (per t of processed ore) US$/t 13.79 Oxide Processing Cost (per t of processed ore) US$/t 21.22 Sulphide Gold Recovery % 95 Final Pitwall Angle Degrees 45

15.3.2 Pit Optimisation and WAI Mineral Reserve Estimation

The results of the WAI Base Case optimisation and subsequent Mineral Reserve estimate are presented in Table 15.7. Only the Measured and Indicated Mineral Resources were utilised in the optimisation. The table also includes a mining schedule for the Gougre deposit.

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The Mineral Reserve estimate includes 1.5Mt of Probable ore at an average grade of 1.76g/t Au and 89.66koz of contained gold. The current mining schedule equates to 3 years of production, targeting production of 750kt of ore in Years 1 and 2 and ramping down to 83kt in Year 3.

Table 15.7: Gougre Open Pit Mineral Reserves as of 01 January 2012 (WAI) (in accordance with the guidelines of the JORC Code (2004)) Year Parameter Unit Total 1 2 3 Rock Mined kt 7,119 4,653 175 11,947 kt 99.4 - - 99.4 Oxide g/t 1.44 - - 1.44 kg 143 - - 143 kt 301.9 4.0 - 305.8 Probable Transition g/t 1.85 2.47 - 1.86 Ore kg 560 10 - 570 kt 348.9 745.9 83.3 1,178.1 Sulphide g/t 1.62 1.82 1.89 1.76 kg 564 1,354 158 2,076 kt 750 750 83 1,583 Total Probable Ore g/t 1.69 1.82 1.89 1.76 kg 1,267 1,364 158 2,789 Contained Metal koz 40.73 43.86 5.08 89.66 Waste* kt 5,852 3,289 17 9,159 Strip t/t 7.80 4.39 0.21 5.78 Note: Mining Factors of 6% Dilution and 97% Mining Recovery applied Cut-off-grade: Oxide 0.57g/t, Sulphide 0.78g/t. *Waste is given inclusive of Inferred material

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16 MINING METHODS

16.1 Introduction

A Feasibility Study by Genivar dated June 2010 was prepared in order to satisfy the requirements for the Mining Licence and approval was granted in June 2011.

The operation envisages open pit mining at an annual rate of approximately 3Mtpa, utilising drill & blast with a truck and shovel approach to ore and waste haulage. Processing will be by CIL.

16.2 LOM Mining Schedule

After optimised pitshells were generated for each of the optimisation runs, WAI has designed a mining schedule for the Base Case.

The schedule is targeting 4Mtpa with a ramp-up of production during first year. The reserve statement was prepared by WAI as of 01 January 2012. LOM schedule targets to maintain consistent total volume of ore (at grade, equal to average grade for the deposit) and waste extracted, providing the required planed annual ore tonnage as well. During the first two years, mining is focused on extraction of high grade material.

Table 16.1 below describes mining schedule for the base case open pit shell designed by WAI.

Table 16.1: Bissa Deposit LOM Mining Schedule (WAI 2012) Year 2013 2014 2015 2016 2017 2018 2019 2020 2021 Total Rock kt 15,438 25,738 32,785 25,589 16,071 21,919 28,500 18,611 1,368 186,017 Waste kt 13,935 22,738 28,788 21,585 12,069 17,922 24,496 14,611 845 156,989 Stripping Ratio t/t 9.3 7.6 7.2 5.4 3.0 4.5 6.1 3.7 1.6 5.41 Ore kt 1,503 3,000 3,997 4,004 4,002 3,996 4,003 4,000 523 29,028 Au g/t 1.93 2.04 1.62 1.66 1.71 1.71 1.75 1.78 1.46 1.75 Au kg 2,893 6,123 6,492 6,642 6,824 6,842 7,003 7,129 763 50,711 Fresh Ore kt 1,501 2,986 3,888 2,685 237 1,421 2,908 2,497 49 18,172 Fresh Ore Au Grade g/t 1.93 2.05 1.62 1.53 1.62 1.66 1.78 1.75 1.58 1.75 Weathered Ore kt 2 14 109 1,319 3,765 2,575 1,095 1,502 474 10,856 Weathered Ore Au Grade g/t 0.93 1.01 1.82 1.93 1.71 1.74 1.67 1.83 1.45 1.75 Note: 6% dilution and 97% mining recovery applied. Waste is given inclusive of Inferred material, which is also treated as waste

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16.3 Mining Operations

The gold deposits at Bissa are near surface and suitable for conventional truck and shovel open pit mining. Ore will be hauled from the pits and taken to a run of mine (ROM) stockpile where it will be dumped prior to being tipped in the primary crusher.

The topsoil and any sensitive material will be removed and stockpiled, to be used in the rehabilitation of mine site and waste from the pits will be mainly composed of overburden (laterite, argillite and saprolite) and will be dumped near the topsoil stockpile. The two waste dumps will be located near the pits on the south side.

The recent work by WAI on a new resource and reserve estimate suggests a much larger mine throughput than the previous planned project at some 1.4Mtpa.

As such, at this time, it is not possible to be prescriptive with regards to equipment selection and personnel requirements.

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17 RECOVERY METHODS

The operation at Bissa envisages open pit mining at an annual rate of approximately 3 Mtpa, utilising drill & blast with a truck and shovel approach to ore and waste haulage. A CIL process route was proposed for the Bissa mine at a nominal rate of 3Mtpa, although the new design target throughput is nearer to 4Mtpa.

17.1 Introduction

The Bissa process flowsheet consists of a conventional carbon-in-leach (CIL) design involving fine grinding of the ore followed by leaching of the gold in agitated tanks using sodium cyanide.

The gold is initially removed from the solution using activated carbon after which it is stripped and recovered onto steel cathodes using an electrolytic process. These cathodes are then melted, refined and poured into gold doré bars.

17.2 Crushing

Run of mine ore will be delivered to the plant by truck where it will be discharged into a hopper equipped with an 800mm trash screen. Oversize will be broken up using a hydraulic breaker.

From the hopper, material will be fed using an apron feeder onto a 150mm aperture grizzley with all oversize material reporting to a single toggle primary jaw crusher. The jaw crusher will crush this oversize to a P80 of 170mm before being recombined with the undersize.

The material will then either be conveyed to the grinding circuit supply silo which will have an operating retention time of 4 hours or to an emergency stockpile which will be used to feed the grinding circuit in the event of breakdown or maintenance to the crushing circuit.

17.3 Grinding

Crushed ore will initially be ground using a 8.5m diameter by 4.9m long (6,000kW motor) semi autogenous (SAG) mill operating in closed circuit with 10mm aperture vibrating screen. ZT61-1100/MM696 Final V6.0 Page 150 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

Screen oversize material will be conveyed back to the SAG mill feed conveyor, with provision for pebble crushing, whilst all undersize material will go for further grinding using a 6.1m diameter by 9.1m long (6,000kW motor) ball mill operating in closed circuit with hydrocyclones.

The hydrocyclones will operate at a target P80 of 75µm with all underflow returning to the feed of the ball mill. Cyclone overflow will gravitate through a trash screen to remove any grit or remaining organic material after which it will be pumped to the leach circuit.

17.4 Carbon-in-leach Circuit

Leaching will be performed using a standard circuit consisting of six agitated tanks which will provide a total circuit residence time of 24 hours.

Cyanide will be added to the first tank at a rate of between 0.2-0.6 kg/t ore and allowed to fall at the pulp passes through the remaining five leach tanks. Each tank will contain an air injection system to, if necessary, allow the levels of dissolved oxygen to be increased in order to promote leaching.

In order to adsorb the gold, barren activated carbon will be added to the sixth tank from where it will be advanced using a system of pumps against the flow of the pulp. Carbon is prevented from leaving each tank using inter-tank screens.

The loaded carbon will then be recovered from the pulp using a screen and sent for elution in order to recover the gold.

The leached tailings material will be pumped, at a density of 40% solids, to the tailings management facility.

17.5 Elution

Gold will be stripped from the activated carbon using an AARL (Anglo American Research Laboratory) elution circuit.

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The elution circuit is designed to take the gold content of the activated carbon from a loaded value of circa 2,200g/t Au to a barren concentration of 100g/t Au.

This will be achieved initially by subjecting the loaded carbon to an acid wash using a 3% hydrochloric acid solution after which it will undergo pre-soaking using a 2% sodium cyanide/3% sodium hydroxide solution. Finally, the gold will be stripped from the carbon using fresh water heated to a temperature of 130oC.

Each elution cycle will be able to treat 6 tonnes of activated carbon and will take approximately 12 hours to complete. One complete elution will be performed each day.

Following elution, the pregnant eluate will be sent for electrowinning in order to recover the gold within solution whilst the barren carbon will be sent for carbon regeneration.

17.6 Electrowinning

The gold contained within the pregnant eluate solution will be recovered onto stainless steel cathodes by means of electrowinning.

The electrowinning circuit will consist of two 3.5m3 electrolytic cells each containing a total of twenty two 1m2 stainless steel cathodes. An electrical current will be applied to the cathodes in order to remove the gold from solution where it will become plated onto the surface of the cathodes whilst the barren solution will be returned to the elution circuit for reuse.

In order to minimise the total elution time, the pregnant eluate will only undergo a single stage of electrowinning of between 4 and 6 hours in length with the circuit designed to produce approximately 20kg of metal each day.

17.7 Refining

At appropriate intervals, the gold plated cathodes will be removed from the electrowinning circuit and washed using a high pressure water jet in order to remove the deposited gold. This, along with an electrolytic sludge, will then be dried and calcined in order to remove impurities. ZT61-1100/MM696 Final V6.0 Page 152 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

Finally, the calcined product will be mixed with fluxes and smelted to produce doré bars.

These will then be stored securely until they are transported off-site for further refining.

17.8 Carbon Regeneration

Following elution, barren carbon will be regenerated in an electric kiln.

The carbon will be regenerated in batches of 500kg by first heating to between 650 – 750 oC for approximately 15 minutes using the kiln after which it will be quenched in a tank of cold water.

The quenched carbon will then be screened in order to remove any fines that may have been generated during either the leaching, elution or regeneration processes sand returned to the CIL circuit.

17.9 Tailings Disposal

Tailings material from the CIL circuit will be pumped to the Tailings Management Facility at a density of 40% solids where it will be allowed to settle.

Any supernatant that does not naturally evaporate will be recovered and returned to the plant to be reused.

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18 PROJECT INFRASTRUCTURE

The construction of the mine accommodation and associated facilities at Bissa commenced in late July 2011. The accommodation comprises facilities for 180no permanent staff and ex- pats and an adjacent accommodation site will provide facilities for 200no temporary employees. At the time of the visit brick buildings were being constructed along with the associated infrastructure i.e. potable water supply, sewerage pipes, telecommunications access roads etc.

Each of the accommodation areas will be fenced and provided with a gate to control access. The sites will be equipped with individual rooms and health facilities, restaurant / dining room, laundry, parking, and power generation equipment.

Various elements of infrastructure typical of such a mining complex were defined in the Feasibility Study, they include:

 a fuel station and provided with a closed gate and a camera, with a storage volume for equipment operation of 50,000l (including service station equipment) and a volume storage for the power plant of 50,000l;  fences, with a cumulative length of about 26km, to secure different areas of the mine, including the entire site, and boundaries of areas such as plant and crushing area, an outside storage area, accommodation areas and fuel farm;  three site blocks with guard posts, including two used as changing rooms for workers, with lockers, bathrooms and showers;  a landfill for waste; and  service buildings for uses such as: administrative office, processing plant office, machine shop and electrical plant, warehouse rooms, laboratory, secure building for storage of cyanide, explosives store and indoor and outdoor storage areas, garage temporary "construction", permanent parking, septic systems for garages and offices, and medical centre.

The national power grid at Ouagadougou will be unable to supply power requirements for the mine, hence diesel powered generation on site will be used and 2no 50,000l storage tanks are being currently being constructed.

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Access to the mining site will be from the west, using the diverted RN22 and a connection to the water reservoir, located approximately 18km to the east of the site is planned. Security measures for dealing with artisanal miners are in place.

Potable water is currently supplied from boreholes and is not treated. Approximately 30m 3 is currently used daily to supply the mine camp and temporary camp. A 15m 3 water tank will be installed to supply the mine camp potable requirements during the operational phase. Further boreholes will be drilled to supply the processing plant with potable water. During the operational phase borehole water will be filtered and treated before use.

Septic tanks will provide the main form of sewage treatment at the mine camp, which will include two septic tanks to the northeast and three to the west of the camp. Each tank will have capacity for about 100 people. In the future there is an option to install a biological treatment system.

A key issue for the project’s development involves a 6-7km diversion of Route Nationale 22 (RN22) trunk road, which currently passes directly through the mineralised zones and intended mining area. The original plan was to build an 18.2km diversion around the south and east of the mine to re-join the road to the north. This was rejected by the government. The new plan, recently agreed by the authorities, will take a shorter 7.7km route to the west of the intended operations, despite the limiting topography and the possible sterilisation of the southwest extension of resources.

The following plant items are reported to have been purchased, See Table 18.1.

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Table 18.1: Plant Items Purchased for Mining Plant Item No CAT 777F Dump Trucks (50 tonne) 17 No CAT 390 DL Excavator 2 No CAT 329 DL Hydraulic Excavator 1 No Bycyrus RH90-C Hydraulic Excavator 2 No CAT 993K Front End Loader 3 No CAT 966M Front End Loader 1 No CAT 928HZ Front End Loader 1 No CAT D9R Bulldozer 3 No CAT D5K Bulldozer 1 No CAT Grader 16M 2 No CAT TH514 Telehandler 1 No CAT 777F Water Bowser 2 No

This mining plant will be initially utilised to expedite the excavation of the overburden and the waste rock pre-production phase. A transport plan and road network has been developed at the Feasibility Stage which includes a network which will allow the movement of trucks and other heavy equipment used for the mining operations. The main access road, the roads on the site and truck road will be respectively 10m, 15m and 20m wide with the approximate lengths of 2.1km, 15km and 19.8km respectfully.

Electricity and telecommunications is reported in the Feasibility study as follows.

The site at Bissa will be powered by a power plant consisting of generators. The average load was estimated at 5.8MW and annual demand is estimated at 50.8GWh/year. For reasons of flexibility of operation and delivery / installation, diesel-powered generators were preferred to the alternative equipment burning fuel oil.

The fleet of generators will be composed of 7no diesel generators, or 5no continuous service and two in reserve. The capacity of each generator mode DC is 1190kW and 1520kW in standby mode (standby).

Generators will be installed in a building and connected to a distribution apparatus at a voltage of 6.6kV. This equipment will feed power distribution of the plant by a buried cable, and an airline. Despite their longer delivery time, alternators groups generators will operate directly to medium voltage (6.6kV) instead of standard 400V, thus avoiding the presence of booster transformers with power losses and space extra they need.

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Two backup generators to diesel fuel are provided in case of failure of the main generator. These will be located at the processing plan and the mine camp. These will be installed to facilitate the construction of infrastructure of the mine.

Distribution on the mine site will be with an airline three-phase 6.6kV. A total length of 6.5km line is required to meet the needs of different points of use, including lighting safely between buildings and work areas.

A fire alarm system will be installed in places where they are needed. The system will be connected to a main controller in a multi-zone gate in order to notify the guardian of a problem detected immediately.

Telephone and Internet links will be provided by a satellite connection. LAN telephony and Internet, fibre optic link different buildings and offices of the mine, whose plant and remote sites. System radio communication system will also be available on the site.

The basic planned infrastructure for the Bissa Hill open pit gold mining project is likely to remain similar to that illustrated in Figure 18.1 below.

Figure 18.1: Basic Planned Process Plant Infrastructure for Bissa Hill Open Pit

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Figure 18.2: Accommodation Infrastructure Planned for Bissa Hill

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Figure 18.3: General Proposed Infrastructure at Bissa Hill

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19 MARKET STUDIES AND CONTRACTS

Gold is the principial commodity at Bissa deposit and is freely traded, at prices that are widely known, so that prospects for sale of any production are virtually assured. Prices are usually quoted in US dollars per troy ounce.

There is currently no contract in place.

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20 ENVIRONMENTAL STUDIES, PERMITTING, AND SOCIAL OR COMMUNITY IMPACT

20.1 Environmental and Community Context

The Bissa Gold project is located in a rural area of Burkina Faso in Africa’s Sahel region adjacent to the tarmac Route Nationale 22 trunk road.

The marked wet and dry seasons and variable seasonal rainfall mean that water supply is a key issue for the ecology and communities of this region. The typical, natural vegetation is Sahelian Acacia savannah. The local environment is affected by over-grazing, the over- intensive collection of wood and by small-scale and artisanal mining, lowering the ecological value of the area.

The region has a low population density with several villages in the vicinity of the project. The main land-use is extensive pastoral and arable subsistence agriculture, the principle crops being sorghum (Sorghum bicolor) and millet (Pennisetum glaucum).

Part of the area of the Bissa Gold concession has been subjected to artisanal mining over many years. High River Gold banned artisanal mining at the site.

Water is scarce in the Sahel, and the area surrounding the Bissa Gold project is no exception. There are several small river valleys in the vicinity of the mine which contain ephemeral waterways. Much of the water supply to local communities is by communal boreholes.

20.2 Summary of Project Status and Activities

20.2.1 Introduction

The Bissa Gold project has undergone major changes since 2009, when the site was mainly greenfield with some exploration activities underway. The EIA for the project was published in February 2010 and was approved by the Ministry of Environment, Science and Sustainable Development in May 2010. HRG received its exploitation permit on 23 June

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2011 and since then the development of the site has been underway. Development of the mine itself began officially on 29 September 2011.

Current activities on site comprise major land clearance and construction activities, including major access roads and the mine camp, as well as the clearance and grading of land at the site of the proposed processing plant. There is also on-going exploration work.

In 2010 HRG took the decision to halve the intended life of mine from seven years to approximately three, thereby doubling anticipated annual production from 1.5Mt/y to 3Mt/y. HRG intends to use carbon in leaching in tanks (CIL) to extract gold. The substantial increase in production will have an impact on the scale of the infrastructure and equipment required. In terms of licensing, HRG needs to inform the Burkina Faso government of the proposed changes to production and mine life.

A 5.8MW diesel fuelled power station will be constructed to power the mine.

20.2.2 Bissa Mine Camp

Construction of the Bissa mine camp was well underway in 2011. The Bissa mine camp is located about 1km from the nearest part of Bissa village and only about 200m from the home of the village chief.

Security at the camp currently consists of 18 staff during the day-shift and approximately 25 at night. A 1.8km security fence has been installed around the camp.

The design of the mine camp and construction activities have been modified to minimise impacts on the existing vegetation – particularly the mature trees – as they are valued for their shade and aesthetics.

20.2.3 Processing Plant Area

In September 2011, the area designated for the processing plant had been stripped of vegetation and the topsoil removed. The topsoil was being stockpiled for future use. There was no intention to artificially establish vegetation on the stockpiles. The wood from felled

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trees has been given to local people. Laterite stripped during grading of the site is used to surface the internal haul roads.

Once the mine is operational, the mine ore will be trucked from the pits to the processing plant along unsealed roads.

There are currently three bowsers operating to control dust on the site’s roads. During the wet season, substantial amounts of dust were being generated by on-site traffic.

20.2.4 Tailings Area

Extensive artisanal mining operations, consisting of numerous shafts up to 40-50m deep and connected underground, were noted on the proposed TMF site. It is Bissa Gold policy to discourage such activities as they are now liable for any accidents. In Burkina Faso artisanal mining is illegal in the wet season, but is allowed during the dry season.

20.3 Environmental Effects and Management

20.3.1 Introduction

A provisional environmental and social monitoring and management programme (PGES) was produced in February 2010, and is currently being developed into a comprehensive programme. The provisional PGES outlines the tentative monitoring regimes for soil, noise and vibration, water (surface and ground), air, biodiversity and weather. The detail regarding methodologies and permissible emissions are currently in development. It indicates a budget for the activities described therein, amounting to approximately US$6,146,000 and includes the costs of resettlement and compensation.

20.3.2 Waste Management

HRG’s waste management systems will be subject to the relevant acts of Burkina Faso’s 1997 Environment Code. The mine’s waste management plan is currently in development as part of the comprehensive environmental monitoring and management plan and will cover all types of waste produced by the mine, including: mineral wastes, domestic waste,

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sewage, industrial waste, waste oils and laboratory waste. The main principles of the plan will be in line with the national Environment Code of 1997 and will require that:

 The plan is regularly updated;  The production of waste will be minimised;  The types of waste will be identified and the amounts produced recorded;  Where feasible waste will be sorted and recycled;  Co-operation with other industrial operators will be sought; and  Sub-contractors will be informed of their responsibility for their own waste management.

Waste Rock

Waste rock will be stored in three dumps to the east and southeast of the pits. It will be sorted to enable the re-use of suitable aggregate material for the haul roads. Analyses of potential waste rock materials have indicated a low but present risk of acid generation. Regular monitoring of the run-off from waste rock dumps and testing of waste rock samples for acid-generation potential is planned.

Tailings

Tailings will be stored in a TMF to be constructed to the south of the pits in an area with no surface waters, deep groundwater and sparse population. Construction of the TMF will include storm water diversion ditches. The impoundment will be subjected to very high evaporation, which could account for up to 75% water loss from the facility. This will increase the risk of dust generation. An estimated 9.8 to 10.5Mt of tailings will be deposited here. It has been assumed that the chemistry of the potential tailings material has been characterised as non-acid generating and non-leachable, although during the detailed engineering phase the EIA suggests that tailings materials are assessed for potential acid generation, leaching and anticipated residual cyanide content.

Other Types of Waste

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wastes not included in the above categories will be sorted and recycled where possible. The procedures for this have still to be determined.

20.3.3 Water Effluents and Management

Bissa Gold’s water management plan is currently in development. An outline is provided in the EIA which states the project will not use groundwater for its operations, other than for potable water at the site. Water pumped from the pits will be used in the processing water circuit.

The planned usage was 3Mm3 annually from a 23Mm3 reserve, which has now increased to 10Mm3 annually to allow for the planned increase in production. Bissa Gold is constructing a dam and reservoir, approximately 12km east of the mine in the Tiben area, to supply technical water to the mine. The dam will be filled by diverting water from a public dam 3km away. The construction of a track between the mine and the Tiben dam is almost complete.

Potable water is currently supplied from boreholes and is not treated. Approximately 30m 3 is currently used daily to supply the mine camp and temporary camp. A 15m 3 water tank will be installed to supply the mine camp’s potable requirements during the operational phase. Further boreholes will be drilled to supply the processing plant with potable water. During the operational phase borehole water will be filtered and treated before use.

Piezometers will be constructed up- and down-stream of the TMF to enable the monitoring of groundwater.

Surface waters from exceptional rainfall will be pumped/drained to a collection basin before being discharged.

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20.3.4 Emissions to Air

The main sources of emissions to air during the construction phase will be transport-related dust on unsealed roads and exhaust gases. During operations, dust will be generated by these sources as well as the ore-stockpile area, crushers, screens and conveyors and drilling and blasting works. Waste rock dumps and the TMF are also potential dust sources. There is a risk of contamination from the latter with cyanide. Gaseous emissions will occur primarily from transport and the power station, including greenhouse gases (GHGs) and volatile organic compounds (VOCs). Other sources include laboratory air extraction systems and blasting gases.

The ESIA states that the PM10 emissions from point sources will be within IFC/World Bank guideline values at the perimeter of the site. The impact of dust from diffuse emissions will be reduced by relatively low prevailing wind speeds, the moderating effect of the local topography on wind speeds, the use of new explosives techniques and the design of transport routes away from housing areas.

The ESIA identifies transport-related dust as a potential road safety issue. Water bowsers were spraying the site’s roads to reduce dust, although dust still remained an issue. Planned mitigation measures include the planting of trees along major transport routes.

The main sources of gaseous emissions will be vehicular emissions, the furnace for the regeneration of activated charcoal and electricity generation.

20.3.5 Soil Management

During mine development, topsoil stripped from the site is being stockpiled for use in rehabilitation work at a later date. Laterite removed from the areas being graded are used in road-building around the site.

20.3.6 Biodiversity

According to the ESIA the development of a “green belt” within the footprint of the mine will assist in mitigating the negative effects of the development and operation of the mine

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on biodiversity. This will be achieved by improving local biodiversity, irrigation with treated waste water, and assisting in dust suppression from previously disturbed land.

20.3.7 Hazardous Materials Storage and Handling

Bissa mine will use the various hazardous substances usually associated with modern gold mines, including explosives, diesel and other hydrocarbons, hydrochloric acid, sodium hydroxide, cyanide etc. The relevant plans and procedures have not yet been developed.

20.4 Permitting

Bissa Gold’s activities are subject to the following national laws:

 The Burkinabe Environment Code (law No.0005 No.0005/97/AN 97 of January 1997) governs environmental issues and requires mining companies to an Environmental and Social Impact Assessment (ESIA) followed by a public enquiry to obtain the authorisation from the Ministry of the Environment and Sustainable Development;  The Mining Code of 2003 (law No.31 No.31/2003/AN 2003) obliges mining projects to undertake ESIAs and to respect environmental laws and its Article 65 gives the right to compensation. Burkina Faso’s 2003 Mining Code is currently under review by the government; it is unknown when a revised code will be released.  National law No.014/96/ADP of 1996 deals with agrarian and land reform. This indicates that every holder of real estate can be obliged to give it up in the interests of public utility, after fair and prior-informed compensation agreement has been reached; and  National law No.034-2009 of 2009 deals with the rural land regime and outlines the requirements for the expropriation of land for public purposes and compensation.

In addition HRG aims to go beyond national legislation and comply with IFC/WB Performance Standards on:

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 Loss of property or loss of access to these properties; and  A loss of sources of income or means of existence, whether the affected people have been displaced or not.

20.5 Community Effects and Management

20.5.1 Land and Community

The footprint of the development will cover approximately 80km2 – the area in which environmental and social studies were concentrated. There are four villages that the development will have an impact on, namely: Bissa, Imiougou, Zandkom and Bissinguin.

The RN22 trunk road, which currently passes directly through the intended mining area, will be diverted. The original plan was to build an 18.2km diversion around the south and east of the mine to re-join the road to the north. This was rejected by the government. The new plan, recently agreed by the authorities, will take a shorter 7.7km route to the west of the intended operations. This development required a separate EIA to be submitted to the authorities.

20.5.2 Community Resettlement and Compensation

Bissa Gold is obliged to move two villages as part of the development, namely Bissa (833 people in 212 households) and Imiougou (2,000 people in 195 households). A maximum of 430 new households in total are to be developed.

Effective and sensitive community resettlement is critical to the reputation of the mine and, ultimately, HRG. Bissa Gold has developed a resettlement plan to compensate for the disruption caused to individuals and communities. The plan focuses on the compensation of local communities.

A specific resettlement plan has been designed for approximately 2,800 people in the villages of Bissa and Imiougou and the Tiben sector of the village of Baskouda. Compensation will be paid to residents who have lost a farm, a dwelling or an inheritance to the project. Compensation will favour land and food security. Negotiations are being conducted through a local committee in consultation with the appropriate authorities. ZT61-1100/MM696 Final V6.0 Page 168 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

A detailed resettlement plan, developed with input from the relevant public authority and local community stakeholders, has been produced. This has included input from on-the- ground surveys and inventories as well as consultations with the villagers and local authorities. Prior to agreements being formally reached with local people, explanatory documents are delivered and the recipient is given two-months to reach an understanding.

Dwellings and Public Buildings

The intention is to replace like-for-like house exchanges, based on the number of bedrooms. The new communities will also include community buildings such as a school, community centre, mosque and church. The new school will be bigger than the current one to account for a rising school-age population. In 2011 a contract had already been signed to develop the social infrastructure of the new communities and construction was due to start by the end of September 2011. In addition, a local contractor had been found for the construction of new houses.

New houses are designed to be bigger (e.g. increasing from 10m2 to 12m2) with improved construction than the ones they will replace. A household in this rural area commonly consists of more than one house, so a household may cover 380m2. There are currently no plans to install electricity to each house; however, three boreholes are planned for the new village for drinking water, an increase from the current two.

Farmlands Compensation

The mine site will be fenced thus preventing access to former land-owners. All the farmers will be compensated financially as there is no land available to offer as a land-swap. Compensation payments are based on a calculated five-year income from the land, which is all paid in the first year. HRG will only pay into a bank account, encouraging recipients to open accounts. For those who stay in agriculture, HRG will assist with training in more intensive types of agriculture, reflecting the decreased availability of land.

There are different types of compensation. Those who have lost their livelihoods – mainly farmers – are given priority for employment on the mine. For those unable to work on the mine, a sustainable development programme has been developed to assist them.

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20.5.3 Community Development

Bissa Gold states that it is committed to the improvement of local communities in the areas in which it operates and aims to become an exemplary project in the areas of environmental and social responsibility. There is currently a preliminary community development plan in place that is being further developed to align with the district and provincial/local authority development plans.

The provisional PGES outlines the multi-stakeholder approach that will be taken with respect to community development. These stakeholders will include the NGOs that are already active in the Sabcé area. Development projects that are likely to be considered for support will include: improving communications, the drilling of wells, the repair of public buildings, e.g. schools, mosque, etc., tree-planting, training in modern agricultural/ pastoral techniques, and other appropriate projects as they arise. Bissa Gold has allocated an initial US$1,052,000 for the community programme. This may change with the benefit of experience.

HRG aims to increase the beneficial economic footprint of its activities by promoting policies of:

 Local employment  Local training in relevant skills and trades; e.g. electrical work, carpentry, bricklaying and masonry, needlework, horticulture and farming, etc;  Developing local supply chains, such as encouraging market gardening in the local community to supply the mine and negotiating with the mine’s catering contractor to supply the mine; and  Development of a micro-credit scheme for local women.

The mine is 10% owned by the Burkinabe government who will work in partnership with Bissa Gold on various community development projects. An example here is the increase in Sabcé’s medical and health centre to accommodate the increased population attracted by the mine.

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agent who holds weekly meetings with the sub-contractors to review their employment statistics.

HRG is in the process of setting up three levels of multi-stakeholder committees to influence the community development work of the mine, work on the on-going resettlement activities, and deal with local complaints. The first level will focus on the immediate locality of the mine; known as the Sebcé Communal Local Consultation Committee, this will include representatives of HRG, the mayor and the affected villages. The second level will be the Provincial Committee and the third, the highest level, will be the Regional Committee presided over by the regional governor.

20.6 Health and Safety, Security and Emergency Preparedness and Response

Detailed health and safety (H&S) plans are in development, although HRG does have a health and safety policy. Bissa Gold is currently using Somita SA’s H&S procedures from Taparko mine.

Employees and sub-contractors wear appropriate PPE for their tasks and working environments.

A perimeter fence surrounds the mine camp, which is under construction. A fence is also being constructed around the perimeter of the entire operational site. The entrances to the fenced areas were guarded by trained security personnel.

In 2011, there were about 300 workers on-site, including staff and contractors and were wearing PPE appropriate to their working conditions. Basic health and safety training is provided to all new employees during a site induction. Tool-box meetings are currently held three times per week and the aim is to make these a daily occurrence.

20.7 Mine Closure and Rehabilitation

HRG has not yet developed its mine closure and rehabilitation plan (MCRP), although there is a summary of what it will aim to contain in the provisional PGES. The Mining and Environment Codes require the mine site to be rehabilitated on closure. Burkina Faso’s 2003 Mining Code requires funds to be allocated to the Bank of West Africa to cover ZT61-1100/MM696 Final V6.0 Page 171 July 2012 HIGH RIVER GOLD MINES LTD The Bissa Asset, NI 43 101 Technical Report

environmental protection and rehabilitation costs. Bissa Gold intends to finance the cost of closure by accruing 0.36US cents/t of ore mined to create a closure fund of US$3.22M.

Under Burkinabe law, HRG has two years from the granting of the exploitation licence to develop, in negotiation with the government, the MCRP, which should be based on a model plan provided by the government. The plan will include the environmental rehabilitation of the site and management of the socio-economic impacts on the surrounding locality and region at the termination of operations. By law it must be reviewed every two years.

The closure plan should consider:

 Progressive rehabilitation, even during the earliest stages of operations;  Rigorous post-closure monitoring for a sufficient amount of time; and  The entirety of the operation, its infrastructure and extended footprint and how it should integrate with the surrounding ecological, social and economic landscapes post-closure. In particular, the establishment of long-term, post- closure funding mechanisms, set-up at the outset of mining, such as the development of trust funds, to assist on-going community development.

This plan should be revisited throughout the life of the mine.

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21 CAPITAL AND OPERATING COSTS

A summary of the capital and operating cost estimates, with major components is showed in Table 21.1 below. Details of capital and operating cost estimates are included in Section 22.

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Table 21.1: Summary of Capital and Operating Cost Estimates Year TOTAL 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Gold Price, $/Oz 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 Ore TYPE1 production (diluted) kt 10,855 2.00 14.00 109.00 1,319.00 3,765.00 2,575.00 1,095.00 1,502.00 474.00 Ore TYPE1 Mining cost, $/t 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 Waste TYPE1 Mining cost, $/t 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 Processing TYPE1 cost, $/t 13.00 13.00 13.00 13.00 13.00 13.00 13.00 13.00 13.00 13.00 Ore TYPE2 production (diluted) kt 18,172 1,501 2,986 3,888 2,685 237 1,421 2,908 2,497 49 Ore TYPE2 Mining cost, $/t 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 Waste TYPE2 Mining cost, $/t Processing TYPE2 cost, $/t 13.00 13 13 13 13 13 13 13 13 13 G&A, $/t 4.50 4.50 4.50 4.50 4.50 4.50 4.50 4.50 4.50 4.50 Operating Costs, k$ 684,277 - 45,012 81,468 106,056 94,274 78,543 88,113 99,062 82,694 9,056 CAPEX, k$ 299,029 186,500 20,000 13,000 12,976 12,976 12,976 12,957 12,979 12,970 1,696 Note TYPE1=Weathered; TYPE2=Fresh

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22 ECONOMIC ANALYSIS

22.1 Introduction

A life of mine financial model for the Bissa project has been prepared in order to demonstrate the potential economical outcome of the project and its robustness. This model was based on reserve figures, described above, capital investment requirement estimates provided by HRG and audited by WAI with a view to similar projects, and other parameters. Input parameters were implemented into a life of mine model. The details of this evaluation are given below.

22.2 Life of Mine Assumptions and Input Data

The assumptions made in the WAI life of mine for Bissa Gold project were based on:

 Au price of US$1250/oz;  Mineral Reserves as of 01 January 2012, estimated by WAI in accordance with JORC code guidelines;  Mining Schedule, Prepared by WAI. The Mining Schedule targeting 4.0Mtpa ore mining rate with appropriate ramp-up of production; first year ore tonnage is estimated to be equal 1.5Mtpa;  Long-term operating costs forecasts based on the HRG’s estimation, audited by WAI considering analogous deposits (such as Taparko);  Overall Au recovery indices obtained from testwork results;  Annual discount factor of 11.2% (Base case);  General and administration costs estimated based on HRG’s assumption considering actual figures from neighbouring deposit Taparko; and  Overall tax at 20% of net income applied.

A summary of the Bissa financial model assumptions and input data is given in Table 22.1 below.

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Table 22.1: Bissa Life of Mine Financial Model Assumptions and Input Data Year TOTAL 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Gold Price, $/Oz 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 1,250 Total Rock 186,017 15,438 25,738 32,785 25,589 16,071 21,918 28,499 18,611 1,368 Total Ore 29,028 1,503 3,000 3,997 4,004 4,002 3,996 4,003 4,000 523 Total Waste 156,989 13,935 22,738 28,788 21,585 12,069 17,922 24,496 14,611 845 Total Ore, g/t 1.75 1.93 2.05 1.62 1.53 1.62 1.66 1.78 1.75 1.58 Ore TYPE1 production (diluted) kt 10,855 2.00 14.00 109.00 1,319.00 3,765.00 2,575.00 1,095.00 1,502.00 474.00 Waste TYPE1 mined, kt 156,989 13,935 22,738 28,788 21,585 12,069 17,922 24,496 14,611 845 Ore TYPE1 Mining cost, $/t 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 Waste TYPE1 Mining cost, $/t 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 Mining TYPE1 OPEX, k$ 276,943 22,996 37,541 47,680 37,792 26,126 33,820 42,225 26,586 2,176 Au TYPE1 Grade g/t 1.57 0.93 1.01 1.82 1.93 1.71 1.74 1.67 1.83 1.45 Gold TYPE1 mined, kg 18,943 1.86 14.14 198.38 2,545.67 6,438.15 4,480.50 1,828.65 2,748.66 687.30 Recovery TYPE1 , % 0.90 0.92 0.91 0.90 0.90 0.90 0.90 0.90 0.90 0.90 Gold TYPE1 recovered, kg 17,049 1.71 12.87 179 2,291 5,794 4,032 1,646 2,474 619 Gold TYPE1 recovered, Oz 548,143 55 414 5,740 73,661 186,292 129,646 52,913 79,534 19,887 Processing TYPE1 cost, $/Oz 257 473 440 247 233 263 258 269 246 310 Processing TYPE1 cost, $/t 13.00 13.00 13.00 13.00 13.00 13.00 13.00 13.00 13.00 13.00 Proc and Mining TYPE1 Costs $/Oz 57,992 418,459 91,185 8,553 746 403 519 1,067 580 419 Ore TYPE2 production (diluted) kt 18,172 1,501 2,986 3,888 2,685 237 1,421 2,908 2,497 49 Waste TYPE2 mined, kt Ore TYPE2 Mining cost, $/t 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 1.65 Waste TYPE2 Mining cost, $/t Mining TYPE2 OPEX, k$ 29,984 2,477 4,927 6,415 4,430 391 2,345 4,798 4,120 81 Au TYPE2 Grade g/t 1.75 2 2 2 2 2 2 2 2 2 Gold TYPE2 mined, kg 31,791 2,897 6,121 6,299 4,108 384 2,359 5,176 4,370 77 Recovery TYPE2 , % 0.90 0.92 0.91 0.90 0.90 0.90 0.90 0.90 0.90 0.90 Gold TYPE2 recovered, kg 28,731 2,665 5,570 5,669 3,697 346 2,123 4,659 3,933 70 Gold TYPE2 recovered, Oz 923,726 85,687 179,092 182,253 118,869 11,110 68,255 149,778 126,442 2,240 Processing TYPE2 cost, $/Oz 256 228 217 277 294 277 271 252 257 284 Processing TYPE2 cost, $/t 13.00 13 13 13 13 13 13 13 13 13 Proc and Mining TYPE2 Costs $/Oz 295 257 244 313 331 313 305 284 289 320 Gold Recovered TOTAL, Oz 1,471,868 85,742 179,506 187,993 192,530 197,402 197,901 202,691 205,976 22,128 Proc and Mining TOTAL Costs $/Oz 464 525 454 564 490 398 445 489 401 409 G&A, $/t 4.50 4.50 4.50 4.50 4.50 4.50 4.50 4.50 4.50 4.50 Depreciation (total) k$ 299,029 23,904 38,531 42,561 39,441 34,397 30,049 30,049 30,049 30,049 Revenue, k$ 1,839,835 - 107,178 224,382 234,991 240,662 246,752 247,377 253,364 257,470 27,660 Operating Costs, k$ 28.07 684,277 45,012 81,468 106,056 94,274 78,543 88,113 99,062 82,694 9,056 G&A, Sales 130,622 6,764 13,500 17,987 18,018 18,009 17,982 18,014 17,996 2,354 Royalty, 5%, k$ 91,992 - 5,359 11,219 11,750 12,033 12,338 12,369 12,668 12,873 1,383 CAPEX, k$ 299,029 186,500 20,000 13,000 12,976 12,976 12,976 12,957 12,979 12,970 1,696 Maintanance 92,529 13,000 12,976 12,976 12,976 12,957 12,979 12,970 1,696 Development 188,500 173,500 15,000 Exploration and evaluation 18,000 13,000 5,000 Note TYPE1=Weathered; TYPE2=Fresh

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22.3 Bissa Financial Model

The WAI financial model is presented in Table 22.2 below, with a summary of the key financial indices given in Table 22.3.

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Table 22.2: Bissa Financial Model (All Figures are Given in US$ ‘000)

Year 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Project Year Unit Total 1 2 3 4 5 6 7 8 9 10 Total Revenue k$ 1,839,835 107,178 224,382 234,991 240,662 246,752 247,377 253,364 257,470 27,660 Total Operating Costs k$ 684,277 - 45,012 81,468 106,056 94,274 78,543 88,113 99,062 82,694 9,056 Sales, General and Admin Costs k$ 222,613 - 12,122 24,719 29,736 30,051 30,347 30,351 30,682 30,869 3,736 Capital Expenditure k$ 299,029 186,500 20,000 13,000 12,976 12,976 12,976 12,957 12,979 12,970 1,696 Depreciation k$ 299,029 - 23,904 38,531 42,561 39,441 34,397 30,049 30,049 30,049 30,049 Working Capital Working Capital k$ ------Change in Working Capital k$ ------VAT Total VAT (on CAPEX) k$ ------VAT Rebate (on CAPEX) k$ ------Change in VAT Account (on CAPEX) k$ ------Cash Flow Revenue k$ 1,839,835 - 107,178 224,382 234,991 240,662 246,752 247,377 253,364 257,470 27,660

Cash Production Cost k$ -684,277 - -45,012 -81,468 -106,056 -94,274 -78,543 -88,113 -99,062 -82,694 -9,056 Cash Gross Margin k$ 1,155,558 - 62,166 142,914 128,935 146,388 168,209 159,264 154,301 174,776 18,603

Depreciation k$ -299,029 - -23,904 -38,531 -42,561 -39,441 -34,397 -30,049 -30,049 -30,049 -30,049 Gross Margin k$ 856,529 - 38,262 104,383 86,374 106,947 133,812 129,215 124,253 144,728 -11,445

Sales, General and Admin Costs k$ -222,613 - -12,122 -24,719 -29,736 -30,051 -30,347 -30,351 -30,682 -30,869 -3,736 EBIT k$ 633,916 - 26,140 79,664 56,638 76,896 103,465 98,864 93,571 113,859 -15,182

Less Cash Taxes 20% -129,819 - -5,228 -15,933 -11,328 -15,379 -20,693 -19,773 -18,714 -22,772 0 NOPLAT k$ 504,096 - 20,912 63,731 45,311 61,517 82,772 79,091 74,857 91,087 -15,182

Depreciation (Added back) k$ 299,029 - 23,904 38,531 42,561 39,441 34,397 30,049 30,049 30,049 30,049 Gross Cash Flow from Operations k$ 803,125 - 44,816 102,262 87,872 100,958 117,169 109,140 104,906 121,136 14,867

(Less) Change in VAT Account k$ ------(Less) Change in Net Working Capital k$ ------less Capital Investment k$ -299,029 -186,500 -20,000 -13,000 -12,976 -12,976 -12,976 -12,957 -12,979 -12,970 -1,696

Operating Free Cash Flow k$ 504,096 -186,500 24,816 89,262 74,896 87,982 104,193 96,184 91,926 108,166 13,171 Cumulative Operating Free Cash Flow k$ 504,096 -186,500 -161,684 -72,422 2,474 90,456 194,649 290,833 382,759 490,925 504,096

Discount Factor 11.2% 0.90 0.81 0.73 0.65 0.59 0.53 0.48 0.43 0.38 0.35

Discounted Free Cash Flow k$ 204,331 -167,716 20,069 64,916 48,982 51,745 55,107 45,748 39,319 41,605 4,556 Cumulative Discounted Free Cash Flow k$ 204,331 -167,716 -147,647 -82,731 -33,749 17,996 73,104 118,851 158,170 199,776 204,331

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Table 22.3: Summary of Bissa Key Financial Indices NPV 5 (US$M) 338.7 NPV (US$M) 204.3 NPV 15 (US$M) 147.2 NPV 20 (US$M) 91.2 Internal Rate of Return 35% Pay-Back Period (Years) 3.0 Discounted Pay-Back Period (Years) 4.0

A sensitivity analysis was performed on four key variables in the cash flow model: revenue (recovery/grade/price); operating cost; capital cost; and discount rate. This allows estimation of the robustness of the model should any of these variables change. Several cases were considered, where each of the variables changed from -20% to +20% of its nominal value. The results of the sensitivity analysis are shown in Table 22.4 and Figure 22.1 below.

Table 22.4: Bissa Sensitivity Analysis (US$M) -20% -10% 0% 10% 20% Recovery/grade/price 42.3 123.3 204.3 285.3 363.3 Operating Cost 265.5 234.9 204.3 173.8 143.2 Capital Cost 251.1 227.7 204.3 181.0 157.6 Discount Factor 246.0 224.3 204.3 185.9 168.8

Figure 22.1: Bissa Sensitivity Analysis

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As expected, the results from the sensitivity analysis show that the project is most sensitive to metal revenue (recovery/grade/price) price. However, the project is also relatively sensitive to operating costs and less sensitive to capital cost and discount factor.

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23 ADJACENT PROPERTIES

There is no material on the adjacent properties rather than Gougre and Bouly which are owned by HRG.

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24 OTHER DATA AND INFORMATION

There is no further information deemed necessary to make this report understandable and not misleading.

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25 INTERPRETATION AND CONCLUSIONS

The Bissa Hills area lies in the early Proterozoic Birimian Greenstone Belt of the West African Craton and occurs on the northeast portion of the Boromo greenstone belt. Exploration work on the Bissa and Zandkom permits has led to the delineation of a number of near surface gold deposits that have been traced by trenching and drilling over a strike length of approximately 5km. The gold mineralisation consists of disseminated sulphides, sulphide stringers, quartz veining and attendant hydrothermal alteration and quartz breccia bodies developed in highly strained sedimentary and volcanic rocks, loosely sub-parallel to the dominant foliation fabric of the Sabce shear zone.

A summary of results of the evaluation of resources are shown below, for four different cut- off grade levels: 0.3g/t, 0.5g/t, 1.0g/t Au and 1.5g/t Au

Bissa Resource Estimate (WAI, 01 January 2012) (in accordance with the guidelines of the JORC Code (2004) Ore Tyoe Laterite/Saprolite/Transition/Fresh Cut Off Grade (g/t) 0.3 0.5 1.0 1.5 Tonnage (kt) 2,208 1,964 1,396 1,082 Au (g/t) 2.24 2.47 3.17 3.73 Measured kg 4,947 4,851 4,425 4,038 Metal oz 159,039 155,966 142,251 129,814 Tonnage (kt) 72,194 61,789 26,741 12,573 Au (g/t) 1.09 1.21 1.84 2.56 Indicated kg 78,691 74,765 49,203 32,187 Metal oz 2,529,989 2,403,742 1,581,923 1,034,838 Tonnage (kt) 74,402 63,753 28,137 13,656 Measured + Au (g/t) 1.12 1.25 1.91 2.65 Indicated kg 83,638 79,616 53,628 36,225 Metal oz 2,689,028 2,559,708 1,724,174 1,164,652

Tonnage (kt) 25,249 19,651 7,042 2,852 Au (g/t) 0.91 1.05 1.66 2.33 Inferred kg 22,977 20,634 11,689 6,645 Metal oz 738,714 663,393 375,807 213,639

There are two other important exploration properties lie within a few kilometres of Bissa, these are Gougré and Bouly.

WAI has undertaken resource estimations for both targets:

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Tonnage (kt) 32,150 Au (g/t) 0.75 Inferred kg 24,127 Metal oz 775,673

Tonnage (kt) 3,121 1,862 947 528 Au (g/t) 1.39 1.83 2.41 2.96 Inferred kg 4,352 3,410 2,282 1,566 Metal oz 139,922 109,644 73,367 50,360

WAI has used its own resource estimate to provide an optimised reserve and mine schedule for the operations.Using a US$1,250/oz gold price and a series of agreed Key Performance Indicators, the following reserve applies:

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The operation at Bissa envisages open pit mining at an annual rate of approximately 3- 4Mtpa, utilising drill & blast with a truck and shovel approach to ore and waste haulage. A CIL process route was proposed for the Bissa mine at a nominal rate of 1.4Mtpa (from the Genivar 2009 study), although the new design target throughput is nearer to 4Mtpa. The proposed crushing circuit consisted of a primary jaw crusher and two cone crushers for the secondary and tertiary crushing stages.

Bissa mine’s early stage of development and the state of flux of its various ECHS policies and programmes preclude a conventional MER-type analysis against international standards. The main impact from an ECHS perspective is on the local communities, and the mitigation and adaptation programmes relating to these appear to be well-planned and implemented, and comply with national requirements.The project is considered in compliance with national standards and is moving towards International Compliance.

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26 RECOMMENDATIONS

The primary ore types are not being tested in the current programme of metallurgical testwork. WAI believed that the sulphide ore type for each deposit should be tested to at least obtain a preliminary indication of their processing characteristics. The mineralogical examination of selected sulphide samples noted an association of gold with sulphide.

Some aspects of the mines ECHS planning will need to accommodate the expectations inherent in the revised IFC PSs due to be released in 2012, with increased emphasis on the climate change and social/community performance of mine sites.

In addition, HRG should improve its dust monitoring and control, particularly during the construction phase.

A mine closure and rehabilitation plan will need further development to secure sufficient finance for the mine closure funding.

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27 REFERENCES

SRK Consulting, Resource Evaluation Technical Report, Bissa Gold Project, Burkina Faso, 18 June 2009

Genivar, PFS Report 2009

http://www.mbendi.com/indy/ming/gold/af/bf/p0005.htm High River Gold Mines Ltd. Management’s Discussion and analysis of Financial Position and Operational Results 2010 and 2011.

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DATE AND SIGNATURES

The effective date of this Technical Report, entitled “The Bissa Asset, Burkina Faso, NI 43 101 Technical Report” is July 2012.

20 July 2012

Date

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CERTIFICATE of AUTHOR

As an author of this technical report on the Taparko and Bouroum gold projects of High River Gold Mines Ltd, Canada, I, Phil Newall, BSc, PhD, FIMMM, CEng do hereby certify that:

 I am a Director of: Wardell Armstrong International Ltd., Wheal Jane, Baldhu, Truro, TR3 6EH, United Kingdom;  I graduated with a degree in Mining Geology from the Royal School of Mines, Imperial College, London in 1983, and a PhD in Exploration Geochemistry in 1991 from Camborne School of Mines, Cornwall, UK  I am a Fellow of the Institute of Materials, Mining and Minerals and a Chartered Engineer.  I have practised my profession as a Mining Geologist for the past 28 years in areas of gold and base metals evaluation in a number of countries around the world. I have particular specialisation in CIS, Europe, Central and West Africa, and China, and have developed an extensive portfolio of exploration and mining-related contracts, from project management through to technical audits of a large variety of metalliferous and industrial mineral deposits.  I have read the definition of “qualified person” set out in National Instrument 43 101 (“NI 43 101”) and certify that by reason of my education, affiliation with a professional association (as defined in NI 43 101) and past relevant work experience, I fulfill with requirements to be a “qualified person” for the purposes of NI 43 101 with respect to the subject properties of this report;  I am responsible for the overall production of the technical report titled “The Bissa Asset, Burkina Faso, NI 43 101 Technical Report, 20th July 2012, Ref 61-1100(the “Technical Report”);  I have not had any prior involvement with the properties that are the subject of the Technical Report;  At the effective date of the technical report, to the best of my knowledge, information and belief, the parts of the Technical Report that I am responsible for contains all scientific and technical information that is required to be disclosed in order to make this report not misleading.;  I am fully independent of the issuer applying all of the tests in section 1.5 of the Companion Policy 43-101CP;  I have read the National Instrument 43-101 and Form 43-101F, and the Technical Report has been prepared in compliance with NI 43-101;  I consent to the filing of the Technical Report with any stock exchange and other regulatory authority and any publication by them, including electronic publication in the public company files on their websites accessible by the public, of the Technical Report.

Date: 20 July 2012

Name: Phil Newall BSc, PhD, FIMMM, CEng

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