Annual Environmental Report 2009 Reporting Period

Coyote Gold Project

Tanami Gold NL February 2010

1 Tanami Gold NL Coyote Gold Project AER February 2010

Report prepared by: Jeremy Shepherdson - Principal Consultant Contact details: Ecotec (WA) Pty Ltd 3 Glenunga Way, Craigie WA 6025 ph: (08) 9401 4903 fax: (08) 9401 9107 Date: February 2010 Location: Coyote Gold Project. , Western Australia.

2 Tanami Gold NL Coyote Gold Project AER February 2010 TABLE OF CONTENTS

1 INTRODUCTION ...... 8

1.1 Purpose ...... 8

1.2 Location ...... 8

1.3 Background ...... 10

2 PROJECT DESCRIPTION ...... 11

2.1 Coyote mine site and surrounds ...... 11

2.2 Stage 2 mine site ...... 11

3 PROJECT DISTURBANCE ...... 14

4 MINING, PROCESSING AND EXPLORATION ...... 16

4.1 Mining and Processing...... 16

4.2 Exploration ...... 16

5 REHABILITATION ...... 18

5.1 Coyote waste dump ...... 18

5.2 Stage 2 waste dump ...... 19

5.3 Exploration ...... 20

5.4 Airstrip borrow pit ...... 20

5.5 Original accommodation camp ...... 21

5.6 Vats ...... 22

5.7 Reinjection trial site ...... 22

6 ENVIRONMENTAL MANAGEMENT ...... 24

6.1 Environmental compliance ...... 24

Non-compliance ...... 24

Annual environmental inspection ...... 24

Internal environmental audits ...... 25

6.2 Flora and fauna management ...... 25

Flora monitoring ...... 25

Weed Monitoring ...... 25

6.3 Site disturbance ...... 25

Threatened fauna...... 30

Fauna monitoring ...... 30

3 Tanami Gold NL Coyote Gold Project AER February 2010

Haul road fauna monitoring ...... 34

Taxonomic revision of Dasycercus ...... 36

Introduced fauna ...... 36

6.4 Surface and ground water management ...... 36

Surface water management ...... 36

Groundwater management ...... 37

Groundwater monitoring ...... 37

6.5 Tailings storage facility management ...... 46

Design and operation ...... 46

Monitoring ...... 49

Fauna Management ...... 49

6.6 Waste Management ...... 49

6.7 Dust ...... 50

6.8 Stakeholder communication and consultation ...... 50

7 FUTURE WORK PROGRAM ...... 51

7.1 Mining ...... 51

Coyote ...... 51

Stage 2 ...... 51

Processing ...... 51

7.2 Rehabilitation ...... 51

7.3 Exploration ...... 51

4 Tanami Gold NL Coyote Gold Project AER February 2010

LIST OF FIGURES

Figure 1.1: Project location...... 9

Figure 2.1: Coyote mine site...... 12

Figure 2.2: Stage 2 mine site...... 13

Figure 4.1: Tanami Gold’s exploration activity in 2009...... 17

Figure 6.1: Monitoring site locations...... 39

Figure 6.2: Plan view of TSF Cell 1 with spot heights...... 47

Figure 6.3: Plan view of TSF Cell 2 with spot heights...... 48

Figure 6.4: Cross section through TSF Cell 1...... 48

Figure 6.5: Cross section through TSF Cell 2...... 49

LIST OF TABLES

Table 1.1: Current status of tenements...... 8

Table 1.2: Approvals received for the Coyote Gold Project...... 10

Table 3.1: Coyote mine site disturbance summary...... 14

Table 3.2: Stage 2 mine site disturbance summary...... 15

Table 6.1: Summary of actions required following the regulator’s site visit in September 2009...... 24

Table 6.2: Coyote Project Stage 1 disturbance table...... 28

Table 6.3: Coyote Project Stage 2 disturbance table...... 29

Table 6.4: Bilby and spectacled hare-wallaby activity observed during 2009...... 34

Table 6.5: Comparison of haul road fauna monitoring results...... 35

Table 6.6: Comparison of groundwater pH monitoring results for 2008 – 2009...... 40

Table 6.7: Comparison of groundwater EC monitoring results for 2008 – 2009...... 41

Table 6.8: Comparison of groundwater TDS monitoring results for 2008 – 2009...... 42

Table 6.9: Comparison of groundwater soluble arsenic monitoring results for 2008 – 2009...... 43

Table 6.10: Comparison of groundwater CNTotal monitoring results for 2008 – 2009...... 44

Table 6.11: Comparison of groundwater CNWAD monitoring results for 2008 – 2009...... 45

5 Tanami Gold NL Coyote Gold Project AER February 2010 APPENDICES

Appendix 1 Vegetation monitoring site data sheets.

Appendix 2 Laboratory results of full chemical analysis of Coyote groundwater.

6 Tanami Gold NL Coyote Gold Project AER February 2010

Management Endorsement

This Annual Environmental Report is intended to provide applicable regulatory bodies with an overview of environmental management strategies, methods and outcomes for Tanami Gold’s Coyote Gold Project.

The information provided is an accurate and true record of the results of implementation of the company’s environmental management strategies.

______

Graeme Sloan Rob Walker

CEO General Manager Operations

7 Tanami Gold NL Coyote Gold Project AER February 2010 1 Introduction

1.1 Purpose This Annual Environmental Report (AER) aims to fulfil Tanami Gold’s Coyote Gold Project (the Project) annual environmental reporting requirements to the Department of Mines and Petroleum’ (DMP) and the Department of Environment and Conservations’ (DEC). The report covers the period from January 2009 to December 2009, and includes details of both the Coyote mine site and Stage 2 of the Project, comprising the Kookaburra and Sandpiper open pits. The AER provides:

• an overview of the current status of the operation

• details of environmental monitoring undertaken during the reporting period

• planned future work.

1.2 Location The Project is located in the Tanami Desert approximately 20 km west of the Western Australia-Northern Territory border and 280 km southeast of Halls Creek. Access is via the Tanami Highway from either Halls Creek or Alice Springs. Figure 1.1 shows the location of the Project sites.

The Stage 1 of the Project operates on Mining Tenements M80/559, M80/560, M80/561 and miscellaneous licences L80/46 and L80/51. Stage 2 of the Project commenced in 2008 and is located approximately 35 km north of the existing mine site on M80/563. A haul road linking the two sites was constructed on L80/45. Table 1.1 lists the Coyote Project tenements and the dates of grant and expiry.

Tenement Date Granted Expiry Date

M80/559 27 Sep 2005 26 Sep 2026

M80/560 27 Sep 2005 26 Sep 2026

M80/561 27 Sep 2005 26 Sep 2026

M80/563 2 Dec 2005 1 Dec 2026

L80/45 (Stage 2 haul road) 17 Feb 2006 16 Feb 2027

L80/46 (Airstrip) 11 Feb 2005 10 Feb 2026

L80/51 (Old camp) 17 Feb 2006 16 Feb 2027

Table 1.1: Current status of tenements.

8 Tanami Gold NL Coyote Gold Project AER February 2010

Figure 1.1: Project location.

9 Tanami Gold NL Coyote Gold Project AER February 2010

1.3 Background The Coyote Gold Project commenced in March 2006 following approval of the Notice of Intent. Open pit mining at Coyote ceased in February 2008 and the mining fleet was moved to Stage 2 of the Project to commence the Kookaburra and Sandpiper open pits. Underground mining commenced at Coyote in January 2008.

The Stage 2 operation was suspended in May 2008 and recommenced in September 2009 following re- modelling of the ore body.

Tanami Gold has complied with all requirements for obtaining approvals for the operation. Table 1.2 provides details of the approvals received to date.

Document Title Ref. Number Date Original Application Regulator Received Document Notice of Intent for the NOI 5157 6 Feb 2006 Notice of Intent DoIR Coyote Project – Stage 1 File # E0029200501 Clearing Permit 220/1 23 Dec 2005 Application for a Clearing DoE File # 19179 Permit Works Approval 4188 20 Feb 2006 Works Approval DoE File # W89/05/0 Application Dangerous Goods Storage DGS020529 30 Jun 2006 Dangerous Goods DoCEP License License Licence to Operate Lic.No.8111/1 File 12 Jul 2007 Licence to Operate DEC No. L89/05 Application Statement That A Proposal Assessment No. 20 Sept 2007 Environmental Protection Office of the May Be Implemented 1688 Statement Appeals Convenor/ Minister for the Environment Works Approval W4381/2007/1 18 Oct 2007 Works Proposal - Sewage DEC treatment facility Approval for Mining M80/559 File No. 22 Oct 2007 Mining Proposal DoIR Proposal No. 5782 (MP 5782) Additional Tailings Storage; Details of Underground Mining; Changes to Processing ; Camp Upgrade Approval for Mining E0029/200503 6 Nov 2007 Mining Proposal DoIR Proposal No. 5463 (MP 5463) Coyote Project Stage 2 Approval for Mining Ref: KV:MP 5933 13 Feb 2008 Construction of Stage 2 DoIR Proposal No. 5933 (MP 5933) evaporation dam Approval for Mining Registration No. 15 Dec 2008 Construction of additional DMP Proposal. November 2008 20330 evaporation dam at Coyote (WITHDRAWN) Works Approval W4577/2009/1 26 Nov 2009 Coyote tailings storage DEC facility lift Table 1.2: Approvals received for the Coyote Gold Project.

10 Tanami Gold NL Coyote Gold Project AER February 2010 2 Project Description

2.1 Coyote mine site and surrounds The Coyote mine site currently consists of two open pits, an underground mining operation, a processing plant, a tailings storage facilities (TSF) comprising two cells, a waste dump, an evaporation dam and mine support infrastructure. Figure 3.1 shows the current layout of the Coyote mine site.

Underground mining commenced in January 2008 with construction of a portal and decline from Pit 2. The underground mining operation is currently due for completion in 2010, although further exploration is expected to continue to extend the life of the operation. Section 4 provides details of the mining operation.

The accommodation facility is located approximately 1 km north-east of the mine site. The original accommodation facility, located approximately 10 km west of the mine site, has been decommissioned and is currently being dismantled (refer to Section 5 for further details).

2.2 Stage 2 mine site Stage 2 of the Project (locally referred to as Bald Hill) comprises two open pits, a waste dump, ROM pad, hardstand area and a 34 km haul road to the Coyote processing plant.

The Stage 2 mining operation commenced in March 2008 but was suspended in May 2008 while a revised mining plan was developed. Mining recommenced in September 2009 and is currently underway. Further details of mining are included in Section 4.

Figure 3.2 shows the current layout of the Stage 2 mining operation.

11 Tanami Gold NL Coyote Gold Project AER February 2010

Figure 2.1: Coyote mine site.

12 Tanami Gold NL Coyote Gold Project AER February 2010

Figure 2.2: Stage 2 mine site.

13 Tanami Gold NL Coyote Gold Project AER February 2010 3 Project disturbance

A total area of disturbance of 172.1 ha currently exists at the Coyote mine site. A total area of 225.5 ha is permitted for Coyote mine site and supporting infrastructure under the original Notice of Intent and subsequent addendums and Mining Proposals. Table 3.1 provides a summary of the disturbance areas at the Coyote mine site.

The Stage 2 mining operation occupies a total area of 55 ha at the mine site, with the haul road occupying a further 66 ha. Table 3.2 provides a summary of the disturbance areas at the Stage 2 site.

A detailed breakdown of disturbance areas is included in Section 6.3.

Coyote site elements Area (ha) L80/46 (Airstrip) Airstrip, apron and access 21.5 L80/51 (Camp) Camp facilities, core yard, laydown yard 14.0 M80/561 Camp-mine access road 4.5 M80/560 Camp-mine access road 3.0 Borefield and pipeline 0.5 M80/559 Pit area 16.6 Tailings storage Cells 1 and 2 24.7 Leach vats (decommissioned) 5.5 Waste dump 26.5 Evaporation dam 8.1 ROM and crusher 7.9 Haul and access roads 6.6 Pit surrounds 2.0 Borefields and pipelines 0.5 Processing plant, workshop, offices, laydown areas 9.4 Explosives magazine 1.5 Abandonment bund / diversion drain 10.5 New camp, access road and power line 5.6 Other disturbance 3.2 Total disturbance area - Stage 1 172.1 Table 3.1: Coyote mine site disturbance summary.

14 Tanami Gold NL Coyote Gold Project AER February 2010

Coyote site elements Area (ha) L80/45 Haul road 66.0 M80/563 Waste dump 23.6 Clearing for evap dam 9.5 Abandonment/flood bund 1.4 Office, workshop, laydown area 1.3 ROM pad 2.6 Pit surrounds 1.0 Access roads 3.6 Pits 10.0 Total disturbance area - Stage 2 119.0 Table 3.2: Stage 2 mine site disturbance summary.

15 Tanami Gold NL Coyote Gold Project AER February 2010 4 Mining, Processing and Exploration

4.1 Mining and Processing During the 2009 reporting period open pit mining at Coyote resulted in 22,837 bank cubic metres (BCM) of ore and 310,712 BCM of waste.

43,775 BCM of ore was mined from the Coyote underground operation with 25,154 BCM of waste brought to the surface during the reporting period.

36,231 BCM of ore and 218,966 BCM of waste were mined from the Sandpiper and Kookaburra pits at the Stage 2 operations.

Photograph 4.1: Mining in the Sandpiper Pit, January 2010.

During 2009 219,205 tonnes of ore was processed at the Coyote treatment plant at an average grade of 5.65 grams per tonne to produce 182,141 ounces of gold.

284,900 tonnes of tailings was discharged to the TSF during the 2009 reporting period. A lift on the walls of TSF Cell 1 was partially completed late in 2009. Further discussion of management of the tailings dam is included in Section 6.5.

4.2 Exploration Exploration activities in 2009 commenced with drilling in mid November on a number of prospects within the Bald Hill area. Prospects drilled by Reverse Circulation (RC) drilling included Cuckoo (M80/562), Sandpiper, Osprey and Kookaburra (M80/563) for a total of sixty holes. Figure 4.1 shows the location of the holes in relation to the Kookaburra and Sandpiper pits.

16 Tanami Gold NL Coyote Gold Project AER February 2010

Figure 4.1: Tanami Gold’s exploration activity in 2009.

17 Tanami Gold NL Coyote Gold Project AER February 2010 5 Rehabilitation

5.1 Coyote waste dump Rehabilitation earthwork was completed on the majority of the Coyote waste dump during 2008. This work included battering the faces to approximately 15°, constructing bunds around the upper surface for water management (Photograph 5.1) and spreading topsoil. Approximately 4 ha of the batters on the southern side of the dump were spread with topsoil and trials of soil treatment were undertaken.

At the western end of the dump the batter had a relatively thin layer (100 to 150 mm) of topsoil applied and was not contour ripped. It has been observed that large rip lines create water catchments, causing erosion gullies when they over flow. The trial was to determine whether a smooth slope would achieve better erosion control, and has had reasonable success. Photograph 5.1 shows a typical area of this portion of the waste dump. Moderate gullying is apparent after a moderate wet season, however vegetation growth is progressing well and providing stabilisation of the soil. A variety of grasses (Triodia species) and (predominately Acacia species) are present. This area will be monitored for a further 12 months to assess slope stability and progress of revegetation. A decision will be made following the next wet season as to whether the area will require further work.

Photograph 5.1: Progress of rehabilitation at the western end of the Coyote waste dump.

At the eastern end of the dump a thicker layer (+ 200 mm) of topsoil was applied and very large rip lines were created. This technique has not been successful, with some significant erosion occurring as a result of excessive water accumulation in the rip lines. The erosion has been exacerbated by incomplete water management structures on the upper surface and berm of the dump. Photograph 5.2 shows one of two significant erosion gullies caused by surface water accumulation. Sparse vegetation is apparent on this section of the waste dump.

18 Tanami Gold NL Coyote Gold Project AER February 2010

Photograph 5.2: Erosion gully on the eastern end of the Coyote waste dump.

The trial demonstrates that heavy application of topsoil and very large rip lines increase the potential for surface water erosion on the Coyote waste dump. When suitable machinery returns to the Coyote mine site the eastern end of the waste dump will be reworked. This will involve respreading topsoil to a thickness of approximately 150 mm and either making the surface as smooth as possible or lightly contour ripping it, depending on the success of rehabilitation at the western end of the dump.

Approximately half of the northern side of the Coyote waste dump remains as a tipping face at this stage. Capping material for rehabilitation of the TSF will be sourced from this area.

5.2 Stage 2 waste dump When mining recommenced at the Stage 2 site the western faces of the waste dump were sheeted with lateritic material to increase the stability of the slope. Topsoil has since been applied (Photograph 5.3), however final treatment will not be carried out until the outer faces of the remainder of the dump are complete. It is planned that the waste dump will be side cut with a bulldozer or grader and left smooth.

19 Tanami Gold NL Coyote Gold Project AER February 2010

Photograph 5.3: Topsoil has been applied to western side of the Stage 2 waste dump.

5.3 Exploration The results of drilling are still pending at the time of completion this AER, so permanent capping and rehabilitation of the pads has not been undertaken at this stage. All exploration drill holes have been temporarily plugged and will be permanently capped within six months. Sample bags will be removed and pads and compacted areas will be scarified at this time.

5.4 Airstrip borrow pit A gravel pit used in construction of the airstrip was rehabilitated in 2006. Revegetation has progressed well and species composition is representative of surrounding undisturbed areas. A wider diversity of flora than most of the surrounding areas was observed in 2009 due to fires the previous year which did not affect the rehabilitated area. Photograph 5.4 shows the rehabilitated borrow pit.

20 Tanami Gold NL Coyote Gold Project AER February 2010

Photograph 5.4: Successful rehabilitation of the former borrow pit at the airstrip.

5.5 Original accommodation camp The original camp has been decommissioned and most of the transportable buildings have now been transferred to the mine site or new camp. Several sheds, a transportable building, tanks and the core yard remain in place at this time.

A clean up of the laydown yard has commenced and is planned for completion in early 2010. Materials have been separated into reusable, recyclable and waste. All potentially toxic substances such as oil and fuel have been removed for appropriate disposal. Photograph 5.5 shows the progress at the former exploration laydown area.

21 Tanami Gold NL Coyote Gold Project AER February 2010

Photograph 5.5: Part of the laydown yard with materials ready for removal or disposal.

5.6 Vats Rehabilitation of the former leach vats commenced during 2009. Work commenced at the eastern end and at this stage has involved removal of ore, tearing the liner to allow water penetration and backfilling the void with mine waste. Photograph 5.6 shows the progress as at January 2010.

5.7 Reinjection trial site The sites used for the dewatering reinjection trial have been rehabilitated. The bore holes remain in place however have been securely capped (Photograph 5.7).

22 Tanami Gold NL Coyote Gold Project AER February 2010

Photograph 5.6: Rehabilitation of the leach vats has commenced.

Photograph 5.7: Reinjection trial sites have been rehabilitated.

23 Tanami Gold NL Coyote Gold Project AER February 2010 6 Environmental Management

6.1 Environmental compliance Non-compliance

The company received a formal letter of warning from the Department of Environment and Conservation in September 2009 as a result of failing to meet the Operating Licence condition to implement a groundwater monitoring program. Although the program had been implemented at commencement of the mining operation, monitoring was not undertaken for a 5 month period during 2008. Monitoring has since recommenced and is undertaken monthly as per the licence condition.

Annual environmental inspection

An annual environmental inspection was conducted on 8 September 2009 by officers of the DEC and the Department of Water (DoW).

The company’s failure to maintain the groundwater monitoring program was noted and discussed during the visit. With the exception of this non-compliance, the DEC Environmental Officer found the site to be in fair condition, with two other items requiring action. These are described in Table 6.1 as per the Licensed Premises Inspection Report received from the DEC on 17 September 2009.

Item/issue raised by DEC during Required action. Status 2009 site inspection. Non-compliance with Licence Tanami Gold must implement procedures Addressed. Condition 1 – Groundwater immediately to ensure the required The monitoring program Monitoring Program. monitoring program is completed according has recommenced and is to conditions specified on Environmental conducted monthly in Protection Act licence L8111/2005/1. accordance with the condition. Dust generation at the Coyote mine Water cart regimes need to be adjusted to In progress. site. reduce levels of dust being generated on An additional water cart is mine roads and stockpiles. Tanami to in operation periodically at investigate the provision of an additional the mine site. water truck to reduce the dust generated around the site. Cracked bunding around the Tanami is required to undertake an audit of Complete. process plant. all bunds, silt traps and skimmers used Repairs to the processing around the process plant and repair as plant bunding have been necessary. made. In addition, an ongoing program of repairing the plastic liners in various bunds around the site is underway. Table 6.1: Summary of actions required following the regulator’s site visit in September 2009.

An inspection of the Coyote Gold Project was conducted by officers of the DMP on 16 and 17 December 2009. The officers inspected both the Coyote and Stage 2 mine sites, a recent area of exploration drilling and travelled to two outlying tenements to assess the level of historic disturbance. Although the report on the site visit had not been received at the time of preparation of this AER, no significant issues were raised. Items highlighted predominately related to hydrocarbon management. Relinquishment of environmental bonds over a former airstrip to the west of the site is expected. 24 Tanami Gold NL Coyote Gold Project AER February 2010

Internal environmental audits

Audits of Tanami’s compliance with environmental conditions, legislation and accepted practice are undertaken regularly by Ecotec, the company’s environmental consultants. A report detailing any issues identified, and recommended remedial action is produced for internal use. These audits have assisted the company in identifying and addressing environmental issues to achieve an acceptable standard of environmental management.

6.2 Flora and fauna management Ongoing monitoring of the Project area has continued to assist in determining any changes to the flora and fauna as a result of the mining operation. A significant environmental benefit of the mining operation is increased knowledge of the local flora and fauna as a result of ongoing survey and monitoring work that is carried out. Little was known of the biology of the area prior to the surveys initiated by Tanami Gold. The commitment to undertake further biological surveys in the area will continue.

Flora monitoring

Photographic vegetation monitoring sites were established around the perimeter of the Coyote and Stage 2 mine sites at commencement of operations. Data collection has been conducted twice-yearly since that time. Monitoring of the sites in March and September 2009 demonstrated that there have been no detrimental effects to the vegetation as a result of the mining operation. The results of 2009 monitoring are included as Appendix 1.

Weed Monitoring

Buffel grass (Cenchrus ciliaris) was noted around the old accommodation camp in January 2010. Herbicide spraying was undertaken shortly thereafter in an attempt to control the weed.

Buffel grass and Gallon’s curse (Cenchrus biflorus) have been found on occasion following regular inspections of the Coyote mine site and the old camp. No introduced flora has been located in the camp, along the Stage 2 haul road or at Bald Hill. Regular inspections will continue and spraying will be undertaken as required, however the seed of these species are transported by wind, surface water runoff, vehicles and animals, resulting in the species being wide-spread in the region. Introduction of the species to the region was not a result of the Coyote Gold Project.

6.3 Site disturbance Clearing Permit 220/1 allows for 240.4 ha of native vegetation to be cleared for Stage 1 of the Coyote Gold Project. The cleared area remains at 172.1 ha as there has been no additional clearing undertaken during the reporting period.

Stage 2 of the Project has resulted in a total of 119 ha of vegetation clearing. No further disturbance clearing was undertaken during the reporting period, nor is any anticipated in the future.

Tables 6.2 and 6.3 provide a breakdown of Project disturbance as at December 2009.

25 Tanami Gold NL Coyote Project AER February 2007

Coyote Project - Stage 1 Years Prior to This AER This Reporting Period Proposed Next 12 Months

Disturbed Rehabilitated (ha) Disturbed Rehabilitated (ha) Disturbed Rehabilitated (ha) Tenement Component (ha) E R (ha) E R (ha) E R Airstrip, apron, access 21.5 - - 21.5 - - 21.5 - - Gravel pit 0 - 1.5 0 - 1.5 0 - 1.5 L80/46 Total disturbance 21.5 0 1.5 21.5 0 1.5 21.5 0 1.5 Tenement area 888 Remaining 860.5 Camp and access 14.0 - - 14.0 - - 6.0 - 8.0 Borrow pit - - - 0 - - 0 - - Power line 0 - - 0 - - 0 - - L80/51 Total disturbance 14.0 0 0 14.0 0 0 6.0 0 8.0 Tenement area 400 Remaining 385.8 Tailings Storage 1 9.8 - - 9.8 - - 9.8 - - Tailings Storage 2 14.9 - - 14.9 - - 14.9 - - Leach vats 5.5 - - 5.5 - - 5.5 - - Waste dump 26.5 14.0 3.8 26.5 14.0 3.8 26.5 14.0 3.8 Evaporation dam 8.1 - - 8.1 - - 8.1 - - ROM and crusher 7.9 - - 7.9 - - 7.9 - - M80/559 Haul roads 2.3 - - 2.3 - - 2.3 - - Access roads 4.3 - - 4.3 - - 4.3 - - Pit surrounds 2.0 - - 2.0 - - 2.0 - - Borefields and pipeline 0.5 - - 0.5 - - 0.5 - - Office, workshop, plant, laydown areas 9.4 - - 9.4 - - 9.4 - -

26 Tanami Gold NL Coyote Gold Project AER February 2010 Coyote Project - Stage 1 Years Prior to This AER This Reporting Period Proposed Next 12 Months

Disturbed Rehabilitated (ha) Disturbed Rehabilitated (ha) Disturbed Rehabilitated (ha) Tenement Component (ha) E R (ha) E R (ha) E R Pre-existing tracks (as per DoIR) 0 - 3.0 0 - 3.0 0 - 3.0 Explosives magazine 1.5 - - 1.5 - - 1.5 - - Abandonment/ flood bund 10.5 - - 10.5 - - 10.5 - - Power line clearance 0 - 0.8 0 - 0.8 0 - 0.8 New camp 3.7 - - 3.7 - - 3.7 - - New camp access road 1.1 - - 1.1 - - 1.1 - - New camp power line clearance 0.8 - - 0.8 - - 0.8 - - Other site disturbance (pads, tracks) 3.2 - - 3.2 - - 3.2 - - New evap dam 0 - - 0 - - 0 - - Pits 16.6 - - 16.6 16.6 Total disturbance 128.6 14.0 7.6 128.6 14.0 7.6 128.6 14.0 7.6 Tenement area 997 Remaining 873.8 Camp-mine access road 3.0 - - 3.0 - - 3.0 - - Borefield and pipeline 0.5 - - 0.5 - - 0.5 - - M80/560 Power line 0 - 1.1 0 - 1.1 0 - 1.1 New evap dam 0 - - 0 - - 0 - - Total disturbance 3.5 0 1.1 3.5 0 1.1 3.5 0 1.1

27 Tanami Gold NL Coyote Gold Project AER February 2010 Coyote Project - Stage 1 Years Prior to This AER This Reporting Period Proposed Next 12 Months

Disturbed Rehabilitated (ha) Disturbed Rehabilitated (ha) Disturbed Rehabilitated (ha) Tenement Component (ha) E R (ha) E R (ha) E R Tenement area 994 Remaining 989.4 Camp-mine access road 4.5 - - 4.5 - - 4.5 - - Power line 0 - 1.5 0 - 1.5 0 - 1.5 M80/561 Borrow pit 0 - - 0 - - 0 - - Total disturbance 4.5 0 1.5 4.5 0 1.5 4.5 0 1.5 Tenement area 988 Remaining 982 Coyote total (excluding pits) 155.5 14.0 8.1 155.5 14.0 8.1 155.5 14.0 8.1

Coyote total (including pits) 172.1 14.0 8.1 172.1 14.0 8.1 172.1 14.0 8.1

E = earthworks complete R = rehabilitation complete Table 6.2: Coyote Project Stage 1 disturbance table.

28 Tanami Gold NL Coyote Gold Project AER February 2010 Coyote Project - Stage 2 Years Prior to This AER This Reporting Period Proposed Next 12 Months

Disturbed Rehabilitated (ha) Disturbed Rehabilitated (ha) Disturbed Rehabilitated (ha) Tenement Component (ha) E R (ha) E R (ha) E R Haul road 66.0 - - 66.0 - - 66.0 - - Total disturbance 66.0 0 0 66.0 0 0 66.0 0 0 L80/45 Tenement area 655 Remaining 589 Waste dump 23.6 1.6 - 23.6 1.6 - 23.6 23.6 8 Evaporation dam 9.5 - - 9.5 - - 9.5 - - ROM pad 2.6 - - 2.6 - - 2.6 - - Access roads 3.6 - - 3.6 - - 3.6 - - Office, workshop, laydown 1.3 - - 1.3 - - 1.3 - - Pre-existing exploration M80/563 disturbance 2.0 - - 0 - - 0 - - Pit surrounds 1.0 - - 1.0 - - 1.0 - - Flood bund 1.4 - - 1.4 - - 0 1.4 1.4 Pits 10 - - 10 - - 10 - - Total disturbance 55.0 1.6 - 53.0 1.6 - 51.6 25.0 9.4 Tenement area 975 Remaining 920 Stage 2 total (excluding pits) 111.0 1.6 0 109.0 1.6 0 117.6 25.0 9.4 Stage 2 total (including pits) 121.0 1.6 0 119.0 1.6 0 127.6 25.0 9.4 E = earthworks complete R = rehabilitation complete Table 6.3: Coyote Project Stage 2 disturbance table.

29 Tanami Gold NL Coyote Project AER February 2007

Threatened fauna

The Tanami Desert supports numerous threatened fauna species in a variety of habitats. Sightings of a number of these species are relatively common in the Project area, particularly Major Mitchell’s cockatoos (Cacatua leadbeateri) and Australian bustards (Ardeotis australis). Bilby (Macrotis lagotis) activity can be readily observed and sightings have been relatively frequent since commencement of the project. A population of mulgara (previously identified as Dasycercus cristicauda, now D. blythi – refer to p35 for further discussion) is known in sand dune habitat adjacent to the Stage 2 haul road and woma pythons (Aspidites ramsayi) have been observed on occasion.

Fauna monitoring

Tanami is required to monitor fauna in the Project area to determine the impacts of the mining operation. Monitoring is based on records of animal sightings, animal deaths and a trapping program run in conjunction with operation of the Stage 2 haul road.

Sightings of threatened or unusual fauna are encouraged amongst all site personnel. Instruction regarding the reporting of animal sightings (including deaths) is provided to through the site induction. Sightings of recognised threatened species are reported to the DEC on a regular basis. This report serves to provide the results of monitoring carried out, as per environmental conditions of the Project.

In the Coyote mine site area two regularly monitored transects have been established, primarily for observation of bilby activity. A 1 km transect is located adjacent to the Tanami Road in an area undisturbed by mining activity. No threatened fauna were recorded along this transect in 2009. The only threatened fauna species recorded along the transect since commencement of the Project is the Major Mitchell’s cockatoo. The perimeter of the airstrip serves as the other transect. The eastern end of airstrip is located within potential bilby habitat and evidence of their activity has been recorded in the area since surveys commenced in 2005. There was no current bilby activity observed during the 2009 reporting period.

Bilby activity has previously been observed close to the intersection of the Stage 2 haul road with the Tanami Road, and near the old camp. There was no fresh bilby activity observed within the vicinity of the Project during this reporting period. It is believed that the bilbies have moved on to other areas as food resources have been depleted. The species is known to only temporarily occupy home ranges while food is available.

In September 2009, Jeremy Shepherdson, biologist and Principal Consultant of Ecotec, conducted assessments of several exploration prospects for the company. The purpose of the assessments was to determine whether any threatened species were likely to be impacted by proposed exploration drilling in the areas. During the assessment, recent bilby activity (burrows, foraging and scats) was observed in the vicinity of the Fremlin North and Fremlin South prospects, 15 – 20 km south of Coyote (Photograph 6.1 and Photograph 6.2). Bilby activity was also observed on the track to the Camel prospect, 15 - 20 km west of Coyote (Photograph 6.3), including scats of a juvenile (Photograph 6.4). All bilby activity was observed in areas that have been burnt within the last two years.

30 Tanami Gold NL Coyote Gold Project AER February 2010 Spectacled hare-wallaby activity was observed on the access track to the former Billiluna exploration camp, approximately 30 km west of Coyote (Photograph 6.5 and Photograph 6.6).

Photograph 6.1: Bilby scat at Fremlin North prospect, September 2009.

Photograph 6.2: A recently active bilby burrow at Fremlin South, September 2009.

31 Tanami Gold NL Coyote Gold Project AER February 2010

Photograph 6.3: Bilby forage on the track to the Camel prospect.

Photograph 6.4: Juvenile bilby scats found near the Camel access track.

32 Tanami Gold NL Coyote Gold Project AER February 2010

Photograph 6.5: Spectacled hare-wallaby tracks on the access track to the former Billiluna exploration camp.

Photograph 6.6: Spectacled hare-wallaby scats found with the tracks shown above.

Table 6.4 provides the locations of observed bilby and spectacled hare-wallaby activity during 2009. Although sightings are not recorded (they are too numerous) Major Mitchell’s cockatoos and Australian bustards remain common in the Project area.

33 Tanami Gold NL Coyote Gold Project AER February 2010

Bilby and spectacled hare-wallaby activity observed Date Location (GDA 94, Zone 52) Activity Fremlin North and South prospects 484245 mE 2 x recently occupied bilby burrows and 7789207 mN foraging activity. 14/9/2009 483959 mE Abundant recent bilby foraging activity and 7788722 mN scats. 483796 mE Recently occupied bilby burrow and foraging 7788433 mN activity. Access track to Billiluna exploration camp. Spectacled hare-wallaby tracks and scats Between 2 and 5 km north of camp. along the track. Thought to be two individuals. Camel prospect 15/9/2009 437517 mE Abundant bilby foraging activity and scats. 7795923 mN and extending for up to 2km in Includes scats and tracks of a juvenile. both directions along the track. Table 6.4: Bilby and spectacled hare-wallaby activity observed during 2009.

Haul road fauna monitoring

Stage 2 ore haulage recommenced in September 2009. In accordance with the Ministerial Conditions for the project, monitoring of the mulgara habitat adjacent to the Stage 2 haul was therefore carried out in September 2009 and January 2010.

The September 2009 trapping results show a different assemblage of species when compared with the baseline data collected during the same month in 2006 (refer to Table 6.5). The most notable difference between the two trapping periods is the vegetation composition. Fires in December 2006 and again in late 2007 have resulted in vegetation being predominately grasses, whereas herbaceous and species were previously more common in the area.

Trapping has not previously been conducted in the month of January due to heavy rain preventing access to the trapping site. The January results were expected to be similar to those for December 2006. Although most species captured in December 2006 were again captured in January 2010, fewer reptiles were observed in the most recent period of trapping. The difference in reptile numbers is thought to be due to high rainfall in January 2010 that was not experienced in December 2006. Significantly more frogs were captured in January due to the rain.

34 Tanami Gold NL Coyote Project AER February 2007

r

r

r

r Gould’s sand monito Common name Central Military Dragon Leopard Ctenotus Fourteen Lined Ctenotus Mulgara Sandplain Gecko Blue-lined Dragon Legless lizard Broad-banded Sand swimme Pygmy Desert Monito Burton's Snake Lizard Red-tailed Skink House Mouse Rattling Metal-eyed Frog Knob-tailed Gecko Desert Spade-foot (dead) Spinifex Hopping Mouse Desert Mouse Sandy Inland Mouse Gwardar / Western Brown Snake (previously Diplodactylus) Northern Banded Snake Lesser Hairy-footed Dunnart Tanami Toadlet dead Short-tailed Pygmy Monito ensis g lus y

Month uattuordecimlineatus Dasycercus blythi* blythi* Dasycercus Diplodactylus stenodact Scientific name Ctenophorus isolepis Ctenotus helenae Ctenotus pantherinus Ctenotus piankai Ctenotus q Pseudonaja nuchalis Strophurus ciliaris Simoselaps anomalus Sminthopsis youngsoni Uperoleia micromeles Uperoleia micromeles Varanus brevicauda Varanus eremius Varanus gouldii Diporiphora winneckei Delma nasuta Eremiascincus richardsonii Lerista bipes Lialis burtonis Menetia greyii Morethia ruficauda Mus musculus Neobatrachus aquilonius Nephrurus levis levis Notaden nicholsii Notaden nicholsii Notomys alexis Pseudomys desertor Pseudomys hermannsber

Sept 09 3 1 1 2 2 45 5 1 (Pits)

(Elliots) 3

Sept/Oct 06 2 19 3 1 1 3 2 (Pits)

(Elliots) 2 1

Jan 10 3 4 4 4 3 2 2 17 5 2 421 6 1 232 3 4 (Pits)

(Elliots) 2 2 1

Dec 06 3 3 8 6 8 1 8 62 1 4 5 1 29 3 3 42 1 3 1 (Pits)

(Elliots) 2 4

Table 6.5: Comparison of haul road fauna monitoring results.

* See discussion on p35

35 Tanami Gold NL Coyote Project AER February 2007

No mulgara were captured during either of the September 2009 or January 2010 trapping periods. This may be due to depletion of food resources. The absence of mulgara is not believed to be related to operation of the haul road as, following completion of ore haulage in June 2008 (suspension of the Stage 2 mining operation), nine healthy individuals were captured.

There were no deaths of threatened fauna recorded on the haul road during this reporting period.

Taxonomic revision of Dasycercus

A recent taxonomic revision of the Dasycercus genus has resulted in the species found in the Coyote area being reclassified as D. blythi, a Priority 4 species. This has been confirmed by Mr Roy Teale of Biota Environmental Sciences (Biota) and Dr Ric How of the Western Australian Museum following their review of photographs of the specimens captured during the monitoring program, and a specimen vouchered in 2005 by Biota during a fauna survey. As a result of this change Tanami Gold has requested modification of the Ministerial Condition that requires the mulgara monitoring program to be undertaken.

Introduced fauna

Camels are often observed along the Stage 2 haul road, although are not common near either of the mine sites.

Feral cat sightings have become infrequent since the new camp was established. This is likely to be a direct result of a family of dingoes that frequent the camp and Coyote mine site.

The house mouse (Mus musculus) can be found in the camp, but is also frequently caught in pit fall traps well away from human habitation.

6.4 Surface and ground water management Surface water management

There have been no significant surface water issues at Coyote since the flood protection bund was installed around the southern perimeter of the site.

The Stage 2 haul road becomes flooded at one low point following heavy rain (Photograph 6.7), which results in road closure until the water level recedes.

There have been no significant spills of hydrocarbons or chemicals during the reporting period.

36 Tanami Gold NL Coyote Gold Project AER February 2010

Photograph 6.7: Flooding of the Stage 2 haul road following heavy rain in January 2010.

Groundwater management

The primary goal of ground water management is to maintain groundwater quality and prevent adverse impacts on the surrounding environment. Regular monitoring of the quality and levels of the groundwater and condition of the surrounding vegetation aims to ensure that the following management objectives are met:

• protect the quality of the groundwater resource

• ensure ground water abstraction does not adversely impact on the natural environment

• ensure the continued supply of groundwater for processing and domestic needs.

Groundwater monitoring

Monitoring of the groundwater commenced in October 2006 following commissioning of the tailings storage facility. Monitoring is conducted in accordance with a program agreed with DoIR, DEC and the Department of Water (DoW). Under the conditions of the Licence to Operate water samples are required to be analysed monthly for:

• pH • electrical conductivity (EC)

• total dissolved solids (TDS) • total cyanide (CN Tot)

• weak acid dissociable cyanide (CN WAD) • arsenic (As)

37 Tanami Gold NL Coyote Gold Project AER February 2010

During 2009 the groundwater levels near the Coyote pit dropped below the lower level of many of the bores. As a result, two of the monitoring bores (CYMB02 and CYMB04) are no longer able to be sampled. A former production bore, CYPB03 (located adjacent to CYMB04), is now being used for collection of groundwater samples. Figure 6.1 shows the location of the monitoring bores. Discussion of the groundwater monitoring results follows, with Tables 6.6 to 6.11 providing the results of monitoring during 2009.

38 Tanami Gold NL Coyote Project AER February 2007

Figure 6.1: Monitoring site locations.

39 Tanami Gold NL Coyote Gold Project AER February 2010 pH

Sampling during the 2009 period indicates no significant change in pH of ground water sampled from the monitoring bores. The pH results have remained consistent with the baseline pH for groundwater in the Coyote area with slight variation, believed to be a seasonal fluctuation. pH of the TSF water has remained reasonably consistent.

pH CYPB01 CYPB04

Month CYMB02 CYMB04 CYPB03 CYTSF01 CYTSF02 CYTSF03 CYTSF04 CYTSF05 TSF

May 06 (Baseline) 7.3 8.3 Av: 7.8 ‘08 ’09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09

Jan 8.2 - 7.6 ------8.1 -

Feb - - 8.1 7.3 7.9 7.2 7.5 7.5 7.5 8.2

Mar 8 - 8.2 ------8.7 -

Apr 8.4 8.4 7.5 7 7.7 7 7.3 7.3 7.4 8.8 8.1

May - - 8.3 7.4 8.3 7.4 7.6 7.3 7.7 7.5 7.7 7.7 9.1 8.5

Jun - - 7.4 7.4 7.5 7.6 - 7.6 - 7.8 - 7.8 - 8.3

Jul - - - 7 - 7.1 - 7.2 7.5 - 7.6 - 8.4

Aug - - - 7 - 7.1 - 7.2 - 7.6 - 7.6 - 8.3

Sept - - - 7 - 7.2 - 7.2 - 7.4 - 7.6 - 8.3

Oct - - - 7 - 7 - 7.1 - 7.2 - 7.2 - 8.2

Nov - - 7.7 7.1 7.4 7.1 7.3 7.2 7.4 7.5 7.4 7.2 7.3 8.2 8.2

Dec - - 7.6 7.5 7.1 7.5 7.2 7.5 7.3 7.5 7.4 7.1 7.2 8.2 8.3 Table 6.6: Comparison of groundwater pH monitoring results for 2008 – 2009.

40 Tanami Gold NL Coyote Gold Project AER February 2010 Electrical conductivity

Electrical conductivity at the Coyote mine site has proven to vary considerably with depth, seasonal rainfall, and in response to the rate of dewatering. Ground water near the surface generally has a lower EC than at depth. 2005 and 2006 had above average rainfall, resulting in lower EC due to dilution of the groundwater. 2007 to 2009 have been drier years, resulting in an increasing EC value for most bores as there has been little groundwater recharge.

Electrical conductivity (µS/cm) CYPB01 CYPB04

Month CYMB02 CYMB04 CYPB03 CYTSF01 CYTSF02 CYTSF03 CYTSF04 CYTSF05 TSF

May 06 6900 9700 (Baseline) Av: 8300 ‘08 ’09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 5300 - 5800 - 19000 - 21000 - - - - 25000 - Jan - - - 19000 - 23000 21000 21000 21000 - 45000 Feb 10000 - 3200 - 19000 - 22000 - - - - 26000 - Mar 12000 5600 19000 17000 22000 22000 19000 19000 19000 29000 65000 Apr - 20000 19000 23000 24000 22000 21000 21000 21000 22000 21000 24000 56000 May - - - 19000 - 24000 - 22000 - 21000 - 21000 - 49000 Jun - - - 19000 - 24000 - 21000 - 21000 - 21000 - 44000 Jul - - - 19000 - 23000 - 21000 - 21000 - 21000 - 44000 Aug - - - 17000 - 25000 - 22000 - 22000 - 22000 - 53000 Sept - - - 26000 - 25000 - 23000 - 22000 - 22000 - 62000 Oct 21000 19210 19000 19005 25000 17955 23000 17546 22000 17342 24000 42600 75000 Nov 20000 16000 20000 20000 26000 18000 23000 18000 23000 18000 23000 39000 71000 Dec Table 6.7: Comparison of groundwater EC monitoring results for 2008 – 2009.

41 Tanami Gold NL Coyote Gold Project AER February 2010 Total dissolved solids

Total dissolved solids (TDS) have also proven to vary considerably with depth, seasonal rainfall, and in response to the rate of dewatering. Groundwater near the surface generally has a lower TDS than groundwater at depth. An increase in TDS has also occurred as a result of low rainfall between 2007 and 2009.

Total dissolved solids (mg/L) CYPB01 CYPB04

Month CYMB02 CYMB04 CYPB03 CYTSF01 CYTSF02 CYTSF03 CYTSF04 CYTSF05 TSF

May 06 4200 6200 (Baseline) Av: 5200 ‘08 ’09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 3200 - 3400 - 13000 - 14000 - - - - 18000 - Jan - - - 14000 - 17000 16000 14000 15000 - 33000 Feb 6300 - 1800 - 12000 - 15000 - - - - 18000 - Mar 7600 3600 13000 18000 16000 25000 16000 15000 16000 21000 55000 Apr 13000 13000 15000 17000 16000 14000 15000 14000 15000 14000 17000 43000 May - - - 13000 - 17000 - 15000 - 14000 - 15000 - 37000 Jun

- - - 13000 - 17000 - 15000 - 14000 - 15000 - 33000 Jul - - - 13000 - 17000 - 15000 - 14000 - 15000 - 33000 Aug - - - 13000 - 18000 - 15000 - 14000 - 15000 - 39000 Sept - - - 18000 - 19000 - 15000 - 15000 - 15000 - 48000 Oct 13000 13290 13000 16140 18000 14610 15000 14640 13000 14420 15000 30960 52000 Nov 13000 13000 13200 18000 17800 15000 15200 15000 15000 15000 16000 37000 52300 Dec Table 6.8: Comparison of groundwater TDS monitoring results for 2008 – 2009.

42 Tanami Gold NL Coyote Gold Project AER February 2010 Soluble arsenic

Arsenic is found naturally throughout soil in the Coyote area, particularly in association with the ore body. Levels of arsenic in the soil can be very high (in excess of 500 ppm in places) however the solubility has been demonstrated to be consistently low. Results of water analysis during 2009 support previous findings of low As solubility.

Soluble arsenic (mg/L) CYPB01 CYPB04

Month CYMB02 CYMB04 CYPB03 CYTSF01 CYTSF02 CYTSF03 CYTSF04 CYTSF05 TSF

May 06 0.16 0.38 (Baseline) Av: 0.27 ‘08 ’09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 0.74 - 0.004 - 0.002 - 0.003 - - - - 0.055 - Jan - - - <0.01 - <0.01 <0.01 <0.01 <0.01 - 0.2 Feb 1.1 - <0.01 - <0.2 - <0.2 - - - - 0.4 - Mar

1 <0.004 <0.02 <0.04 <0.02 <0.04 <0.04 <0.04 <0.04 0.45 0.2 Apr <0.02 <0.02 <0.02 <0.02 <0.02 <0.02 <0.02 <0.02 <0.02 <0.02 0.24 0.26 May - - - <0.02 - <0.02 - <0.02 - <0.02 - <0.02 - 0.92 Jun - - - <0.04 - <0.04 - <0.04 - <0.04 - <0.04 - 0.3 Jul - - - <0.04 - <0.04 - <0.04 - <0.04 - <0.04 - 0.24 Aug - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - 0.43 Sept - - - <0.02 - <0.02 - <0.02 - <0.02 - <0.02 - 0.97 Oct 0.1 0.0047 <0.02 0.004 <0.02 0.0047 <0.02 0.004 <0.02 0.006 <0.02 0.486 2.4 Nov <0.01 <0.02 <0.01 <0.02 <0.01 <0.02 <0.01 <0.02 <0.01 <0.02 <0.01 <0.02 3.6 Dec Table 6.9: Comparison of groundwater soluble arsenic monitoring results for 2008 – 2009.

43 Tanami Gold NL Coyote Gold Project AER February 2010 Total cyanide

Total cyanide levels in the monitoring bores have generally been below detectable limits however slightly elevated levels have been observed in the December 2009 sampling. The source of this has not been determined and the results of sampling in January 2010 demonstrated that the levels were again below detectable limits. CNTOT levels in the TSF water have remained low.

Total Cyanide (mg/L) CYPB01 CYPB04

Month CYMB02 CYMB04 CYPB03 CYTSF01 CYTSF02 CYTSF03 CYTSF04 CYTSF05 TSF

May 06 <0.01 <0.01 (Baseline) ‘08 ’09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09

Jan <0.01 - <0.01 - <0.01 - <0.01 - - - - 0.48 -

Feb - - - <0.01 - <0.01 <0.01 <0.01 <0.01 - 0.3

Mar <0.01 - <0.01 - <0.01 - <0.01 - - - - 9.6 -

Apr <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 22 0.27

May <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 19 6.2

Jun - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - 0.46

Jul - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - 3.8

Aug - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - <0.01

Sept - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - 6.4

Oct - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - 9.6

Nov <0.01 0.019 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 0.13 7.5

Dec 0.022 <0.01 0.05 <0.02 0.013 <0.01 0.045 <0.01 0.054 <0.01 0.053 <0.01 17

Table 6.10: Comparison of groundwater CNTotal monitoring results for 2008 – 2009.

44 Tanami Gold NL Coyote Gold Project AER February 2010 Weak acid dissociable cyanide

Weak acid dissociable cyanide has consistently been below the detectable limit in the monitoring bores. CNWAD in the TSF has consistently been well below the accepted safe level for wildlife of 50 mg/L.

Weak acid dissociable cyanide (mg/L) CYPB01 CYPB04

Month CYMB02 CYMB04 CYPB03 CYTSF01 CYTSF02 CYTSF03 CYTSF04 CYTSF05 TSF

May 06 0 0 (Baseline) ‘08 ’09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 ‘08 ‘09 Jan <0.01 - <0.01 - <0.01 - <0.01 - - - - 0.41 - Feb - - - <0.01 - <0.01 <0.01 <0.01 <0.01 - 0.04 Mar <0.01 - <0.01 - <0.01 - <0.01 - - - - 6.4 - Apr <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 11 0.15 May <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 8.9 4.3 Jun - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - 0.42 Jul - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 Aug - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 Sept - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - 4.5 Oct - - - <0.01 - <0.01 - <0.01 - <0.01 - <0.01 - 8.3 Nov <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 0.106 7.4 Dec <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 <0.01 10

Table 6.11: Comparison of groundwater CNWAD monitoring results for 2008 – 2009.

Notes for all groundwater monitoring results tables:

= bore dry

= bore not previously used in the monitoring program

= bore not constructed

- = sample not collected

45 Tanami Gold NL Coyote Project AER February 2007

Under the dewatering licence, a full chemical analysis is required annually from the bores for:

• EC • Al

• Hardness (CaCO3 • As equivalent) • Ca

• Total alkalinity (as CaCO3) • Cl

• pH • CO3 • TDS • Cr

• CN total • HCO3 • CN WAD • K • Fe • Mn • Mg • Ni

• Na • NO3

• NO2 • Pb

• OH • SO4

• SiO2

Appendix 2 provides the laboratory report of full chemical analysis results for 2009 and the baseline results from 2004. The results demonstrate no significant changes in groundwater chemistry since commencement of the mining operation, with the exception of EC and TDS, which are discussed above. Levels of sodium (Na) and chloride (Cl) have also increased as a direct result of increasing salinity (measurable in part by the TDS and EC results).

6.5 Tailings storage facility management Design and operation

The tailings storage facility has been designed and is operated to meet tenement and license conditions. A lift of the walls of TSF Cell 1 commenced in late 2009 to provide more capacity.

The tailings discharge at Coyote has a high liquid component, resulting in more free water in the TSF than desired. To prevent water contact with the TSF walls a concerted effort has been made to construct a consistent tailings “beach” around the inner toe by regularly shifting the discharge point. This has ensured water is kept away from the TSF walls.

284,900 tonnes of tailings was discharged to the TSF during 2009. As at 31 December 2009, TSF Cell 1 had a remaining capacity of 270,190 m3, while TSF Cell 2 had 289,800 m3 remaining capacity.

Tailings was discharge from the processing plant with an average total cyanide concentration of 80 ppm

(monitored by the on-site laboratory). It should be noted that weak acid dissociable cyanide (CNWAD), the measure used for determining the risk to wildlife, is not directly comparable to total cyanide levels. The

CNWAD concentration in the tailings dam has consistently been below the safe level for wildlife of 50 mg/L (Table 6.11).

46 Tanami Gold NL Coyote Gold Project AER February 2010 Figure 6.2 and Figure 6.3 show plan views of the TSF cells with spot heights to indicate levels. Figure 6.4 and Figure 6.5 show cross sections through the wall of each cell with crest and toe heights. The spot heights demonstrate that both Cells 1 and 2 have approximately 2 m difference in height between the centre and the crest of the wall.

Figure 6.2: Plan view of TSF Cell 1 with spot heights.

47 Tanami Gold NL Coyote Gold Project AER February 2010

Figure 6.3: Plan view of TSF Cell 2 with spot heights.

Figure 6.4: Cross section through TSF Cell 1.

48 Tanami Gold NL Coyote Gold Project AER February 2010

Figure 6.5: Cross section through TSF Cell 2.

Monitoring

In accordance with accepted guidance, Tanami Gold aims to achieve an average CNWAD level of 50 mg/L in tailings discharge, the recommended safe level for wildlife. Analysis is conducted monthly with samples collected from the decant point within the tailings dam. Consistently low CNWAD levels have been achieved.

Fauna Management

Inspections of the TSF are conducted at a minimum of once per shift (i.e. twice a day). Operators are required to observe the internal surface of the tailings dam for trapped or dead animals. A set route is followed for the inspection. Animal deaths are required to be reported and a fauna death register is maintained. Although birds are occasionally observed on the TSF, to date there have been no animal deaths. Gas powered cannons are used when necessary to deter birds landing on the TSF. These are shifted regularly and are set at different timing intervals to maintain irregular blasts.

CNWAD levels have consistently remained well below 50 mg/L, the level considered safe for wildlife. To date there have been no reported animal deaths in the TSF.

6.6 Waste Management 310,712 BCM of waste rock was mined from the Coyote open pit operations and incorporated into the waste dump during the reporting period. 218,966 BCM of waste was mined from the Stage 2 pits during the same period. 25,154 BCM of waste was brought to the surface from the underground operation. This has predominately been used as backfill in the pit (Photograph 6.8). 49 Tanami Gold NL Coyote Gold Project AER February 2010

Photograph 6.8: Underground waste (grey material) has been used as backfill in the Coyote pit.

Hydrocarbon contaminated soil is transferred to the purpose-built bio-remediation pad for treatment. The bio-remediation pad was constructed in accordance with the Contaminated Sites Management Series guidelines.

Waste oil, filters, rags and other contaminated waste are transported off site for disposal by Wren Oil, who supply bins for this purpose.

Hydrocarbons are separated out of used wash pad water by a Humeceptor oil-water separator and transferred with wash bay sludge to the bioremediation area.

6.7 Dust Water carts are currently in use to control dust on the site roads.

6.8 Stakeholder communication and consultation Tanami’s commitment to communicate findings of survey work and developments within the operation to the community and other stake holders has been upheld. DoIR, DEC and DoW have been regularly informed of the progress of the operation and have been provided with information upon request.

An inspection of the site by representatives of DEC and DoW was conducted in September 2009, while DMP environmental officers conducted a site visit in December 2009.

This Annual Environmental Report will be distributed to all stakeholders.

50 Tanami Gold NL Coyote Project AER February 2007 7 Future Work Program

7.1 Mining Coyote

Underground mining will continue at the Coyote operation at a production rate of 130,000 tonnes per annum (TPA). The underground workings have currently reached 200 vertical metres below surface and are expected to be deepened by a further 120 vertical metres during the coming year. The operation currently uses a combination of small mechanised and hand-held mining techniques and these methods will continue in 2010. The workforce numbers are expected to remain unchanged.

Water inflows are expected to increase as the mine deepens. It is expected that the current water allotment of 2.19 GL will not be exceeded as the current abstraction rate is 0.8 GL

Stage 2

Mining operations have been suspended at the Stage 2 (Bald Hill) site pending the results of an optimisation study aimed at expanding the open pit mining operation to approximately 500,000 TPA.

Processing

The current processing rate of the plant at the Coyote mine site is 250,000 TPA. A recently commissioned study is being undertaken, aimed at increasing throughput to 600,000 TPA if sufficient reserves can be identified. All appropriate approvals will be sought prior to any increase in the capacity of the processing plant being implemented.

7.2 Rehabilitation Continued rehabilitation of the Coyote waste dumps will be carried out progressively when earthmoving machinery returns to the site. At this stage the timing of this is uncertain. It is expected that the mining operation will continue for some time, so there are no dates set at this stage for decommissioning or rehabilitation of the site.

The Stage 2 waste dump is expected to have most rehabilitation work completed during 2010. The future of mining at the site has not yet been determined. All access roads, laydown areas and the ROM will remain in place until the future of the site is known. The haul road will be maintained until all mining work to the north of Coyote has been completed. The road will then be cut down to its original size.

7.3 Exploration Planned exploration for the 2010 period will involve further RC drilling over a number of prospects, as well as an estimated 45,000 metres of air core drilling to be conducted regionally over the tenement portfolio.

Rehabilitation of drill sites will continue will be carried out in line with regulatory guidelines.

51

Appendix 1

Monitoring site data sheets

Photographic Monitoring Site Data Sheet

Company/Project: Tanami Gold Coyote Project Date: 21/09/09 Site ID: CYMS001 Location: 481746 mE 7799549 mN

Site Description: Located south of evaporation dam. Photographed looking south. Undisturbed vegetation on sandy soil. Burnt 18-20th October 2007 (approx 2 years post burn).

Vegetation Type: Hummock (spinifex) Grassland with scattered Eucalypt, Hakea and Acacia species. Cover: approx 20%

Date of photograph: 21 September 2009

Species present: Number:

Acacia sp. (juv) 1

Aristida holathera 180

Corchorus sidoides subsp. vermicularis 1

Cyperus blakeanus 8

Eragrostis eriopoda 24

Eucalyptus brevifolia 2

Fimbristylis caespitosa 3

Pluchea tetranthera 13

Species present: Number:

Pterocaulon sphaeranthoides 1

Senna notabilis (juv) 1

Tephrosia sp. D Kimberley Flora 39

Triodia schinzii 20

Triodia sp. (tribe Plectrachne) aff. wiseana 15

?Sida sp. 11

Plant Health Assessment

Trees: Trees healthy and recovering from fire

Shrubs: Most shrubs in the surrounding area have regenerated although high number of Acacias have not recovered.

Grasses: Triodia healthy, most seasonal grasses dying off

Photographic Monitoring Site Data Sheet

Company/Project: Tanami Gold Coyote Project Date: 21/09/09 Site ID: CYMS 002 Location: 482507 mE 7799192 mN

Site Description: Located between the pits and the magazine. Undisturbed vegetation. Photographed looking south. Sandy soil. Burnt 18-20th October 2007 (approx 2 years post-burn).

Vegetation Type: Hummock (spinifex) Grassland with scattered Eucalypt, Hakea and Acacia species. Cover: approx 30%

Date of photograph: 21 September 2009

Species present: Number:

Triodia pungens 360

Pluchea tetranthera 12

Triodia aff. wiseana 33

Aristida latifolia 2

Plant Health Assessment

Trees: Trees in surrounding area are healthy and most have recovered from the fire.

Shrubs: Smaller herbs are very scarce in the site (only 1 recorded) and surrounding area. Many of the Acacias did not recover from the fire.

Grasses: Grasses are healthy

Photographic Monitoring Site Data Sheet

Company/Project: Tanami Gold Coyote Project Date: 21/09/09 Site ID: CYMS 003 Location: 483277 mE 7799641 mN

Site Description: Located east of the mine site. Undisturbed vegetation on sandy soil. Photographed looking south. Burnt 18-20th October 2007 (approx 2 years post-burn).

Vegetation Type: Hummock (spinifex) Grassland with scattered Eucalypt, Grevillea, Hakea and Acacia species.

Cover: Approx 20%

Date of photograph: 17th October 2008

Species present: Number:

Acacia stipuligera (juv) 14

Cyperus blakeanus 1

Dicrastylis exsuccosa 9

Eragrostis eriopoda 11

Halgania solanacea 49

Heliotropium tenuifolium 5

Mirbelia viminalis 36

Senna notabilis 2

Species present: Number:

Triodia pungens 200

Triodia sp. (aff. wiseana) 13

Yakirra australiensis 32

Plant Health Assessment

Trees: Most trees in the surrounding area have recovered from the fire and are healthy.

Shrubs: Most of the shrubs in the area did not recover from the fire. Many juvenile Acacias are now emerging. Herbs are scattered, generally small and drying off (seasonal).

Grasses: Healthy. Remaining annuals are drying off (seasonal).

Photographic Monitoring Site Data Sheet

Company/Project: Tanami Gold Coyote Project Date: 21/09/09 Site ID: CYMS 004 Location: 483352 mE 7800520 mN

Site Description: Located east of the processing plant. Photographed looking south. Undisturbed vegetation on sandy soil with high laterite content. Burnt 18-20th October 2007 (approx 12 months post-burn).

Vegetation Type: Hummock (spinifex) Grassland with scattered Eucalypt, Hakea, Grevillea and Acacia species.

Cover: 75%

Date of photograph: 17th October 2008

Species present: Number:

Triodia pungens 200

Halgania solanacea 83

Eucalyptus odontocarpa 1

Eucalyptus brevifolia 1

Acacia stellaticeps 2

Senna notabilis 2

Aristida holathera var. holathera 200

Species present: Number:

Eragrostis eriopoda 40

Yakirra australiensis 150

Acacia adoxa 4

Acacia elachantha 1

Acacia colei 15

Plant Health Assessment

Trees: Most have recovered from fire

Shrubs: Most Acacias did not recover from the fire however many are now emerging (presume from seed) throughout the surrounding area.

Grasses: Annuals are drying off.

Photographic Monitoring Site Data Sheet

Company/Project: Tanami Gold Coyote Project Date: 21/09/09 Site ID: CYMS005 Location: 482697 mE 7800810 mN

Site Description: Located north of the mine site. Photographed looking south. Undisturbed vegetation on sandy soil. Area was not affected by fires in October 2007.

Vegetation Type: Hummock (spinifex) Grassland with scattered Eucalypt, Grevillea, Hakea and Acacia species.

Cover: 80%

Date of photograph: 21 September 2009

Species present: Number:

Acacia adoxa 32

Eragrostis eriopoda 6

Eriachne aristidea 15

Eucalyptus brevifolia 2

Hakea macrocarpa 1

Halgania solanacea 3

Jacksonia aculeata 2

Species present: Number:

Triodia shinzii 600

Plant Health Assessment

Trees: Trees in surrounding area are healthy.

Shrubs: Small herbs appear dry, some are dead. Believed to be the result of low rainfall over the previous wet season.

Grasses: Generally appear to be dry although still provide high % ground cover. Much of the spinifex had recently seeded.

Photographic Monitoring Site Data Sheet

Company/Project: Tanami Gold Coyote Project Date: 15/10/08 Site ID: CYMS 006 Location: 0481535 mE 7799961 mN

Site Description: Located west of the Coyote waste dump. Photographed looking south. Undisturbed vegetation on sandy soil. Area can be subject to waterlogging during the wet season. Burnt 18-20th October 2007 (approx 2 years post-burn).

Vegetation Type: Tussock Grassland with scattered Eucalypt, Hakea and Acacia species. Sedge species and small herbaceous species are common in this area.

Cover: 60%

Date of photograph: 15th October 2008

Species present: Number:

Acacia ?elachantha (juv.) 1

Acacia stipuligera 2

Aristida holathera var. holathera 12

Cyperus blakeanus 61

Eragrostis dielsii 14

Fimbristylis caespitosa 40

Hakea lorea 1

Species present: Number:

Melaleuca nervosa subsp. crosslandiana 1

Mirbelia viminalis 2

Pluchea tetranthera 7

Triodia pungens 130

Plant Health Assessment

Trees: Healthy and have recovered from the fire.

Shrubs: Acacias in the area have generally not recovered from the fire, although most other species (Eucalypts, Hakeas) have regenerated.

Grasses: Generally healthy although they appear to be dry. This is believed to be seasonal.

Photographic Monitoring Site Data Sheet

Company/Project: Tanami Gold Coyote Project Date: 21/09/09 Site ID: KSMS01 Location: 0486010 mE 7834071 mN

Site Description: Western side of waste dump. Sand plain.

Vegetation Type: Open Eucalyptus woodland over mature Triodia hummock grassland. Unburnt.

Date of photograph: 21 September 2009

Species present: Number:

Quadrat 1 (furthest from waste dump) Cover 70%

Acacia adoxa 1

Acacia hilliana 3

Aristida holathera var. holathera 38

Eucalyptus brevifolia 3

Themeda triandra 1

Triodia pungens 11 hummocks

Quadrat 2 Cover: 50%

Acacia adoxa 4

Species present: Number:

Acacia hilliana 5

Triodia pungens 14 hummocks

Quadrat 3 (closest to waste dump) Cover: 60%

Acacia adoxa 2

Acacia lysiphloia 3

Triodia pungens 37 hummocks

Plant Health Assessment

Trees: Healthy

Shrubs: Healthy

Grasses: Healthy, well developed spinifex hummocks

Photographic Monitoring Site Data Sheet

Company/Project: Tanami Gold Coyote Project Date: 21/09/09 Site ID: KSMS02 Location: 0486507 mE 7833921 mN

Site Description: East of waste dump, sand plain with high laterite content.

Vegetation Type: Triodia hummock grassland with scattered Eucalypt and Acacia species. Unburnt.

Date of photograph: 21 September 2009

Species present: Number:

Quadrat 1 (furthest from waste dump) Cover: 40%

Acacia hilliana 6

Aristida holathera var. holathera 4

Eucalyptus odontocarpa 1

Triodia pungens 15 hummocks

Quadrat 2 Cover 60%

Hakea macrocarpa 1

Melaleuca nervosa crosslandiana 9

Triodia pungens 39 hummocks

Species present: Number:

Quadrat 3 Cover 50%

Acacia hilliana 1

Grevillea wickhamii 1

Triodia pungens 14 hummocks

Plant Health Assessment

Trees: Healthy

Shrubs: Healthy

Grasses: Healthy mature spinifex hummocks.

Photographic Monitoring Site Data Sheet

Company/Project: Tanami Gold Coyote Project Date: 21/09/09 Site ID: KSMS03 Location: 0485785 mE 7833411 mN

Site Description: South of waste dump. Red sand plain with high laterite content.

Vegetation Type: Open Eucalyptus woodland over Triodia hummock grassland. Burnt late 2007.

Date of photograph: 21 September 2009

Species present: Number:

Quadrat 1 Cover: 60%

Acacia hilliana 18

Eragrostis eriopoda 18

Heliotropium tenuifolium 20 (dead or dying off)

Hibiscus leptocladus 2

Ptilotus calostachyus 2

Triodia pungens 200+ individual

Quadrat 2 Cover: 60%

Species present: Number:

Acacia hilliana 14

Eragrostis eriopoda 3

Heliotropium tenuifolium 13 (dead or dying off)

Triodia pungens 200+

Unidentified creeper Extensive cover

Quadrat 3 Cover: 50%

Acacia hilliana 27

Aristida holathera holathera 2

Eragrostis eriopoda 4

Heliotropium tenuifolium 11 (dead or dying off)

Ptilotus calostachyus 3

Sida aff. ammophila 2

Triodia pungens 200+

Incidental

Acacia adoxa

Eucalyptus brevifolia

Grevillea wickhamii

Plant Health Assessment

Trees: Healthy. Most have recovered well since the 2007 fire.

Shrubs: Most healthy, some dying off (seasonal). Acacias increasing.

Grasses: Triodia healthy and cover increasing. Annual grasses dying off (seasonal).

Appendix 2

Laboratory results of full chemical analysis of Coyote groundwater.