ASX Code: KGD 22 February 2016

ASX Announcement & Media Release

MOU with Misima Gold Project-1.7moz Gold Resource

Kula Gold Limited (ASX:KGD) (“Kula Gold” or “the Company”) and WCB Resources Ltd (TSX.V:WCB) have signed a non-binding Memorandum of Understanding (MOU) in order to explore the possibility of a joint venture between the two companies and assess the benefits of joint development of WCB's Misima Gold Project (Misima) and Kula Gold’s Gold Project (WIGP). Both assets are located on adjacent islands in , Papua (See Figure 1 below).

Initially, the two companies will assess the synergies between Misima and WIGP with a view to maximising the value of both projects. The Boards of both companies believe that there is potential for significant upside in a joint development of the two gold projects, given their relatively close proximity and the potential benefit of barging ore from one island to the other for processing in a single larger CIP/CIL plant, providing economies of scale and minimising environmental impacts. A joint development along these lines could ultimately increase returns, benefiting shareholders of both WCB and Kula Gold.

The MOU forms the framework under which the companies will work together to explore the technical and commercial benefits of a joint development. It is a non-binding MOU that expresses the wish of both companies to assess this opportunity. The MoU is not exclusive and allows the companies to independently progress the development of their projects.

The Chairman of Kula Gold, David Frecker, said, “We see the MOU with WCB Resources as a logical and pragmatic step for Kula Gold. It opens up the possibility of combining our two projects into one large operation. The economies of scale may be the catalyst for the development of both projects, particularly in the currently low cost environment where costs have materially reduced for plant, equipment, energy and labour. If this combined development is successful it will deliver a larger gold project with expected economies of scale.”

The CEO of WCB Resources, Cameron Switzer, said, “The potential combination of the Misima Gold Project, which currently contains an indicated gold resource of 1.3 million ounces and an additional 0.4 million ounces in inferred in accordance with NI43-101, and the Woodlark Island Gold Project, which contains a historical 2.1 million ounces of gold in accordance with Australian JORC 2004 Standard, could lead to greater commercial returns than would the sum of the individual projects. We have commenced evaluating all potential synergies from an operational and capital perspective that could lead to greater efficiency and opportunity.”

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Figure 1. Shows the close proximity of the Woodlark and Misima Islands in Milne Bay, PNG. For personal use only use personal For

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About WCB Resources Ltd

WCB is focussed on in Milne Bay Province, , where the team has defined a Mineral Resource of 1.7 million ounces of gold and 9 million ounces of silver (prepared in accordance with NI43-101) along with strike and depth extension opportunities. Surface indications and drill hole data further support a porphyry Cu Au system at depth.

WCB Resources entered into a Sale & Farm-In Agreement with Pan Pacific Copper covering EL1747 located on Misima Island, Papua New Guinea. PPC is the owner of granted EL1747 Misima. Under the Agreement, WCB Resources can obtain up to a 70% interest in EL1747 Misima by spending a total of AUD$9.0 million. WCB has reached a 49% interest in the project and is currently earning towards the 70% interest level.

The farm-in on Misima Island is WCB’s principal focus. Misima Island has unique geological pedigree having already produced 4.0 million ounces of gold along with evidence suggestive of further highly significant geological potential for both copper, gold and gold/silver deposits. WCB has identified 1.3 million ounces of gold in an Indicated Resource category and 0.4 million ounces of gold in an Inferred Resource category. Surface indications based on channel sampling along with historic drilling suggest to WCB further ongoing success.

The Misima Mineral Resource was completed independently by AMC Consultants, June 18, 2015, and comprises:

Cutoff Tonnes Gold Silver Deposit OXIDE RECLASS Au Moz Ag Moz g/t Au Mt g/t Au g/t Ag Umuna Oxide Indicated 0.37 4.2 0.71 11 0.10 1.6 Inferred 0.37 2.5 0.94 21 0.07 1.6 Primary Indicated 0.45 32 1.1 4.3 1.2 4.4 Inferred 0.45 4.9 1.2 8 0.19 1.3 Sub-total Indicated 36 1.1 5.1 1.3 6.0 Inferred 7.4 1.1 12 0.27 2.9 Ewatinona Oxide Inferred 0.37 0.54 0.78 3.6 0.013 0.063 Primary Inferred 0.45 3.1 1.0 2.9 0.10 0.29 Sub-total Inferred 3.7 0.97 3.0 0.11 0.35 Misima Total Indicated 36 1.1 5.1 1.3 6.0 Inferred 11 1.1 9.2 0.38 3.3

Notes

1. Rounding may cause apparent computational errors 2. Reported at USD1200/oz gold price USD20/oz silver price within an optimised pit run at USD1400/oz gold price USD20/oz silver price and costs provided by WCB. 3. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.

The technical and scientific disclosure of the Indicated and Inferred Mineral Resource estimate has been reviewed and approved by Mr Peter Stoker an Honorary Fellow of the Australasian Institute of Mining and

For personal use only use personal For Metallurgy and a Chartered Professional, and a full time employee of AMC Consultants Pty Ltd who is a "qualified person" as defined by the National Instrument 43-101. Mr Stoker is independent of WCB and has reviewed and approved the contents of this news release with respect to the Mineral Resource estimate.

WCB Resources is being advised by Curran & Co.

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Background on Woodlark Island Gold Project, PNG Directors

Kula Gold Limited is developing the 100% owned, Woodlark David Frecker Chairman Island Gold Project, located 600 kilometres east of Port Moresby in the Milne Bay Province, Papua New Guinea. Lee Spencer Non-executive director Louis Rozman Non-executive director The Feasibility Study, completed in September 2012, Mark Stowell Non-executive director defined a 2004 JORC Resource of 2.1 million ounces and an Arnold Vogel Non-executive director Ore Reserve of 766,000 ounces based on a gold price of Garry Perotti Company secretary US$1,200 per ounce. The nine year Project is based around three open pit mining areas and a 1.8Mtpa gravity and Registered office carbon in leach plant. Suite 2, 20 Howard Street The Company has been granted the Environment Permit Perth, WA 6000, and the Mining Lease for the Project. T: + 61 8 6144 0588 The Project has excellent upside potential through the F: + 61 8 6144 0589 conversion of Inferred Resources and numerous nearby E: [email protected] exploration targets within a short distance of the proposed W: www.kulagold.com.au process plant location. Auditor For further information, contact: Ernst & Young 11 Mounts Bay Road, Garry Perotti Perth, WA 6000, Australia Chief Financial Officer Office: +61 8 9249 2222 Kula Gold Limited T: + 61 8 6144 0588 Share registry Link Market Services Limited Level 12, 680 George Street Sydney, NSW 2000, Australia T: 1300 554 474 or +61 2 8280 7111

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Competent Person Statements events or any other factors affect the information contained in this announcement, except where required by applicable law and stock The information in this report that relates to Exploration Results are based exchange listing requirements. on information compiled by Mr. Lee Spencer. Mr Spencer was the CEO of Kula Gold Limited until 1 July 2013 and remains on the Kula Gold Board as Woodlark Island Gold Project Mineral Resources Report as per JORC2004 a Non-executive director. Mr. Spencer is a Member of The Australasian As of July 2012 at a 0.5g/t Au lower cutoff Institute of Mining and Metallurgy and has sufficient experience which is Deposit Category Resource Grade Gold relevant to the style of mineralisation and type of deposit under (Mt) (Cut) (Cut) consideration and to the activity which he is undertaking to qualify as a (g/t Gold) (Oz) Competent Person as defined in the 2012 Edition of the Australasian Code Kulumadau Measured 5.0 1.78 285,000 for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Kulumadau Indicated 4.4 1.75 245,000 Kulumadau Inferred 8.6 1.4 375,000 Mr. Spencer consents to the inclusion in the report of these matters based Kulumadau Totals 18.0 1.6 910,000 on information in the form and context in which it appears. Busai Measured 3.9 1.54 190,000 Busai Indicated 10.4 1.4 480,000 The information in this announcement that relates to the Mineral Resource Busai Inferred 8.8 1.3 370,000 estimates for Kulumadau, Busai and Woodlark King is based on information Busai Total 23.1 1.4 1,040,000 compiled by Mr. John Doepel, Principal Geologist for Continental Resource Boniavat Indicated 3.0 1.2 115,000 Boniavat Inferred 1.0 1.8 60,000 Management Pty Limited (Resource Report, Woodlark Island). CRM has Boniavat Total 4.0 1.4 175,000 acted as independent consulting geologist to WML since 2005 and has All Measured 8.9 1.67 480,000 undertaken several visits to the island and to the sample preparation All Indicated 17.8 1.5 840,000 facilities. Mr. Doepel is a Member of The Australasian Institute of Mining All Inferred 18.5 1.4 800,000 Totals* 45.1 1.5 2,120,000 and Metallurgy and has sufficient experience which is relevant to the style Note 1: Totals may appear incorrect due to rounding of mineralisation and type of deposit under consideration and to the Note 2: The Busai Indicated Resource includes 0.4Mt @ 1.4/t Au for 20,000oz from activity which he is undertaking to qualify as a Competent Person as overlying alluvial mineralisation. Note 3: The Busai Inferred Resource includes 0.4Mt @ 1.2/t Au for 15,000oz from defined in the 2012 Edition of the ’Australasian Code for Reporting of overlying alluvial mineralisation and 3.9Mt @ 0.9g/t Au for 110,000oz from Munasi (2km southeast of Busai). Exploration Results, Mineral Resources and Ore Reserves’. Mr. Doepel Note 4: The Boniavat Inferred Resource includes 0.3Mt @ 3.0g/t for 30,000oz Au consents to the inclusion in this announcement of these matters based on from Watou (1.5km south of Woodlark King). Note 5: All Resources based on a 0.5g/t gold cut-off grade information in the form and context in which it appears. Note 6: There have been no material changes to the reported Resources from what was previously reported under the 2004 JORC code The information in this announcement that relates to Ore Reserves is based on information compiled by Mr.Linton Putland, Principal of LJ Putland & Associates and a consultant to Kula Gold’s 100% subsidiary, Woodlark Woodlark Island Gold Project Mineral Resources Report as per JORC2004 Mining Limited. Mr. Putland is a Member of The Australasian Institute of As of July 2012 at a1g/t Au lower cutoff

Mining and Metallurgy and has sufficient experience that is relevant to the Totals may appear incorrect due to rounding style of mineralisation and type of deposit under consideration and to the Resource Category Resource Au Au Oz activity which he is undertaking to qualify as a Competent Person as (Mt) Cut (g/t) Cut defined in the 2012 Edition of the ‘Australasian Code for Reporting of Measured 5.1 2.34 385,000 Exploration Results, Mineral Resources and Ore Reserves’. Mr. Putland Indicated 7.6 2.5 615,000 consents to the inclusion in this announcement of these matters based on Inferred 7.0 2.4 545,000 information in the form and context in which it appears. Totals 19.7 2.45 1,550,000 Forward Looking Statements Woodlark Island Gold Project Ore Reserves All statements other than statements of historical fact included in this Report as per JORC2004 As of July 2012 at variable lower cutoffs announcement including, without limitation, statements regarding future Totals may appear incorrect due to rounding plans and objectives of Kula Gold Limited (Kula Gold) are forward-looking Deposit Proved Probable Total statements. When used in this announcement, forward-looking Tonnes Grade Ounces Tonnes Grade Ounces Tonnes Grade Ounces statements can be identified by words such as ‘may’, ‘could’, ‘believes’, Busai 3,283,000 2.2 233,000 2,811,000 1.9 175,000 6,094,000 2.1 408,000 ‘estimates’, ‘targets’, ‘expects’ or ‘intends’ and other similar words that Kulumadau 3,144,000 2.2 223,000 751,000 2.4 59,000 3,863,000 2.3 282,000 involve risks and uncertainties. Woodlark King 704,000 1.7 39,000 704,000 1.7 39,000 Kulumadau East 330,000 3.7 37,000 330,000 3.7 37,000

These statements are based on an assessment of present economic and Total 6,427,000 2.2 456,000 4,596,000 2.1 310,000 10,991,000 2.2 766,000 operating conditions, and on a number of assumptions regarding future events and actions that, as at the date of this announcement, are expected to take place. Such forward-looking statements are not guarantees of The information in the three tables above was prepared and first disclosed future performance and involve known and unknown risks, uncertainties, under the JORC Code 2004. It has not been updated since to comply with assumptions and other important factors, many of which are beyond the the JORC Code 2012 on the basis that the information has not materially control of the company, its directors and management of Kula Gold that changed since it was last reported. could cause Kula Gold’s actual results to differ materially from the results expressed or anticipated in these statements.

Kula Gold cannot and does not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this announcement will actually occur and

investorsonly use personal For are cautioned not to place undue reliance on these forward- looking statements. Kula Gold does not undertake to update or revise forward-looking statements, or to publish prospective financial information in the future, regardless of whether new information, future

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