5th May 2014 WWW.LCC.ASIA

IMPORTANT DISCLAIMER This report has been prepared by Lincoln Crowne & Company Pty. Limited ("LCC"). The research is based on information obtained from sources believed to be accurate and reliable. LCC does not guarantee the accuracy, reliability, completeness or suitability of any such information and makes no warranty, guarantee or representation, expressly or impliedly about this research. LCC accepts no ob ligation to correct or update the information. No opinion or recommendation is made within this research. This report is not intended to be, nor should it be relied on, as a substitute for professional advice. This report should not be relied upon as the sole basis for any investment decision or planning, and LCC does not accept any responsibility on this basis for actions made

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CODELCO DESPERATE FOR CAPEX FUNDING Global Economic Fundamentals

Source: Capital IQ, COMEX, LCC, LME, SHFE, Thomson Reuters, WGC

Precious Metals Last Week r 4-Wk r YTD r Base Metals Last Week r 4-Wk r YTD r

Gold (A$/oz) 1,404 ▲ 0.1% ▲ 0% ▲ 4% Copper (A$/lb) 3.28 ▼ (1.1%) ▲ 1% ▼ (12%)

Gold (US$/oz) 1,300 ▼ (0.1%) ▼ (0%) ▲ 8% Copper (US$/lb) 3.04 ▼ (1.3%) ▲ 0% ▼ (9%)

Silver (US$/oz) 19.5 ▼ (1.2%) ▼ (2%) ▲ 0% Copper (RMB/t) 48,680 ▼ (0.7%) ▲ 3% ▼ (7%)

Platinum (US$/oz) 1,435 ▲ 0.8% ▼ (1%) ▲ 5% Cobalt (US$/lb) 13.47 ▼ (2.6%) ▼ (3%) ▲ 1%

Palladium (US$/oz) 807 ▼ (0.5%) ▲ 2% ▲ 12% Molybdenum (US$/lb) 13.38 ▲ 2.6% ▲ 13% ▲ 37%

Iron Ore (US$/t) 107 ▼ (7.9%) ▼ (8%) ▼ (20%) Nickel (US$/lb) 8.26 ▼ (1.4%) ▲ 10% ▲ 30%

Crude Oil (US$/barrel) 100 ▼ (0.8%) ▼ (1%) ▲ 1% Lead (US$/lb) 0.93 ▼ (3.8%) ▼ (2%) ▼ (7%)

Gas H.Hub (US$/m btu) 4.67 ▲ 0.3% ▲ 5% ▲ 11% Zinc (US$/lb) 0.91 ▼ (2.4%) ▼ (2%) ▼ (4%)

Uranium (US$/lb) 30 ▼ (2.0%) ▼ (11%) ▼ (13%) Tin (US$/lb) 10.43 ▼ (3.4%) ▼ (1%) ▲ 2%

Currencies & Indices Last Week r 4-Wk r YTD r Global Markets Last Week r 4-Wk r YTD r

AUD/USD 0.925 ▼ (0.2%) ▼ (0%) ▼ (0%) ASX 200 5,458 ▼ (1.3%) ▲ 1% ▲ 2%

RMB/USD 0.160 ▼ (0.1%) ▼ (1%) ▼ (0%) Dow Jones 16,513 ▲ 0.9% ▲ 1% ▼ (0%)

CAD/USD 0.911 ▲ 0.5% ▼ (0%) ▲ 1% S&P 500 Index 1,881 ▲ 1.2% ▲ 1% ▲ 2%

EUR/USD 1.387 ▲ 0.2% ▲ 1% ▲ 0% Shang Hai Index 2,026 ▲ 2.0% ▼ (2%) ▲ 1%

ASX Ordinary Gold 2,200 ▲ 0.1% ▼ (0%) ▼ (4%) Hang Seng Index 22,261 ▼ (0.5%) ▼ (1%) ▼ (4%)

TSX Global Gold 186 — 0.0% ▲ 0% ▼ (1%) Nikkei 225 14,458 ▲ 0.2% ▼ (4%) ▼ (11%)

ASX 300 Metals & Mining 3,238 ▼ (3.6%) ▼ (2%) ▼ (3%) FTSE 100 Index 6,822 ▲ 0.3% ▲ 2% ▲ 4%

TSX Global Mining 76 ▼ (0.7%) ▲ 1% ▲ 0% Euro STOXX 50 Index 3,178 ▲ 1.6% ▼ (2%) ▲ 0%

1,200

1,300

1,400

1,500

1,600

0

100

200

300

Feb Mar Apr May

Tho

usa

nd

s

Gold Price

Volume A$/oz US$/oz200 day average

2.90

3.10

3.30

3.50

3.70

0

100

200

300

Feb Mar Apr May

Tho

usa

nd

s

LME Copper Price and Volume

Volume ('000 lot)Price (A$/lb)Price (US$/lb)

2.90

3.10

3.30

3.50

0

10

20

30

Feb Mar Apr May

COMEX Copper Price and Stocks

Stocks ('000 t)

Price (US$/lb)

44000

46000

48000

50000

52000

54000

0

100

200

300

Feb Mar Apr May

Tho

usa

nd

s SHFE Copper Price and Stocks

Stocks ('000 t)

Price (RMB/t)44000

46000

48000

50000

52000

54000

0

1

1

2

2

3

Feb Mar Apr May

Mill

ion

s

SHFE Copper Price and Volume

Volume (mt)Price (RMB/t)

2.90

3.10

3.30

3.50

0

25

50

75

100

Feb Mar Apr May

COMEX Copper Price and Volume

Volume ('000 lot)

Price (US$/lb)

1500

2000

2500

3000

Feb Mar Apr May

S&P/ASX All Ordinaries Gold Index(XGD)

3.00

3.20

3.40

3.60

3.80

4.00

0

100

200

300

400

500

600

Jan Mar May Jul Sep Nov Jan Mar

China Copper Imports Tonnes (kt)

Copper Price

2.90

3.10

3.30

3.50

3.70

0

100

200

300

Feb Mar Apr May

LME Copper Price and Stocks

Stocks (kt)Price (A$/lb)Price (US$/lb)

0

500

1000

1500

2000

600

800

1000

1200

1400

Q1 12 Q2 12 Q3 12 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13

World Gold Demand and Supply

Total Demand (tonnes)

Total Supply (tonnes)

0

20

40

60

80

100

120

140

160

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Hong Kong Gold Net Imports (tonnes)

2013

2014

$2.96

$2.98

$3.00

$3.02

$3.04

Cash 3 Months Dec 1 Dec 2 Dec 3

LME copper forward curve

Seller

Buyer

5th May 2014 WWW.LCC.ASIA

IMPORTANT DISCLAIMER This report has been prepared by Lincoln Crowne & Company Pty. Limited ("LCC"). The research is based on information obtained from sources believed to be accurate and reliable. LCC does not guarantee the accuracy, reliability, completeness or suitability of any such information and makes no warranty, guarantee or representation, expressly or impliedly about this research. LCC accepts no ob ligation to correct or update the information. No opinion or recommendation is made within this research. This report is not intended to be, nor should it be relied on, as a substitute for professional advice. This report should not be relied upon as the sole basis for any investment decision or planning, and LCC does not accept any responsibility on this basis for actions made

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Markets & Majors

Codelco CEO Thomas Keller warmed to the idea of tapping Chile's sovereign wealth funds (US$23 billion) to pay for its US$30.0 billion investment plan. Is there an alternative?

Captain Copper, a superhero teaching Chilean kids about the metal, courtesy of Codelco

Thomson Reuters - The London Metal Exchange (LME) plans to seek permission to appeal against a court ruling it lost last month, which halted a major reform aimed at cutting backlogs at warehouses. In late March, Russian aluminium producer Rusal won a ruling that halted a warehouse reform because consultations had been "unfair and unlawful". The LME, which is owned by Hong Kong Exchanges and Clearing Ltd, earlier this month lost the first stage of an effort to appeal, in which it turned to the court that made the original ruling. Now it is going up to the next level by filing with the Court of Appeal. A legal source said parties that lose rulings are often advised to seek leave to appeal to give them the widest possible set of options.

Thomson Reuters - U.S. futures exchange CME Group is considering the introduction of daily limits on price moves in gold and silver futures in a bid to rein in wild volatility that has spooked investors in recent years. CME at present has price fluctuation limits for futures contracts in some energy, agricultural commodities and financial products, but none for its precious and base metals products. The possible move reflects growing concern at the largest U.S. exchange of futures and options about big bouts of buying or selling that have caused huge fluctuations in prices without any apparent fundamental reason.

Thomson Reuters - U.S. Securities and Exchange Commission will implement large portions of a rule requiring companies to determine if their products contain "conflict minerals" from a war-torn part of Africa, SEC Chair Mary Jo White said last week. The conflict minerals rule stems from a provision in the 2010 Dodd-Frank Wall Street reform law that requires publicly traded manufacturers to disclose to investors whether any tantalum, tin, gold or tungsten used in their products may have originated from the conflict-ridden Democratic Republic of Congo (DRC).

Fighting a crippling current account deficit and a weakening currency, India’s finance ministry has pushed up gold import duties tenfold from 1% at the start of 2012 to 10% today. Other measures include excise duties at 9%, cash only for imports, re-export of 20% of all imports, transaction taxes and bans on gold-backed exchange traded fund investments. The measures are having the intended effect with latest official data showing gold imports falling 47% to $5.4 billion in the 2013-14 fiscal year. Despite the curbs, overall Indian consumption still rose by more than 100 tonnes to 975 tonnes last year, with an estimated doubling of unofficial imports to more than 100 tonnes.

Newmont Mining Corp is running out of space to store copper concentrate in Indonesia, where a dispute with the government has halted exports, and may be forced to cut production. Newmont indicated that the concentrate barn was set to reach full capacity in the second half of May. If this happens, the company will be forced to implement contingency plans to scale back production. Newmont is cautiously optimistic that it will get permission to export in the coming weeks and that the country's proposed export tax "will be clarified."

Copper Explorers & Emerging Producers

Source: ASX, Capital IQ, LCC. Assumption: A$/US$ of 0.90

Code Company NameClose

PriceWeek r YTD r

Market

Cap (A$m)

52 Week

Range

Cash

(A$m)EV (A$m)

ARE Argonaut Resources 0.022 ▲ 5% (8% ) 8 1.3 6

AVI Avalon Minerals 0.009 ▼ (10% ) (10% ) 11 1.7 9

AVB Avanco Resources 0.067 ▼ (1% ) (6% ) 91 13.7 77

AZS Azure Minerals 0.030 ▼ (9% ) 0% 21 1.6 20

BMB Balamara Resources 0.11 ▼ (8% ) 16% 38 1.5 36

BTR Blackthorn Resources 0.16 ▼ (11% ) (40% ) 25 14.2 11

BOC Bougainville Copper 0.51 ▲ 1% 7% 205 6.2 198

CYU Chinalco Yunnan Copper 0.03 ▼ (29% ) (22% ) 7 0.8 7

CDU Cudeco 1.83 ▼ (3% ) 2% 429 26.3 403

ERM Emmerson Resources 0.045 ▲ 13% 7% 14.7 0.7 14

ENR Encounter Resources 0.19 — 0% 0% 25 3.1 22

ESR Estrella Resources 0.15 ▲ 12% (17% ) 16 1.1 15

FND Finders Resources 0.18 — 0% (17% ) 99 5.2 94

GCR Golden Cross Resources 0.004 — 0% (20% ) 8 3.0 5

HAV Havilah Resources 0.23 ▼ (10% ) (10% ) 27 3.5 24

HCH Hot Chili 0.25 ▼ (15% ) (41% ) 87 5.4 81

HIG Highlands Pacific 0.060 ▼ (6% ) (2% ) 51 8.1 43

IRN Indophil Resources 0.14 ▼ (3% ) (15% ) 168 211.7 (43)

KGL KGL Resources 0.088 ▼ (5% ) (16% ) 12 19.1 (7)

KDR Kidman Resources 0.090 ▼ (14% ) (51% ) 12 3.6 8

MMC Marengo Mining 0.014 ▲ 17% (7% ) 16 0.9 43

MNC Metminco 0.022 ▲ 5% (29% ) 38 5.5 33

PEX Peel Mining 0.18 ▼ (16% ) (31% ) 24 3.9 20

RDM Red Metal 0.18 ▼ (5% ) 20% 26 1.9 24

RXM Rex Minerals 0.33 ▼ (3% ) (31% ) 73 27.6 45

SBR Sabre Resources 0.031 — 0% (28% ) 7 3.5 4

SUH Southern Hemisphere 0.065 ▲ 12% 30% 16 2.8 13

SMD Syndicated Metals 0.032 ▼ (6% ) (6% ) 9 2.3 6

TLM Talisman Mining 0.11 ▲ 8% 0% 14 16.6 (3)

VXR Venturex Resources 0.006 ▼ (14% ) (40% ) 9 2.1 7

XAM Xanadu Mines 0.050 ▲ 9% 0% 12 1.5 10

5th May 2014 WWW.LCC.ASIA

IMPORTANT DISCLAIMER This report has been prepared by Lincoln Crowne & Company Pty. Limited ("LCC"). The research is based on information obtained from sources believed to be accurate and reliable. LCC does not guarantee the accuracy, reliability, completeness or suitability of any such information and makes no warranty, guarantee or representation, expressly or impliedly about this research. LCC accepts no ob ligation to correct or update the information. No opinion or recommendation is made within this research. This report is not intended to be, nor should it be relied on, as a substitute for professional advice. This report should not be relied upon as the sole basis for any investment decision or planning, and LCC does not accept any responsibility on this basis for actions made

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Copper Producers

Source: ASX, Capital IQ, LCC. Assumption: A$/US$ of 0.90

Mergers & Acquisitions

First quarter M&A activity in the global metals market plunged to its lowest level since 2008, with 13 deals totalling US$3.3 billion, a 78% drop year on year, according to a report from PwC.

Barrick Gold Corp and Newmont Mining have terminated talks for a gold mega-merger.

Ord River Resources (ASX: ORD) has made a combined scrip and cash takeover office to acquire Dampier Gold (ASX: DAU). Ord River Resources is offering 6 ORD shares and 1.5 cents cash per DAU share. The implied offer price of A$0.0486 per DAU share (calculated the 90 day VWAP of ORD shares) represent a 79% premium to the 90 day VWAP of DAU shares.

ASX-Listed Company News

Aditya Birla Minerals (ASX: ABY) stood down the majority of its

workforce as the Nifty copper operations continue to be

suspended.

Sandfire Resources (ASX: SFR) has completed an accelerated

prepayment of A$20 million against the DeGrussa project finance

facility. The prepayment reduces the outstanding balance of the

facility to A$170 million as at 30 April 2014.

Northern Star Resources (ASX: NST) produced 50,219 oz of gold

in the March quarter at cash operating costs of A$929/oz and

AISC of A$1,167/oz. Production guidance is expected to be

between 180,000 to 190,000 ounces of gold at between A$1,100

to A$1,150/oz AISC. The June quarter is expected to recover

80,000 to 90,000 oz of gold at an AISC of A$1,100/oz.

St Barbara (ASX: SBM) produced 92,522oz of gold for the March

quarter (December quarter: 93,577 oz), with production from the

Australian operations consistent with expectations, and lower than

expected production from the Pacific operations. Consolidated

cash operating costs for the quarter were A$1,139/oz (Dec Q:

A$1,189/oz), with good cost performance at Gwalia, but continued

above plan costs in the Pacific operations. AISC were A$1455/oz.

Gold Explorers & Emerging Producers

Source: ASX, Capital IQ, LCC. Assumption: A$/US$ of 0.90

Gold Producers

Source: ASX, Capital IQ, LCC. Assumption: A$/US$ of 0.90

Code Company Name Close Price Week r YTD rMarket

Cap (A$m)

52 Week

Range

Cash

(A$m)EV (A$m)

EV/

EBITDA

ABY Aditya Birla Minerals 0.21 ▼ (29% ) (38% ) 66 137 (70) NM

AOH Altona Mining 0.15 ▼ (3% ) (9% ) 80 16 64 3.1x

DML Discovery Metals 0.025 ▼ (7% ) (53% ) 14 3 169 NM

HGO Hillgrove Resources 0.065 ▼ (8% ) (28% ) 77 17 105 2.5x

OZL OZ Minerals 3.530 ▼ (6% ) 12% 1,071 364 707 4.1x

PNA PanAust 1.535 ▼ (5% ) (15% ) 939 130 992 4.0x

SFR Sandfire Resources 5.500 ▼ (6% ) (15% ) 856 90 956 8.0x

SRQ Straits Resources 0.006 ▲ 20% (25% ) 7 12 118 NM

TGS Tiger Resources 0.335 ▼ (1% ) (3% ) 281 11 351 4.4x

MWE Mawson West C$0.47 ▼ (11% ) (20% ) 78 54 42 0.4x985 CST Mining Group HK$0.052 ▼ (5% ) (22% ) 196 119 77 NM

1208 MMG Limited HK$1.88 ▲ 6% 15% 1,386 154 3,045 3.9x

Code Company NameClose

PriceWeek r YTD r

Market

Cap (A$m)

52 Week

Range

Cash

(A$m)

EV

(A$m)

ABU ABM Resources 0.023 — 0% 5% 87 14.4 73

ALK Alkane Resources 0.290 ▼ (11% ) (15% ) 108 18.6 89

AUK Augur Resources 0.049 — 0% (35% ) 13 1.7 11

AZM Azumah Resources 0.039 ▼ (15% ) 39% 14 4.9 9

BSR Bassari Resources 0.006 ▼ (25% ) (25% ) 6 0.1 6

BAB Bullabulling Gold 0.076 ▲ 9% 69% 26 3.0 23

CHN Chalice Gold 0.15 ▼ (3% ) 11% 37 50.4 (13)

CHZ Chesser Resources 0.11 ▼ (8% ) 5% 24 2.9 21

CDG Cleveland Mining 0.09 ▲ 23% (8% ) 22 6.6 16

CAS Crusader Resources 0.26 ▼ (2% ) (15% ) 32 2.9 34

DCN Dacian Gold 0.35 — 0% 46% 34 12.2 21

EXG Excelsior Gold 0.082 ▲ 2% 19% 34 8.7 23

FML Focus Minerals 0.01 ▼ (8% ) 0% 110 78.6 49

GCY Gascoyne Resources 0.14 ▲ 17% 0% 22 1.8 20

GOR Gold Road Resources 0.15 ▼ (9% ) 52% 77 14.1 63

GRY Gryphon Minerals 0.13 ▼ (7% ) (24% ) 52 38.7 13

IDC Indochine Mining 0.060 ▼ (12% ) 40% 60 2.0 60

IAU Intrepid Mines 0.27 ▼ (2% ) (14% ) 150 97.6 53

KGD Kula Gold 0.09 ▼ (5% ) (14% ) 11 1.8 11

MSR Manas Resources 0.027 ▼ (10% ) (16% ) 11 3.5 8

MYG Mutiny Gold 0.027 ▼ (7% ) (16% ) 18 3.8 21

OBS Orbis Gold 0.26 — 0% 4% 65 10.1 55

ORD Ord Resources 0.00 — 0% (20% ) 5 2.3 4

PAN Panoramic Resources 0.60 ▼ (12% ) 138% 192 41.0 151

PIR Papillon Resources 1.22 ▼ (8% ) 24% 415 41.3 374

PXG Phoenix Gold 0.12 ▼ (14% ) (25% ) 40 8.7 31

RED Red 5 0.07 ▼ (3% ) (22% ) 52 41.4 11

RNI Resource & Investment 0.078 — 0% 47% 27 1.3 46

ROL Robust Resources 0.23 ▼ (15% ) (34% ) 49 5.4 49

SIH Sihayo Gold 0.026 ▼ (13% ) (13% ) 26 0.2 26

SXG Southern Cross Goldfields 0.014 ▲ 17% 8% 12 2.9 15

SUM Sumatra Copper & Gold 0.06 ▼ (21% ) (14% ) 25 1.7 26

TAM Tanami Gold 0.02 ▼ (5% ) (9% ) 24 1.6 29

WAF West African Resources 0.12 ▼ (8% ) (18% ) 31 1.2 30

WPG WPG Resources 0.036 ▲ 6% 24% 9 8.2 1

YTC YTC Resources 0.21 — 0% (9% ) 69 21.6 132

Code Company NameClose

PriceWeek r YTD r

Market Cap

(A$m)52 Week Range

Cash

(A$m)EV (A$m)

EV/

EBITDA

AQG Alacer Gold 2.56 ▼ (3% ) 13% 764 292 472 2.5x

ALK Alkane Resources 0.29 ▼ (11% ) (15% ) 108 19 89 6.4x

AGD Austral Gold 0.09 — 0% (25% ) 15 9 56 3.5x

BDR Beadell Resources 0.64 ▼ (4% ) (19% ) 506 13 543 4.9x

BEZ Besra Gold 0.024 — 0% (47% ) 8 1 32 NM

DRM Doray Minerals 0.85 ▼ (4% ) 52% 139 37 130 5.5x

DRA Dragon Mining 0.12 ▼ (20% ) (8% ) 11 13 (3) 1.3x

EVN Evolution Mining 0.81 ▼ (10% ) 32% 575 37 680 4.0x

EVR Endeavour Mining Corp 0.79 ▼ (4% ) 63% 335 119 516 NM

IGO Independence Group 4.11 ▼ (3% ) 32% 959 47 962 11.7x

KCN Kingsgate Consolidated 0.85 ▼ (12% ) (9% ) 190 52 297 4.1x

KRM Kingsrose Mining 0.42 ▲ 5% 25% 151 6 145 NM

LSA Lachlan Star 0.14 ▼ (20% ) (30% ) 21 3 22 NM

MML Medusa Mining 1.74 ▼ (9% ) (15% ) 362 23 339 6.6x

MLX Metals X 0.21 — 0% 21% 339 73 266 13.8x

MOY Millennium Minerals 0.10 ▼ (17% ) (49% ) 21 9 41 1.0x

MLI Mintails 0.054 — 0% (4% ) 15 2 13 NM

NCM Newcrest Mining 10.13 ▼ (1% ) 30% 7,759 121 12,276 11.6x

NGF Norton Gold Fields 0.10 ▼ (20% ) (26% ) 93 32 176 2.3x

NST Northern Star Resources 1.10 ▼ (6% ) 40% 636 76 560 10.3x

OGC OceanaGold Corporation 2.65 ▲ 7% 67% 842 47 983 2.8x

PNA PanAust 1.54 ▼ (5% ) (15% ) 939 130 992 4.0x

PGI PanTerra Gold 0.039 — 0% (5% ) 30 5 74 17.0x

PRU Perseus Mining 0.31 ▼ (15% ) 24% 161 48 113 13.0x

RMS Ramelius Resources 0.11 — 0% 8% 38 28 14 0.9x

RRL Regis Resources 2.35 ▼ (5% ) (20% ) 1,174 31 1,159 5.4x

RSG Resolute Mining 0.58 ▼ (10% ) 5% 372 68 408 3.2x

SAR Saracen Mineral Holdings 0.31 ▼ (6% ) 65% 242 67 187 2.9x

SBM St Barbara 0.19 ▼ (16% ) (27% ) 93 58 372 NM

SLR Silver Lake Resources 0.41 ▼ (6% ) (23% ) 206 41 165 NM

TBR Tribune Resources 2.95 ▲ 2% 27% 148 11 137 3.0x

TGZ Teranga Gold Corp 0.67 ▼ (13% ) 22% 254 54 240 NM

TRY Troy Resources 0.96 ▼ (5% ) 22% 187 54 173 7.0x

UML Unity Mining 0.016 ▼ (6% ) (61% ) 16 8 8 0.3x

VGO Vantage Goldfields 0.045 ▲ 22% 73% 11 13 (2) 2.5x

ANG AngloGold Ashanti ZAR190 ▼ (2% ) 55% 7,894 725 11,390 6.2x

ABX Barrick Gold Corp C$19.14 ▼ (3% ) 2% 21,945 2,882 22,158 4.1x

CRK Crocodile Gold Corp C$0.27 ▲ 13% 121% 126 38 131 1.8x

GFI Goldfields ZAR44 ▼ (1% ) 34% 3,499 358 5,548 NM

NEM Newmont Mining Corp US$25 ▼ (7% ) 7% 13,316 1,591 22,031 7.0x