· PDF fileSeveral satellite targets to drill test and follow up FROM DISCOVERY TO DEVELOPMENT...

SOUTHERNGOLD

SOUTHERN GOLD: A UNIQUE JUNIOR Investor Presentation – March 2015

Disclaimer

Forward-looking statements

The information in this presentation is published to inform you about Southern Gold Limited (“Southern Gold”) and its activities. Some statements in thispresentation regarding estimates or future events are forward looking statements. These may include, without limitation:

• Estimates of future cash flows, the sensitivity of cash flows to metal prices and foreign exchange rate movements;

• Estimates of future metal production; and

• Estimates of the resource base and statements regarding future exploration results and increasing the company’s resource base

Such forward looking statements are based on a number of estimates and assumptions made by the Company and its consultants in light of experience,current conditions and expectations of future developments which the Company believes are appropriate in the current circumstances. Such statementsare expressed in good faith and believed to have a reasonable basis. However the estimates are subject to known and unknown risks and uncertaintiesthat could cause actual results to differ materially from estimated results.

All reasonable efforts have been made to provide accurate information, but the Company does not undertake any obligation to release publicly anyrevisions to any “forward-looking statement” to reflect events or circumstances after the date of this presentation, except as me be required underapplicable laws. Recipients should make their own enquiries in relation to any investment decisions from a licensed investment advisor.

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Why Buy Southern Gold?

Key features of the company

FROM DISCOVERY TO DEVELOPMENT 3

1. “Blue Chip” Gold Address

2. High grade gold resource

3. Cash generation from near term production

4. Metals X Deal – MLX as operators at Cannon

5. Potential resource extensions

6. “Blue Sky”


Southern Gold’s Cannon Gold Resource: 30km east of the world class gold district of Kalgoorlie


Metals X – Jubilee Mill

is where Cannon Gold

Resource ore will be

processed

(approx. 35km haul).

2. High Grade Gold Resource

ON TRACK TO PRODUCTION 5

Cannon Project Gold Resource - 93% in the Indicated category

Indicated Inferred TotalTonnes Au Au Tonnes Au Au Tonnes Au Au

t g/t Ounces t g/t Ounces t g/t Ounces

Oxide 8,000 3.0 800 1,500 2.4 100 9,500 2.9 900

Transitional 137,600 3.1 13,900 34,100 2.6 2,900 171,700 3.0 16,800

Fresh 573,500 4.3 78,500 57,500 2.3 4,200 631,000 4.1 82,800

Total 719,100 4.0 93,200 93,000 2.4 7,200 812,200 3.9 100,400

3. Cash Generation from near term production

ON TRACK TO PRODUCTION 6

Completed PFS confirmed favourable project economics

Base CaseA$1,400/oz Au

Scenario 1A$1,500/oz Au

Scenario 2A$1,600/oz Au

Mine Life Months 36 36 36

Tonnes Mines Tonnes 484,000 484,000 484,000

Head grade g/t Au 4.4 4.4 4.4

Mined Ounces1 oz Au 68,200 68,200 68,200

Recovery (ave) % 92 92 92

Infrastructure Cost A$m 13.3 13.3 13.3

Operating Cost A$/oz 964 964 964

WA State Royalty2 % 2.5 2.5 2.5

Free surplus cash flow A$m 12.4 18.5 24.6

(See ASX announcement dated 29 August 2013 and 18 February 2014 for key parameters of PFS)Note 1: Mined ounces and grade calculated, based on cut-off grade from $1400/oz base case scenario.Note 2: WA State Royalty of 2.5% is applied to all ounces produced after the first 2,500 oz produced in each financial year.

4. The Metals X Deal – MLX as operatorsNov 2014: Mining and profit share agreement executed


Key terms

Metals X to manage all mining operations

At-cost, open book basis

Secured loan facility A$500,000

Profit share 50:50

• Metals X - experienced and well-funded mining company who are an Australian top ten gold producer and Australia’s largest tin producer.

• Metals X - finance, mine, haul and process ore from the Cannon Gold Resource with these activities charged on an at-cost, open book basis.

• Reduces project execution risk.

• Phase 1 development of the open pit within 12 months of commencement

• with an option at that point for the parties to agree to proceed with Phase 2 underground development.

Cross sections show continuity of broad high grade gold zones

8FROM DISCOVERY TO DEVELOPMENT

5. Potential Gold Resource Extensions

Section 110mN Section 175mN

7.6m @21.5g/t Au

7.5m @11.5g/t Au

Open

Open

Several satellite targets to drill test and follow up


6. “Blue Sky”

You have to drill more than shallow holes…..


6. “Blue Sky”

……..Cannon resource sits under the RAB drilling


6. “Blue Sky”

……..lets take a look at that again


6. “Blue Sky”

Corporate Overview

Financial information

Number of shares 422.62 m

Share price (6 March 2015) A$0.012

Market capitalisation A$5.1 m

Debt (Metals X finance) A$0.5 m

Cash (@ 31 December 2014) A$0.6 m

Enterprise value A$5.0 m

Major shareholders

Silver Lake Resources 10.24%

Gary B Branch 5.56%

JP Morgan Nominees 4.32%

Board and management 7.5%

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Relative share price performance

Why did I “buy” Southern Gold?


2. High grade gold resource

3. Cash generation

4. Metals X as Operators

5. Resource extensions

6. “Blue Sky”

Board of Directors

• Corporate and technical experience in the resource sector for 25 years.

• Senior executive for the past decade including Toro Energy Ltd and Asiatic Gold Ltd.

• Gold experience with Normandy NFM, Aurora Gold, RGC Exploration.

• Project finance executive in investment banking.

Greg Boulton AM – Non-Executive Chairman

Corporate finance

• 25 years of corporate finance experience

• Experience in capital raisings, acquisitions and commercial negotiations

• Chairman of Paragon Equity

• Deputy Chairman K&S Corporation

• Non-Executive Director of Statewide Superannuation Trust

• 40 years of mining industry experience

• Worked in company secretarial, Non-Executive and Managing Director roles

• Experience in debt and equity raising, project evaluation and feasibility studies in Australia and overseas

• Executive Chairman/CEO of AIM-listed Thor Mining

• Non-Executive Director at ASX-listed Emperor Range Group Ltd

• Over 27 years experience in the Australian and Asian resource sector

• Driven business development, corporate merger and acquisition activities in precious metals, bulk commodities and industrial minerals

• Experience in minerals exploration, project development and commercial evaluation of mineral assets

• Previous directorships with ASX-listed Lawson Gold and formerly ASX-listed FerrAus

David Turvey – Non-Executive Director

Geology

Mick Billing – Non-Executive Director

Corporate finance and accounting

Simon Mitchell – Managing Director

Geology and Corporate Development

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Multi-disciplinary Board with strong technical and corporate experience

SOUTHERNGOLD

Current Activities

Grade Control Drilling Completed

16

CANNON GOLD PROJECT – Grade Control and Sterilisation Drilling completed in February

ON TRACK TO PRODUCTION

Grade Control Drilling Results

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Within the limits of drilling, Grade Control affirms the overall geometry of the mineralisation


Pre-Development/Permitting Timetable

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ACTIVITY FINALISED DEC JAN FEB MAR APR MAY

Project Funding

Permitting

- Project Management Plan

- Miscellaneous Licence (A)

- Mining Proposal Submitted

- Environmental Management Plan Submitted

- Closure Plan Submitted

- Vegetation Clearing Permit

- Miscellaneous Licence (B) Submitted

Pre-Development- Grade Control Drilling Completed

- Sterilisation Drilling Completed

- PFS and Mine Design optimised

- Pre-strip/Mining commence

- Haul Road construction

- Railway crossing construction

CANNON GOLD PROJECT - SCHEDULE



Cannon Project – Resource Extensions

Open

Open

Key milestones

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Strong newsflow expected in short to medium term

Cannon Gold Resource development and production

Grade Control Drilling Results March 2015

Re-optimisation, pit design and revised schedule and economics March/April 2015

Final regulatory approvals submitted March/April 2015

Roadworks and other preliminary development* 1Q 2015

Complete development and begin production* 2Q 2015

First Net Cash Flow from Operations* 4Q 2015

Near Cannon Gold Resource exploration

Follow up drilling at Arsenal and Cannon South 2015

First pass drill testing of Tier 1 targets 2015

Regional exploration

Exploration program at Cowarna Project 2015/2016

* Development dates are subject to regulatory approval schedules and Exploration programs will be scheduled around cash flow timelines


Discovery to development to further discovery

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Cannon Gold Resource

• Only 30km east of Kalgoorlie giving easy access to infrastructure, skilled workforce, informed stakeholders, mining equipment and processing plants

• Development in 2015 could provide an early cashflow opportunity and support further growth

• Existing potential to grow the gold resource through further testing and underground exploration

Metals X transaction

• Mining and profit share agreement to fast-track development and reduce project risk

• Potential to lead to further optimisation of project costs and mine plan

The bigger picture

• 200km2 tenement holding, with 30 priority anomalies identified from regional geochemical auger programme conducted over the eastern area of the Bulong Gold Project

• Follow up work has prioritised 6 Tier 1 targets – what else did the RAB drilling miss?

• Knowledge gained from work at the Cannon Gold Resource provides important structural and geochemical information to assess regional targets in context

Mining of Cannon Gold Resource and wider tenement position provides strong future outlook


SOUTHERNGOLD

Appendix A – Bulong Gold Resource

Indicated Inferred Total

Tonnes Au Au Tonnes Au Au Tonnes Au Au

t g/t Ounces t g/t Ounces t g/t Ounces

Cannon Gold Resource

Oxide 8,000 3.0 800 1,500 2.4 100 9,500 2.9 900

Transitional 137,600 3.1 13,900 34,100 2.6 2,900 171,700 3.0 16,800

Fresh 573,500 4.3 78,500 57,500 2.3 4,200 631,000 4.1 82,800

Total 719,100 4.0 93,200 93,000 2.4 7,200 812,200 3.9 100,400

Pinner Resource

Oxide - - - 600 3.0 200 600 3.0 200

Transitional - - - 76,400 2.2 5,400 76,400 2.2 5,400

Fresh - - - 94,900 2.0 6,100 94,900 2.0 6,100

Total - - - 172,000 2.1 11,500 172,000 2.1 11,500

Total Resource 719,100 4.0 93,200 265,000 2.2 18,700 984,100 3.5 111,900

Appendix 1 – Bulong Gold Project Resource Table

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Bulong Gold Resource

93% of the Cannon Gold Resource is within the Indicated category

Appendix 1 – Bulong Gold Project Resource Table

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Disclaimer cont.Competent Person’s statements

The information in this report that relates to Exploration Results has been compiled under the supervision of Mr. Ian Blucher (MAusIMM). Mr Blucher, who is a full time employees of Southern Gold Limited and a Member of the Australian Institute of Mining and Metallurgy, has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he has undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for the Reporting of Mineral Resources and Ore Reserves. Mr Blucher consents to the inclusion in this report of the matters based on the information in the form and context in which it appears.

The information in this report that relates to Mineral Resources is based on information compiled by Mr Ian Blucher (MAusIMM). Mr. Blucher is a full time employee of Southern Gold Limited and has sufficient experience that is relevant to the style of mineralisation, type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (JORC, 2012). Mr Blucher consents to the inclusion in this report of the matters based on the information in the form and context in which it appears.

Pre-Feasibility Study Results

The Optimisation announcement dated 13 February 2014 had no material changes to the methodology and assumptions used to determine the production target as detailed in the PFS announcement of 28 August 2013, and all of the key parameters continue to apply. The Optimisation announcement provided an update to the market of the reduction in the forecast operating costs. There have been no material changes to the methodology used to determine the operating costs as outlined in the PFS announcement.

Simon MitchellManaging Director

+61 8 8368 [email protected]

229 Greenhill Road Dulwich SA 5065

PO Box 255 Kent Town SA 5071

SOUTHERNGOLD

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