BHP Group Limited — Capital/Financing Update 2016

Jan 28, 2016

ASX / MEDIA RELEASE

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29 January 2016

ST GEORGE COMPLETES ACQUISITION OF MT ALEXANDER PROJECT

HIGHLIGHTS:

• St George finalises acquisition of 75% interest in the high grade nickel‐copper sulphide Mt Alexander Project from BHP Billiton

• Western Areas retains a 25% interest in the Project and has also become a shareholder in St George

• A high quality addition to St George’s growing WA project portfolio

• Drilling programme planned by St George in 2016

HIGH GRADE NICKEL‐COPPER SULPHIDE PROJECT – ACQUISITION COMPLETED

St George Mining Limited (ASX: SGQ ) (‘St George’ or ‘the Company’) is pleased to announce it has completed the previously announced acquisition of a 75% interest in the Mt Alexander Project from BHP Billiton Nickel West Pty Ltd (“Nickel West”).

The completion of the acquisition follows satisfaction of all conditions precedent under the Sale Agreement signed by the parties. The acquisition by St George includes all technical and exploration data for the Project from Nickel West.

St George has also allotted 3,500,000 ordinary shares to Western Areas Limited, which agreed to not exercise its right of pre‐emption over Nickel West’s interest in the Mt Alexander Project. For further details of the terms for the acquisition of the Mt Alexander Project, see our ASX Release dated 17 December 2015 “New High Grade Nickel‐Copper Sulphide Project” .

St George Mining Executive Chairman, John Prineas said:

“This is an important strategic acquisition for St George which we believe will deliver significant value for our shareholders.

“Very impressive intersections of shallow high grade nickel‐copper sulphides have already been discovered by drilling at Mt Alexander.

”We are looking forward to our first drilling campaign at Mt Alexander, and the opportunity to make further significant discoveries of high grade mineralisation.”

The Mt Alexander Project is an outstanding low‐risk exploration project in a world class nickel region of Western Australia, and offers tremendous exploration upside for St George.

The Project is located 120km south‐southwest of the Agnew‐Wiluna belt which hosts numerous world class nickel deposits. St George will be the Manager of the Project with Western Areas retaining a 25% non‐ contributing interest in the Project until there is a decision to mine.

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ASX / MEDIA RELEASE

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High grade nickel‐copper sulphides were discovered at the Mt Alexander Project in 2008 from drilling at the Cathedrals Prospect. The nickel‐copper sulphides were discovered by drill testing below isolated nickel‐iron gossans hosted in granites.

Follow‐up drilling targeting electromagnetic (EM) conductors at Cathedrals resulted in further significant high grade nickel‐copper sulphide intersections including:

• 4m @ 4.9%Ni, 1.7%Cu and 3.9g/t total PGEs from 91.4m in drill hole MAD12

• 3m @ 3.8%Ni, 1.6%Cu and 2.7g/t total PGEs from 56.3m in drill hole MAD13

• 6m @ 3.3%Ni, 1.5%Cu and 2.7g/t total PGEs from 60m in drill hole MARC49

The drill holes intersected massive, matrix and disseminated sulphides at shallow depth. Figures 1 and 2 show sections of the drill core from MAD12 and MAD13 with massive nickel‐copper sulphides in komatiite ultramafics.

The Cathedrals Fault that hosts the mineralised komatiites remains largely untested along strike from the Cathedrals Prospect.

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Figure 1 – high grade nickel‐copper sulphides in komatiite ultramafic in MAD12

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Figure 2 – high grade nickel‐copper sulphides in komatiite ultramafic on contact with granite in MAD13

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ASX / MEDIA RELEASE

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St George has initiated a detailed geological review of the exploration data for the Mt Alexander Project. The first joint venture meeting with Western Areas’ technical team will take place next week, with a view to preparing a multi‐phase exploration programme for Mt Alexander in 2016. A further announcement regarding proposed exploration at Mt Alexander, including the next drill programme to test nickel sulphide targets, will be made soon.

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Figure 3 – a map showing the location of Mt Alexander Project over TMI magnetics. The Hawaii Project was also recently acquired by St George from Nickel West.

In October 2015, St George completed the 100% acquisition of exploration licence E29/548 from Nickel West which covers 45.12 sq km. In addition, St George has lodged an application for exploration licence E29/954 which covers 41.72 sq km.

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ASX / MEDIA RELEASE

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These two tenements are owned 100% by St George, with E29/638 – the tenement that hosts the Cathedrals Prospect – being a joint venture between Western Areas (25%) and St George (75%).

All three tenements are contiguous and provide St George with approximately 165 sq km of highly prospective ground in this under‐explored area.

TRANSACTION TERMS

The consideration payable to Nickel West by St George for the acquisition of the 75% interest in the Mt Alexander Project is $300,000.

Other key commercial terms of the acquisition are:

• 1) Nickel West has off‐take rights to St George’s share of any nickel produced from the Project;

• 2) Nickel West may charge a base royalty of 1% of the proceeds from St George’s share of any mineral production at the Project; and

• 3) Nickel West may charge an additional royalty of 1% of the proceeds from St George’s share of any nickel produced from the Project provided that the additional royalty is only payable if a minimum measured and indicated JORC resource of at least 25,000 tonnes of contained nickel is defined at the Project and payments of the additional royalty start 12 months after commercial production from the Project.

For further information, please contact:

John Prineas Colin Hay Executive Chairman Professional Public Relations St George Mining Limited (+61) 08 9388 0944 mob 0404 683 355 (+61) 411 421 253 colin.hay@ppr.com.au John.prineas@stgm.com.au

Competent Person Statement:

The information in this report that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr Matthew McCarthy, a Competent Person who is a Member of The Australasian Institute of Geoscientists. Mr McCarthy is employed by St George Mining Limited.

Mr McCarthy has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the Joint Ore Reserves Committee (JORC) Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr McCarthy consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

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The following sections are provided for compliance with requirements for the reporting of exploration results under the JORC Code, 2012 Edition.

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections)

Criteria	JORC Code explanation	Commentary
Sampling	Nature and quality of sampling (eg cut	This ASX Release dated 29 January 2016 reports on the acquisition
techniques	channels, random chips, or specific specialised	by St George Mining Limited (“St George”) of a majority 75% interest
	industry standard measurement tools	in the Mt Alexander Project which is encompassed in E29/638.
	appropriate to the minerals under investigation, such as down hole gamma sondes, or handheld XRF instruments, etc.). These examples should not be taken as limiting	This ASX Release refers only to historic exploration drilling and does not report any new drilling results, assay or other sampling exploration work.
	the broad meaning of sampling.
	Include reference to measures taken to ensure	This ASX Release refers only to historic exploration drilling and does
	sample representivity and the appropriate	not report any new drilling results, assay or other sampling
	calibration of any measurement tools or	exploration work.
	systems used.
	Aspects of the determination of mineralisation	This ASX Release refers only to historic exploration drilling and does
	that are Material to the Public Report.	not report any new drilling results, assay or other sampling
	In cases where ‘industry standard’ work has	exploration work.
	been done this would be relatively simple (eg
	‘reverse circulation drilling was used to obtain
	1 m samples from which 3 kg was pulverised to
	produce a 30 g charge for fire assay’). In other
	cases more explanation may be required, such
	as where there is coarse gold that has inherent
	sampling problems. Unusual commodities or
	mineralisation types (eg submarine nodules)
	may warrant disclosure of detailed
	information.
Drilling	Drill type (eg core, reverse circulation, open‐	This ASX Release refers only to historic exploration drilling and does
techniques	hole hammer, rotary air blast, auger, Bangka,	not report any new drilling results, assay or other sampling
	sonic, etc) and details (eg core diameter, triple	exploration work.
	or standard tube, depth of diamond tails, face‐ sampling bit or other type, whether core is oriented and if so, by what method, etc).	References to reverse circulation and diamond drilling on E29/638 are to drilling conducted by BHP Billiton Nickel West Pty Ltd (“Nickel West”), the party from which St George has acquired its 75%
		majority interest in the tenement (see Section:Exploration Done by
		Other Parties)
Drill sample	Method of recording and assessing core and	This ASX Release refers only to historic exploration drilling and does
recovery	chip sample recoveries and results assessed.	not report any new drilling results, assay or other sampling
		exploration work.
	Measures taken to maximise sample recovery	This ASX Release refers only to historic exploration drilling and does
	and ensure representative nature of the	not report any new drilling results, assay or other sampling
	samples.	exploration work.

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Criteria	JORC Code explanation	Commentary
	Whether a relationship exists between sample	This ASX Release refers only to historic exploration drilling and does
	recovery and grade and whether sample bias	not report any new drilling results, assay or other sampling
	may have occurred due to preferential	exploration work.
	loss/gain of fine/coarse material.
Logging	Whether core and chip samples have been	This ASX Release refers only to historic exploration drilling and does
	geologically and geotechnically logged to a	not report any new drilling results, assay or other sampling
	level of detail to support appropriate Mineral	exploration work.
	Resource estimation, mining studies and
	metallurgical studies.
	Whether logging is qualitative or quantitative	This ASX Release refers only to historic exploration drilling and does
	in nature. Core (or costean, channel, etc)	not report any new drilling results, assay or other sampling
	photography.	exploration work.
	The total length and percentage of the relevant	This ASX Release refers only to historic exploration drilling and does
	intersections logged.	not report any new drilling results, assay or other sampling
		exploration work.
Sub‐sampling	If core, whether cut or sawn and whether	This ASX Release refers only to historic exploration drilling and does
techniques and	quarter, half or all core taken.	not report any new drilling results, assay or other sampling
sample		exploration work.
preparation
	If non‐core, whether riffled, tube sampled,	This ASX Release refers only to historic exploration drilling and does
	rotary split, etc and whether sampled wet or	not report any new drilling results, assay or other sampling
	dry.	exploration work.
	For all sample types, the nature, quality and	This ASX Release refers only to historic exploration drilling and does
	appropriateness of the sample preparation	not report any new drilling results, assay or other sampling
	technique.	exploration work.
	Quality control procedures adopted for all sub‐	This ASX Release refers only to historic exploration drilling and does
	sampling stages to maximise representivity of	not report any new drilling results, assay or other sampling
	samples.	exploration work.
	Measures taken to ensure that the sampling is	This ASX Release refers only to historic exploration drilling and does
	representative of the in situ material collected,	not report any new drilling results, assay or other sampling
	including for instance results for field	exploration work.
	duplicate/second‐half sampling.
	Whether sample sizes are appropriate to the	This ASX Release refers only to historic exploration drilling and does
	grain size of the material being sampled.	not report any new drilling results, assay or other sampling
		exploration work.
Quality of	The nature, quality and appropriateness of the	This ASX Release refers only to historic exploration drilling and does
assay data and	assaying and laboratory procedures used and	not report any new drilling results, assay or other sampling
laboratory	whether the technique is considered partial or	exploration work.
tests	total.

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Criteria	JORC Code explanation	Commentary
	For geophysical tools, spectrometers, handheld	This ASX Release refers only to historic exploration drilling and does
	XRF instruments, etc, the parameters used in	not report any new drilling results, assay or other sampling
	determining the analysis including instrument	exploration work.
	make and model, reading times, calibrations
	factors applied and their derivation, etc.
	Nature of quality control procedures adopted	This ASX Release refers only to historic exploration drilling and does
	(eg standards, blanks, duplicates, external	not report any new drilling results, assay or other sampling
	laboratory checks) and whether acceptable	exploration work.
	levels of accuracy (i.e. lack of bias) and
	precision have been established.
Verification of	The verification of significant intersections by	This ASX Release refers only to historic exploration drilling and does
sampling and	either independent or alternative company	not report any new drilling results, assay or other sampling
assaying	personnel.	exploration work.
		Significant intersections discussed in this ASX release were checked
		by St George personnel using assay data supplied by Nickel West.
	The use of twinned holes.	This ASX Release refers only to historic exploration drilling and does
		not report any new drilling results, assay or other sampling
		exploration work.
	Documentation of primary data, data entry	This ASX Release refers only to historic exploration drilling and does
	procedures, data verification, data storage	not report any new drilling results, assay or other sampling
	(physical and electronic) protocols.	exploration work.
	Discuss any adjustment to assay data.	This ASX Release refers only to historic exploration drilling and does
		not report any new drilling results, assay or other sampling
		exploration work.
Location of	Accuracy and quality of surveys used to locate	This ASX Release refers only to historic exploration drilling and does
data points	drill holes (collar and down‐hole surveys),	not report any new drilling results, assay or other sampling
	trenches, mine workings and other locations	exploration work.
	used in Mineral Resource estimation.
	Specification of the grid system used.	The grid system used at the Mt Alexander project is GDA94 (MGA),
		zone 51.
	Quality and adequacy of topographic control.	This ASX Release refers only to historic exploration drilling and does
		not report any new drilling results, assay or other sampling
		exploration work.
Data spacing	Data spacing for reporting of Exploration	This ASX Release refers only to historic exploration drilling and does
and	Results.	not report any new drilling results, assay or other sampling
distribution		exploration work.
	Whether the data spacing and distribution is	This ASX Release refers only to historic exploration drilling and does
	sufficient to establish the degree of geological	not report any new drilling results, assay or other sampling
	and grade continuity appropriate for the	exploration work.
	Mineral Resource and Ore Reserve estimation
	procedure(s) and classifications applied.
	Whether sample compositing has been applied.	This ASX Release refers only to historic exploration drilling and does
		not report any new drilling results, assay or other sampling
		exploration work.

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Criteria	JORC Code explanation	Commentary
Orientation of	Whether the orientation of sampling achieves	This ASX Release refers only to historic exploration drilling and does
data in relation	unbiased sampling of possible structures and	not report any new drilling results, assay or other sampling
to geological	the extent to which this is known, considering	exploration work.
structure	the deposit type.
	If the relationship between the drilling	This ASX Release refers only to historic exploration drilling and does
	orientation and the orientation of key	not report any new drilling results, assay or other sampling
	mineralised structures is considered to have	exploration work.
	introduced a sampling bias, this should be
	assessed and reported if material.
Sample	The measures taken to ensure sample security.	This ASX Release refers only to historic exploration drilling and does
security		not report any new drilling results, assay or other sampling
		exploration work.
Audits or	The results of any audits or reviews of sampling	This ASX Release refers only to historic exploration drilling and does
reviews	techniques and data.	not report any new drilling results, assay or other sampling
		exploration work.

Section 2 Reporting of Exploration Results

Criteria	JORC Code explanation	Commentary
Mineral	Type, name/reference number, location and	The Mt Alexander Project is comprised of two granted Exploration
Tenement and	ownership including agreements or material	Licences (E29/638 and E29/548). Tenement E29/638 will be a Joint
Land Status	issues with third parties including joint	Venture between St George (75% interest) and Western Areas (25%
	ventures, partnerships, overriding royalties,	interest). Both tenements are subject to a royalty in favour of a third
	native title interests, historical sites, wilderness	party that is outlined in the ASX Release dated 17 December 2015
	or national park and environmental settings.	(as regards E29/638) and the ASX release dated 18 September 2015
		(as regards E29/548).
	The security of the tenure held at the time of reporting along with any known impediments to obtaining a licence to operate in the area.	No environmentally sensitive sites have been identified on the tenements. A registered Heritage site known as Willsmore 1 (DAA identification 3087) straddles tenements E29/548 and E29/638.
		The newly acquired tenement E29/638, as well as E29/548, are in
		good standing and no known impediments exist.
Exploration	Acknowledgment and appraisal of exploration	Exploration on tenement E29/638 has been largely for komatiite‐
Done by Other	by other parties.	hosted nickel sulphides both in the Mt Alexander Greenstone Belt,
Parties		and at the Cathedrals Prospect in the northern section of the
		tenement.
		The target lithological unit in the Mt Alexander Greenstone belt has
		been the Central Ultramafic Unit, which has been explored by a
		number of parties, most recently by Nickel West.
		High grade nickel‐copper sulphides were discovered at the Mt
		Alexander Project in 2008. Drilling was completed to test co‐incident
		electromagnetic (EM) and magnetic anomalies associated with
		nickel‐PGE enriched gossans. The drilling identified high grade Ni‐Cu
		mineralisation and the discovery was named the Cathedrals
		Prospect. The tenement remains underexplored.
Geology	Deposit type, geological setting and style of	The Mt Alexander Project is at the northern end of a western
	mineralisation	bifurcation of the Mt Ida Greenstones. The greenstones are bound
		to the west by the Ida Fault, a significant Craton‐scale structure that
		marks the boundary between the Kalgoorlie Terrane (and Eastern
		Goldfields Superterrane) to the east and the Youanmi Terrane to the
		west.
		The Mt Alexander Project is prospective for further high‐grade
		komatiite‐hosted nickel‐copper‐PGE mineralisation and also
		precious metal mineralisation (i.e. orogenic gold) that is typified
		elsewhere in the Yilgarn Craton.

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Criteria	JORC Code explanation	Commentary
Drill hole	A summary of all information material to the	This ASX Release refers only to historic exploration drilling and does
information	understanding of the exploration results	not report any new drilling results, assay or other sampling
	including tabulation of the following	exploration work.
	information for all Material drill holes:	Table 1 to this JORC Section contains drill hole information on the
	• Easting and northing of the drill hole collar	historic drilling that is discussed in this ASX Release. This historic
	•Elevation or RL (Reduced Level – elevation	drilling was reported by Western Areas Limited in its ASX Release
	above sea level in meters) of the drill hole collar • Dip and azimuth of the hole	dated 2 April 2008_‘Assays Confirm High Grade Nickel/Copper/PGE_ Discovery at Mt Alexander Joint Venture’.
	• Down hole length and interception depth
	• Hole length
Data	In reporting Exploration Results, weighting	This ASX Release refers only to historic exploration drilling and does
aggregation	averaging techniques, maximum and/or	not report any new drilling results, assay or other sampling
methods	minimum grade truncations (e.g. cutting of	exploration work.
	high grades) and cut‐off grades are usually
	Material and should be stated.
	Where aggregated intercepts incorporate short	This ASX Release refers only to historic exploration drilling and does
	lengths of high grade results and longer	not report any new drilling results, assay or other sampling
	lengths of low grade results, the procedure	exploration work.
	used for such aggregation should be stated and
	some typical examples of such aggregations
	should be shown in detail.
	The assumptions used for any reporting of	This ASX Release refers only to historic exploration drilling and does
	metal equivalent values should be clearly	not report any new drilling results, assay or other sampling
	stated.	exploration work.
Relationship	These relationships are particularly important	This ASX Release refers only to historic exploration drilling and does
between	in the reporting of exploration results.	not report any new drilling results, assay or other sampling
mineralisation widths and intercept lengths	If the geometry of the mineralisation with respect to the drill hole angle is known, its nature should be reported. If it is not known and only the down hole lengths are reported,	exploration work. Historical assay intersections are reported as down hole lengths. The relationship of down hole width to true width will be reviewed by St George upon assessment of the newly acquired technical data.
	there should be a clear statement to this effect
	(e.g. down hole length, true width not known).
Diagrams	Appropriate maps and sections (with scales)	Relevant scaled and oriented maps are included in the body of the
	and tabulations of intercepts should be	ASX Release.
	included for any significant discovery being
	reported. These should include, but not be
	limited to a plane view of drill hole collar
	locations and appropriate sectional views.
Balanced	Where comprehensive reporting of all	This ASX Release refers only to historic exploration drilling and does
Reporting	Exploration Results is not practical,	not report any new drilling results, assay or other sampling
	representative reporting of both low and high	exploration work. Comprehensive reporting of all exploration results
	grades and/or widths should be practiced to	is not required for the scope of this ASX release and will be
	avoid misleading reporting Exploration Results.	tabulated upon detailed evaluation of the newly acquired project
		database.
Other	Other exploration data, if meaningful and	This ASX Release refers only to historic exploration drilling and does
substantive	material, should be reported including (but not	not report any new drilling results, assay or other sampling
exploration	limited to): geological observation; geophysical	exploration work.
data	survey results; geochemical survey results; bulk
	samples – size and method of treatment;
	metallurgical test results; bulk density,
	groundwater, geotechnical and rock
	characteristics; potential deleterious or
	contaminating substances.

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Criteria	JORC Code explanation	Commentary
Further Work	The nature and scale of planned further work	Further exploration on E29/638 will be planned once all newly
	(e.g. tests for lateral extensions or depth	acquired technical data has been reviewed. Details of further work
	extensions or large – scale step – out drilling).	at the tenement will be announced after completion of the
	Diagrams clearly highlighting the areas of	acquisition, scheduled for 28 January 2016, occurs.
	possible extensions, including the main
	geological interpretations and future drilling
	areas, provided this information is not
	commercially sensitive.

HOLE ID	EASTING	NORTHING	DIP	AZM	DEPTH	FROM	TO	WIDTH	Ni	Cu	Total PGEs
	(m)	(m)	(deg)	(deg)	(m)	(m)	(m)	(m)	(%)	(%)	(g/t)
MAD012	233885	6806995	‐70	170	111.5	81.5	95.5	14	1.9	0.8	1.8
incl.						91.4	95.4	4	4.9	1.7	3.9
MAD013	233805	6806955	‐70	170	93.3	56.3	59.3	3	3.8	1.6	2.7
incl.						57.6	59	1.4	7.1	3.0	2.9

Table 1 to 2012 JORC Section – Significant intersections at the Cathedrals Prospect within E29/638

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