KGL RESOURCES LIMITED — Capital/Financing Update 2015

May 7, 2015

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8 May 2015

Drilling returns more high-grade results

KGL Resources (ASX:KGL) is pleased to announce that reverse circulation (RC) and diamond drilling at Jervois has continued to extend high‐grade mineralisation. Significant results from this program include:

Green Parrot (KJC129)

11m @ 1.93% Cu, 2.61% Pb, 1.25% Zn, 218.1g/t Ag, 0.25g/t Au from 153 m

Including 4m @ 3.58% Cu, 4.61% Pb, 1.7% Zn, 393.8g/t Ag, 0.56g/t Au from 160 m

4m @ 3.44% Cu, 2.95% Pb, 0.74% Zn, 252.2g/t Ag, 1.76g/t Au from 177 m

Johannsen (GTD004)

1m @ 2.3g/t Au, 8.1g/t Ag from 63 m

3m @ 4.1% Cu, 0.82% Pb, 0.3% Zn, 189.2g/t Ag, 0.29g/t Au from 64 m

Reward (KJC114)

5m @ 0.88% Cu, 13g/t Ag, 0.32g/t Au from 244 m

7m @ 1.4% Cu, 0.56% Pb, 28.5g/t Ag, 0.32g/t Au from 256 m

A ~10,000m RC drilling program was commenced in early February at the Bellbird, Marshall‐Reward and Green Parrot Resources. Particular emphasis was placed on targeting poorly drilled portions of these resources that have potential for high‐grade mineralisation and are within the proposed open pits or close to planned underground mine development.

KJC129 at Green Parrot was drilled to follow up intersections in holes JOC222‐223 drilled last year below the planned open pit shell. Two zones of mineralisation were intersected that are likely to result in a resource extension and deepening of the pit. The increase in gold and over 200g/t silver in both intervals at depth is particularly encouraging.

GTD004 was drilled at the edge of the planned Reward open pit. A zone of supergene enriched copper was intersected in a mineralised trend parallel to the main Reward resource at the Johannsen prospect. Although mineralisation at Johannsen is less continuous, its close proximity to Reward is likely to have a positive impact on the pit shell.

Drilling at the northern end of Reward in KJC114 intersected good mineralisation at depth, adjacent to existing designed UG development.

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Simon Milroy, the Managing Director of KGL Resources comments, “The resource extension drilling program was conducted as part of a study to optimise the economics of the Jervois Project. Drill results received so far have met our expectations and are likely to result in an increase in the resource and the size of the pit shells”.

“The Green Parrot results are particularly encouraging as we continue to hit very high grades of mineralisation, including gold and silver, well below the base of the current pit design but also well within conventional open pit depths.”

Drilling is now complete with additional geological mapping, soil sampling and research work planned. Assay results from the drilling are anticipated over the next 4 weeks with over 5,000 outstanding. These will feed into an updated resource estimation that is anticipated to be completed in July 2015.

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Figure 1 Plan of Bellbird prospect with 2005 RC drilling

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Figure 2 Johannsen Prospect cross Section 7494575N

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Figure 3 Marshall‐Reward Prospect cross Section 7495530N

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Figure 4 Plan of Bellbird drilling

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Figure 5 Plan of Green Parrot and Marshall‐Reward drilling

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Table 1 Table of significant results

Hole ID	Easting (m)	Northing (m)	RL (m)	Dip	Azimuth	BOX1 (m)	Total Depth (m)	From (m)	To (m)	Interval (m)	ETW2 (m)	Cu %	Pb %	Zn %	Ag g/t	Au g/t
KJC114	630302	7495531	352	‐60	84	55	328	133	134	1	0.5	0.84	0.11	0.07	5.4	0
								244	249	5	2.6	0.88	0.08	0.17	13	0.32
								256	263	7	3.7	1.4	0.56	0.11	28.5	0.32
KJC115	630354	7495440	354	‐63	90	85	262	87	90	3	1.9	0.65	0.6	0.29	32.6	0.11
								92	94	2	1.2	0.03	2.04	0.33	16.9	0.02
								117	118	1	0.6	0.65	0.07	0.08	16.1	0.11
KJC116	630367	7495490	355	‐65	86	96	286	95	103	8	3.4	0.09	1.47	0.15	9.6	0.02
								103	115	12	5.9	0.51	0.04	0.04	4.7	0.14
								237	242	5	2.9	0.76	0.01	0.03	12.6	0.12
								244	249	5	2.9	0.79	0.01	0.03	7.3	0.07
								256	257	1	0.6	2.83	0.01	0.11	44	0.17
KJC117	627438	7490694	367	‐65	245	40	364	20	22	2	0.9	1.39	0.42	0.31	9.5	0.01
								54	55	1	0.5	0.86	0.02	0.2	2.9	0.01
								234	237	3	1.3	0.78	0.01	0.02	6.7	0.05
								240	241	1	0.4	0.64	0.03	0.03	4.7	0.09
								249	250	1	0.5	0.5	0	0.02	1.4	0.02
								251	253	2	0.9	1.15	0.02	0.02	2.5	0.04
								269	270	1	0.4	0.65	0.01	0.02	1.3	0.01
KJC118	630129	7494870	348	‐59	85	39	412	347	350	3	2.1	2.62	0.04	0.04	11.9	1.2
KJC127	630127	7493980	353	‐55	88	19	136	80	85	5	3.5	0.65	0.5	0.18	63.5	0.04
KJC129	630061	7493860	350	‐54	88	31	220 Including	99	100	1	0.6	0.52	0.01	0.29	25.8	0.07
								153	164	11	6.7	1.93	2.61	1.25	218.1	0.25
								160	164	4	2.5	3.58	4.61	1.7	393.8	0.56
								177	181	4	2.6	3.44	2.95	0.74	252.2	1.76
GTD002	630473	7494716	346	‐55	298	83	92	21	22	1	0.6	8.11	0.01	0	23.5	0.26
								24	28	4	2.3	0.65	0	0.02	1.8	0.03
GTD003	630225	7494901	346	‐58	89	44	180	177	178	1	0.5	0.6	0.02	0.1	5.8	0.74

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Hole ID	Easting (m)	Northing (m)	RL (m)	Dip	Azimuth	BOX1 (m)	Total Depth (m)	From (m)	To (m)	Interval (m)	ETW2 (m)	Cu %	Pb %	Zn %	Ag g/t	Au g/t
GTD004	630152	7494564	346	‐58	60	26	162	63	64	1	0.6	0.04	0.07	0.16	8.1	2.3
								64	67	3	1.7	4.1	0.82	0.3	189.2	0.29
								75	81	6	3.4	0.52	0.05	0.09	31.5	0.05
GTD005	630427	7494904	347	‐72	137	40	81	75.5	76.2	0.7	0.3	1.31	0.02	0.02	2.9	0.06
GTD007	627381	7490676	365	‐58	298	46	135	106.5	107.5	1	0.5	1.91	0.01	0.01	3	0.08
								118.5	122.5	4	2.1	0.83	0.01	0.01	3	0.03

1Base of Oxidisation down hole depth 2Estimated true width

For further information contact:

Mr Simon Milroy Managing Director Phone: (07) 3071 9003

About KGL Resources

KGL Resources Limited is an Australian mineral exploration company focussed on increasing the high grade Resource at the Jervois Copper-Silver-Gold Project in the Northern Territory and developing it into a multi-metal mine.

Competent Person Statement

The following drill holes were originally reported on the date indicated and using the JORC code specified in the table. Results reported under JORC 2004 have not been updated to comply with JORC 2012 on the basis that the information has not materially changed since it was last reported.

Hole	Hole	Date originally Reported	JORC Reported Under
JOC JOC JOC JOC JOC JOC	157 158 004 005 006 007	08/08/2014 08/08/2014 18/07/2014 18/07/2014 18/07/2014 18/07/2014	2012 2012 2012 2012 2012 2012

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The Jervois Exploration data in this report is based on information compiled by Martin Bennett, who is a member of the Australian Institute of Geoscientists and a full time employee of KGL Resources Limited.

Mr. Bennett has sufficient experience which is relevant to the style of the mineralisation and the type of deposit under consideration and to the activity to which he is undertaking, to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr. Bennett has consented to the inclusion of this information in the form and context in which it appears in this report.

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Figure 6 Plan of RC drilling for resource extension

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– 1 JORC CODE, 2012 EDITION TABLE

Section 1 Sampling Techniques and Data

(Criteria in this section apply to all succeeding sections.)

Criteria	JORC Code explanation	JORC Code explanation	Commentary	Commentary
Sampling		Nature and quality of sampling (eg cut channels, random		Diamond drilling and reverse circulation
techniques		chips, or specific specialised industry standard measurement		(RC) drilling were used to obtain samples
		tools appropriate to the minerals under investigation, such as		for geological logging and assaying.
		down hole gamma sondes, or handheld XRF instruments, etc). These examples should not be taken as limiting the broad meaning of sampling.		RC drill holes are sampled at 1m intervals and split using a cone splitter attached to the cyclone to generate a split of ~3kg.
		Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used.		Diamond core was quartered with a diamond saw and generally sampled at 1m intervals with shorter samples at geological
		Aspects of the determination of mineralisation that are		contacts.
		Material to the Public Report.		RC samples are routinely scanned with a
		In cases where ‘industry standard’ work has been done this would be relatively simple (eg ‘reverse circulation drilling was used to obtain 1 m samples from which 3 kg was pulverised		Niton XRF. Samples assaying greater than 0.1% Cu, Pb or Zn are submitted for analysis at a commercial laboratory.
		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 techniques		Drill type (eg core, reverse circulation, open-hole hammer,		RC Drilling was conducted using a reverse
		rotary air blast, auger, Bangka, sonic, etc) and details (eg		circulation rig with a 5.25” face-sampling
		core diameter, triple or standard tube, depth of diamond tails,		bit. Diamond drilling was either in NQ2 or
		face-sampling bit or other type, whether core is oriented and		HQ3 drill diameters. Metallurgical diamond
		if so, by what method, etc).		drilling (JMET holes) were PQ
Drill sample		Method of recording and assessing core and chip sample		RC samples were not weighed on a regular
recovery		recoveries and results assessed.		basis but no sample recovery issues were
		Measures taken to maximise sample recovery and ensure		encountered during the drilling program.
		representative nature of the samples.		Overweight samples (>3kg) were re-split
				with portable riffle splitter
		Whether a relationship exists between sample recovery and
		grade and whether sample bias may have occurred due to
		preferential loss/gain of fine/coarse material.
Logging		Whether core and chip samples have been geologically and		All RC and diamond core samples are
		geotechnically logged to a level of detail to support		geologically logged. Core samples are
		appropriate Mineral Resource estimation, mining studies and		also orientated and logged for geotechnical
		metallurgical studies.		information.
		Whether logging is qualitative or quantitative in nature. Core
		(or costean, channel, etc) photography.
		The total length and percentage of the relevant intersections
		logged.
Sub‐sampling		If core, whether cut or sawn and whether quarter, half or all		RC drill holes are sampled at 1m intervals
techniques and		core taken.		and split using a cone splitter attached to
sample		If non-core, whether riffled, tube sampled, rotary split, etc and		the cyclone to generate a split of ~3kg.
preparation		whether sampled wet or dry.		Diamond core was quartered with a
				diamond saw and generally sampled at 1m
		For all sample types, the nature, quality and appropriateness		intervals with shorter samples at geological
		of the sample preparation technique.		contacts.
		Quality control procedures adopted for all sub-sampling		RC sample splits (~3kg) are pulverized to
		stages to maximise representivity of samples.		85% passing 75 microns.
		Measures taken to ensure that the sampling is representative		Diamond core samples are crushed to 70%
		of the in situ material collected, including for instance results		passing 2mm and then pulverized to 85%
		for field duplicate/second-half sampling.		passing 75 microns.
		Whether sample sizes are appropriate to the grain size of the
		material being sampled.
Quality of assay		The nature, quality and appropriateness of the assaying and		The QAQC data includes standards,
data and		laboratory procedures used and whether the technique is		duplicates and laboratory checks. In ore
laboratory tests		considered partial or total. For geophysical tools, spectrometers, handheld XRF		zones Standards are added at a ratio of 1:10 and duplicates and blanks 1:20.
		instruments, etc, the parameters used in determining the		Basemetal samples are assayed using a
		analysis including instrument make and model, reading times,		four acid digest with an ICP AES finish.

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Criteria JORC Code explanation	Commentary
calibrations factors applied and their derivation, etc.  Nature of quality control procedures adopted (eg standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (ie lack of bias) and precision have been established.	Gold samples are assayed by Aqua Regia with an ICP MS finish. Samples over 1ppm Au are re-assayed by Fire Assay with an AAS finish.  An umpire laboratory is used to check ~1% of samples analysed.
Verification of sampling and assaying  The verification of significant intersections by either independent or alternative company personnel.  The use of twinned holes.  Documentation of primary data, data entry procedures, data verification, data storage (physical and electronic) protocols.  Discuss any adjustment to assay data.	 Data is validated on entry into the Datashed database.  Further validation is conducted when data is imported into Vulcan
Location of data points  Accuracy and quality of surveys used to locate drill holes (collar and down-hole surveys), trenches, mine workings and other locations used in Mineral Resource estimation.  Specification of the grid system used.  Quality and adequacy of topographic control.	 Surface collar surveys were picked up using a Trimble DGPS.  Downhole surveys were taken during drilling with a Ranger or Reflex survey tool every 30m with checks conducted with a Gyrosmart gyro and Azimuth Aligner.  All drilling is conducted on the MGA 94 Zone 53 grid. All downhole magnetic surveys were converted to MGA 94 grid.
Data spacing and distribution  Data spacing for reporting of Exploration Results.  Whether the data spacing and distribution is sufficient to establish the degree of geological and grade continuity appropriate for the Mineral Resource and Ore Reserve estimation procedure(s) and classifications applied.  Whether sample compositing has been applied.	 Drilling for Inferred resources has been conducted at a spacing of 50m along strike and 80m within the plane of the mineralized zone. Closer spaced drilling was used for Indicated resources.  Shallow oxide RC drilling was conducted on 80m spaced traverses with holes 10m apart
Orientation of data in relation to geological structure  Whether the orientation of sampling achieves unbiased sampling of possible structures and the extent to which this is known, considering the deposit type.  If the relationship between the drilling orientation and the orientation of key mineralised structures is considered to have introduced a sampling bias, this should be assessed and reported if material.	 Holes were drilled perpendicular to the strike of the mineralization a default angle of -60 degrees but holes vary from -45 to - 80.
Sample security  The measures taken to ensure sample security.	 Samples were stored in sealed polyweave bags on site and transported to the laboratory at regular intervals by KGL staff or a transport contractor.
Audits or reviews  The results of any audits or reviews of sampling techniques and data.	 The sampling techniques are regularly reviewed.

Section 2 Reporting of Exploration Results

(Criteria listed in the preceding section also apply to this section.)

Criteria JORC Code explanation	Commentary
Mineral tenement and land tenure status  Type, reference name/number, location and ownership including agreements or material issues with third parties such as joint ventures, partnerships, overriding royalties, native title interests, historical sites, wilderness or national park and environmental settings.  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.	 The Jervois project is within E30242 100% owned by Jinka Minerals and operated by Kentor Minerals (NT), both wholly owned subsidiaries of KGL Resources.  The Jervois project is covered by Mineral Claims and an Exploration licence owned by KGL Resources subsidiary Jinka Minerals.
Exploration done by other parties  Acknowledgment and appraisal of exploration by other parties.	 Previous exploration has primarily been conducted by Reward Minerals, MIM and PlentyRiver.
Geology  Deposit type, geological setting and style of mineralisation.	 EL30242 lies on the Huckitta 1: 250 000 map sheet (SF 53-11). The tenement is located mainly within the Palaeo- Proterozoic Bonya Schist on the northeastern boundary of the Arunta Orogenic Domain. The Arunta Orogenic Domain in the north western part of the tenement is overlain unconformablyby

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Criteria	JORC Code explanation	JORC Code explanation	Commentary	Commentary
				Neo-Proterozoic sediments of the
				Georgina Basin.
				The copper-lead-zinc mineralisation is
				interpreted to be stratabound in nature,
				probably relating to the discharge of base
				metal-rich fluids in association with
				volcanism or metamorphism or dewatering
				of the underlying rocks at a particular time
				in thegeological historyof the area.
Drill hole		A summary of all information material to the understanding of		Refer Table 1
Information		the exploration results including a tabulation of the following
		information for all Material drill holes:
		o easting and northing of the drill hole collar
		o elevation or RL (Reduced Level – elevation above sea
		level in metres) of the drill hole collar
		o dip and azimuth of the hole
		o down hole length and interception depth
		o hole length.
		If the exclusion of this information is justified on the basis that
		the information is not Material and this exclusion does not
		detract from the understanding of the report, the Competent
		Person should clearly explain why this is the case.
Data aggregation		In reporting Exploration Results, weighting averaging		Refer Table 1
methods		techniques, maximum and/or minimum grade truncations (eg
		cutting of high grades) and cut-off grades are usually Material
		and should be stated.
		Where aggregate intercepts incorporate short lengths of high
		grade results and longer lengths of low grade results, the
		procedure 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 metal equivalent
		values should be clearly stated.
Relationship		These relationships are particularly important in the reporting		Refer Table 1
between		of Exploration Results.
mineralisation		If the geometry of the mineralisation with respect to the drill
widths and		hole angle is known, its nature should be reported.
intercept lengths		If it is not known and only the down hole lengths are reported,
		there should be a clear statement to this effect (eg ‘down hole
		length, true width not known’).
Diagrams		Appropriate maps and sections (with scales) and tabulations		Refer Figures 1, 2, 3, 4, 5 & 6
		of intercepts should be included for any significant discovery
		being reported These should include, but not be limited to a
		plan view of drill hole collar locations and appropriate
		sectional views.
Balanced reporting		Where comprehensive reporting of all Exploration Results is		Refer Table 1
		not practicable, representative reporting of both low and high
		grades and/or widths should be practiced to avoid misleading
		reporting of Exploration Results.
Other substantive		Other exploration data, if meaningful and material, should be		Outcrop mapping of exploration targets
exploration data		reported including (but not limited to): geological		using Real time DGPS.
		observations; geophysical 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.
Further work		The nature and scale of planned further work (eg tests for		Refer Figures 4, 5 & 6
		lateral extensions or depth extensions or large-scale step-out
		drilling).
		Diagrams clearly highlighting the areas of possible
		extensions, including the main geological interpretations and
		future drilling areas, provided this information is not
		commercially sensitive.