PREDICTIVE DISCOVERY LIMITED — Capital/Financing Update 2013

May 13, 2013

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14[th] May 2013

ASX Announcement

Excellent Gold Recoveries from Preliminary Metallurgical Test Work, Burkina Faso Highlights:

Predictive Discovery Limited is a gold exploration company with an advanced exploration project in Burkina Faso, West Africa and strong technical capabilities.

• Preliminary metallurgical test work was designed to:

• provide an initial indication of gold recoveries by standard CIL treatment of ore from PDI’s high grade prospects, Bongou, Solna and Tambiri , and

• gain a preliminary understanding of the potential for gold recovery by heap leaching of the moderate grade Dave Prospect

ASX: PDI

Issued Capital: 234M shares Share Price: 3 cents

• High gold recoveries from cyanidation of ground primary material was obtained from three composite drill samples from the high grade Bongou, Solna and Tambiri Prospects as follows:

Market Capitalisation: $7M Cash (at 31 March 2013): $2.2M

• Bongou Prospect – 94%

• Solna Prospect – 96%

• Tambiri Prospect – 92%

Directors

• Preliminary test work on oxidised gold mineralisation from the Dave Prospect for heap leach generated a high gold recovery as follows:

Phillip Harman Non-Exec Chairman

Paul Roberts Managing Director

• 89% gold recovery from 10 day bottle roll cyanidation of unground RC drill material with low cyanide consumption and rapid gold extraction in the first few hours.

Bobby Danchin Non-Executive Director

c Tom Whiting Non-Executive Director

Mr Paul Roberts, the Company’s Managing Director commented: “We are pleased by these initial metallurgical results. Gold recoveries from cyanidation of ground ore from our high grade prospects are excellent and we can see potential for heap leach gold recovery at the moderate grade Dave Prospect.”

Phil Henty Non-Executive Director

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INTRODUCTION

PDI’s major country focus is Burkina Faso, West Africa where it has established a well-qualified Burkina-based exploration team and a large regional tenement package mainly in the north east of the country covering 1,605km[2] (Figure 1).

PDI’s tenement holding covers approximately 100 km of strike length in the Samira Hill greenstone belt in eastern Burkina Faso (the Bonsiega permit group, Figure 1). This belt hosts the 2.5 million ounce Samira Hill gold mine across the border in Niger and contains numerous active artisanal gold mine sites along its length. The Bangaba permit covers 10km of strike of the nearby Sebba Belt, including the largest known artisanal workings in that belt. PDI now owns 100% or rights to earn 95 to 100% of all its permits in Burkina Faso.

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Figure 1: Locality of PDI permits, showing location of principal prospects explored by PDI in the March Quarter.

METALLURGICAL TEST WORK

The preliminary metallurgical test work described in this release was designed to:

• provide an initial indication of gold recoveries by standard CIP treatment of ore from PDI’s higher grade prospects - Bongou, Solna and Tambiri , and

• gain a preliminary understanding of the potential for gold recovery by heap leaching of the moderate grade Dave Prospect.

Four samples were submitted for metallurgical test work, each weighing 20kg. Each sample was made up of ten two kilogram samples. All samples were obtained from RC drill holes.

The test work was carried out at SGS’s Perth laboratories under the supervision of Coffey Mining.

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Bongou Prospect

Recent drilling at the Bongou Prospect has revealed a series of excellent gold intercepts, including:

• 48m at 4.3g/t Au from 34m including 16m at 9.7g/t Au ,

• 23m at 6.9g/t Au from 111m including 16m at 8.9g/t Au ,

• 20m at 4.8g/t Au from 70m, and

• 10m at 7.4g/t Au from 47m.

Gold mineralisation is contained within an intensely silicified and quartz veined, pyrite-bearing microgranite intrusion.

The composite sample was obtained from seven RC drill holes: BNGRC001, BNGRC002, BNGRC003, BNGRC004, BNGRC007 and BNGRC009. All of the sampled intervals were of primary (not oxidised) mineralisation. A 500g screen fire assay of the composite sample at SGS in Perth gave a head grade of 2.92g/t Au and a multi-element ICP analysis indicated low levels of potentially deleterious elements (e.g. arsenic and antimony).

The sample was ground to 75 microns and subjected to a standard cyanide leach test over 72 hours. Gold recovery was 94% at the end of the test with 90% recovered in the first four hours. Cyanide and lime consumption were 2.0kg/t[1] and 0.3kg/t respectively. Cyanide consumption was not optimised and is expected to decrease considerably in future testing when oxygen levels are increased to the levels expected in a commercial CIP plant.

Solna Prospect

RC and diamond drilling at Solna has produced a number of high grade intercepts including:

• 7m at 12.8g/t Au from 117m

• 2m at 55.8g/t Au from 65m

• 6m at 20.0g/t Au from 40m

• 2m at 20.3g/t Au from 70m

• 5.6m at 15.6g/t Au from 205.4m

Gold mineralisation consists of siliceous and sericitic, quartz veined sheared granodiorite with minor pyrite.

The composite sample was obtained from seven RC drill holes: SOLRC019, SOLRC023, SOLRC027, SOLRC029, SOLRC040, SOLRC047, SOLRC051. As at Bongou, all sampled intervals were of primary mineralisation. A 500g screen fire assay of the composite sample at SGS in Perth gave a head grade of 7.65g/t Au and a multi-element ICP analysis indicated low levels of potentially deleterious elements.

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1 kilograms per tonne of ore

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The sample was ground to 75 microns and subjected to a standard cyanide leach test over 72 hours. Gold recovery was 96% at the end of the test with 91% recovered in the first four hours. Cyanide and lime consumption were 1.9kg/t and 0.3kg/t respectively. Again, cyanide consumption was not optimised and is expected to decrease considerably in future test work.

Tambiri Prospect

RC and diamond drilling at Tambiri has produced a number of broad gold intercepts containing high grade intervals, including:

• 5m at 17g/t Au from 96m including 1m at 71.7g/t Au

• 8m at 7.3g/t Au from 58m including 1m at 51.0g/t Au

• 9.3m at 4.9g/t Au from 62.7m including 1.7m at 21.6g/t Au

• 19m at 2.6g/t Au from 55m including 1m at 22.4g/t Au

Gold mineralisation consists of quartz veined and metamorphosed mafic volcanics with minor pyrite and pyrrhotite. The highest grade mineralisation contains minor amounts of sphalerite (zinc sulphide), galena (lead sulphide) and traces of chalcopyrite (copper iron sulphide).

The composite sample was obtained from six RC drill holes: TMBRC014, TMBRC017, TMBRC022, TMBRC025, TMBRC026 and TMBRC027. As at Bongou, all sampled intervals were of primary mineralisation. A 500g screen fire assay of the composite sample at SGS in Perth gave a head grade of 3.55g/t Au and a multi-element ICP analysis indicated low levels of potentially deleterious elements.

The sample was ground to 75 microns and subjected to a standard cyanide leach test over 72 hours. Gold recovery was 93% at the end of the test with 85% recovered in the first four hours. Cyanide and lime consumption were 2.0kg/t and 0.3kg/t respectively. Again, cyanide consumption was not optimised and is expected to decrease in future test work.

Dave Prospect

Drilling at Dave Prospect in 2011 and 2012 revealed widespread gold mineralisation in multiple lodes over a strike length of approximately 5km. The mineralisation has been tested to depths of 60 to 70m with the majority of intercepts being in weathered volcanic rocks. The Dave mineralisation is lower grade than the above three Prospects with average grades expected to be in the range of 1 to 2g/t Au. Consequently, the preliminary metallurgical test work on Dave was designed to assess the possibility of using the relatively low unit operating cost, heap leach gold recovery method.

The composite sample was obtained from seven RC drill holes: DAVRC107, DAVRC107, DAVRC190, DAVRC199, DAVRC215, DAVRC233 and DAVRC241. All of the samples consisted of strongly weathered and oxidised volcanic rocks. A 500g screen fire assay of the composite sample at SGS in Perth gave a head grade of 1.45g/t Au and a multi-element ICP analysis indicated low levels of potentially deleterious elements apart from very minor arsenic (580ppm).

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The sample was composed largely of fine material, having been converted to powder by the RC drilling process. It was therefore taken without any further grinding and subjected to an intermittent bottle roll in a weak cyanide solution for a period of ten days. As with the other three samples, most gold was extracted very quickly with 70% gold recovery achieved after just 4 hours and 81% gold recovery after one day. At the end of the test 89% of the gold had been recovered . Had the material been ground to 75 microns, a slightly higher recovery may well have been achieved. The rapid early gold extraction and the high final percentage recovery figure suggests that heap leach gold extraction might be possible on this mineralisation . Cyanide consumption was low at just 0.3kg/t with lime consumption at 2.9kg/t. Addition of lime is not expected in any future heap leach operation, however, because the use of cement in the agglomeration process will serve the same purpose as lime (i.e. maintenance of an elevated pH).

The Dave oxidised gold mineralisation contains clay which means that agglomeration will be required for any successful future heap leach operation. Agglomeration is a process by which dried ground ore is mixed with cement and water to produce small permeable balls. Use of agglomeration ensures that an entire heap is permeable, thereby maximising gold extraction. To assess the likely cement consumption in agglomeration of the Dave ore, a series of percolation tests were carried out using different quantities of cement in the agglomerated balls. These tests suggested that acceptable percolation rates would be achieved with approximately 20kg of cement per tonne of ore. While this is probably too high, the cement consumption in a future heap leach operation can reasonably expected to be significantly lower than 20kg/t because the weathered rock will not be ground as finely as the powdered RC chips were used in this test work. In general, the coarser the ore is, the lower the amount of cement which is required.

Discussion

While not being definitive, this metallurgical test work suggests that the primary gold mineralisation from four of PDI’s important Prospects in eastern Burkina Faso can be treated successfully with standard CIP processing methods. In addition, further assessment of the potential for recovering gold by heap leach from oxidised ore from the Dave Prospect is warranted.

25-30% of the gold in the Bongou, Solna and Tambiri samples reported in the +75 micron fraction. This coarser gold fraction may be recoverable by gravity pre-treatment.

Additional metallurgical test work will be carried out as and when JORC resources are calculated on these Prospects.

About Predictive Discovery:

Predictive Discovery Limited (PDI) was established in late 2007 to explore for gold and uranium. The Company is focused principally on exploration for gold in West Africa with one additional gold project in Australia. PDI has a distinctive technological capability, known as Predictore [TM] , which is designed to increase drill targeting efficiency thereby reducing ore discovery cost. The Company’s major focus is in Burkina Faso, West Africa where it has assembled a substantial regional ground position totalling 1,605km[2] and is exploring for large open-pittable gold ore deposits.

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Competent Persons Statement

The exploration results reported herein, insofar as they relate to mineralisation, are based on information compiled by Mr Paul Roberts (Fellow of the Australian Institute of Geoscientists). Mr Roberts is a full time employee of the company and has sufficient experience relevant to the style of mineralisation and type of deposits being considered to qualify as a Competent Person as defined by the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the JORC Code, 2004 Edition). Mr Roberts consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

For further details please contact:

Paul Roberts

Managing Director

Ian Hobson Company Secretary

Tel: +61 8 9216 1020 Email: paul.roberts@predictivediscovery.com

Tel: +61 8 9216 1020 Email: ianhobson@bigpond.com

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