PREDICTIVE DISCOVERY LIMITED — Capital/Financing Update 2013

Feb 19, 2013

20th February 2013

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ASX Announcement

– Exploration Update Eastern Burkina Faso Gold Project

Highlights:

• RC drilling at Bongou and Madyabari Prospects to re-commence within three weeks (infill and extension) . Previous drilling results at these prospects included:

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

o Bongou:

• 10m at 7.4g/t Au from 47m

• 20m at 4.8g/t Au from 70m

• 102m at 1.1g/t Au from 4m, including 14m at 3.0g/t Au

ASX: PDI

• 70m at 1.2g/t Au from 62m (to EOH) incl. 18m at 1.8g/t Au

Issued Capital: 234M shares

• Madyabari :

Share Price: 4.6 cents

• 3m at 8.3g/t Au from 23m incl. 1m at 21g/t Au

• 2m at 8.3g/t Au from 34m incl. 1m at 14g/t Au

Market Capitalisation: $11M

• Madyabari gold rush site growing , now 800m long , indicates increasing potential size of gold mineralised system.

Cash (at 31 December 2012): $3.0M

• Recent discovery of altered granite in abandoned artisanal gold workings 1.8km west of Bongou and 1.2km to the east indicates excellent potential to find more granite-hosted gold mineralisation along strike from Bongou.

Directors

Phillip Harman Non-Exec Chairman

• Other current and planned exploration activities include:

• a geophysical survey along strike from Bongou

Paul Roberts Managing Director

• geological mapping for additional granite targets along 20km of the 43km of the Bongou fault structure in PDI’s tenements

• trenching part of the Dave mineralisation to better understand ore continuity

Bobby Danchin Non-Executive Director c

• geological mapping and ground magnetics on the new Bira exploration permit as a precursor to drilling for extensions to this 1km long zone

Tom Whiting Non-Executive Director Phil Henty Non-Executive Director

• Preliminary metallurgical test work to commence on samples from Bongou, Dave, Solna and Tambiri.

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Mr Paul Roberts, the Company’s Managing Director commented: “Our exploration program this field season is tightly focused on prospects that offer the best combination of ore continuity, width and gold grade to grow the resource potential of our Eastern Burkina Faso Project rapidly. Following the success of our December 2012 drilling program, we are putting most of our attention on the Bongou and Madyabari Prospects where earlier drilling indicated good ore continuity and gold grades. Both Prospects lie within the Laterite Hill Gold Field which also contains the Dave, Laterite Hill and Prospect 71 Prospects, all of which contain bulk tonnage oxide gold ore potential within a short distance of both Bongou and Madyabari.

A 43km strike length of the major fault associated with Bongou is located within PDI’s tenements and application area and offers potential for Bongou look-alikes. We are also commencing exploration on the recently acquired Bira Permit where historic drill results have already indicated strong continuity over good widths in a 1km long gold mineralised system which is open to the north and south.”

Current and Planned Exploration - Eastern Burkina Faso Gold Project

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Figure 1: PDI Eastern Burkina Faso Project, showing locations of prospects where field work is planned or currently in progress.

In summary, exploration activities in progress and those planned over the next 6 to 8 weeks will include the following:

• Bongou Prospect, Laterite Hill Gold Field:

• Both infill and extension RC drilling at the Bongou Prospect, commencing in the second week of March 2013.

• Induced polarisation geophysical survey over a 3km strike length around the Bongou Prospect, now in progress.

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• Geological mapping over a fault strike length of approximately 20km along strike from Bongou out of the total 43km within PDI tenements and tenement application, now in progress.

• Madyabari Prospect, Laterite Hill Gold Field:

• RC drilling along and across strike from the four RC holes drilled in December 2012, commencing immediately after Bongou RC drilling.

• Dave Prospect, Laterite Hill Gold Field

• Trenching in an area of known gold mineralisation, now in progress.

• Bira Permit, North-East Bonsiega Permit Group :

• Ground magnetic survey, starting in late March.

• Geological mapping, commencing also in late March

• Preliminary metallurgical testwork on RC drill samples from the Dave and Bongou Prospects and the Bangaba permit (Solna and Tambiri Prospects), commencing in March.

Bongou Prospect

The Bongou Prospect is located within the Laterite Hill Gold Field in Eastern Burkina Faso (Figure 1). It covers artisanal workings forming an irregular open pit approximately 150m long and 50m wide. Past exploration by PDI has included rock chip sampling, trenching and completion of nine RC holes during May and December 2012. Broad gold intercepts have been obtained along with some high gold grades, including:

• BNGRC001: 54m at 2.1g/t Au from 36m including 20m at 4.8g/t Au

• BNGRC002: 70m at 1.2g/t Au from 62m (stopped in mineralisation) including 18m at 1.8g/t au

• BNGRC003: 102m at 1.1g/t Au from 4m including 14m at 3.0g/t Au

• BNGRC004: 10m at 7.4 g/t Au from 47m including 8m at 9.2g/t Au

Gold grades from RC drilling above a 0.5g/t Au cut-off grade have a weighted average value of 2.3g/t Au .

The gold mineralisation is located within an intensely silicified microgranite containing disseminated pyrite. There appears to be a higher grade component of the mineralisation close to the northern contact between the microgranite and the enclosing gabbro (Figure 2). Our emerging understanding of the geology suggests that this contact has only been tested effectively by two holes so far.

Aeromagnetic data indicates that the Bongou granite extends for at least 3km along strike and recent geological mapping has confirmed this interpretation with a few windows of of granite outcrop mapped within the zone. Two outcrop areas, 1.8km west and 1.2 km east of Bongou, are also artisanal gold mining sites. The western site consists of an abandoned open pit, approximately 60m long with strong sericite-pyrite alteration (Figure 3) and horizontal quartz veins. The alteration and quartz veining is similar to Bongou except that there is no silicification.

Identification of more altered granite nearly 2km from Bongou is encouraging in an area of such little outcrop. PDI’s geological interpretation is that the upper part of the granite lies beneath the surface

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at shallow depths through most of the 3km long long area and probably beyond, at least to the west . The Bongou mineralisation appears to be in an upward projection from the granite, suggesting considerable potential to find more similar gold mineralisation along strike.

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Figure 2: Cross-section through holes BNGRC003 and 004. No vertical exaggeration.

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Figure 3: Abandoned open pit artisanal mine working 1.8km west of Bongou in altered pyritic granite.

Planned Work Program

An induced polarisation survey has commenced, covering a 3km x 1km area over the interpreted area of the granite. This method is used to detect disseminated sulphide mineralisation such as at the

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Bongou Prospect. Geological mapping along 20km of the major Bongou fault zone, looking for more granite outcrops in other new target areas is also in progress.

Anomalies identified by the geophysical survey will be followed up with geochemical sampling or drilling; limited geochemical sampling immediately west of the Bongou artisanal workings has already been completed. Evidence of gold-bearing Bongou-style mineralisation will then be followed up with RC drilling later in the field season.

An RC drilling program designed to test the northern gabbro contact for higher grade gold mineralisation (e.g. 10m at 7.4g/t Au in BNGRC004, Figure 2) and nearby extensions to the known mineralisation will commence in the second week of March.

Madyabari Prospect

The Madyabari Prospect is the site of an artisanal miner gold rush reported in November 2012. PDI geologists mapped over 1,500 artisanal mine shafts on the site in November, most of which had been excavated between July and November 2012. Following a site visit last week, the Company now estimates that there are over 2,000 artisanal mine shafts and that the workings are now approximately 800m long and 200-300m wide, approximately 200m longer than they were in late November (see Figure 4 for photographic comparison).

Four vertical RC holes, totalling 280m, were drilled at Madyabari in December 2012, intersecting mineralised quartz veins in weathered mafic volcanics at depths between 23 and 36 metres. Based on the drilling results and the artisanal miners’ own descriptions, these veins appear to be approximately horizontal. Gold mineralised quartz was intersected in all four holes, the best intercepts being 3m at 8.3g/t Au from 23m, including 1m at 23g/t Au and 2m at 8.3g/t Au from 34m including 1m at 14g/t Au . In one hole, a void was intersected, suggesting that possible high grade quartz vein material had already been removed by artisanal miners. Some extremely high grade ore has been extracted by the miners (e.g. Figure 5) suggesting that there may be some very high grade areas, potentially lifting average gold grades overall.

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Figure 4: Photographs comparing Madyabari gold rush site in November 2012 with the site in mid-February, 2013. Note that the February panorama covers a much wider area than the November photograph. In November, there were no artisanal mine shafts in front of the gold sluicing area.

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Figure 5: Exceptionally high grade gold ore from Madyabari artisanal gold rush site. Red circled areas contain visible gold.

Planned Work Program

At least 10 shallow RC drill holes will be completed in mid-March 2013. The holes will test both along strike and across strike from the previous four holes on 80m centres. Most of the holes will be collared within the artisanal mine site.

Other Planned Activities

Dave Prospect Trenching

Drilling at the Dave Prospect (Figure 1) has revealed extensive oxide gold mineralisation in multiple mineralised zones over 5km of strike. Ore continuity in each of those zones is, however, not completely understood. The Company is therefore undertaking a program of trenching across and along strike in areas of known shallow mineralisation to derive a better understanding of the geology.

Bira Permit Ground Surveys

In January 2013, PDI announced the pending grant of the Bira Permit (Figure 1). A database of historic drill results obtained by the Company indicates numerous gold mineralised intercepts over a strike length of 1km with apparently good ore continuity. Better historic results include:

• 14.5m at 3.1g/t Au from 1m (stopped in gold mineralisation)

• 13m at 2.5g/t Au from 3m (stopped in gold mineralisation)

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• 21m at 1.7 g/t Au from 22m

Commencing in late February , the Company will carry out a program of geological mapping and ground magnetic surveys over most of the permit. This is work will lead to definition of a drilling program to test for extensions and possible parallel ore zones within the Bira mineralised trend.

Metallurgical Test Work

Preliminary metallurgical test work will be conducted on four composite samples derived from RC drilling at the Dave, Bongou, Solna and Tambiri Prospects, respectively; Solna and Tambiri are located in the Bangaba Permit (Figure 1). The primary focus will be on gold recoveries from cyanidation of ground ore. The samples will be air freighted from Ouagadougou to Australia once Burkina Faso government approval is obtained. The work will be carried out under the supervision of Coffey Mining in Perth and is expected to commence in early March.

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 1,565km[2] and is exploring for large open-pittable gold ore deposits.

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 Ian Hobson Managing Director Company Secretary Tel: +61 8 9216 1020 Tel: +61 8 9216 1020 Email: Email: ianhobson@bigpond.com paul.roberts@predictivediscovery.com

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