SANDFIRE RESOURCES LIMITED — Capital/Financing Update 2017

Jun 12, 2017

12 June 2017

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ASX Announcement

FIRST CONTRACT FOR MONTY COPPER-GOLD MINE AWARDED TO YAGAHONG ALLIANCE

$8.2 million contract for civils and earthworks awarded to leading Indigenous alliance

Highlights

• Civils and earthworks contract for the new $90 million Monty Copper-Gold Mine awarded to Yagahong Alliance Pty Ltd, a joint venture between Central Earthmoving Company Pty Ltd, the leading Geraldton-based civil contractor and the Yugunga-Nya People.

• This is the second major contract which Sandfire has awarded to the Yagahong Alliance and represents another strong endorsement of its positive relationship with the Yugunga-Nya People, who are the traditional owners of the project area.

• The contract, which is valued at $8.2M, includes:

  • 14km haul road from Monty to DeGrussa

  • Local access roads

  • Stockpile and laydown area pads

  • o Box-cut for underground access o Infrastructure earthworks and drainage

• The award of the contract reflects Sandfire’s strong commitment to increasing Aboriginal engagement at the DeGrussa Copper-Gold Mine and to providing employment and economic opportunities in the Midwest region.

• Development of the box-cut for the underground portal at the Monty Copper-Gold Mine is expected to commence in Q2 FY 2018, with other upcoming key milestones expected to include:

  • Award of underground mining contract

  • o Award of power supply contract o Remaining statutory approvals

Sandfire Resources NL (ASX: SFR; “Sandfire”) is pleased to announce, on behalf of the Springfield Joint Venture (Sandfire: 70%; Talisman Mining (ASX: TLM): 30%), the award of the first major contract for the development of the new Monty Copper-Gold Mine in Western Australia.

The contract, which has an estimated value of $8.2 million, has been awarded to the Yagahong Alliance, a joint venture between the Geraldton-based earthmoving and civil contracting company Central Earthmoving and the Yugunga-Nya People, the traditional owners of the project area.

A positive Feasibility Study was recently completed on the Monty Project, confirming its suitability to be developed as a satellite source of high-grade feed to supplement existing copper production at Sandfire’s 100%-owned DeGrussa Copper-Gold Mine, located 10km away.

The earthmoving and civils contract, which was awarded following a competitive tender process, encompasses the development of a 14km long haul road from Monty to the DeGrussa Copper-Gold Mine, local access roads, stockpile and laydown area pads, the cutting of a box-cut for underground

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PO BOX 1495 WEST PERTH WA 6005  AUSTRALIA www.sandfire.com.au

Level 1, 31 Ventnor Avenue WEST PERTH WA 6005  AUSTRALIA ABN 55 105 154 185

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access and additional infrastructure works and drainage. Initial site works under the contract will commence immediately.

The Yagahong Alliance already provides a number of site-based earthmoving and contracting services for Sandfire under a contract which it secured in July 2015. The Yugunga-Nya People and Central Earthmoving formed the Yagahong Alliance to tender for earthmoving and mining services opportunities with the aim of employing Aboriginal people in the Midwest region.

The success of the Yagahong Alliance has been recognised by the Civil Contractors Federation who awarded Centrals the WA 2016 Aboriginal Engagement Award and by other Traditional Owner representative bodies, who have sought to replicate the JV model in their country.

Cutting of the decline portal for the new underground mine is expected to commence in the December quarter of this year and underground development will take approximately one year before first ore is accessed.

Sandfire’s Managing Director & CEO, Mr Karl Simich, said the award of the first major contract for the Monty Project to the Yagahong Alliance was a great opportunity to extend the strong working relationship between Sandfire and the Yugunga-Nya People through the Yagahong Alliance.

“We are glad to be able to continue to support the alliance between Centrals and Yugunga-Nya and in the process continue our Aboriginal engagement across the mining operation while also generating employment and opportunities for communities in the Midwest region,” he said.

“We look forward to commencing the development of what will be the first new copper mine in the Bryah Basin since the development of DeGrussa six years ago,” he added.

“We are excited to be a part of this alliance between the Yugunga-Nya People and Central Earthmoving and hope it plays a part in increasing opportunities for the local Meekatharra community,” Mr Simich said.

Craig Paterson, the Managing Director of Centrals and a director of the Yagahong Alliance said Yagahong highly values the strong supportive relationship that it has developed with Sandfire, while Ron Shay, a director of Yagahong and an elder of the Yugunga-Nya people said “the awarding of the Monty Project civil works to Yagahong is a big thing for the Yugunga-Nya People. Especially as it will provide training and employment opportunities for our mob and it enables the Yagahong business to keep growing strongly.”

ENDS

For further information contact:

Sandfire Resources NL Read Corporate Karl Simich – Managing Director/CEO Mobile: +61 419 929 046 (Nicholas Read) Office: +61 8 6430 3800 Mobile: +61 421 619 084 (Paul Armstrong)

Forward-Looking Statements

Certain statements made during or in connection with this statement contain or comprise certain forward-looking statements regarding Sandfire’s Mineral Resources and Reserves, exploration operations, project development operations, production rates, life of mine, projected cash flow, capital expenditure, operating costs and other economic performance and financial condition as well as general market outlook. Although Sandfire believes that the expectations reflected in such forward-looking statements are reasonable, such expectations are only predictions and are subject to inherent risks and uncertainties which could cause actual values, results, performance or achievements to differ materially from those expressed, implied or projected in any forward looking statements and no assurance can be given that such expectations will prove to have been correct. Accordingly, results could differ materially from those set out in the forward-looking statements as a result of, among other factors, changes in economic and market conditions, delays or changes in project development, success of business and operating initiatives, changes in the regulatory environment and other government actions, fluctuations in metals prices and exchange rates and business and operational risk management. Except for statutory liability which cannot be excluded, each of Sandfire, its officers, employees and advisors expressly disclaim any responsibility for the accuracy or completeness of the material contained in this statement and excludes all liability whatsoever (including in negligence) for any loss or damage which may be suffered by any person as a consequence of any information in this statement or any error or omission. Sandfire undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after today's date or to reflect the occurrence of unanticipated events other than required by the Corporations Act and ASX Listing Rules. Accordingly you should not place undue reliance on any forward looking statement.

SANDFIRE RESOURCES NL

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