Tembang Production Update - ASXTembang Production Update Sumatra Copper & Gold plc (“the Company”) is pleased to provide a production update for its Tembang Gold-Silver Operation,

SUMATRA COPPER & GOLD PLC Registered No. 5777015

ASX Announcement: 19 February 2016

Sumatra Copper & Gold plc (ASX:SUM) Page 1 of 12

Tembang Production Update Sumatra Copper & Gold plc (“the Company”) is pleased to provide a production update for its Tembang Gold-Silver Operation, located in southern Sumatra, Indonesia (“Tembang”). The Company poured its first gold on 27 September 2015 and has been progressively ramping-up operations. During January 2016 the Company processed 39,065 tonnes of ore at a grade of 2.65 g/t AuEq1 (1.81 g/t Au and 62.5 g/t Ag) at a recovery of 88.9% Au and 69.3% Ag to produce 2,750 gold equivalent1 ounces (2,025 oz of gold and 54,374 oz of silver).

Figure 1: Monthly production at Tembang from commissioning to the end of January 2016

The plant operated at an annualised rate of 460,000 tonnes during January, 15% above nameplate capacity. Further metal production increases are expected over the coming months as ramp-up of mining operations progresses and mine grade increases with depth.

Belinau underground mine development In January 2016 a milestone was achieved with the successful completion of the first stope on Level 1 (Figure 2). Ore development is continuing on Level 2 with benching currently in progress. Upon completion of benching, the ore exposed in the ore drive floor will be trenched (to a width of 1.2m). This is expected to produce high grade ore with minimal dilution. Following the completion of trenching the narrow excavation will be filled with cemented rock fill to allow waste to be backfilled; this will facilitate the commencement of drilling and stoping of the high grade stope block between Level 1 and level 2. This development strategy has been successful in achieving 100% ore recovery without any requirement for residual ore pillars for geotechnical support. A further milestone has been achieved with the main decline becoming fully operational. As previously announced, the main decline had encountered difficult ground conditions which resulted in the decision to incline towards the main decline from Level 2. Ventilation will now be greatly improved along with the ability for the underground mine trucks to enter the mine and significantly improve haulage productivity. Ground conditions have improved markedly and the main decline is on track to access Level 3 during the current quarter. Level 3 will be the first level to access the full strike length of the Belinau main vein providing development ore with drives of up to 250 meters in length (Figure 2). Level 3 will also provide access to the Bitu north vein and potentially the Bitu south vein (Figure 3).

1 Note: “AuEq” = Gold equivalent, calculated as gold assay or ounces + (silver assay or ounces / 75) where 1oz Au =75oz Ag

- 10,000 20,000 30,000 40,000 50,000 60,000

- 500

1,000 1,500 2,000 2,500 3,000

oz A

g pr

oduc

ed

oz A

u &

AuE

q pr

oduc

ed

Metal production

AuEq prodn Au prodn Ag prodn

0.00.51.01.52.02.53.0

- 500

1,000 1,500 2,000 2,500 3,000 3,500

g/t A

uEq

in o

re m

illed

oz A

uEq

in o

re m

illed

Ore processed

Contained AuEq Milled grade AuEq

For

per

sona

l use

onl

y

ASX ANNOUNCEMENT 19 FEBRUARY 2016


Figure 2: Long Section of Belinau showing mined areas and decline development towards Level 3

Discovery of new vein at Belinau During mining of the Belinau east cutback in January 2016 a new vein was discovered in the south wall of the Belinau pit. This vein is believed to be the southern extension of the Bitu vein that has previously been drilled on the northern side of the pit (refer to September 2013 Quarterly Report). Surface sampling of the exposed vein returned grades of up to 8.87 g/t gold (Table 1). Historically drilling would have been parallel to this structure. Diamond drillhole BTD1221 intersected 2m @ 18.9 g/t Au and 175.5 g/t Ag from 23m downhole depth (Table 2) and potentially intersected a parallel vein to the Bitu South vein but has yet to be adequately followed up. To follow-up this intersection, and to determine the orientation, width, strike and depth extent of the new Bitu South vein structure, resource drilling is planned to commence in March 2016. Any additional ounces added to the existing Ore Reserve may provide a significant potential uplift in profitability of the Belinau underground operation.

Open Open

Open

For

per

sona

l use

onl

y

mailto:2m%20@%2018.9



Figure 3: Plan view of Belinau showing new Bitu South vein and drill hole BTD1221

Figure 4: Exposed new Bitu South Vein in East Cutback

For

per

sona

l use

onl

y



Table 1: Bitu South Surface channel samples

Table 2: Historical Diamond Drillhole BTD1221

BTD1221 was drilled by BTM in Belinau dated completion of hole with EOH at 130.6m on 22/9/1998

Hole Location Purpose East North RL Length(m) Dip Azimuth Sample Type From To Interval Recovery Au(ppm) Ag(ppm)BN-TR0039_0#0002 39 Grade Control 41319.05 82483.97 37.199 0.95281 0 216.59 4000341 FS 0 0.95 0.95 100 3.57 28.20BN-TR0040_0#0102 40 Grade Control 41324.54 82480.08 40.127 0.7007 0.98 216.93 3001366 TR 0 0.70 0.70 100 6.36 41.60BN-TR0040_0#0202 40 Grade Control 41322.92 82481.32 39.995 0.89149 6.27 232.28 3001369 TR 0 0.89 0.89 100 2.56 12.30BN-TR0040_0#0302 40 Grade Control 41321.60 82483.06 39.747 0.95087 0.66 234.8 3001372 TR 0 0.95 0.95 100 8.59 34.90BN-TR0040_0#0402 40 Grade Control 41325.42 82479.48 40.062 0.98537 6.65 197.17 3001379 TR 0 0.99 0.99 100 8.87 16.90

Hole Location East North Elevation Dip Azimuth Type From_m To_m Interval Au_ppm Ag_ppmBTD-1221 Belinau 41333.80 82452.56 1066.36 -65 330 DC 23.00 24.00 1.00 9.18 115.00

-65 330 DC 24.00 25.00 1.00 28.70 236.00

For

per

sona

l use

onl

y



For further information please contact: David Fowler Phil Retter Managing Director Investor Relations Sumatra Copper & Gold plc NWR Communications +61 8 6298 6200 M: +61 407 440 882 [email protected] [email protected]

About Sumatra Copper & Gold plc Sumatra Copper & Gold plc (ASX: SUM) is a gold and silver producer and precious metals explorer in southern Sumatra, Indonesia. The Company’s flagship asset is its Tembang gold/silver mine, currently in production. The Company also has an extensive exploration portfolio with projects ranging from brownfield, near-production opportunities to strategically located greenfield holdings.

Directors

Steve Robinson Jocelyn Waller Gavin Caudle Non-Executive Chairman Non-Executive Director Non-Executive Director

David Fowler Adi Sjoekri Managing Director Executive Director

Contact

Level 1, 5 Ord Street Registered address West Perth WA 6005 39 Parkside, Cambridge Western Australia United Kingdom CB1 1PN T: + 61 8 6298 6200 Registered Number 5777015 E: [email protected] ASX Code: SUM

Web: www.sumatracoppergold.com

Competent Person’s Statement – Mine Operations and Grade Control Estimates The information in this report that relates to mine operations and grade control estimates is based on information compiled by Mr Donovan Harper, who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Harper has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity, 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 Harper consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

Competent Person’s Statement – Exploration Results The information in this report that relates to exploration results is based on information compiled by Mr Matthew Farmer, who is a part time consultant of the Company and a Member of the Australasian Institute of Mining and Metallurgy. Mr Farmer has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and to the activity, 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 Farmer consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

For

per

sona

l use

onl

y

mailto:[email protected]

http://www.sumatracoppergold.com/



Appendix 1

JORC Code, 2012 Edition - TABLE 1: The information in this table is relevant to all sampling and drilling results being reported in this announcement and for prior exploration results reported for the Tembang Gold-Silver Operation

Section 1: Sampling Techniques and Data

Criteria JORC Code explanation Commentary

Sampling techniques

Nature and quality of sampling (e.g. cut channels, random chips, or specific specialised industry standard measurement tools 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 the broad meaning of sampling.

• Drill hole samples of Reverse Circulation (RC), Diamond Core (DC) and surface rock chip samples have been collected

• Recently, magnetic susceptibility measurements have been collected with a hand held KT-6 Portable Kappameter

• Continuous sampling has been undertaken across the mineralised ore development face at Belinau; with the sample from each face being composed of chips collected from the entire area across each face.

• Sample has been tested by Aqua Regia Digest and data is stored in the data base following Appropriate QA/QC Procedure which has been design by Laboratory Information Managements System (LIMS) C-Class.

• For Partial Preparation , after Jaw crusher a Split by Jones Riffle Splitter is done

Include reference to measures taken to ensure sample representivity and the appropriate calibration of any measurement tools or systems used.

• Diamond core samples are split with diamond saw and 50% collected for sampling

• Reverse Circulation samples are collected and split at the drill with triple tiered sample splitter resulting in a 12.5% or 1/8 split with an approximate sample weight of 2-3 kg

• Drilling samples are collected continuously with minimum/maximum sample size of 0.5m and 2.0m respectively

• All visual mineralization is sampled including sampling past the perceived zone of mineralization and into fresh rock

• Surface samples are collected to best represent the trend of perceived mineralization ie. across the vein

Aspects of the determination of mineralisation that are Material to the Public Report. In cases where ‘industry standard’ work has been done this would be relatively simple (e.g. ‘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

• Mineralisation is associated to quartz vein lodes and 1m average sample size is collected (min/max sample sizes are 0.5m/2.0m)

• All drill samples are analysed for gold and silver with 50g fire assay for Au and 2-acid digestion with AAS finish for Ag

• Gold samples >50g/t Au are reanalysed with gravimetric method

• Silver samples >100g/t Ag are reanalysed with 4-acid digestion with AAS finish

For

per

sona

l use

onl

y




required, such as where there is coarse gold that has inherent sampling problems. Unusual commodities or mineralisation types (e.g. submarine nodules) may warrant disclosure of detailed information.

• Surface samples are being collected for Au and a standard multi-element ICP OES package that includes silver and common pathfinder minerals in epithermal systems

Drilling techniques

Drill type (e.g. core, reverse circulation, open-hole hammer, rotary air blast, auger, Bangka, sonic, etc) and details (e.g. core diameter, triple or standard tube, depth of diamond tails, face-sampling bit or other type, whether core is oriented and if so, by what method, etc).

• Diamond drilling uses HQ3 sized diamond drill core, triple-tube and 1.5m core barrels where required to improve recoveries

• Digital core orientation techniques are used (Reflex-ACT and Pathfinder-Ori-Fnder)

• Reverse Circulation drilling uses standard double walled drill pipe and face sampling hammer

Drill sample recovery

Method of recording and assessing core and chip sample recoveries and results assessed.

• For diamond drilling, standard core recovery and RQD data is collected at the drill rig and based on drill runs (meter blocks)

• For Reverse Circulation drilling, complete samples are weighed at the drill with a conventional balance

Measures taken to maximise sample recovery and ensure representative nature of the samples.

• Triple/Split tubes are used along with 1.5m (short) drill runs with diamond drilling to improve sample recoveries

• Drilling mud and additives professionals have been to site to plan suitable mud mixes and recommend techniques and materials to improve recoveries in low recovery zones

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.

• Diamond core recoveries of quartz vein lodes is lower than in fresh rocks but generally the recoveries have been acceptable at >90% on average and no evidence of a grade bias due to variation in core recovery has been detected

Logging Whether core and chip samples have been geologically and geotechnically logged to a level of detail to support appropriate Mineral Resource estimation, mining studies and metallurgical studies.

• Geotechnical and recovery data is collected at the drill with whole core and prior to transporting core to logging facility

• Reverse circulation chips samples are collected and logged at the drill by a geologist

• Logging is of a suitable standard to allow for detailed geological and resource modelling

Whether logging is qualitative or quantitative in nature. Core (or costean, channel, etc) photography.

• Core logging is completed at a suitable facility (on waist high inclined benches, in dry conditions and with sufficient natural light)

• Drill core is logged for Lithology, alteration, oxide, structure, veining and mineralization

• Standard nomenclature is used for logging and codes or abbreviations are used to input into a database

• Historically, core logging has been collected manually on A3 paper sheets and is currently

For

per

sona

l use

onl

y




transitioning to digital data collection with a commercially available software, GeoSpark

The total length and percentage of the relevant intersections logged.

• 100% of drill holes are logged • Selective sampling is utilized based on geological

descriptions and presence or lack of visual mineralization

• All mineralized intervals are sampled • Complete mineralized / hydrothermally altered

zone is sampled both before and after (start and finish sample run in "fresh" rock)

Sub-sampling techniques and sample preparation

If core, whether cut or sawn and whether quarter, half or all core taken.

• HQ diameter diamond drill core is sawn and 50% collected for sampling.

• The remaining 50% is stored on site in a core storage facility

• Chip samples went sent to the on-site laboratory without drying or splitting.

• Blanks and standards are inserted into face samples batches;

• Underground face/channel samples are taken across the face at every (mineralised) cut. The faces are geologically mapped and photographed. Sample widths are generally 1.0m

If non-core, whether riffled, tube sampled, rotary split, etc and whether sampled wet or dry.

• Reverse circulation samples are collected on a per meter basis and split at the drill with a manual triple tired sample splitter resulting in a 12.5% or 1/8 split (2-3 kg sample)

• Chip samples went sent to the on site laboratory without drying or splitting.

For all sample types, the nature, quality and appropriateness of the sample preparation technique.

• Sample size aims at a 2-3kg representative sample • Samples are sent to Intertek Labs (Jakarta) where

the sample prep package includes; drying at 105°C'

• crushing (jaw crusher to 95% <5mm), • Pulverising (LM2 pulveriser to 95% <75um) • Grade Control samples are submitted to an on site

commercial laboratory managed by PT Geoservices where the sample prep package includes; drying at 105 C'

• crushing (jaw crusher to 95% <5mm), • Pulverising (LM2 pulveriser to 95% <75um)

Quality control procedures adopted for all sub-sampling stages to maximise representivity of samples.

• Standard industry practice Quality Assurance-Quality Control procedure includes insertion of;

• Field Blanks (1/30) • Field Duplicates (1/30) • Standards (1/30)

Measures taken to ensure that the sampling is representative of the in situ material collected, including for instance results for field duplicate/second-half sampling.

• Lab results include analyses for replicates and duplicates

• Historically, procedure included re-analysis of sample pulps at primary Lab (~5%)

• Future procedure will include re-analysis of sample pulps at an Umpire Lab (~5%)

Whether sample sizes are appropriate to • Gold mineralization in low sulphidation deposits is

For

per

sona

l use

onl

y




the grain size of the material being sampled.

typically erratic (high grade - narrow vein) • Tembang mineralization is not considered to have

a high nugget effect Quality of assay data and laboratory tests

The nature, quality and appropriateness of the assaying and laboratory procedures used and whether the technique is considered partial or total.

• Sample analysis is completed at a commercial analytical laboratory; Intertek Testing Services laboratory (Jakarta)

• Au is analysed by 50g fire assay technique and considered total

• Ag is analysed by 2-acid digestion with AAS finish and considered total

• Grade control sample analysis is completed at an on-site laboratory managed by independent laboratory services provider PT Geoservices. Au and Ag are analysed by taking a 30g split of pulverised material and analysed by AAS technique.

• Certified reference Material Has been inserted for every 20 samples and will select random by LIMS, CRM performance should be within (± 5%)

• If more than (± 5%) re Assayed is carried out • Blank sample also inserted as Barren wash blank

and Aqua Regia Blank Solution. • Replicate and Duplicate are done and selected

automatically by C-class For geophysical tools, spectrometers, handheld XRF instruments, etc, the parameters used in determining the analysis including instrument make and model, reading times, calibrations factors applied and their derivation, etc.

• Not Applicable

Nature of quality control procedures adopted (e.g. standards, blanks, duplicates, external laboratory checks) and whether acceptable levels of accuracy (i.e. lack of bias) and precision have been established.

• Standard industry practice Quality Assurance-Quality Control procedure includes insertion of;

• Field Blanks (1/30) • Field Duplicates (1/30) • Standards (1/30) • Results of certified reference material "standards"

indicate no lab bias • For Grade control Quality Assurance-Quality

Control procedures includes the insertion of; • Field Blanks (1/100) • Field Duplicates (1/50) • Standards (1/500)

Verification of sampling and assaying

The verification of significant intersections by either independent or alternative company personnel.

• Calculations of significant intersections are carried out by qualified geology professional and reviewed by Competent Person Matthew C Farmer consultant geologist to Sumatra Copper and Gold plc.

The use of twinned holes. • I8 twin holes were completed in 2008 to compare historical RC data with recent diamond drilling

Documentation of primary data, data • Historically, data has been collected via MS excel tables and MS Access database

For

per

sona

l use

onl

y




entry procedures, data verification, data storage (physical and electronic) protocols.

• More recently, a commercially available data collection and management software; GeoSpark has been purchased and is in process of being deployed

• Data is backed-up on hard discs at the project and the Jakarta head office

• A Server has been installed on site • Dropbox has been used extensively at the project

but is not considered a central data storage system

• Physical Drill Logs and Assay Certificates are stored on site

• Certified reference Material has been inserted for every 20 samples and will select random by LIMS, CRM performance should be within (± 5%)

• If more than (± 5%) re Assayed is carried out Blank sample also inserted as Barren wash blank and Aqua Regia Blank Solution.

• Replicate and Duplicate are done and selected automatically by C-class

Discuss any adjustment to assay data. • To date, there have been no adjustments made to assay data.

• Some historical RC drill holes are considered in-valid due to suspected downhole smearing, likely caused by RC drilling in wet conditions. These holes may have manual adjustments made to the assays to better reflect an interpreted interval of representative of mineralization and still allow the drill hole to be included as inferred resources.

• Current JORC 2012 compliant Mineral Resources are reported without RC data

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.

• In 2007 SCG commissioned PT Geoservices to complete a topographic survey of the Tembang post-mining surface. A set of survey beacons was established tied to the Indonesian UTM national grid. From the pick-up of old drill collar markers and infrastructure a correction factor was established to adjust the existing BTM data to true UTM coordinates.

• All drill collars are surveyed (picked up) by company surveyors using NIKON TOTAL STATION, DTM-352 equipment and tied to control points set out in 2007 survey.

• All drill holes collect down hole survey data with a single shot camera. Drill holes are not considered to be very deep and ground conditions relatively uncomplicated, as a result drill hole deviation has not been a problem

• Historically, all drill holes were surveyed down hole every 50m

• Currently, down hole surveys are collected every 25m with an aim to collect at least 3 points per hole in shorter holes

For

per

sona

l use

onl

y




• The topographic survey on the underground workings has been done by a qualified surveyor using a TOPCON 1” DS Total Station. The survey uses laser for the location of sample locations and underground workings.

Specification of the grid system used. • The grid system used is WGS 84 UTM-UTS Zone 48 South corrected to mine grid by -9600000N and -200000E

Quality and adequacy of topographic control.

• Day to Day topography is completed with total station equipment for surveying of project surface data including drill collars

• A drone (UAV) survey is planned to improve accuracy of topography inside pits/pit walls

Data spacing and distribution

Data spacing for reporting of Exploration Results.

• Drill spacing has generally aimed at; • 50m x 50m for inferred resources, • 25m x 25m for indicated resources and • <25m x <25m spacing for measured resources • Face samples are between 0.5m to 1m and

continuous along the mineralised zone. 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

• The mineralisation and geology show good continuity from hole to hole and is sufficient to support the definition of a Mineral Resource or Ore Reserve and the classifications contained in the JORC Code (2012 Edition).

Whether sample compositing has been applied.

• Sample compositing is only applied during the resource estimation process and is typically done on 1m intervals to reflect the average samples interval size and relatively narrow nature of the mineralized lodes

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.

• Drill holes are planned to intersect quartz vein lodes as close to perpendicular as logistically possible

• An attempt has been made to orient diamond drill core however broken core or "bad ground" prohibits orientation process

• For face sampling, the data orientation is intended to cover the mineralised zone approximately along strike and down dip. Data is collected from all underground openings

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.

• No material sampling bias is considered to have been introduced by the drilling direction.

Sample Security The measures taken to ensure sample security.

• Drill core and chip samples are transported from the drill sites to the drill core and sample processing facility at Tembang Exploration Camp.

For

per

sona

l use

onl

y




• Geology professionals complete logging and select sample intervals and supervise photography and sample preparation procedures

• All samples for assay are bagged in numbered calico sample bags which are then sewn in to polyweave bags for transport.

• Samples are dispatched to the assay lab in Jakarta in a private vehicle (local contractor)

• Samples are driven to Jakarta (~2 days by road/ferry)

• Samples are received by Intertek personnel and custody of samples is handed over by signing and a sample receipt form

• Intertek advises by electronic mail that the samples have been delivered/received and a physical copy of receipt is returned to project for filing

• For face samples, samples are stored in plastic sample bags, stored in a dedicated secure facility on site prior to transport to the lab.

• All laboratory pulps are stored in the storage facility onsite in boxes supplied by the labs, stacked in dry places

Audits or reviews

The results of any audits or reviews of sampling techniques and data.

• External Resource consultants , H&S Consultants and Cube Consulting visited the project in 2013 as part of JORC compliancy for reporting of mineral resources

• Behre Dolbear Australia (BDA) reviewed the drilling data in 2014 as part of external audit of definitive feasibility study (2014)

• No audit or review has been undertaken regarding the results reported in this announcement

For

per

sona

l use

onl

y

Documents

Tembang Production Update - ASXTembang Production Update Sumatra Copper & Gold plc (“the Company”) is pleased to provide a production update for its Tembang Gold-Silver Operation,