INDEPENDENCE GROUP NL ANNUAL REPORT 2017

OPERATIONS—NOVA MINE ORE MINING AND PROCESSING By the end of FY17, the paste fill plant had been commissioned and ore production was taking place over three levels to enable consistent ore feed to the processing plant. Development is continuing both at Nova and Bollinger. Grade control drilling at Nova and Bollinger is well advanced and due to be completed by the end of the December 2017 quarter. The process plant has transitioned to a continuous operation as the delivery of stope ore has become more consistent. Continuous operation of the plant has enabled ore recoveries and concentrate quality to approach design levels. As part of the original design, the tailings storage facility is used as a water storage dam to store water pumped from an aquifer above the underground mine. Dewatering of this aquifer was successfully completed during FY17 to provide a process water source from the tailings dam. Electric power for the Nova operation is provided by Zenith Pacific’s 20MW power station under a build, own and operate contract. This power station has proved to be reliable and efficient. As part of the design, a concept was developed to construct a 6.7MW solar power station. This project has taken longer than planned to reach construction stage due to the changing economic situation resulting from lower oil prices. Zenith Pacific and IGO are currently negotiating with ARENA to assist in funding of this project. NEAR MINE EXPLORATION The majority of the focus during FY17 has been on the completion of underground grade control drilling with limited near mine exploration. One of these programs was underground diamond drilling of C5 mineralisation, above the Bollinger orebody. A 2D seismic traverse of almost 10km was completed by HiSeis which has shown strong reflectivity and the ability to map the geological and structural architecture. Work is progressing with the aim of completing a 3D seismic survey on the Nova Mining Lease during FY18. Surface diamond drilling has also commenced, designed to test a number of EM conductors proximal to the Nova-Bollinger deposit. 16 — IGO ANNUAL REPORT 2017