Regional Gold Exploration Projects

Tropicana
Karlawinda
Holleton
De Beers Database – Project Generation

IGO has budgeted $5.6 million for regional gold exploration in 2010/11. The bulk of the regional gold exploration budget has been allocated to drill testing advanced targets at Karlawinda and Holleton. A location map of all regional gold projects is provided in Figure 6.

This budget figure does not include Tropicana Joint Venture exploration and feasibility budgets, or potential construction expenditure should the JV partners approve the development of the project.

Tropicana Joint Venture

Figure 7: Tropicana JV – Tenure, Tropicana and Havana Resource Location, Gold Geochemical Anomalies, Significant Drill Intercepts Outside June 2009 Resources and Selected Prospect Locations

The Tropicana JV comprises approximately 15,000 km2 of largely unexplored tenure over a strike length of 400km along the Yilgarn Craton – Fraser Range Mobile Belt Collision Zone (Figure 7). The project was initially targeted and pegged by IGO in 2001. AngloGold Ashanti Australia was brought in to fund and manage exploration due to the substantial resources required to effectively explore this very large and remote tenement package. The JV has a dominant ground position in what is shaping up to be a new Australian Gold Province. In 2005 the JV discovered the Tropicana deposit which now has resources in excess of 5 million ounces of gold and is the subject of a Bankable Feasibility Study ("BFS") which is due for completion in late 2010.

Feasibility Study

Following the conclusion of the Tropicana Prefeasibility Study ("PFS") in mid-2009, the Tropicana JV partners commenced a BFS on the Tropicana and Havana deposits, focusing on open pit resources. The outcome of the BFS will be presented for Project approval by the JV partners scheduled
to be in the final quarter of 2010. The BFS will only consider the Tropicana, Havana and Havana South open cuts (Figure 8). The Havana Deeps underground and Boston Shaker open cut scoping studies are planned for completion in late 2010.

Tropicana-Havana mineralisation identified to date dips at approximately 30 degrees to the south- east and has been drilled to a vertical depth of 570m where it remains open. Gold mineralisation, which has now been delineated over a 5km strike length, is hosted in quartzo-feldspathic gneiss and generally occurs as one or two laterally extensive, moderately dipping planar lenses.

Figure 8: Tropicana JV – Isometric Model Showing 0.3 g/t Au Mineralised Envelope, >50 gram Au x Metre Envelope and Pre-feasibility Study Open Pit Outlines

Table 4: Tropicana JV Resources and Reserves

Resources: The information in the resources table is based on information compiled by Mark Kent, who is a full-time employee of AngloGold Ashanti Limited and a member of the AusIMM. Mark Kent has sufficient experience relative to the type and style of mineral deposit under consideration and to the activity which has been undertaken, to qualify as a Competent Person (or Recognised Mining Professional) as defined in the 2004 Edition of the JORC Code. Mark Kent consents to the release of this resource based on the information in the form and context in which it appears.

Reserves: The information in this report that relates to the Tropicana Joint Venture Ore Reserves is based on information compiled by Marek Janas, who is a full-time employee of AngloGold Ashanti Limited, and a member of the AusIMM. Marek Janas has sufficient experience relative to the type and style of mineral deposit under consideration and to the activity which has been undertaken, to qualify as a Competent Person (or Recognised Mining Professional) as defined in the 2004 Edition of the JORC Code. Marek Janas consents to the release of this reserve based on the information in the form and context in which it appears.

Figure 9: Tropicana JV – Proposed Tropicana and Havana BFS Open Pit Outlines, Prospect Locations, g/t Au x Thickness (m) Contours, Figure 10 Cross-Section Location and Significant Intercepts Outside June 2009 Resources

Tropicana Project mineral resource estimates released by AngloGold Ashanti Australia in July 2009 identified a resource of 75.3Mt @ 2.07 g/t Au for 5.01Moz (Table 4) with oxide and fresh cut-off grades of 0.6 g/t Au and 0.7 g/t Au respectively. The resource is constrained by an A$1,250/oz optimal pit shell.

A PFS mining reserve of 45Mt @ 2.3 g/t for 3.3 Moz (Table 4) with oxide and fresh cut-off grades of 0.7 g/t Au and 0.8 g/t Au respectively was estimated in December 2009. The resource was optimised at an A$1,059/oz Au gold price and does not take into account down-plunge mineralisation which could potentially be mined by underground methods or the recently discovered Boston Shaker gold deposit.

Figure 10: Tropicana JV – Havana South Cross-Section Showing the Down Dip Continuation of the Havana Gold System Beneath the Proposed Open Pit

The BFS is based on contract mining and a processing rate of up to 6Mtpa over a 10 year mine life, treating stockpiled Tropicana and Havana ore in years 8-10. Mining is planned to be undertaken by conventional open-pit drill and blast methods using trucks and excavators. It has been assumed that bulk mining methods would be appropriate for waste material.

A comprehensive metallurgical test work program and engineering analysis was completed, which recommended a BFS gold process flow sheet including high pressure grinding rolls and ball milling to 80% passing 75 microns followed by a carbon-in-leach (CIL) circuit. This is anticipated to result in an average recovery rate of 90%.

All mining licences and miscellaneous licences necessary to enable the project to proceed have been granted. A comprehensive consultation programme with key stakeholders is continuing. Environmental approval of the project by the State and Federal agencies is anticipated by December 2010.

Construction of a new 220km site access road will be required before major site construction activities can commence. Construction of site infrastructure is anticipated to take up to two years. Providing all JV partner and regulatory approvals are obtained by late 2010, it is anticipated that project commissioning would occur in 2013.

IGO's share of initial planned production is over 1Moz Au. Mine life has the potential to increase via the incorporation of the Boston Shaker mineralisation into future mine schedules, potential Havana underground operations, as well as the potential for further regional exploration success.

Exploration

In addition to the Feasibility work at the Tropicana deposit, exploration is continuing at a number of priority locations throughout the joint venture area.

The focus of work has been on exploring prospects within trucking distance of the proposed Tropicana treatment plant. Drilling programs proximal to Tropicana, including Havana South, Havana Deeps and Boston Shaker have been very successful and are likely to add significantly to the resource base of the project.

Figure 11: Tropicana JV – Computer Generated Model of Proposed Plant Layout

At Boston Shaker, located 360m north of the Tropicana resource, drilling on a 100 x 50m spacing has identified the faulted offset of Tropicana mineralisation over a strike length of 700m. The northern end of Boston Shaker in turn appears to be fault offset and additional drilling is planned to locate potential further extensions to the north. Intercepts from Boston Shaker include:

• 32m @ 3.7 g/t Au from 181m including 29m @ 4.0 g/t Au
• 22m @ 4.4 g/t Au from 247m
• 18m @ 4.3 g/t Au from 34m

The Havana Deeps area, testing the down dip extensions of the high-grade shoots at Havana beneath the conceptual pit floor, has been a major focus of exploration drilling during the year (Figure 10). It is anticipated that if these extensions can be demonstrated to have sufficient continuity, thickness and grade, there is potential for ore derived from bulk underground mining methods to be mined and blended with open-cut ore after the completion of the planned high-grade starter open-cuts.

Drill testing of the Havana Deeps target has been highly encouraging with step out drilling intersecting mineralisation up to 800m down plunge of the conceptual pit wall (570m vertically) and "step-back" drilling returning numerous thick high-grade intersections including:

• 35m @ 5.0 g/t Au from 514m
• 22m @ 4.0 g/t Au from 550m including 14m @ 5.8 g/t Au
• 14m @ 4.8 g/t Au from 663m
• 18m @ 3.5 g/t Au from 386m including 14m @ 4.2 g/t Au
• 12m @ 5.3 g/t Au from 607m
• 13m @ 6.1 g/t Au from 417m

Drill intersections quoted for Boston Shaker and Havana Deeps approximate true widths.

Joint Venture manager AngloGold Ashanti Australia expects that scoping level economic studies on the Boston Shaker and Havana Deeps potential resource additions will be completed by December 2010.

Elsewhere on the project's tenure, surface geochemical sampling has been completed over the majority of granted tenements generating numerous anomalies. First pass and follow- up aircore drilling and RC drilling to test these anomalies continues to provide encouraging results at a number of prospects and this effort will continue throughout the year.

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Karlawinda

The Karlawinda Project is located on the southern margin of the Archaean Sylvania Inlier, some 65km south-east of Newman, close to the Great Northern Highway and gas pipeline infrastructure (Figure 12).

Figure 12: Karlawinda – Location Plan Showing Tenure, Prospects and Significant Drill Intercepts

Drilling at Francopan has defined an extensive gold mineralised system extending over a strike length of 1.1km and 0.5km down dip (open in both directions) beneath approximately 190m of Proterozoic Bangemall Basin cover sediments. Previously announced intercepts include 7m @ 4.6 g/t Au, 6m @ 4.5 g/t Au and 15m @ 3.0 g/t Au. Based on the extent and style of mineralisation the project is considered to have good potential for the delineation of a significant Archaean mesothermal lode gold system.

The current focus of exploration is on the Bibra Prospect approximately 4km to the north of Francopan, where Archaean bedrock is not obscured by thick Bangemall cover.

Bibra Prospect

At Bibra IGO has defined gold mineralisation extending over 1km both along strike and down dip (open). Mineralisation strikes NNE and is developed in a series of shallowly plunging WNW orientated shoots within a more continuous lower grade halo.

Supergene gold is generally well developed above the up-dip oxidised portion of the main mineralised zone.

Figure 13: Karlawinda – Francopan Cross-Section Showing Thick Gold Alteration Zones Containing Narrow Higher Grade Intervals

A recent aircore drilling program comprising 109 holes for 6,516m tested the supergene and oxide gold potential over a 1,600m strike length to a vertical depth of 60m. Results confirmed widespread shallow oxide mineralisation including the following highly encouraging intercepts:

• 23m @ 2.4 g/t Au from 37m
• 12m@2.5g/tAufrom7m
• 18m @ 2.2 g/t Au from 21m
• 7m@5.7g/tAufrom45m
• 11m @ 2.5 g/t Au from 42m
• 5m@4.3g/tAufrom6m
• 10m @ 2.6 g/t from 9m
• 9m@2.5g/tAufrom27m
• 9m@2.4g/tAufrom40m
• 8m@2.6g/tAufrom50m

The economic potential of the oxide mineralisation is currently being assessed. Leach-well assay results indicate that the gold is readily liberated with average recoveries in excess of 97%. Further extensional and infill drilling together with preliminary metallurgical sampling is planned.

Drilling to date at Karlawinda has been mostly confined to the Francopan and Bibra Prospects. The tenement package contains numerous other untested stratigraphic, structural and geophysical target positions which are planned to be drill tested in 2010/11.

Figure 14: Karlawinda – Bibra Prospect – Drill-Defined Gold Anomalies, Significant Intercepts and Figure 15 Cross-Section Location

Figure 15: Karlawinda – Bibra Prospect – Cross-Section Showing Supergene, Oxidised and Primary Mineralised Zones

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Holleton

Figure 16: (a) Holleton – Project Tenure Over Regional Geology Showing Major Gold Mines Proximal to the Project and Selected Prospects, Gold Geochemical Anomalies and Significant Drill Intercepts over Regional Geology (b) Geochemical Gold Anomalies and Significant Syme's Find Prospect Drill Results

The Holleton Project covers an area of approximately 1,300km2 over the largely unexplored Holleton greenstone belt in the Southern Cross Province of the Archaean Yilgarn Craton.

The Southern Cross Province has total production and resources of approximately 11 million gold ounces and contains a number of individual deposits with total gold endowment in excess of 1 million ounces including:

• Westonia (2.3M oz),
• Yilgarn Star (1.7M oz)
• Southern Cross (1.5M oz)
• Marvel Loch-Nevoria (2M oz)

Much of the greenstone within the project is under varying depth of sand cover. However where exposed in the centre of the project, there are a number of old gold workings. The Holleton greenstone belt has similarities to the Westonia belt and it is inferred that these belts are structurally connected. A number of magnetic and non-magnetic domes intrude the belt providing favourable structural positions for gold mineralisation.

IGO's focus is on two narrow unexplored north– south trending greenstone belts in the north of the project area and a larger poorly exposed area of greenstone towards the southern end of the project (Brahma).

During the year surface sampling at the Syme's Find Prospect, located at a "jog" position in the eastern most north-south trending greenstone belt, defined a NNE trending Au-in-soil anomaly measuring 1.5km x 500m (+200ppb Au). A single line of AC drilling across the anomaly has returned shallow intervals of up to 5m @ 3.5 g/t Au (primary oxide) and 8m @ 2.6 g/t Au (laterite). Follow-up aircore drilling on 100m spaced lines along the strike of the anomaly has recently been completed with preliminary results (4m composite sampling) including up to 12m @ 5.3 g/t Au.

Other prospects include:

• Felstead's Find (new tenement application) which contains mineralized intervals open both along strike and down-dip including 9m @ 2.5 g/t Au and 9m @ 1.7 g/t Au in strongly weathered rocks.
• Brahma Prospect where auger sampling has defined a +50ppb Au anomaly over a strike length of 2.4km (max 7.2 g/t Au). Aircore and limited diamond drill testing has returned
  broad low grade intervals of up to 13m @ 0.7 g/t Au, 22m @ 0.4 g/t Au and 18m @ 0.5 g/t Au which include narrower higher grade zones of 1m @ 7.6 g/t Au and 1m @ 4.3 g/t Au. These results are considered encouraging, as the lithologies intersected are very similar to those at the Westonia gold mine (+1Moz). Further work will target interpreted structural positions that will potentially provide the focus necessary for these zones to develop into significantly mineralised systems.

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De Beers Database - Project Generation

In 2009 IGO acquired the non-diamond specific exploration database of De Beers Australia Exploration Limited ("DBAE"). This database represents the culmination of more than 30 years of exploration. The key assets of the database are the surface geochemical samples and associated analytical results covering many mineral prospective regions throughout Australia (Figure 5). As DBAE was solely focused on diamond exploration, less than half of the samples were appraised for commodities other than diamonds. IGO views the database as a very powerful tool for rapidly generating new projects in Australia across a range of commodities.

Database Highlights:

• Culmination of over 30 years of exploration
• Over 2,200 samples in the database reporting visible gold
• 103,000 analysed samples
• 189,000 unanalysed samples
• 300,000 diamond concentrates available
• 893,000 microprobes analyses
• 175 geophysical surveys covering 306,000km2

The initial priority for IGO is analysis of samples covering under-explored Proterozoic basins and basin margins in Western Australia and the Northern Territory, prospective for polymetallic base metals and gold mineralisation. Orientation studies have been undertaken to test the effectiveness of the DBAE samples collected in the vicinity of known mineral deposits prior to their discovery. Strong anomalous assays were returned around a number of mines, including the Plutonic discovery (Figure 17).

Figure 17: De Beers Data Base – Aerial Photograph Showing the Location of De Beers Samples Collected in 1980 Prior to the Discovery of the Plutonic Gold Mine

A total of 28,385 samples have been analysed to date with a further 20,000 to 25,000 samples earmarked for analysis in 2010/11.

This work continues to generate a number of anomalies in gold, base metals and other commodities. Systematic prioritisation and field appraisal of these anomalies are progressing.

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