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JSC “SiGMA” - an example of successful development of the gold project "Ozernovskoye" (Kamchatka, Russia) Dmitry S. Prjibelski, CFO, Managing Partner

DISCLAIMER

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Disclaimer

The purpose of this Memorandum is to inform and help the recipient decide whether to investigate and evaluate further the activities of the OJSC SiGMA and its affiliates (hereinafter referred to as “the Company” or “the Group”) and should not serve as the basis for taking any investment decisions or the decision to acquire stake in the Company’s equity capital without further analysis (due diligence). The fact that this Memorandum is prepared and disseminated should not be regarded as a guarantee of a subsequent sale of a stake in the equity capital of the Company. Information in the form of facts and/or estimates submitted by the Company and contained in this Memorandum was not subject to independent verification by Z1 INVESTMENT GROUP. Such information shall not be regarded as comprehensive and exhaustive. OJSC SiGMA and Z1 INVESTMENT GROUP cannot guarantee and shall not be held liable for the completeness and reliability of the Memorandum, or for any information transferred subsequently in verbal or written form to the Recipient of the Memorandum or its consultant. Specifically, OJSC SiGMA and Z1 INVESTMENT GROUP cannot guarantee and shall not be held liable for the fulfillment or attainment of any forecasts relating to the future indicators of the Company’s activities, nor for the reliability of any admissions and assumptions which were directly or indirectly used in compiling forecasts for future indicators of the Company’s performance. Certain statements, beliefs and

• pinions in this document, are forward-looking, which reflect the Company’s or, as appropriate, the Company’s management’s current expectations and projections about future events. By

their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. Forward-looking statements contained in this document regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. OJSC SiGMA and Z1 INVESTMENT GROUP does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or

• ther wise. You should not place undue reliance on forward-looking statements, which speak only as of the date of this document.

The recipient of this Memorandum should, if appropriate, conduct due diligence and evaluate the information provided on the activities of OJSC SiGMA independently. OJSC SiGMA reserves the right, in its sole discretion, to modify any of the information provided herein, or without prior notice and for reasonable cause therefore, to decide not to proceed with any transaction. Neither OJSC SiGMA nor any of their agents, representatives, advisors or consultants will be liable or responsible to any person for any cost or expense incurred in responding to the Investment or in any investigation or transaction, whether or not consummated, which may follow. This document does not constitute an offer to sell or solicitation of an offer to buy any security or shares, nor does it constitute an offer to sell or a solicitation of an offer to buy any security

• r share in any jurisdiction in which such an offer, solicitation or sale is not authorized, or to any person to whom it is unlawful to make such an offer, sale or solicitation.

This document and its contents are confidential and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published, in whole or in part, for any purpose. By attending the presentation to which this document relates or by accepting this document you will be taken to have represented, warranted and undertaken that you have read and agree to comply with the contents of this notice; you will use the information in this document solely for evaluating your possible interest in the Investment Opportunity and for no other purpose.

INVESTMENT SUMMARY

Summary

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Technology Management & Shareholder Production Targets

 Open pit mining with relatively low strip ratio  Carbon-in-leach recovery method (recovery ~ 90%)  Management with up to 25 years experience in gold sector  Main shareholder with access to substantial funds, connections and business experience  Start of production in 2015 with 60 K oz per year, expansion to 130 K oz per year in 2017 and to ~300 K oz per year by 2018-19.

Substantial Resources Significant Upside Potential Intensive Development

 3.35 M oz Au / 104.1 t contained at average grade of 2 g/t (M,I&I), according to Independent NI43-101 compliant Report - Technical Due Diligence & Resource Estimate  Over 8 M oz / 250 t total upside potential expected  Upside in run-of-mine grades and reserves because of bonanza dissemination (grades > 100 g/t)  Intensive geological exploration, infrastructure development  A number of finished steps: metallurgical tests and extraction technology, road construction project, geological audit and NI 43-101 report, FS preparation by Q2 2013

Target

 Building up a company with total reserves exceeding 9 M oz, annual production of about 300 K oz and market cap of more than USD 2 bn.

COMPANY OVERVIEW

COMPANY OVERVIEW

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RUSSIAN FEDERATION

General Overview

• Head-office located in Saint-Petersburg, main branch in

Petropavlovsk-Kamchatsky.

• At present, exploration works are in full swing, front-end

engineering and design works are being carried out, operating procedures are being clarified, infrastructure facilities are being shipped in and set up

• Equipment, trenching tools and drilling facilities have been

delivered to the field.

Head Office: Saint-Petersburg Main Branch: Petropavlovsk-Kamchatsky Ozernovskoe Minefield

• In March 2010 was acquired by current shareholders.
• In that time no official reserves according to

international or Russian classification

• New shareholders provided financing and resumed

exploration works in 2010, which had been temporarily suspended by previous owners.

• Main and the only project – Ozernovskoe. License

awarded on state public auction in 2005.

• Since March 2010 current shareholders invested more

than $55 million in JSC Sigma, mostly in exploration and project design

RUSSIAN FEDERATION

PROJECT TIMELINE

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Current Ownership Structure*

Ozernovskoe Ore field Timeline 2008 1998 1992 1987 1997 2006 March 2010 2011 September 2012

1.2M oz Au JORC resources confirmed

2005

Over $55 mm invested exploration and development) Further exploration (2012- 2014) Factory construction (2013- 2014) and start of production (2015) 3.35 M oz Au NI43-101 resources confirmed

2013- 2014

Prospecting and evaluation carried

• ut by CKEE GGP

“Kamchatgeologia” Exploration carried out by CJSC Palamos OJSC SiGMA acquired the license to Ozernovskoe field From the state auction Exploration carried out by previous

• wners of OJSC

SiGMA (UFG Private Equity) Sigma acquired by current shareholders Zero official resources

4Q 2012

PROJECT OVERVIEW - OZERNOVSKOE

RESOURCE BASE

• Due Diligence and NI 43-101 estimation of 2010

resources was done jointly by Micromine Consulting Services (Australia) and TOMS Engineering (Russian leading consulting firm).

• 2011 ​resource update and 2012 NI 43-101 were

performed by international consulting company CSA Global Pty Ltd (CSA, Australia).

• During operational exploration, concurrent with
• pen pit mining, it is expected to spot many rich

and bonanza ore spots, lenses and shoots, which are common for this type of deposit. As a result, run-of-mine grades are expected increase.

• Total NI43-101 resources as of the 1st half of 2012

are confirmed at the level 3.35 M oz / 104.1 t gold with average grade 2 g/t (reduction of nugget grades)

• 0.46 M oz/14.3 t - measured
• 1.86 M oz / 41.5 t – indicated
• 1.03 M oz / 52.7 t – inferred

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Resources of the most explored zones

Total Resources (M,I & I), oz

+ + 1.8m

1.2 m 3.0 m

+ + 0.3m

Dec 2010 Dec 2011 Sept 2012 3.3 m

+ + 0.8m

0.5 m 1.3 m

+ + 1.0m

Dec 2010 Dec 2011 Sept 2012 2.3 m

Resources, Measured & Indicated, oz

COG Au_cut, Au, Au_cut, Au, g/t g/t Koz Koz Measured 2,50 3,14 459,00 576,94 Indicated 1,70 2,02 1 860,00 2 216,82 Inferred 1,53 1,67 1 028,00 1 119,97 Total: 1,72 2,01 3 347,00 3 913,74 Measured 3,26 4,19 415,00 532,74 Indicated 2,49 3,10 1 465,00 1 821,82 Inferred 2,23 2,50 776,00 868,58 Total: 2,50 3,03 2 656,00 3 223,14 Measured 4,94 6,70 330,00 447,47 Indicated 4,39 6,03 947,00 1 300,14 Inferred 4,71 5,77 411,00 504,06 Total: 4,57 6,09 1 688,00 2 251,68 Measured 6,45 9,25 268,00 384,39 Indicated 6,54 9,88 676,00 1 021,01 Inferred 8,32 10,96 289,00 380,18 Total: 6,86 9,94 1 233,00 1 785,59 3,0 GEOLOGICAL AUDIT 1st HALF OF 2012 г. 0,6 1,0 2,0

MINEFIELD DESCRIPTION

Location

• Ozernovskoe ore field is located in the Koryak

Autonomous Area in Kamchatka region, 150 km north of nearest town Klyuchi and 520 km from the regional centre Petropavlovsk-Kamchatsky.

• The climate of the district is moderate continental,

transitional to marine.

• Exploration works can be conducted year round.

Layout of the sites

• License area (48.5 sq km) covers most explored eastern

part of the Ozernovskoe ore field.

• There are 5 major auriferous mineralized zones outlined

within the license area: BAM, Homut, Promezhutochny, Kayukovsky and Prometei.

• Out of all zones, BAM and Khomut are the most explored.
• The BAM site occupies the SSE part of the ore field,

incorporating the ore field’s largest ore bearing zone.

• The Khomut site is located in the central part of the ore

field, occupying the Khomut plateau and the upper reaches of the Khomut creek.

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Prometey Kayurkovsky Khomut Promezhutochny BAM

License Area Zoning License Area Zoning

Ozernovskoe Ore field

EXPLORATION WORKS BEFORE END OF 2010

Exploration Stages

Type of work Unit of measurement Central Kamchatka Exploration Expedition (1987-1993) CJSC Palamos (1997-1998) OJSC SiGMA (2006-2008) OJSC SiGMA (2010) Core drilling

• lin. m.

11,489 2,696 12,301 4,504 BAM site

• lin. m.

8,929 2,696 5,105 293 Khomut site

• lin. m.

– – 7,196 4,211 Number of wells pcs 56 14 112 – BAM site pcs 42 14 70 – Khomut site pcs – – 42 – Channels and trenches m3 198 ,000 7 confirmatory underground channels drilled 46,500 35,200 BAM site m3 600 Khomut site m3 45,900

Exploration Works Description

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Exploration History before 2011

The main exploration work done at the deposit may be divided into four time phases:

• Prospecting and evaluation is carried out during the

Soviet and the early post-Soviet period in 1987-1992 (CKEE GGP “Kamchatgeologia”);

• Exploration carried out by JSC Palamos in 1997-1998;
• Exploration carried out by JSC SiGMA in 2006-2008;
• Exploration currently performed by JSC SiGMA.

Trenching and drilling methods were applied to explore mineralized bodies. The deposit was explored from the surface by trenches. At depth the deposit was drilled by vertical, inclined and horizontal drill holes.

• Prospecting

was also carried

• ut

by different

• rganizations prior to 1987.
• In the course of these works about 46,000 m3 of trenches

and 400 m3 of test pits were excavated. However, the quality of materials does not allow snapping the workings reliable enough.

• Before 2006, drilling was carried out at the BAM site only.

Currently the BAM and the Khomut sites are being drilled.

• Most explored of all is mineralized zone BAM.

EXPLORATION WORKS IN 2011 AND 2012

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Exploration work types Work areas Measurement unit Actual Volumes 2011 Actual Volumes 9 months 2012 Operator Trenching and geological work (ditches, trenches), total: m3 334,344 164,126 OJSC SiGMA Drilling work, total:

• lin. m

34,423 27,651 OJSC SiGMA Geological sampling, total: Pcs. 22,702 15,002 OJSC SiGMA

• Trenching

Pcs. 5,021 10,412

• Core sampling

Pcs. 17,681 4,590 Analytical work - Au and Ag assay Analysis 21,770 14,239 Irgiredmet

Exploration works conducted in 2011 and planned works for 2012

• During 2011, 34,400 lin. m of core drilling and 334,344 m3 of trenching and geological operations were carried out, more

than doubling all exploration works performed on the site before the end of 2010.

• Currently, geological exploration is ongoing. 9 months of 2012 exploration works amounted to 28,000 m of diamond drilling

and about 164,000 m3 of surface cuts & trenching.

• Overall, 97,200 linear m of diamond drilling and 737,300 cu m of surface exploration works have been conducted.
• Samples are being prepared at the Ozernovskoe field, analytic works (gold and silver assay) – in the laboratory of OJSC

“Irgiredmet”.

• Exploration drilling is outsourced to OJSC "Kamchatgeologia" that used imported drilling machines LF-90С (the Khomut

area), LM-75 and Versa Drill (both at the BAM area). OJSC SiGMA currently owns 2 drilling rigs.

• Geological support of exploration works is conducted by OJSC "SiGMA" geologists.

Recent and Currently Held Exploration Works

INFRASTRUCTURE AND EQUIPMENT

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Road & Access

• Nearest road accessible all year round is in 60 km from

the deposit. This last section can be used by wheel and track-type transport during summers and winters, and year round by off roaders.

• The Company has conducted engineering exploration and

prepared a project to build a year round road in this last 60 km before the minefield.

• Start of construction of the road is scheduled for the 1Q
• f 2013.

Local Infrastructure

Equipment

Equipment Vityaz two-unit transport truck (heavy all-terrain vehicle) POL mobile warehouse using flexible fuel tanks Komatsu heavy bulldozer JCB backhoe loader Mobile homes for worker’s settlement Caterpillar medium bulldozer Ural automobile MLTBU (all-terrain vehicle) Eider 1100s drilling rigs (2 units) Shelters Drilling sleighs with heated enclosures Other

In its activity, the Company uses a variety of equipment to conduct exploration works. A number of broad categories of equipment can be singled out, as follows:

• machinery used in trenching operations (tracked

bulldozers, towing machines and all-terrain vehicles);

• equipment used for drilling operations (drilling rigs,

shelters, heated enclosures, and special vehicles used to perform drilling operations);

• mobile warehouses and storage facilities;
• mobile laboratories;
• workers’ settlement facilities.

List of Proprietary Equipment

• A permanent camp and infrastructure facilities are set

up near the field, and a stock of equipment and tools has been purchased.

• The area is provided with drinking and technical water.
• There are no power supply sources in the work area.

Autonomous diesel generators can be used as a power source.

GEOLOGY DESCRIPTION

Geology of the ore field and the deposit

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• Ozernovskoe ore field and the deposit itself are of epithermal origin.
• Ozernovskoe ore field is located in the central part of near circular Pravoukinsky volcanic structure and is confined to

wedge-like block of the structure. Paleo volcano vent is located near the top of this wedge-like block and right in the middle

• f the ore field and is marked by sub-volcanic bodies of quartz-andesites and typical circular or arc shaped tectonic

dislocations.

• Volcanic rocks of Miocene & Pliocene age, such as andesite-basalts, gabbro-diorites, dolerites and quartz-andesites are

most important within the ore field as their totally altered varieties by quartz metasomatites host majority of ore mineralization.

• Andesite-basalts form a major sill or seam like 250 m thick body with horizontal dimensions 1 x 2.5 km, which makes up

most of the BAM and Promezhutochny zones. It is pinching out south-eastwards. This andesite-basalt volcanic body is largely altered by propilites, argillizites and quartz metasomatites. The later contains major mineralization within BAM and Promezhutochny zones.

• Stocks of gabbro-diorites, which found in southwestern part of BAM site and southeastern part of Promezhutochny site,
• bviously acted as paths for outflow of andesite-basalts. Small stocks of gabbro-diorites are found also at Khomut site.
• Sub-volcanic shallow dipping tabular body of quartz-andesites is located at Khomut and occupies center of the volcanic
• structure. Dolerites form two lenticular or lens-shaped bodies within tuffs and dacites at southeastern flank of Khomut.

They follow major tectonic dislocation paths and are of northwestern strike.

• All mentioned volcanic rock varieties are totally altered by propilites, argillizites, pre-ore and post-ore quartz-
• metasomatites. Ore bearing quartz metasomatites itself form ferruginated, argilllized and hydrothermal breccia types with

barren disseminated pyrite in them, presence of sericite, clay minerals, adularia, alunite, iron oxides & hydroxides.

• Major tectonic dislocations (strike-slip faults and uplifts) of northwestern and subordinate northeastern strike paid

important role in the formation of the mineralized zones so that most of ore bearing metasomatites are elongated bodies

• f such strikes.
• Varieties of ore bearing quartz-metasomatites form hopper-shaped body at BAM, where wide mineralized stock work zone
• ccurs having northwestern strike and steep dip angle.
• At Khomut ore bearing metasomatites form both north-west- & north-east striking elongated steeply dipping bodies. The

width of them is from 10 to +50 m, which is less than at BAM.

• At Promezhutochny, which is under explored to date, these mineralized metasomatite bodies are preliminary more

narrower and have northwestern strike. Other deposit sites – Prometei and Kayurkovsky are little explored to date.

• Geophysics (apparent resistivity & induced polarization) over all ore field delineated very well not only known mineralized

zones but also unknown their extents and totally unknown potential targets (like the one in between BAM & Khomut etc).

GEOLOGICAL MAP

Sketch-map of Ore Bodies delineated to 2012 (scale 1:5,000)

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Source: Data from OJSC SiGMA’s 2010 exploration report

GEOPHYSICAL MAP

Map of Geophysical Anomalies delineated by Apparent Resistivity & Induced Polarization

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ORE FEATURES

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• Predominant amount of gold is contained in the form of:
• fine native gold inclusions within the chalcedonic-like

quartz

• within goldfildite (Cu-containing sulfosalt)
• gold Tellurides
• The rocks which host auriferous mineralization typically

are:

• quartz metasomatites, often ferruginated to variable

degree

• argillized to variable degree quartz metasomatites and
• ther metasomatic rock varieties
• hydrothermal breccias over metasomatically altered

rocks.

• Though there are totally or partly altered rocks which

host gold-silver mineralization present, actual ore minerals are primary and not altered.

• There is no any supergene or secondary enrichment

zones present within the deposit.

• Grades distribution is very uneven: within material with

average grade Au 1-3 g/t there are often shoots met containing several hundreds g/t Au.

• Apart from earlier test works which examined high grade

samples, the most recent test work program (2011, TOMS Engineering) was done on three ore samples (graded 1.88 g/t, 3.55 g/t & 13.53 g/t) which represent typical range of

• res found within the deposit. In 2012 two additional

samples from drilling core were examined and showed similar figures

• To summarize relevant results of the recent test works,

tested ore samples show variation from 82.5 to 89.5 % with the average ~ 87 % Au recovery into solution by agitated sorption cyanide leaching with the grind of material 200 mesh (90-95%).

• Percolation column leach tests on material crushed to ‘-2’

mm & ‘-10’ mm show averaged Au recoveries into solution

• f 66.3 % and 47.1 % respectively.
• Results testify that most appropriate metallurgical route in

terms of recovery should be agitated sorption leaching (Carbon-In-Leach - CIL). The optimal grind size is to be properly optimized.

• However, modern variant of continuous vat leaching is not

an excluded option.

• On the basis of the metallurgical test works (2011) the

Company considers CIL variation of the agitated leach as a first choice. Relevant comprehensive technology description has been prepared by TOMS Engineering. Mineralogy of ores Metallurgical Test Works

SITE PLAN

Development Plan

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TECHNOLOGY BREAKDOWN

Carbon-in-Leach processing route

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Pit Optimization Graphics – Contour of final Pit (3 M tpa) at BAM site

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PIT MAP

Pit Optimization Graphics – Long Section through Pit at Khomut site

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PIT MAP

DEVELOPMENT STRATEGY

STRATEGIC OUTLOOK

Company Milestones

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MAIN STEPS

2011_ 2012_ 2013_ 2014_ 2015_ 2016_ 2017_ 2018_ 2019_ 2020_ H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H3 H4 H5 H6

Exploration Works Road Technical Feasibility Study Camp Construction Road to Minefield Construction NI 43-101 Audit Mining & Smelting Complex Feasibility Study

Construction of a first phase plant (0.25 Mt of ore pa)

First Phase Production (60-130K Oz Au pa) Construction of a large-scale plant (~3 Mt of ore pa) Full Scale Production Launch (300K Oz Au pa)

Implementing exploration program on known and newly explored mineralization zones during 2013- 2014 in aim to reach resources > 6 M oz / 200 t (370,000 m3 of trenching and 55,000 lin. m of diamond drilling is planned until the end of 2014)

STRATEGY

Synthetic BioFuel Market Description

Company’s development strategy implies a comprehensive exploration works on the ore field and construction of processing plant with up to 300 K oz annual gold production capacity in two separate phases. In particular, the strategy implies:

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Development Strategy Supplementary Exploration

Further exploration of the entire ore field in order to confirm resources up to 8.0 M oz / 250 t of gold

Resource Base Increase

Finalizing engineering, design and technological works for building infrastructure and preparing for the launch of pilot-scale plant with annual capacity of 250 Kt of ore aimed at developing areas with high gold grades

Mining and Processing Complex Feasibility Study

Construction of the first phase plant with annual processing capacity of 250-500 K t of ore during 2012- 2013 and launch of production in 2015 in amount of 70 K oz of gold per year

Processing Complex Construction

Expanding of production capacity up to 2,5 - 3 M t of ore per year during 2017-18 and achieving annual gold production volume of up to 300 K oz (10 t) of gold per year in 2018-19.

Production Launch

The final goal is to build a company with total reserves exceeding 9 M oz, annual production of about 300 K oz and market cap of more than USD 2 billion.

Thank you for your attention! Questions?

CONTACTS

Dmitry Przhibelsky Chief Financial Officer | SiGMA Tel: +7.812.407.88.53 | Mob: +7.921.743.31.11 Borovaya St. 32 А | 191119 Saint Petersburg | Russia dmipr@geosigma.ru

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