Operating Highlights TSX & ASX: TGZ Friday, October 28, 2016 - - PowerPoint PPT Presentation

Q3 2016 Financial & Operating Highlights

Friday, October 28, 2016

TSX & ASX: TGZ

This presentation contains certain statements that constitute forward-looking information within the meaning of applicable securities laws (“forward-looking statements”), which reflects management’s expectations regarding Teranga Gold Corporation’s (“Teranga” or the “Company”) future growth, results of operations (including, without limitation, future production and capital expenditures), performance (both operational and financial) and business prospects (including the timing and development of new deposits and the success of exploration activities) and opportunities. Wherever possible, words such as “plans”, “expects”, “does not expect”, “budget”, “scheduled”, “trends”, “indications”, “potential”, “estimates”, “predicts”, “forecasts”, “focused on”, “anticipate” or “does not anticipate”, “believe”, “intend”, “ability to” and similar expressions or statements that certain actions, events or results “may”, “could”, “would”, “might”, “will”, or are “likely” to be taken, occur or be achieved, have been used to identify such forward looking information. Specific forward-looking statements in this presentation include the commencement of expected drill programs, anticipated future life of mine cash flows, anticipated future interests in Joint Venture projects, the anticipated completion of construction of the Banfora project - including the first gold pour, the anticipated conversion of resources into reserves at the Banfora project, the timing of completion of an updated 2Mtpa Feasibility Study for the Banfora project, and Teranga’s estimated full year financial and operating totals, such as production. Although the forward-looking information contained in this presentation reflect management’s current beliefs based upon information currently available to management and based upon what management believes to be reasonable assumptions, Teranga cannot be certain that actual results will be consistent with such forward looking information. Such forward-looking statements are based upon assumptions, opinions and analysis made by management in light

• f its experience, current conditions and its expectations of future developments that management believe to be reasonable and relevant but that may prove to be incorrect.

These assumptions include, among other things, the ability to obtain any requisite Senegalese governmental approvals, the accuracy of mineral reserve and mineral resource estimates, gold price, exchange rates, fuel and energy costs, future economic conditions, anticipated future estimates of free cash flow, and courses of action. Teranga cautions you not to place undue reliance upon any such forward-looking statements The risks and uncertainties that may affect forward-looking statements include, among others: the inherent risks involved in exploration and development of mineral properties, including government approvals and permitting, changes in economic conditions, changes in the worldwide price of gold and other key inputs, changes in mine plans and other factors, such as project execution delays, many of which are beyond the control of Teranga, as well as other risks and uncertainties which are more fully described in Teranga’s Annual Information Form dated March 30, 2016, and in other filings of Teranga with securities and regulatory authorities which are available at www.sedar.com. Teranga does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change. Nothing in this report should be construed as either an offer to sell or a solicitation to buy or sell Teranga securities. This presentation is as of October 28, 2016. All references to Teranga include its subsidiaries unless the context requires otherwise. This presentation contains references to Teranga using the words “we”, “us”, “our” and similar words and the reader is referred to using the words “you”, “your” and similar words. All dollar amounts stated are denominated in U.S. dollars unless specified otherwise.

Teranga Gold Forward-Looking Statements

2

Richard Young

President & CEO

Another Strong Quarter

4

Increase in Gold Production to 49,481 Ounces (compared to 32,956 in Q3 2015)

+50%

Increase in Throughput to a Record 933,000 Tonnes Milled (compared to 691,000 in Q3 2015)

+35%

All-in Sustaining Costs per Ounce(1)

• f $907 (compared

to $1,191 in Q3 2015)

24%

Increase in Cash to $57.9M(2) Since December 31, 2015

+30%

Refer to Endnotes (1) and (2) on the second last slide

(1)

Senegal Côte d’Ivoire Burkina Faso

Mali Guinea

Guinea- Bisseau The Gambia

Ghana Benin Niger Sierra Leone Liberia Togo

Sabodala Gold Mine Status: Producing Reserves: 2.6Moz (3) M&I: 4.4Moz (3)

5

Growing Multi-Jurisdictional West African Gold Company

Banfora Project Status: Development Reserves: 1.0Moz (4) M&I: 3.0Moz (4) Golden Hill Exploration JV Gourma Exploration JV

Refer to Endnotes (3) and (4) on the second last slide

Guitry Exploration JV Dianra Exploration JV Mahepleu Exploration JV Tiassale Exploration JV

2.7x 5.9x 5.9x 6.4x 7.3x 12.2x 13.6x 22.3x

Teranga Endeavour Alacer Semafo Golden Star B2Gold Asanko Roxgold

Enterprise Value/2016E EBITDA

Undervalued with the Potential for a Major Rate Reset

6

Teranga’s Share Price

• vs. Net Present Value (NPV)(5) per Share

133%

Refer to Endnote (5) on the second last slide

$1.19 $1.39 $2.77

Share Price BMO NPV per Share Revalued Share Price

0.9x

Current TGZ NPV Trading Multiple(3)

2.0x

Average NPV Multiple for Medium Producers(3)

48 62 87 197 197 260 383 442 468

Perseus Alacer Teranga Asanko Golden Star Endeavour Semafo B2Gold Roxgold

EV/2P Reserves ($/oz)

Data Source: BMO GoldPages published October 24, 2016

Paul Chawrun

Chief Operating Officer

3.5M 2.9M 3.2M 6.5M 11.0M 2012 2013 2014 2015 2016

11M Hours Worked Without a Lost Time Injury

Health & Safety: A Key Tenet of Responsible Mining

6 LTI 2 LTI Zero LTI Zero LTI Zero LTI Number of lost time injuries 8

Tracking To 2016 Production Guidance Range of 200,000oz – 215,000oz(6)

9

Refer to Endnote (6) on the second last slide

172,748oz

YTD PRODUCTION FOR THE 9-MONTHS ENDED SEPTEMBER 30, 2106

2,503 2,991

YTD 2015 YTD 2016

Record Throughput Supported by Mill Expansion

10 691 933

Q3 2015 Q3 2016 ORE MILLED

(Koz)

Record Quarterly Mill Throughput

Driven by processing a fresh/oxide blend; increased gold recovery; and fully commissioned mill optimization project, which as been operating at nameplate capacity since September

Early Start-up of Second Crusher Circuit

Mill optimization project was completed in Q3 ahead of schedule and 12% below $20M budget

35% 20%

Refer to Endnote (1) on the second last slide

Double-Digit Reduction in Key Unit Costs

11 $3.12 $2.47 $2.59 Q3 2014 Q3 2015 Q3 2016

MINING COSTS

($/t mined)

MILLING COSTS

($/t milled)

CASH COSTS INCLUDING ROYALTIES(1)

($/oz)

17%

$15.96 $16.50 $11.05 Q3 2014 Q3 2015 Q3 2016 $781 $712 $617 Q3 2014 Q3 2015 Q3 2016

21% 31%

Unlocking Value at the Banfora Gold Project

12

Increase reserve base

• Infill drilling to convert

resources to reserves

• Drill brownfields targets

to define additional resources/reserves 2Mtpa mill

• ptimization studies
• Trade off studies – grind

size/gravity circuit/silver recoveries

• Plant design
• Power studies

Update reserve models based on drill program

• Optimize mine plan –

maximize grade in early years Review capital and

• perating parameters

2H 2016 1H 2017 2H 2017 1H 2018 2H 2018 1H 2019 2H 2019

Commences drilling campaign to confirm existing reserve deposits and potential for reserve expansion File NI 43-101 technical report Seek board approval and commence construction First gold pour at Banfora

1 2 3 4

David Mallo

Vice President, Exploration

13

Banfora Gold Project: Drill Results Confirm Mineralisation

14

Drilling Completed at Three of Four Deposits

Nogbele, Fourkoura, and Samavogo named in Gryphon’s 2013 Feasibility Study; drilling to commence at Stinger deposit in Q4

Results in Line with Expectations

Results confirm both Banfora mineralisation and its potential for reserve expansion

Comprehensive Exploration Through 2017

Plan is to continue to convert resources to reserves within the 4 deposits included in the mine plan; work underway to complete updated NI 43-101 by mid-2017

Banfora Gold Project (Burkina Faso)

15

Nogbele: The Largest of the Four Deposits

Positive Drill Results

Confirming the geological resource model and identifying extension along trend from known mineralisation

Tahiti: A Newly Identified Strike Extension

There is a minimum 200-metre strike extension to a broad shallow oxide zone

Nogbele Plan Map

16

Samavogo & Fourkoura

Samavogo Plan Map

Q3 drilling confirmed previous modeling, outlined up-dip gold mineralisation at the southern end, and successfully extended a mineralised zone in the central portion of the deposit

Fourkoura Plan Map

Results to date provide confidence in the previous geological model and encouragement for near-surface strike extensions

Eleven Targets Within Trucking Distance to Proposed Banfora Mill

17

Banfora Gold Project (Burkina Faso)

BAGU SUD /WEAH KAFINA WEST OUAHIRI

Ouahiri Prospect is the Highest Priority Target

Displays a similar geochemical footprint in both size and tenor as Nogbele deposit

10 Priority Prospects to be Explored in Q4

Previous work has identified strong gold anomalies on several prospects .

KONANDOUGOU BAZOGO BASSONOGRO HILLSIDE MUDDI SUD

Proposed Plant

Siou Pit M&I: 1.07 Moz ¹ Houndé M&I: 2.55 Moz ³ Yaramoko M&I: 0.81 Moz ² Mana M&I: 2.76 Moz ¹ Teranga’s JV Golden Hill Project

Initiating Exploration at Golden Hill

Regional Prospect in Burkina Faso

Exploration permit located ~200Km NE of Banfora and is comprised of 468km2 located at a very good address on the Houndé belt

Exploration Has Defined High Quality Prospects

Prioritized ten prospects for more advanced work, including substantial drilling, in the coming months

18

Gourma Golden Hill Banfora

Burkina Faso

*M&I Resources are inclusive

• f P&P Reserves

Source: ¹ Semafo Corporate Presentation, (Sept 18, 2016) ² Roxgold Corporate Presentation, (Oct 2016) ³ Endeavour Corporate Presentation (Sept 2016)

Golden Hill Joint Venture (Burkina Faso)

Initiating Exploration at Gourma

19

Regional Exploration Property

1,322km2 land package which covers ~60 Km strike length

• f crustal scale shear zone

Numerous Prospects Being Advanced

Six prospects identified from preliminary work to-date with follow-up scheduled to commence in the first half of 2017

Gourma Golden Hill Banfora

Burkina Faso

Gourma Joint Venture (Burkina Faso)

Sabodala Mill Teranga Prospects Ore Shells Projected to Surface Masato Style Bulk Tonnage Gold Trend Golouma Style High- Grade Gold Trend Mining Concession Exploration Permits Gora Pit

Mali

20

Initial Resource Estimates in Senegal

Sabodala Mine License & Regional Land Package in Senegal

Golouma North Goumbati West Marougou Main Representative plans and sections related to the initial resource estimations for these deposits are available on the Company’s website under “Exploration”.

Deposit Indicated Resources Inferred Resources Tonnes Grade Au oz Tonnes Grade Au oz ('000s) (g/t Au) ('000s) ('000s) (g/t Au) ('000s) Golouma North 170 1.32 7 295 1.42 14 Goumbati West 568 1.69 31 178 1.19 7 Marougou Main 1,199 1.41 54 Total 738 1.61 38 1,672 1.39 75

Notes for Mineral Resources:

1.

CIM definitions were followed for Mineral Resources.

2.

Open pit oxide Mineral Resources are estimated at a cut-off grade of 0.35 g/t Au.

3.

Open pit transition and fresh rock Mineral Resources are estimated at a cut-off grade of 0.40 g/t Au.

4.

High grade assays were capped at grades ranging from 5.0 g/t Au to 13.5 g/t Au.

5.

Open pit shells were used to constrain open pit resources.

6.

Mineral Resources are estimated using a gold price of US$1,450 per ounce.

7.

Sum of individual amounts may not equal due to rounding.

A High Priority Target

A NNE trending gold in quartz vein system comprised

• f three zones located ~10km from the Sabodala plant

Shows Good Continuity

Remains open to further extension along both north and south trend and at depth. Minimum strike length

• f ~1,500m. Initial drill results at Zone C suggest a

sub-parallel quartz vein system is present

Goumbati West Zones A, B and C (Sabodala Mine License)

21

Goumbati West Resource Outline

• Continue with multi-drill approach

and resource definition

• New target generation program

will continue

• Exploration work will include

Banfora gold project as well as Golden Hill and Gourma joint venture properties

• Geophysics, best fit geochemistry,

prospecting and multiple types of drilling to be utilized

Senegal Burkina Faso

22

Côte d’Ivoire

• High-precision bulk leach

extractable gold survey planned to cover the entirety of the four JV exploration properties

Expansive 15-Month Exploration Program to Commence in Q4 2016

Navin Dyal

Chief Financial Officer

23

TOTAL REVENUE

($M)

$37.8 $60.3 Q3 2015 Q3 2016 59% Three months ended September 30 YTD September 30 Per ounce 2016 2015 % Change 2016 2015 % Change Average realized gold price $1,333 $1,112 20% $1,244 $1,185 5% Average spot gold price $1,335 $1,124 19% $1,258 $1,178 7% Low $1,308 $1,081 21% $1,077 $1,081 0% High $1,366 $1,168 17% $1,366 $1,296 5% $166.4 $213.1 YTD 2015 YTD 2016 28%

Significant Jump in Revenue

24

Development capex

$712 $617 $232 $200 $247 $90

Q3 2015 Q3 2016 25

Refer to Endnote (1) on the second last slide

ALL-IN SUSTAINING COSTS(1)

(per ounce sold)

Administration expenses, regional admin costs, capitalized deferred stripping, capitalized reserve development, and sustaining capital Total cash costs(1)

$907 $631 $598 $217 $201 $116 $96

YTD 2015 YTD 2016

$964

Improved AISC of $907(1) for Q3

Mainly due to higher production, lower cash costs and lower mine development costs

Lower Cash Costs of $617(1) for Q3

Due to lower unit processing costs and G&A costs for both periods

Lower Development Costs

Prior year period included final capital spend to complete development of high-grade Gora deposit $1,191 24% $895 7%

Continuing to Improve All-in-Sustaining Costs

Refer to Endnote (7) on the second last slide

Keeping a Sharp Focus on G&A

26

$7.9 $5.4 YTD 2015 YTD 2016 $2.1 $1.9 Q3 2015 Q3 2016 13% 32% ADMINISTRATION EXPENSE(7)

($M)

CASH MARGIN PER OUNCE* $50 $315 ($79) $426

$1,339 $1,269 $1,112 $1,333 $1,289 $954 $1,191 $907

• 90

110 310 510 710 910 1110 1310

Q3 2013 Q3 2014 Q3 2015 Q3 2016 Cash Margin/oz Average Realized Gold Price/oz All-in Sustaining Cost/oz

Expanding Cash Margins

27

(*cash margin = average realized gold price/oz – all-in sustaining costs per ounce) (1)

Refer to Endnote (1) on the second last slide

Higher Profitability & Cash Flow During Q3 2016

28

Increase in EBITDA(8) to $26.8M (compared to $10.4M in Q3 2015)

+$16M

EPS of $0.03 compared to nil in the prior year quarter

+$0.03

Increase in Cash Flow From Operations to $13.3M (compared to ($8.2M) in Q3 2015)

+$21M

Increase in Free Cash Flow per Ounce Sold(9) (compared to ($632) per ounce in Q3 2015)

+$715

Refer to Endnotes (8) and (9) on the second last slide

Completed 5% Cash Investment in Gryphon

To accelerate exploration and development at Banfora prior to acquisition

$13.5M Increase in Cash Balance Since Start of Year

Cash balance and $7.6M in proceeds from placement with Tablo contributes to a pro forma cash balance of $65.5M(2)

Equity Placement with Tablo Corporation

Pre-emptive participation right exercised in October for 9.7M shares subsequent to quarter end in connection with the acquisition of Gryphon CASH POSITION

($M)

$44.4 $57.9 December 31, 2015 September 30, 2016

Refer to Endnote (2) on the second last slide

Building Cash Since Beginning of the Year

29

30%

Tracking to 2016 Outlook (Excluding Gryphon Acquisition)

30

Refer to Endnotes (1), (6), (7), (10), (11), and (12) on the second last slide

Year-to-Date 9-Month Period Ended September 30, 2016 2016 Revised Guidance(10) Ore mined (‘000t) 1,599 2,000 - 2,500 Waste mined (‘000t) 24,317 34,500 - 36,000 Total mined (‘000t) 25,916 34,000 - 35,000 Grade mined (g/t) 2.58 2.50 - 2.75 Ore milled (‘000t) 2,991 3,700 - 3,900 Head grade (g/t) 1.93 1.80 - 2.00 Gold produced (oz) 172,748 200,000 - 215,000(6)(12) Total cash cost (incl. royalties) (1) $/oz sold 598 600 - 650 Total all-in sustaining cash cost (1) $/oz sold 895 900 - 975 Mine production costs $ millions 108.7 145 - 155 Regional administration costs (7) (included in cost of sales) $ millions 1.4 2 Total capital expenditures (11) $ millions 25.4 32 - 37 Exploration (expensed) $ millions 3.7 5 Corporate administration expense (7) $ millions 5.4 8 - 9 CSR Expense (7) $ millions 2.8 3 - 3.5

2016 Guidance Revisions as of Q3

• Total mined tonnes reduced from 36.5 – 38.5Mt

due to reduced shovel availability in Q2 and Q3

• Grade mined reduced from 2.75 – 3.25 g/t to

2.50 – 2.75 g/t due to increased recovery of low grade ore above reserves block model

Gryphon Not Included in Outlook

• Exploration expected to increase by ~$2M

and Capex expected to increase by ~$2M.

Q&A

Refer to Endnotes (3) and (13) on the second last slide

32

WORLD-CLASS Gold Belts in Mining-Friendly Jurisdictions SIGNIFICANT Growth Opportunities with Expansion into West Africa SOLID Balance Sheet & Cash Position STRONG Life of Mine Cash Flows(13) CORNERSTONE INVESTOR with Strong Ties to West Africa LARGE Long-Life & Low Cost Reserve & Resource Base(3)

Appendices

Teranga Gold Competent & Qualified Persons Statement

34 The technical information contained in this Report relating to mineral resource estimates for the Company’s Sabodala Gold Operations is based on, and fairly represents, information compiled by Ms. Nakai-Lajoie. Ms. Patti Nakai-Lajoie, P. Geo., is a Member of the Association of Professional Geoscientists

• f Ontario, which is currently included as a "Recognized Overseas Professional Organization" in a list promulgated by the ASX from time to time. Ms.

Nakai-Lajoie is a full time employee of Teranga and is not "independent" within the meaning of National Instrument 43-101. Ms. Nakai-Lajoie has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activity which she is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the "Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves". Ms. Nakai-Lajoie is a "Qualified Person" under National Instrument 43-101 Standards of Disclosure for Mineral Projects. Ms. Nakai-Lajoie has consented to the inclusion in this Report of the matters based on her compiled information in the form and context in which it appears in this Report. Teranga's exploration programs are being managed by Peter Mann, FAusIMM. Mr. Mann is a full time employee of Teranga and is not "independent" within the meaning of National Instrument 43-101. Mr. Mann has sufficient experience which is relevant to the style of mineralization 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. Mann is a "Qualified Person" under National Instrument 43-101 Standards of Disclosure for Mineral Projects. The technical information contained in this news release relating exploration results are based on, and fairly represents, information compiled by Mr. Mann. Mr. Mann has verified and approved the data disclosed in this release, including the sampling, analytical and test data underlying the information. The RC samples are prepared at site and assayed in the SGS laboratory located at the site. Analysis for diamond drilling is sent for fire assay analysis at ALS Johannesburg, South Africa. Mr. Mann has consented to the inclusion in this news release of the matters based on his compiled information in the form and context in which it appears herein. Teranga's disclosure of mineral reserve and mineral resource information is governed by NI 43-101 under the guidelines set out in the Canadian Institute

• f Mining, Metallurgy and Petroleum (the "CIM") Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as may be

amended from time to time by the CIM ("CIM Standards"). CIM definitions of the terms "mineral reserve", "proven mineral reserve", "probable mineral reserve", "mineral resource", "measured mineral resource", "indicated mineral resource" and "inferred mineral resource", are substantially similar to the JORC Code corresponding definitions of the terms "ore reserve", "proved ore reserve", "probable ore reserve", "mineral resource", "measured mineral resource", "indicated mineral resource" and "inferred mineral resource", respectively. Estimates of mineral resources and mineral reserves prepared in accordance with the JORC Code would not be materially different if prepared in accordance with the CIM definitions applicable under NI 43-101. There can be no assurance that those portions of mineral resources that are not mineral reserves will ultimately be converted into mineral reserves.

Endnotes

1) Total cash costs per ounce and all-in sustaining costs per ounce are non-IFRS financial measures and do not have a standard meaning under IFRS. Total cash costs per ounce and all-in sustaining costs per ounce are before stockpile inventory value adjustments and government waiver accruals. For more information regarding these measures, please refer to non-IFRS Performance Measures in the Company’s Management’s Discussion & Analysis for the three and nine months ended September 30, 2016 accessible on the Company’s website at www.terangagold.com. 2) Pro forma cash balance at September 30, 2016 is defined as cash including equity placement in October 2016 by Tablo Corporation of $7.6 million. 3) Teranga’s Sabodala Mineral Reserves and Mineral Resources for estimates as at December 31, 2015 as per Company disclosure. For more information regarding Teranga Gold’s Mineral Reserves and Resources and related notes, please refer to Teranga Gold’s December Quarter and Year-end 2015 Report accessible on the Teranga’s website at www.terangagold.com. 4) The Mineral resources are as per Gryphon Minerals 2Mtpa Heap Leach Feasibility Study (JORC) released August 4, 2014. Despite the most recent Gryphon Reserve Estimate for the Banfora Gold Project of 826,000

• unces (17.4 Mt at 1.5 g/t) based on a lower capital cost heap leach processing option, Teranga has stated in the press release dated June 19, 2016, and in the Scheme Booklet announced on the ASX on August 17, 2016

and re-confirmed herein that Teranga’s preferred development path for the Banfora Gold Project will be based on an optimized CIL flowsheet. The Proven and Probable Mineral Reserve estimate of 1 million ounces included in Teranga’s June 19, 2016 press release and herein is based on Gryphon’s CIL feasibility study Mineral Reserve estimate of 1.05 million ounces (16.7 Mt at 1.95 g/t) issued in January 2013. A number of relevant factors have changed since this estimate was issued by Gryphon Minerals in 2013, and as such and benefitting from an optimization study to be completed by Teranga, we anticipate updating the feasibility study and the resource and reserve estimates in the first half of 2017. Complete information is available on Gryphon’s website at www.gryphonminerals.com.au and filed on the ASX at www.asx.com.au. 5) Net Present Value (“NPV”) per share is a Non-IFRS financial measure. NPV per share, average NPV multiple of medium producers, and Teranga’s share price is as per BMO GoldPages published October 24, 2016. According to BMO GoldPages, NPV per share is calculated using the net present value of the life of mine cash flows based on the NI 43-101 plan, less cash flow of corporate costs, less net debt per share, using the model at SPOT commodity prices and exchange rates. The “Revalued Share Price” is calculated using the NPV per share at SPOT times the NPV multiples as listed. The BMO NPV calculation assumes a US$1,267 SPOT gold price per ounce, 5% discount, 0.75 USD/CAD exchange rate. For more information regarding Non-IFRS financial measures, please refer to Non-IFRS Performance Measures in the Company’s Management’s Discussion and Analysis for the three and nine months ended September 30, 2016 accessible on the Company’s website at www.terangagold.com. 6) The production guidance is based on existing proven and probable reserves only from the Sabodala mining license initially reported by Teranga Gold in its NI 43-101 Technical Report dated March 22, 2016. And as disclosed in Appendix 2 of Teranga Gold’s 2015 Fourth Quarter ASX Report titled “Teranga Outperforms Cost Guidance” issued January 28, 2016 accessible on the Company's website at www.terangagold.com. The estimated ore reserves underpinning this production guidance have been prepared by a competent person in accordance with the requirements of the 2012 Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves (the “2012 JORC Code”). Please refer to the Competent Persons Statement available in the ASX Report referenced above. 7) To better align costs with industry peers, during the first quarter 2016 the Company began to present CSR Expense and Regional Administration Costs separately from Corporate Administration Expense. The Company's 2016 guidance has been updated to reflect this change in accounting presentation. 8) Earnings before interest, taxes, depreciation and amortization ("EBITDA") is a Non-IFRS performance measure. Please refer to Non-IFRS Performance Measures in the Company's Management’s Discussion & Analysis for the three and nine months ended September 30, 2016. 9) Free cash flow and free cash flow per ounce are defined as operating cash flow less capital expenditures. This is a Non-IFRS Performance Measure and does not have a standard meaning under IFRS. 10) Key assumptions: This forecast financial information is based on the following material assumptions for 2016: gold price: $1,200 per ounce; Brent oil:$50/barrel; Euro:USD exchange rate of 1.1:1; USD:CAD exchange rate

• f 0.7:1. Other important assumptions include: any political events are not expected to impact operations, including movement of people, supplies and gold shipments; grades and recoveries will remain consistent with the

life-of-mine plan to achieve the forecast gold production; and no unplanned delays in or interruption of scheduled production. 11) Excludes capitalized deferred stripping costs, included in mine production costs. 12) 22,500 ounces of production are to be sold to Franco-Nevada at 20% of the spot gold price. 13) Cash flow is the Life of Mine net cash flow based on the Company’s most recent NI 43-101 Technical Report (“43-101 plan”) filed in March 2016, before income taxes, interest, debt repayments, closure costs, dividends and working capital.

35

TSX & ASX: TGZ

Trish Moran Head of Investor Relations T: +1.416.607.4507 E: investor@terangagold.com W: terangagold.com 121 King Street West, Suite 2600 Toronto, ON M5H 3T9