Melbourne, Australia--(Newsfile Corp. - August 18, 2021) - Newcrest Mining Limited (ASX: NCM) (TSX: NCM) PNGX: NCM) is pleased to announce that the Newcrest Board has approved the Cadia PC1-2 Pre-Feasibility Study (the Study), enabling the commencement of the Feasibility Stage (the Feasibility Study) and Early Works Program.

The Study updates and defines a significant portion of Cadia's future mine plan, with the development of PC1-2 accounting for ~20% of Cadia's current Ore Reserves. The approved commencement of the Early Works Program will allow critical infrastructure to be established in parallel with the Feasibility Study, before the commencement of the Main Works program in the second half of CY22. A$120 million (~US$90 million) of funding has been approved for this Early Works Program which is expected to commence in the December 2021 quarter.

Summary of Study Findings^1,2,3,4

• The PC1-2 Pre-Feasibility Study has the following key findings:
  • Estimated total capital expenditure of ~A$1.3 billion (~US$0.9 billion)
  • Real, after-tax Internal Rate of Return (IRR) of 21.5%
  • Net Present Value (NPV) of A$2.0 billion (US$1.5 billion)^[5]
  • ~17 year mine life from first production, at an average of 15mtpa
  • Total ore production of 258mt producing 3.5moz of gold and 660kt of copper
  • Average All-In Sustaining Cost (AISC) of A$54/oz (US$41/oz)
  • Enhanced footprint design and productivity allowing:
    • Deferral of ~25% of the previously required footprint into a future PC1-3 project
    • A$150 million (US$112 million) reduction in the initial capital spend
    • Enhanced average gold and copper grades in the medium term
• Early Works Program of critical path activities for the establishment of PC1-2 is expected to commence in the December 2021 quarter
• Feasibility Study has now commenced

Newcrest Managing Director and Chief Executive Officer, Sandeep Biswas, said, "The development of the PC1-2 cave is the next step in Cadia's block caving journey. The Study underpins an optimised mine design which we expect will deliver higher gold and copper grades and enable the deferral of capital expenditure in the medium term. We have significant financial headroom to fund the construction of PC1-2, together with our other organic growth options, from our expected cash flow generation over the development period and our strong balance sheet."

"This project, together with the expansion project currently in progress, is expected to sustain Cadia's position as one of the largest, lowest cost and long life gold mines in the world. The team at Cadia is passionately committed to building on this world class asset, driving employment and other benefits for the local community and other stakeholders, and maintaining a focus on innovation, continuous improvement and sustainable development," said Mr Biswas.

Table of Key Study Findings^1,4,6

Cadia's indicative production profile^1,6,7,8

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Mine development and sequence^1,6,7

Total capital expenditure for the development of PC1-2 is estimated to be ~A$1.3 billion (~US$0.9 billion), with first production expected in CY25. The timing of PC1-2's development is expected to ensure that, in conjunction with the already approved PC2-3 project, the total Cadia mine production rate is sustained at ~35-36mtpa as production from the operational PC1 and PC2 caves begins to decline from FY24.

The PC1-2 Pre-Feasibility Study includes enhancements over previously published mine designs, which include:

• Optimised North/South footprint configuration to debottleneck extraction drives and boost production intensity by ~90% compared to previous designs
• Gold and copper production brought forward by prioritising PC1-2 higher grades
• Optimised pre-conditioning to enhance operator safety, mine schedules and reduce the underground development scope
• Crusher productivity and ventilation enhancements with the addition of a fifth tipping location and dedicated ventilation exhaust

It is planned to bring PC1-2 into production across two stages:

• Stage 1
  • Execute a 12 month Early Works Program to establish ventilation systems and other critical path development. This is expected to commence in the December 2021 Quarter and has an estimated cost of A$120 million (US$90 million)
  • Completion of the Feasibility Study will run concurrently with the Early Works Program and has an estimated cost of A$14 million (US$11 million)
• Stage 2
  • Execute the PC1-2 Main Works Program following the conclusion of the Feasibility Study in the second half of CY22. The Main Works Program is expected to cost A$1.12 billion (US$0.84 billion) and is expected to be completed by CY29

The PC1-2 cave is expected to take approximately six years to reach its maximum production capacity from the time of the blasting of the first drawbell.

PC1-2 Extraction Level Design

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Location of Planned Cadia East Caves in Schematic Section View

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Indicative ore production profile^1,6,7

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Indicative mine production profile^1,6,7

Metal Price and Exchange Rate Sensitivity Analysis^1,2,3,4

The actual IRR of the Project will vary according to the gold and copper prices realised. Base case assumptions include a gold price of US$1,500 per ounce, copper price of US$3.30 per pound, and an AUD:USD exchange rate of 0.75.

The table below outlines how the estimated Base Case Project IRR of 21.5% varies using different price assumptions:

Permitting & Tailings

Cadia presently holds a major Project Approval for the Cadia East Project until CY31 (inclusive of the permit to develop PC1-2).

Newcrest is currently engaging with the NSW Department of Planning, Industry and Environment (DPIE) with respect to Newcrest's request for a modification to the existing approval to allow for an increased production rate above 32mtpa.

Further approvals will be required to continue mining operations beyond the existing approved mine life of CY31.

Estimated project capital expenditure profile^1,4

Technology and value breakthrough strategies

Through the Feasibility Study, Newcrest will investigate the application of single pass caving, mechanical excavation and remote production during the execution of PC1-2, in line with its Next-Gen Caving strategy. These have not been assumed in the Study findings to date and represent upside opportunities.

Cadia East Mineral Resource⁹

The Cadia East Mineral Resource has been updated from that reported in the Annual Mineral Resources and Ore Reserves Statement as of 31 December 2020. The update includes mining depletion to 30 June 2021 and the incorporation of a revised resource estimate. A summary of material assumptions is outlined below and included in JORC Table 1 included in the Appendix (JORC Table 1 - Sections 1 to 3).

Mineral Resources are reported inclusive of Ore Reserves.

Summary of Mineral Resource

Geology and Geological Interpretation
The Cadia gold copper deposits are hosted by a late Ordovician to early Silurian shoshonitic volcano-intrusive complex which forms part of the larger zone of arc-related volcanic and associated intrusive rocks in the eastern Lachlan Fold Belt. Mineralisation at Cadia is hosted by the mid to late Ordovician Forest Reefs Volcanics and the underlying Weemalla Formation and by the late Ordovician early Silurian Cadia Intrusive Complex. Post-mineral cover comprises Silurian Cadia Coach Shale and a relatively thin capping of Tertiary basalts and gravels in some areas. Recognised structural controls include the regional northwest corridor - dilation zone thought to control the emplacement of the Cadia Intrusive Complex and post-mineral faulting in two dominant orientations striking northwest and north-south.

The Cadia East deposit is hosted within the Forest Reef Volcanics and porphyry intrusions. A north-east trending mass of narrow sheet like dykes of monzonitic to dioritic compositions intrude the lower parts of the FRV at Cadia East. These intrusives are largely restricted to the eastern half of the deposit although some narrow dykes and isolated bodies of monzonite have been recognised in the western end. At the upper western end of the deposit immediately underneath the Gibb Fault, isolated narrow intersections have been identified with south dipping mineralised quartz veining. These occurrences are interpreted to be the Cadia Hill Monzonite.

Mineralisation at Cadia East can be divided into two broad overlapping zones: an upper, copper rich disseminated zone and a deeper gold-rich zone associated with sheeted veins. The upper zone forms a relatively small cap to the overall mineralised envelope and has a core of disseminated chalcopyrite, capped by chalcopyrite-pyrite mineralisation. The upper zone mineralisation is stratigraphically controlled within the volcaniclastic unit. This zone is transitional to the deeper vein style mineralization. The deeper zone is localised around a core of steeply dipping sheeted quartz-calcite-bornite-chalcopyrite-molybdenite, with the highest gold grades associated with the bornite-bearing veins. Copper and molybdenite form a mineralised blanket above and to the east of the higher-grade gold envelope.

The geology model for the Cadia East deposit includes lithology, alteration, and structural faults. Modelling of the fault planes and lithological boundaries comprises data obtained from drill core and underground mapping. The major faults are used as estimation domains, with semi-soft boundaries. The factor most influencing grade continuity is that Cadia East is a porphyry copper-gold mineralisation exhibiting properties of the diffusion model.

Drilling Techniques
The Cadia East deposit has been diamond drilled with core sizes ranging from NQ3 (45.1 mm core diameter), HQ3 (61.1 mm core diameter) and PQ (85 mm core diameter). Triple tube is used to maximise core recovery. Most drill holes are collared as PQ or HQ for accurate and safe drilling. All recent drilling is orientated.

Sampling and Sub-Sampling
Data used for resource estimation is obtained from drill core, which is sampled and assayed on 2.0 metre intervals. Drill core is sampled by cutting the core in half with a diamond saw. The left hand of the cut core is placed in a calico bag, marked with the appropriate sample number and sent to the laboratory for assaying. The remaining half-core is stored in the original tray on a pallet at the core processing facility for an unspecified period and then moved to storage at the Cadia Core Farm. Sample preparation is conducted at the Newcrest Laboratory facility located in Orange and all routine drill core samples are processed on site. Pulp replicates and crushed coarse reject duplicates are routinely undertaken.

Sample Analysis Methods
Samples are routinely assayed for gold by fire assay, copper, silver, molybdenum, lead, zinc, sulphur by ICP-OES analysis with additional cyanide-soluble copper analysis. Comprehensive QA/QC procedures have been in place since drilling and sampling programs at Cadia East began. These processes are undertaken at both the laboratory and site that includes a combination of check samples (blind reference material, random blanks, duplicates, repeats, replicates, and second lab checks), meetings, visits, and external audits. Various primary laboratories located on Orange have been used including Newcrest Services Laboratory since June 2010, ALS-Chemex between May 2004 and May 2010, and AMDEL prior to May 2004.

Estimation Methodology
Ordinary Kriging of copper, gold, sulphur, silver, molybdenum and fluorine are undertaken directly into 20 m x 20 m x 20 m blocks. Estimation domains (based on structural interpretation) have been revised and simplified for the 2021 resource model for Au, Cu, Ag, Mo and S. Semi-soft boundaries were used between all estimation domains. The 0.1% copper grade shell was used to constrain estimation as a global domain. All elements are estimated independently of each other. Copper and gold grades are not capped. The resource model is validated via visual, geostatistical and production reconciliation methods. Bulk density has been estimated in the 2021 model using Inverse Distance, which is a change from the previous estimate where bulk densities were assigned by lithology.

Mineral Resource Classification
The Cadia East Mineral Resource consists of majority Indicated Mineral Resource and a portion of Inferred Mineral Resource. Classification is based on an assessment of geological confidence as a function of geological and mineralisation continuity. Grade continuity and drill hole density is assessed using Extension Variance methods, whilst the reported resources were constrained within a 'value' shell representing the limit to eventual economic extraction.

Cut-off Grade
A value algorithm is used to calculate the net smelter return (NSR) for each block using revenue and cost assumptions as of 31 December 2020. The NSR calculation takes into account Mineral Resource revenue factors, metallurgical recovery assumptions, and site operating costs. Site operating costs include mining cost, processing cost, relevant site general & administration costs. The breakeven cut off value equates to approximately A$18.00/t milled.

Mining and Metallurgical Methods and Parameters and Other Modifying Factors
No mining or environmental factors have been incorporated into the estimation. Metallurgical factors have been incorporated into the value algorithm which constrains the Mineral Resource classification.

Cadia East Ore Reserve¹⁰

The study has updated the Cadia East Ore Reserve from that reported in the