Aphrodite Gold : Progress Report

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5 January 2017

The Company Announcements Office Australian Securities Exchange Limited

Positive metallurgical testwork results as part of PFS

Key Points

• Metallurgical testwork on the Transition zone composite resulted in overall recovery of 88%, with gravity recovery of 45%, cyanide consumption of 0.8kg/t, fast kinetics and opportunities to improve this result identified. This is a very positive result for the project.

• The reconciled head grade of 2.2 g/t gold of the Transition Zone composite compares favourably with the prior calculated assay head grade of 1.46 g/t gold.

• Final metallurgical drill results from APDM0006 includes 25m @ 1.7 g/t from 55m within the transition zone

• The Company is very encouraged by the preliminary results from the metallurgical testwork and remains on schedule to complete the prefeasibility study during the March Quarter 2017

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Aphrodite Gold Limited ("Aphrodite" or "the company") wishes to provide a further update to their Pre-feasibility study, previously reported on 22nd December 2016. The board and management are greatly encouraged by the drill results and metallurgical testwork results to date. The drill program is now complete. All drill holes achieved core recovery > 95% thus providing reliable samples for assay and metallurgical testwork with particular emphasis on the oxide and transition zones of mineralisation. Previous metallurgical testwork indicated that acceptable metallurgical recoveries could be achieved by conventional CIL/CIP processing of the oxide/transition zone mineralisation. Current studies confirms this.

Metallurgical Testwork results

The metallurgical testwork program is based on composite intervals from APDM0001- APDM0003 covering 3 metallurgical zones, transition, lower transition/upper primary and primary. The composite samples calculated head grade of the transition zone was 1.46g/t gold, the lower transition/upper primary zone 2.22g/t gold and the lower primary zone of 4.17g/t gold.

Aphrodite is encouraged by the conventional carbon in pulp/leach (CIP/CIL) results with the overall recovery of the Transition zone composite at 88%; 45% of gold recoverable through the gravity circuit, kinetics were fast with leaching within 6.5 hours, cyanide usage of 0.8 kg/t and improvements of these results possible from further testwork. The reconciled head grade of 2.2g/t compares favorably with the calculated head grade of 1.46g/t. Additional CIP/CIL metallurgical testing of transition zone composites from metallurgical drill holes APDM0004, APDM0006 and APDM0007 is underway.

The results from the lower transition/upper primary composite sample indicate that 27% of gold was recovered from the gravity circuit with overall recovery of 43%. This was achieved based on a conventional grind of P80/75micron and cyanide consumption of 1.1 kg/t. The reconciled head grade of the lower transition zone was 2.1g/t gold compared to the calculated assay grade of 2.2g/t gold.

Additional testwork will focus on improving the metallurgical recovery of the transition zone and on optimizing and or better defining the boundary between the metallurgical recovery of 88% of the transition zone and the 43% of the lower transition/upper primary zone.

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Metallurgical Drilling Results

Drill hole APDM0006, intersected within the transition zone 25m @ 1.7g/t gold from 55m and 15.1m @ 3.1g/t gold from 101.9m within the lower transition zone sulphide zone (Figure 1).

Results for APDM0006 are shown in Table 1. Previously reported results are shown Appendix 1.

Figure 1- APDM0006Cross section 6659600mN

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Table 1- Recent Significant Results since last release

Hole	Hole Type	Easting	Northing	Dip	Mag. Azimuth	Inclined Depth (m)	From (m)	To (m)	Length (m)	Gold g/t	Domain
APDM0006	Metallurgical	329175	6659600	-60	270	150.4	55	80	25	1.65	T
							Incl 55	56	1	1.76	T
							Incl 62	62.8	0.8	0.77	T
							Incl 65	68	3	3.12	T
							Incl 77	80	3	9.41	T
							86	93	7	1.52	P
							94	95	1	0.72	P
							101.9	117	15.1	3.12	P
							123	125	2	1.01	P

Other Pre-feasibility Activities

All finalised reports relating to the fieldwork components of the environmental surveys have been received by the company's consultant Environmental Project Manager.

Yours sincerely

Michael Beer Company Secretary

The information in the report to which this statement is attached that relates to open pit possible operations, Scoping Studies, Resource estimates is based on information compiled by Mr Eduard Eshuys, a Competent Person who is a Fellow of The Australasian Institute of Mining and Metallurgy. Mr Eduard Eshuys has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken 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 Eshuys consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.