Crater Gold Mining Limited ABN 75 067 519 779

PO Box R607

Royal Exchange, NSW 1225

Australia Ph (02) 9241 4224

14 November 2016

Australian Securities Exchange

MAIDEN JORC GOLD RESOURCE AT HGZ PROJECT, CRATER MOUNTAIN, PNG

Highlights:

• High grade JORC gold resource

• Potential to increase gold resource substantially

• 3 major gold veins identified contain the majority of the gold

• Drilling programme to target extensions of identified high grade veins

Crater Gold Mining Limited (ASX: CGN or the Company) is pleased to announce a maiden inferred resource estimate reported in accordance with JORC guidelines for its HGZ gold mining project, part of the Crater Mountain Project in Papua New Guinea (PNG) of 44,500 tonnes at 11.9 g/t for 17,100 ounces of gold (cut- off grade of 5 g/t Au).

With the project already being in production and having gold processing facilities on site, the maiden resource paves the way for increased production with minimal additional capital expenditure or development time.

The initial Inferred Resource at HGZ comprises:

Resource Category	Tonnes	Grade (Au g/t)	Gold Oz
Inferred - cut-off of
5g/t au	44,500	11.9	17,100

Within this resource at a higher cut-off of

> 7.5g/t Au 23,500 17.2 13,000

As part of the resource definition, mapping of the HGZ showed three distinct major high grade gold veins Figure 1. The three veins are closely linked and are estimated to carry 11,800 ounces of gold. The Company will now refine the mining method for maximum gold extraction from the higher cut-off grade of 7.5g/t Au implementing a revised, more focussed mining plan. This will allow more efficient, targeted gold production The mining plan will be implemented, with the development of the 1930 Level via a new adit which is currently being established

Figure 1 - - N-S Composite Sections: The 3 identified high grade veins N1, JL1 and L1

CGN's Technical Director, Richard Johnson commented:

"This maiden resource marks a significant milestone for the Company, confirming the potential for profitable gold mining from the HGZ project. The report also provides us with more detail of the high grade veins enabling us to target more selective mining of the 3 main high grade veins. going forward. Whilst the initial JORC resource may seem modest, the gold is accessible and all infrastructure is in place, allowing the Company to move quickly to mining of the 3 veins as well as other cross cutting structures.'

The maiden resource estimate only considers the HGZ as identified to date. Development of the 1930 Level will pass through approximately 100m of previously unexplored ground adjacent to the high-grade zone. This area is considered prospective for finding additional gold bearing structures.

The potential to increase the resource is also considered substantial given that drilling to date has mostly been confined to a maximum depth of 75m from surface (Figure 2). However there is also evidence from drilling that gold is encountered at least to a depth of 128m from surface (NEV022) The Company plans to commence in-fill drilling from the 1930 level which is currently under development as recommended.

Figure 2 - Mineralised Zones at Crater Mountain Deposit. (9281000 mN)

The resource estimate was completed by Ian Taylor, (AusIMM(CP)) of Mining Associates.

The Nevera Prospect was visited by Mr Ian Taylor during the period 26th to 30th September 2016. In the course of the site visit, Mr Taylor viewed mineralised drill core and examined the drill core, processing and storage facilities. He also toured the underground workings, inspecting geology in the backs and walls of underground drives.

From this, he provided a report including the resources estimate, mapping details of high grade veins and recommendations.

Recommendations

Mr Taylor states in his report to the Company that there is an opportunity to expand the resource along strike and laterally with further drilling and mapping, and also to improve the confidence of the mineral resources internally by infill drilling and development. Lateral drilling to extend resources should be targeted based on existing intersections and understanding of cross structures and the steeply plunging shoots from the newly developed working pad at the 1930 level. Infill drilling should confirm the strike continuity of vein systems particularly following up intersections identified in the deep drill hole NEV022. Infill drilling and further channel sampling is required to increase level of the resource categories.

An opportunity exists for deeper drilling targeting the high grade shoots during development of the 1930 m RL adit. A drill cuddy could be cut at 9280980 mN and 287990mE (1934 mRL) to provide a suitable platform for 4 to 8 holes (Table 1 & Figure 3) targeting the extensions of identified high grade shoots, particularly veins N1 and L1.

Table 1: Proposed Drill Holes

Proposed Hole	Dip	Azimuth	Depth	Extension or Infill
P1	-6	60	85	E
P2	0	100	65	I
P3	15	110	70	E
P4	-36	60	90	E
P5	-42	65	90	E
P6	-48	70	85	I
P7	-48	85	80	I
P8	-44	100	70	I