Azumah Resources : Quarterly Activities Report

ASX & Media Release ASX Code - AZM 24th October 2014

www.azumahresources.com.au

Investment Highlights:

Wa Gold Project:

 2.0Moz Mineral Resource including

1.3Moz Measured & Indicated

 624,000oz Ore Reserves at 2.14 g/t plus

28,500oz 'mining inventory'

 Feasibility Study well advanced

 Initial 7yr mine-life at +/- 100,000oz pa

 Excellent Infrastructure (grid power, water, established roads, airport)

 Mining Leases granted

 2,800km2 licenses with >150km strike of prospective Birimian terrain.

 15% strategic investment in neighbour, Castle Minerals Limited (~10,000km2)

 Board and management team of successful explorers, mining and corporate professionals

Issued Capital:

388.8M ordinary shares

3.0M unlisted options

9.57M performance rights

2.0M $1.00 Converting Notes

Directors & Management:

Chairman: Michael Atkins

Managing Director: Stephen Stone

Non-Executive Directors: Geoff M Jones

Bill LeClair

Company Secretary: Dennis Wilkins

Contact:

Stephen Stone

Mb: [phone] [e-mail]

ACTIVITIES REPORT QUARTER ENDED 30th SEPTEMBER 2014

 Wa Gold Project Ore Reserves Increased 45%

 Feasibility Study Advanced To Final Costings Stage

 Exploration Drilling Scheduled For Q4 2014

 Placement Completed

Perth-based gold explorer and developer Azumah Resources Limited (ASX:AZM) ("Azumah" or "the Company") provides the following summary of activities undertaken during the Quarter ended 30th September 2014 including an update on the progress of its Feasibility Study ("Study") for the Wa Gold Project, northwest Ghana, West Africa (the "Project") (Figure 1).

The Project comprises a nominal 1.2Mtpa (primary ore) CIL gold plant located adjacent to the flagship Kunche deposit with an initial seven-year mine life producing +/-100,000oz pa for the first four years.

There are excellent prospects to extend and expand production at Wa through successful exploration on the Company's 2,800km2 of prospective Birimian terrain.

Azumah's current focus is positioning the Project to be 'development-ready'

which requires it to:

 Complete the Study (scheduled for Q4 2014);

 Secure key permits, licences and approvals required to develop and operate the Project;

 Develop and lock in fiscal and other operating arrangements with the

Government of Ghana;

 Advance Project finance arrangements across senior debt, equity and other options; and

 Generate new drill-ready exploration prospects to expand the existing target pipeline for future Mineral Resource and mining inventory growth.

The September Quarter saw continuing high levels of activity across all of these and a number of other areas in which Azumah:

 Increased JORC compliant Proven and Probable Ore Reserves by 45% to

9.1Mt grading 2.14g/t Au for 624,000oz and updated Mineral Resources

(Refer ASX release dated 2nd September 2014)(Tables 1 and 2);

 Identified additional 'Mining Inventory' of 28,500oz gold within planned pits to increase total mining inventory to 652,500oz;

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Azumah Resources Limited - Activities Report - Quarter Ending September 2014

 Undertook metallurgical test work which returned average estimated process recoveries of 92% gold;

 Completed flowsheet design, equipment sizing & specifications, plant and site layouts;

 Advanced capital and operating cost estimates via GR Engineering Services Limited (GRES);

 Evaluated options, selected and costed a preferred haul road route to transport ore from Wa East for treatment at the Kunche plant;

 Initiated power supply negotiations to enable direct access to a 161kV power line that is being constructed to the Project site by GridCo; and

 Progressed environmental permitting including preparatory work for new environmental impact studies to reflect the larger-scale Julie mining operations, the modified processing plant, a new tailings storage facility design and the results of Azumah's extensive community consultation work over the past three years.

EXPLORATION

 Continued to undertake well-focused, low-cost, auger drilling based geochemical sampling to grow and

refine the pipeline of targets within the Company's 2,800km2 of highly prospective licences; and

 Scheduled drilling programmes for Q4 2014 to test high-priority drilling targets north and south of the

Kunche-Bepkong deposits on the Wa-Lawra belt and at Wa East.

CORPORATE

 Raised $1.2M through the placement of 30M new ordinary shares at $0.04 each to existing shareholder, Caitlyn Limited ('Caitlyn'), to lift its ownership to 12.89% (refer ASX release dated 16th September 2014);

 Entered into a Subscription Agreement with Caitlyn that provides it with a frontline opportunity to participate in a Project development funding package structured by Azumah, requires it not to use its shareholding to block progress of the financing or any related corporate transaction if it choses not to participate, contains a 12-month anti-dilution provision and an undertaking not to exceed a 19.99% holding for three years;

 Held an EGM of shareholders on 29th September at which all eight resolutions were approved (refer

Notice of Meeting dated 25th August 2014 and ASX release dated 26th September 2014); and

 Retained cash of $4.2M plus a 15% strategic investment in its Ghana neighbour, Castle Minerals

Limited, valued at $0.4M (19.3M shares @ $0.021)(both as at 30th September 2014).

NEXT QUARTER

In the December 2014 Quarter Azumah plans to:

 Complete the Study;

 Progress the update of the Environmental and Social Impact Study towards the procurement of environmental development and operating permits;

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Azumah Resources Limited - Activities Report - Quarter Ending September 2014

 Advance discussions with private sector electricity providers in Ghana;

 Engage with Ghana road regulators to obtain approvals for the Julie haul road;

 Initiate discussions with the Ghana Government on fiscal matters;

 Review work programmes required to upgrade the Aduane and Collette Mineral Resources to Ore

Reserves;

 Maintain a high level of community and social engagement, including exploration access arrangements and Project consultations;

 Continue low-cost auger drill-based geochemical sampling programmes to confirm and/or better define anomalies;

 Commence a series of aircore and RC drilling programmes to test high-priority targets and extend existing mineralisation;

 Evaluate corporate and Project financing options; and

 Maintain a prudent control of expenditures whilst ensuring that the Company is able to achieve its key

Project, exploration and corporate objectives.

For further information on Azumah Resources Limited and its projects please visit its website at www.azumahresources.com.au

Stephen Stone Managing Director

Tel: [phone]

[e-mail]

Robert Gundelach - Australia NWR Communications

[phone]

[e-mail]

Joanna Longo - North America Terre Partners

[phone]

[e-mail]

About Azumah

Azumah Resources Limited is a Perth-based, ASX-listed (ASX: AZM) company focused on exploring and developing its

Wa Gold Project in the Upper West Region of Ghana, West Africa.

Three main deposits have been discovered and extensively drilled at Kunche and Bepkong, adjacent to the Black Volta River and Ghana's border with Burkina Faso, and at Julie ~80km to the east. Several satellite deposits, including Aduane and Collette, have also been delineated.

To date the Company has defined a JORC Mineral Resource of 2.0Moz of gold grading 1.5g/t Au including 1.3Moz

Measured and Indicated grading 1.6g/t gold with these evenly distributed between Kunche-Bepkong and Wa East (Julie

& Collette).

Mineral Resources have grown progressively through systematic exploration of the Company's 2,800km2 licence holdings which encompass large tracts of prospective Birimian terrain, the rocks that host the majority of West Africa's gold mines. Azumah anticipates Mineral Resources will continue to grow through the systematic testing of its pipeline of specific targets, prospects and many areas of interest.

Azumah is currently completing a Feasibility Study for a mining operation based on an initial seven-year life and producing ~100,000oz Au per year from the open pit mining and treatment of ore through a nominal 1.2 million tonnes per year carbon-in-leach (CIL) processing plant (1.8Mtpa treating softer oxide material). The plant will be located adjacent to the Kunche deposit and incorporate a flotation and regrind circuit to treat Julie primary and some transitional ore which will be hauled by road to the processing plant.

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Azumah Resources Limited - Activities Report - Quarter Ending September 2014

A JORC Ore Reserve of 624,000oz Au (9.1Mt at 2.14g/t Au) has been defined based on recent studies. With the addition of Inferred mineralisation contained in designed and optimised pits the total Mining Inventory is 652,500oz gold. Extensive metallurgical test work has been undertaken to confirm a high average overall gold recovery of ~92% for the Kunche, Bepkong and Julie deposits.

Azumah has had two 15-year Mining Leases granted over its key deposits (Ghana government holds a 10% free carried interest in their 'rights and obligations' and is also entitled to a 5% gross gold royalty) and is now moving to obtain environmental operating permits necessary to allow development to proceed.

No technical, social or environmental impediments to development have been identified and there is strong support from stakeholders for the Project. Whilst the region has no other major industry, the Project benefits from excellent regional infrastructure including grid power to site, good quality bituminised and non-bituminised roads, good access to water, a sealed airstrip at the regional centre of Wa and good general communications.

Key investors in Azumah include Macquarie Bank (Metals & Energy Capital Division), mining services group Ausdrill Limited and Caitlyn Limited which is associated with Emirates based gold refiner Fujairah Gold FZE, a wholly owned subsidiary of global mining group, Vedanta Resources plc. Azumah itself holds a 15% interest in its neighbour and junior Ghana explorer, Castle Minerals NL which has 10,000km2 of licences adjacent to Azumah.

Figure 1: Wa Gold Project - Key Deposits and Prospects

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Azumah Resources Limited - Activities Report - Quarter Ending September 2014

Table 1: Ore Reserves Summary - August 2014

Ore Reserves Summary
(As at August 2014)	Proved	Probable	Total	Gold To Mill
(As at August 2014)	Tonnes Grade (Mt) g/t Au	Tonnes Grade (Mt) g/t Au	Tonnes Grade (Mt) g/t Au	Oz Au
Kunche Bepkong Julie	4.91 1.79 0.29	1.92 1.84 2.45	0.05 0.11 1.93	3.11 1.97 2.89	4.97 1.90 2.21	1.94 1.85 2.84	309,000 113,000 202,000
Total	7.00	1.92	2.09	2.85	9.08	2.14	624,000

Values have been rounded

NB: The Ore Reserve excludes 28,000oz gold deemed 'Mining Inventory'

Table 2: Mineral Resource Estimate - August 2014

Cut-off	Measured	Indicated	Inferred	Total
0.5 g/t Au	Tonnes	Grade	Gold	Tonnes	Grade	Gold	Tonnes	Grade	Gold	Tonnes	Grade	Gold
0.5 g/t Au	(M)	g/t Au	Oz	(M)	g/t Au	Oz	(M)	g/t Au	Oz	(M)	g/t Au	Oz
Kunche Bepkong Aduane Julie Collette	8.42 2.22 0.89	1.73 1.79 1.44	468,000 128,000 41,000	2.24 1.70 10.06	1.38 1.33 1.57	99,000 73,000 507,000	4.86 1.17 1.77 5.98 1.69	1.17 1.17 1.50 1.49 1.45	183,000 44,000 85,000 286,000 79000	15.52 5.09 1.77 16.93 1.69	1.50 1.49 1.50 1.53 1.45	751,000 245,000 85,000 834,000 79,000
Total	11.52	1.72	637,000	14.00	1.51	679,000	15.47	1.36	677,000	40.99	1.51	1,994,000

Values have been rounded

Competent Persons' Statements

The scientific and technical information in this report that relates to the geology of the deposits and exploration results is based on information compiled by Mr Stephen Stone, who is a full-time employee (Managing Director) of Azumah Resources Ltd. Mr Stone is a Member of the Australian Institute of Mining and Metallurgy and has sufficient experience which is relevant to the style of mineralisation 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 Stone is the Qualified Person overseeing Azumah's exploration projects and has reviewed and approved the disclosure of all scientific or technical information contained in this announcement that relates to the geology of the deposits and exploration results.
The scientific and technical information in this report that relates to the in-situ Mineral Resource estimates for the Bepkong and Collette deposits is based on information compiled by Mr David Williams, who is a geological consultant employed by CSA Global Pty Ltd. Mr Williams is a Member of the Australian Institute of Geoscientists and the Australian Institute of Mining and Metallurgy and has sufficient experience which is relevant to the style of mineralisation 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 Williams has reviewed and approved the disclosure of all scientific or technical information contained in this announcement that relates to the Bepkong and Collette Mineral Resource estimate.
The scientific and technical information in this report that relates to the in-situ Mineral Resource estimates for the Kunche and Aduane deposits is based on information compiled by Mr Dmitry Pertel, who a full-time employee (Manager - Resources) of CSA Global Pty Ltd. Mr Pertel is a Member of the Australian Institute of Geoscientists and has sufficient experience which is relevant to the style of mineralisation 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 Pertel has reviewed and approved the disclosure of the relevant scientific or technical information contained in this announcement that relates to the Kunche and Aduane Mineral Resource estimates.
The scientific and technical information in this report that relates to Mineral Resources estimates for the Julie deposit is based on information compiled by Mr Brian Wolfe, a Competent Person who is a Member of the Australian Institute of Geoscientists. Mr Wolfe is a consultant to Azumah Resources Limited and is not an employee of the Company. Mr Wolfe 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 Wolfe consents to the inclusion in the report of the Julie Mineral Resources in the form and context in which it appears.
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Azumah Resources Limited - Activities Report - Quarter Ending September 2014

The scientific and technical information in this report that relates to Ore Reserves estimates for the Kunche, Bepkong and Julie deposits is based on information compiled by Mr Linton Kirk, an independent consultant to Azumah Resources Limited. Mr Kirk is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Kirk has sufficient experience that is relevant to the style of minerali sation 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 Kirk consents to the inclusion in the report of the matters related to the Ore Reserve estimate in the form and context in which it appears.
The scientific and technical information in this report that relates to Process Metallurgy is based on information compiled by Mr Ian Thomas, an independent process consultant to Azumah Resources Limited. Mr Thomas is a member of the Australasian Institute of Mining and Metallurgy. Mr Thomas 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 Thomas consents to the inclusion in the report of the matters related to the metallurgy, specifically the data represented in Table 3 in ASX release dated 2nd September 2014, in the form and context in which it appears.

Forward-Looking Statement

This release contains forward-looking information. Such forward-looking information is often, but not always, identified by the use of words such as "seek", "anticipate", "believe", "plan", "estimate", "expect" and "intend", and statements that an event or result "may", "will", "should", "could", or "might" occur or be achieved, and other similar expressions. In providing the forward-looking information in this news release, the Company has made numerous assumptions regarding: (i) the accuracy of exploration results received to date; (ii) anticipated costs and expenses; (iii) that the results of the feasibility study continue to be positive; and (iv) that future exploration results are as anticipated.
Management believes that these assumptions are reasonable. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those contained in the forward-looking information. Forward-looking information is based on estimates and opinions of management at the date the statements are made.

Table 3: Change in Interests in Mining Tenements

Tenement reference and location	Interest at beginning of Quarter	Interest at end of Quarter
ML 10/1 Kunche ML 10/5 Julie PL 10/4 Collette, Loggo PL 10/5 Julie near Du PL 10/9 Josephine, Du PL 10/12 Vapor PL 10/13 Basabli PL 10/14 Duri PL 10/18 Butele PL 10/19 Vapor West PL 10/20 Vapor South PL 10/35 Dorimon West PL 10/36 Tangasia PL 10/37 Zadong South PL 10/38 Dorimon PL 10/39 Vapor S/West PL 10/40 Tangasia S/East PL 10/41 Lawra North PL 10/42 Tangasia North PL 10/43 Samoa S/West PL 10/44 Samoa South PL 10/45 Samoa North PL 10/46 Samoa	90% 90% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100%	90%* 90%* 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% 100% *Ghana 10% Free Carried Interest and 5% Gross Royalty

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