Nzema Gold Mine. February 13, 2014 GOLD PRODUCER WEST AFRICA CASH FLOW

Transcription

1 Nzema Gold Mine February 13, 2014 GOLD PRODUCER WEST AFRICA CASH FLOW

2 Disclaimer & Forward Looking Statements This presentation contains forward-looking statements including but not limited to, statements with respect to Endeavour s plans and operating performance, the estimation of mineral reserves and resources, the timing and amount of estimated future production, costs of future production, future capital expenditures, and the success of exploration activities. Generally, these forward-looking statements can be identified by the use of forward-looking terminology such as expects, expected, budgeted, forecasts and anticipates. Forward-looking statements, while based on management s best estimates and assumptions, are subject to risks and uncertainties that may cause actual results to be materially different from those expressed or implied by such forward-looking statements, including but not limited to: risks related to the successful integration of acquisitions; risks related to international operations; risks related to general economic conditions and credit availability, actual results of current exploration activities, unanticipated reclamation expenses; changes in project parameters as plans continue to be refined; fluctuations in prices of metals including gold; fluctuations in foreign currency exchange rates, increases in market prices of mining consumables, possible variations in ore reserves, grade or recovery rates; failure of plant, equipment or processes to operate as anticipated; accidents, labour disputes, title disputes, claims and limitations on insurance coverage and other risks of the mining industry; delays in the completion of development or construction activities, changes in national and local government regulation of mining operations, tax rules and regulations, and political and economic developments in countries in which Endeavour operates. Although Endeavour has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forwardlooking statements. Please refer to Endeavour s most recent Annual Information Form filed under its profile at for further information respecting the risks affecting Endeavour and its business. GOLD PRODUCER WEST AFRICA CASH FLOW 2

3 Table of Contents Introduction Operations Geology Exploration CSR Summary Tabakoto Mine Agbaou Mine Houndé Project Accra Operations Youga Mine Nzema Mine GOLD PRODUCER WEST AFRICA CASH FLOW 3

4 Nzema Mine in Ghana Nzema ownership is 90% Endeavour, 10% government of Ghana Located 280 km from Accra, and 70 km from Takoradi Workforce: 688, including 464 contractors; only 3 expats Ghana: Top gold producing nation in West Africa Mining is ~12% of GDP Next election in 2016 Town, village Endeavour Mines Accra Operations Road from Abidjan To Agbaou Kumasi Youga Mine Tamale Accra Operations Takoradi Nzema Mine GOLD PRODUCER WEST AFRICA CASH FLOW 4

5 Nzema Mine Nzema Gold Mine (90% Endeavour, 10% Ghana government) Resources (incl. of Reserves, 100%) Reserves (100%) M&I: 1.3 g/t for 1.943Moz Inferred: 1.2 g/t for 0.421Moz 1.9 g/t for 0.797Moz Strip Ratio 4.7 to 1 (2013) Processing Rate Met. Recovery Production Cash Costs ($/oz) Expected Mine Life Royalty 1.6 to 2.1Mtpa Gravity/CIL plant 91% to 75% depending on ore type ,447 ozs ,464 ozs 2014e 110,000 to 120,000 ozs $ m - $ e $780 to $830 6 years (based on current reserves) 5% (+1% third-party at Adamus pits) Corporate Tax 35% GOLD PRODUCER WEST AFRICA CASH FLOW 5

6 Nzema Exploration: Prospect Location Map Accessed by 304 km paved highway followed by 8 km graded road from Accra 3 hours drive from Abidjan 14 km/33 Kv electrical transmission Substation at Esiama Power cost is $0.24 per kwhr Water supply is 100% recycled process water; 0% from water storage dam, none from pit Fuel cost is $1.30 per litre GOLD PRODUCER WEST AFRICA CASH FLOW 6

7 Process Up to 2.1 Mtpa Oxide/Saprolite ore and 1.6 Mtpa bedrock ore 350 tph primary jaw crusher 290 dtph oxide/200 dtph bedrock Outotec 3.5MW grinding circuit 22 hr Leach & carbon adsorption circuit (Total live volume of leach tank = 12,000m3) 7t Zadra method for elution 7 t Regeneration kiln for carbon reactivation 48 Gravity concentrator/intense leaching 2-stage thickening circuit for cyanide recovery TSF constructed to Australian engineering standards, 20M tonnes capacity 88% recovery overall (91% in oxide, 75% upper transition) GOLD PRODUCER WEST AFRICA CASH FLOW 7

8 Flowsheet GOLD PRODUCER WEST AFRICA CASH FLOW 8

9 Mining Akango North Mining from two areas: 9 km long chain of shallow oxide pits along Salman trend plus the Adamus pits, 8 km west of Salman 2 Liebherr 984C back-hoe hydraulic excavators and 12 CATT 777 rear dump trucks Akango South Contract mining with AMS Nfutu Process Plant Adamus Haul Road Nugget Hill Salman North Teberu Salman Central Salman South Bokrobo Aliva GOLD PRODUCER WEST AFRICA CASH FLOW 9

10 Production and Guidance NZEMA, Ghana Q1 Q2 Q3 Q4 FY Guidance / Actual Ore Milled ( 000 t) ,954 - Milled Grade (g/t Au) Gold Production (ozs) 22,456 24,053 27,895 29, , ,000 to 120,000 Cash Cost per Ounce Produced (US$/oz) 1 $1,068 $1,010 $773 $777 $893est $780 to Cash Cost per Ounce produced excluding royalties is a non-gaap financial performance measure with no standard meaning under IFRS GOLD PRODUCER WEST AFRICA CASH FLOW 10

11 Regional Geology Nzema Gold Mine GOLD PRODUCER WEST AFRICA CASH FLOW 11

12 Regional and Mine Geology Adamus Domain Salman Domain Avrebo Domain GOLD PRODUCER WEST AFRICA CASH FLOW 12

13 Adamus Geology M+I resource of g/t for 608,000 oz plus Inferred resources of g/t for 40,000 oz (0.5 g/t cut-off, Dec 31, 2012) Hosted by folded phyllites and greywacke Located in the nose of a NE trending anti-formal closure Mineralization within two shallow NW dipping NE striking lenses Gold mineralization associated with quartz veins with carbonate and pyrite Well developed supergene enrichment Sulphide mineralization is non-refractory 8 km west of Salman GOLD PRODUCER WEST AFRICA CASH FLOW 13

14 Salman Trend Geology M+I resource of g/t for 1,053,000 oz plus Inferred resources of g/t for 234,000 oz (0.5 g/t cut-off, Dec 31, 2012) Birimian age greenstone belt mostly sediments with metavolcanics Western phyllite-dominated sub-domain and eastern more competent, folded, greywacke-dominated sub-domain Northwest directed compression caused folding and thrusting and later strike-slip shearing along Salman Trend Mineralization associated with quartz veins and fine grained arsenopyrite in steeply east and west dipping zones Current reserve is based on oxide and transition resources Sulphide mineralisation is refractory GOLD PRODUCER WEST AFRICA CASH FLOW 14

15 Nzema Satellite Deposit and Geochem Coverage Bokrobo M+I resource of g/t for 138,000 oz plus Inferred of g/t for 81,000 oz (0.5 g/t cut-off) Nfutu M+I resource of g/t for 51,000 oz plus Inferred resources of g/t for 6,000 oz (0.5 g/t cut-off) Aliva M+I resource of g/t for 60,000 oz plus Inferred resources of g/t for 7,000 oz (0.5 g/t cut-off) Avrebo M+I resource of g/t for 33,000 oz plus Inferred resources of g/t for 4,000 oz (0.5 g/t cut-off) As of Dec 31, 2012 GOLD PRODUCER WEST AFRICA CASH FLOW 15

16 Exploration Exploration focus on: Salman o Oxide ounces o Splays and parallel trends o Low lying areas between known resources Adamus Pit o Conversion of Inferred resources Satellite Deposits o Extend existing resources o Identification of new targets in the highly prospective Aliva Nfutu Adamus Bernard Corridor GOLD PRODUCER WEST AFRICA CASH FLOW 16

17 Nzema CSR Projects Focus on education and youth training Scholarship programs and partnership with Australian High Commission to train youth in skills development Provide good drinking water, sanitation access and partnership with healthcare NGO Alternative Livelihood Program for 30 vulnerable Salman households: poultry, pig-rearing, bakery training Phase II Livelihood Restoration Program for 60 farmers Salman Village: resettlement of 2,200 villagers completed in March 2012 GOLD PRODUCER WEST AFRICA CASH FLOW 17

18 CSR Relocation of Teleku-Bokazo village GOLD PRODUCER WEST AFRICA CASH FLOW 18

19 Summary Produced 103,464 ounces in Guidance: o o 100,000 to 120,000 oz Cash costs of $780 to $830 per oz GOLD PRODUCER WEST AFRICA CASH FLOW 19

20 Appendix: Mineral Reserves (Dec 31, 2012, US$1350/oz) Deposit Material CoG, g/t Proved Probable Proved and Probable Ore, 000t Au, g/t koz Ore, 000t Au. g/t koz Ore, 000t Au g/t koz Anwea Oxides Upper transition Lower transition 0.7 1, , Fresh 0.7 3, , , Sub total 6, , , Salman Oxides 0.6 1, , Upper transition Lower transition Fresh Sub total 2, , Bokrobo Oxides Transition Fresh Sub total Nfutu Oxides Transition Fresh Sub total Aliva Oxides Upper transition Lower transition Fresh Sub total Total In-Situ Mineral Reserves 10, , , Stockpile Total Mineral Reserves 10, , , GOLD PRODUCER WEST AFRICA CASH FLOW 20

21 Appendix: Mineral Resources (Dec 31, 2012, 0.5 g/t Au) Nzema Totals Measured Indicated Measured & Indicated Inferred Mtonnes Grade Koz Mtonnes Grade Koz Mtonnes Grade Koz Mtonnes Grade Koz Anwia Salman , Bokrobo Nfutu Aliva Avrebo Akropon Total , , Nzema Totals Measured Indicated Measured & Indicated Inferred Mtonnes Grade Koz Mtonnes Grade Koz Mtonnes Grade Koz Mtonnes Grade Koz Non-refractory oxide transition sulphide Refractory transition sulphide Total , , GOLD PRODUCER WEST AFRICA CASH FLOW 21