Petra Diamonds Limited · LSE:PDL
Petra Diamonds — Technical Presentation (February 2015)
44 slides from Petra Diamonds's technical presentation, Feb 5, 2015
Slide 1: Finsch Diamond Mine
Finsch Diamond Mine A Major Producer with a Sustainable Mine Plan
Slide 2: Important Notice
Important Notice These Presentation Materials do not constitute or form part of any invitation, offer for sale or subscription or any solicitation for any offer to buy or subscribe for any securities in the Company nor shall they or any part of them form the basis of or be relied upon in any manner
Slide 3: Site Visit Itinerary
Site Visit Itinerary 10:00 Finsch mine overview & induction 11:00 Underground visit 12:30 Central Control Room, Plant visit, Open pit viewing, Diamond viewing 14:00 Lunch Q&A 15:00 Group departs Finsch mine 16:15 Group 1 arrives Lanseria 18:00 Group arrives Cape Town 19:15 Group 2 arrives Lanseria 3
Slide 4: Introduction & Overview
INTRODUCTION & OVERVIEW 4
Slide 5: Growth & Margin Expansion
2. Growth & Margin Expansion • Brownfields expansion programmes expected to lift production ca. 60% by FY 2019 production FY 2019 – all programmes on time and on budget target of ca. 5.0 Mcts 6 Carat production (million carats) 1000 5 FY 2015 FY 2014 production production of target of 3.3 Mcts 4 3.1
Slide 6: Finsch Location
Finsch Location 4 PetraDiamonds South Africa Tanzania Botswan Kimberley Underground Koffiefontein
Slide 7: Finsch Overview
Finsch Overview Fincham & Schwabel established Finsch Diamonds Extensive modifications treatment plant 1961 1963 1978 1980 1990 2002 2008 2011 1961 1980 14 Sep 2011 Established Finsch Diamonds 1963 Full mining rights 1978 First stage underground Upgrade of treatment plant 1990 Open pit operation cea
Slide 8: Mine Site Layout
Mine Site Layout 9 2 6 5 4 8 1 3 7 1 Underground 3 Post-79 TD 5 Waste rock dump 7 FRD’s 1,2 and 3 and Infill Dam 2 Pre-79 TMR 4 Overburden Deposit 6 Britz FRD 8 Old Paddocks 8
Slide 9: Moving into Undiluted Ore
Moving into Undiluted Ore • Caving is a safe and proven mechanised mining method; provides access to higher volumes of ore than other methods • Current underground mining taking place in diluted, mature caves nearing end of lives • Expansion programmes to take next ‘cut’ by deepening and establishin
Slide 10: Finsch Mine Plan – High Level
Finsch Mine Plan – High Level Mining is currently transitioning from block cave at 63 level to 4 level sub level cave in Block 5 between 70 to 78 levels A new block cave is planned in Block 5 at 90 level from FY 2024 The blue block represents existing resources not in the current mine plan – opportu
Slide 11: A Sustainable Future
A Sustainable Future Before – facing closure: 3.5 Million tonnes (ROM) 3.0 2.5 2.0 1.5 1.0 0.5 0.0 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 Block 4 After – Petra mine plan of +16 years: 4.0 Residual Million tonnes (ROM) 3.5 resources (Block 6) 3.
Slide 12: Safety Briefing for Underground / Surface Site Visit
SAFETY BRIEFING FOR UNDERGROUND / SURFACE SITE VISIT 12
Slide 13: Site Visit Arrangements
Site Visit Arrangements • Safety Induction • Self rescue pack training • Grouping: • Group A: Petra HQ: Johan Dippenaar; David Abery; Cathy Malins; Koos Visser; Andrew Rogers Mine: Luctor Roode; Hangwane Motundwana Philip Mostert; Tom Anderson; Bobby Morse; Kieron Hodgson; Leif Powis; Matthew O’Keef
Slide 14: Surface
Surface Open Pit Admin Conf Changehouse Sorthouse Lookout Point Room Lamproom & Shaft Control Room 14
Slide 15: Underground
Underground SLC rim intersection 63 Pillars SWPC 70, 73, 75 & 78 level rim drives complete SLC Phase 1 SLC Phase 2 Sections 2,3 & 4 BC Ground BC of SLC ground Handling handling tunnels complete 15
Slide 16: SHE Credentials
SHE CREDENTIALS 16
Slide 17: Long Term Safety Statistics
Long Term Safety Statistics 14 2.0 1.8 12 1.6 10 1.4 1.2 No. of Injuries 8 1.0 LTIFR 6 0.8 4 0.6 0.4 2 0.2 0 2002FY 2003FY 2004FY 2005FY 2006FY 2007FY 2008FY 2009FY 2010FY 2011FY 2012FY 2013FY 2014FY 0.0 Fatals 0 0 0 0 0 0 0 1 0 0 0 0 0 LTI 11 8 10 8 12 4 3 2 2 5 6 4 2 LTIFR 0.47 0.27 0.29 0.19 0.39
Slide 18: SHE Achievements
SHE Achievements Achieved 2,000,000 Fatality Free Shifts 20 November 2014 ISO14001:2004 OHSAS18001:2007 re-certification re-certification Finsch won first place in the Northern Cape Mine Managers’ Association (NCMMA) Awards, for the underground mines safety category – 28 November 2014 18
Slide 19: Development Programme
DEVELOPMENT PROGRAMME 19
Slide 20: Geology
Geology • Finsch pipe is hosted by banded ironstones at surface and thereafter dolomites of the Griqualand West Sequence of the Transvaal Supergroup • A Group II kimberlite pipe with an age of 118Ma • 17.9ha on surface • Main pipe tapers to 3.7ha and Precursor to 1.5ha at 880m • Truncates earlier Pr
Slide 21: Block 5 SLC and Block Cave Project
Block 5 SLC and Block Cave Project • Objective to extend Finsch LOM to sustain the current production profile and increase ROM throughput to 3.5Mtpa • Mining currently taking place in Block 4 at 630m • Development of SLC over 4 levels from 700m to 780m • Dedicated conveyor ore- handling infrastructu
Slide 22: SLC Project Progress
SLC Project Progress SLC rim intersection 63 Pillars SWPC • SLC (Phase I) rim tunnels complete 70, 73, 75 & 78 level rim drives complete • Tunnelling through orebody in progress, contributing undiluted ore • Excavation of 1,400m out of 1,600m of conveyor tunnels completed • Civil work and structural
Slide 23: What is sub-level caving?
What is sub-level caving? • A cave where most of the recovered rock is drilled, charged and blasted • The face must continuously advance: • To disturb the column above • To manage the damaged brows • Performance is highly dependent on: • Extraction sequencing and disciplined following of it • Drill
Slide 24: Mining in action
Mining in action Drilling rings for the Pillar Retreat at 63 Level Development drill rig drilling the end Employees at a development end Supervisor discusses work with drill rig operator 24
Slide 25: Plant Overview
PLANT OVERVIEW 25
Slide 26: Plant Infrastructure
Plant Infrastructure Pre upgrade: • Original plant built – 1964 • First upgrade completed – 1980 • Underground operation commence – 1990 • Introduce Pre-79 dump retreatment – 2003 • Full contops since 2005 @ capacity of 5.7 Mtpa Post upgrade: • Treatment plant upgrade – predominantly the DMS, recove
Slide 27: Plant Overview
Plant Overview Ore Reception Ore Preparation Concentration Mine Residue Disposal Recovery WIFS 27
Slide 28: Simplified Process Flow
Simplified Process Flow Shaft -300mm Primary Gyratory Crusher -150mm Buffer Stockpile Secondary & Tertiary Crushing High Pressure Rolls Crushing Coarse DMS -22mm Overspill Bin +22mm -150mm -22+ 1mm Feed Separation & -22+8mm Final Recovery Primary Scrubbing & Secondary Screening Scrubbing -1mm -8+1mm
Slide 29: Plant Modifications by Petra
Plant Modifications by Petra • Bottom cut reduced from 1.47mm to 1.0mm • Top cut increased from 19mm to 22mm • Coarser tailings mid cut reduced from 8mm to 6mm, improving diamond liberation • Number of projects completed which improved plant reliability and increased flexibility, ultimately improvin
Slide 30: Production Plan
Production Plan • ROM tonnages to rise 17%, but ROM carat production to rise 58% due to higher grade • Positive impact on average value per carat as tailings production winds down Tonnes treated and grades Carat production and average diamond values¹ 2.5 160 6.0 70 Million carats $/ct cpht Million t
Slide 31: Diamond Profile
Diamond Profile • Rich in gem quality smaller diamonds • Highly commercial goods of +5 carats • Produces a number of +50 carat stones pa – both white and yellow diamonds Selection from tender (Nov 2014) 36cts & 43cts (Nov 2013) 53cts (Aug 2013) 43cts (Oct 2013) 2.9cts (Jun 2012) 2 classic models of
Slide 32: Typical Production Layout
Typical Production Layout 32
Slide 33: Financial
FINANCIAL 33
Slide 34: Capex Overview
Capex Overview • Total expansion Capex of ca. R4.3 billion (ca. US$400 million) • R1.2 billion capital spent to date (H1 FY 2015); R3.2 billion remaining spend to FY 2024 • Guidance (below to FY 2019); post FY 2019, ca. ZAR260 million per annum spent from FY 2020 to FY 2024 related to the new Block
Slide 35: Cost of Production
Cost of Production Operating cost break down 100% 90% 25% 24% • 3 year wage agreement of +10% 27% 80% pa with NUM concluded in 70% 24% 23% September 2015; ca. 8.2% 60% 23% increase on total labour for FY 50% 40% 13% 14% 14% 2015 for Group 30% 20% 37% 37% 39% • Manage rising energy costs 10% through
Slide 36: H1 FY 2015 Trading Update Results
H1 FY 2015 Trading Update Results Unit H1 FY 2015 H1 FY 2014 Variance FY 2014 Sales Revenue US$m 77.3 83.2 -7% 183.7 Diamonds sold Carats 906,214 863,319 +5% 1,856,939 Average price per carat US$ 85 96 -11% 99 ROM Production Tonnes treated Tonnes 1,530,455 1,505,356 +2% 2,910,195 Diamonds produced C
Slide 37: Social Responsibility
SOCIAL RESPONSIBILITY 37
Slide 38: Labour Relations
Labour Relations • Labour relations at Finsch have been stable in FY 2015 • Strong focus on internal communications and engagement with employee representatives • Petra concluded 3 year wage agreement with NUM in September 2014 • Itumeleng Petra Diamonds Employee Trust owns 5% of mine • First IPDET
Slide 39: Corporate Social Investment (CSI)
Corporate Social Investment (CSI) • Finsch Diamond Mine plays an active and supportive role in the local community • The mine contributes to a wide number of community projects – below are just a few examples: 1. Community health • Mobile clinic for the Kgatelopele community 2. Portable Skills Train
Slide 40: Corporate Social Investment (CSI) Continued
Corporate Social Investment (CSI) Continued 3. John Taolo Gaetsewe Water Project • Improve local water efficiency • Reduce leaks • Regulated water resources & consumption 4. Rally to Read • Delivering books & teaching aids to the most remote and needy local schools Education is our future: Girls fro
Slide 41: Outlook
OUTLOOK 41
Slide 42: Outlook
Outlook Rising Production Rising Margins Rising Prices • ROM production ramping up • Grade to rise ca. 40% to ca. • Positive long term outlook from 1.89 Mctpa to ca. 2 58 cpht based on fundamentals Mctpa by FY 2018 • Contribution of lower value • ‘Mass luxury’ to drive market; • Initial mine plan of
Slide 43: Appendix – Analyst Guidance
Appendix – Analyst Guidance Finsch - Overview Description Guidance notes (FY 2015) • LOM: Current plan up to ROM Tonnes (Mt) FY 2015: 3.0 Mtpa, 3.0 Mt in FY 2016, 3.2 Mtpa by FY 2017 (when SLC is 2030 operational), and 3.5 Mtpa from FY 2018 onwards (production supplemented with tonnes from SWPC). Bl
Slide 44: Thank You
(P PetraDiamonds Thank You
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