Slide 1: Damang Mine: Swinging Back to Profits
DAMANG MINE: SWINGING BACK TO PROFITS ALFRED BAKU EVP & Head of West Africa May 2015
Slide 2: Content
CONTENT Where we’ve come from Reversing the trend Transformation pillars Sustaining the turnaround Way forward Damang Mine: Swinging Back to Profits | Alfred Baku | May 2015 2
Slide 3: Where We've Come From: Key Financial Metrics
WHERE WE’VE COME FROM Key Financial Metrics AISC/Gold Price/Cash Flow 2 500 25.0 2 000 20.0 1 500 15.0 AISC/Gold Price (US$/oz) Cashflow (US$m) 1 000 10.0 500 5.0 0 0.0 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 C2014 -500 -5.0 -1 000 -10.0 -1 500 -15.0 -2 000 -20.0 AISC Gold price receiv
Slide 4: Where We've Come From: Production Profile
WHERE WE’VE COME FROM Production Profile 2.00 1.80 1.60 ORE TONNES(Mt) 1.40 1.20 1.00 0.80 0.60 0.40 0.20 - 2012 Q1 2012 Q2 2012 Q3 2012 Q4 2013 Q1 2013 Q2 2013 Q3 2013 Q4 2014 Q1 2014 Q2 Planned Ore tonnes Actual Ore Tonnes • 2012-2013: implementation of a 3-cycle,4 shift roster. • Reduced tons min
Slide 5: Significant Negative Cash Flows and Financial Loss
WHERE WE’VE COME FROM Significant Negative Cash Flows and Financial Loss 2012 2013 Lower grades mined Closure/Care & (Huni Sandstone) Maintenance considered Lower gold production (average 39koz per quarter) High AISC/Gold Price Ratio Reserve dropped to 1 moz due • 2012 Average US$1,753/oz to signifi
Slide 6: Reversing the Trend: Key Strategic Steps
REVERSING THE TREND 3 Key Strategic Steps Put in place a turnaround strategy Consolidate and stabilize – increase waste strip, extend life of mine, and stabilize the processing plant Increase relevance – put Damang back on the map as a Productive member of the Gold Fields family Damang Mine: Swingin
Slide 7: Transformation Pillars: Damang's Turnaround Strategy
TRANSFORMATION PILLARS Damang’s Turnaround Strategy driven by: Safety Human Resources Processing Business Improvement Efficiency and Productivity Financial Discipline and Cost Management Sustainable Development and Social Responsibility Effective Planned Maintenance While maintaining the company’s c
Slide 8: Transformation Pillars: Safety and Human Resources
TRANSFORMATION PILLARS Safety If we cannot mine safely, we will not mine • Visible Leadership exemplified by HOD walk-the-talk • Focus on the correct, job specific PPE. • Focus on Vehicular Safety. • Zero tolerance approach to safety. Human Resources Description 2013 2014 2015 866 GF Employees; 637
Slide 9: Processing – Strategic Intervention
TRANSFORMATION PILLARS Processing – Strategic Intervention Improved on plant recovery to reduce metallurgy cost by ~25% C2012 - Metric UoM 2014 New Approach C2013 Added aqueous instead of solid lead nitrate to passivate sulphides in the leach Leach efficiency % 30.9 56.1 feed. Adsorption efficiency
Slide 10: Processing – What Next?
TRANSFORMATION PILLARS Processing – What next? Crushing and Milling Adopt full fine crushing Improve on the quality of grinding media for both mills Circuit Continue to modify the milling circuit parameters. Modify milling system to allow single-stage Ball Mill operation. Gold 100% usage of oxygen i
Slide 11: Process Optimization: 2012 – 2013 Metrics
TRANSFORMATION PILLARS Process Optimization: 2012 – 2013 metrics Plant throughput was averaging 16% below plan Ouput UoM Actual Avg Plan Avg % Var Status Gold produced koz 39.2 49.5 -21% L Plant recovery was averaging 1% below plan Yield g/t 1.16 1.27 -9% L Gold produced was averaging 21% below plan
Slide 12: Efficiency and Productivity
TRANSFORMATION PILLARS Efficiency and Productivity Switch from V- Juno Go-Line 71 to SV-2 Fuel Facility Operation Operation Sneipner Fly the Rigs Blast Efficiency & 9m to 12m Optimization cost–saving Blasts initiatives Pre-Split Extending Drilling Lubricant Life Geological Components’ and Dilution R
Slide 13: Business Improvement
TRANSFORMATION PILLARS Business Improvement Cost Usage Initiatives Throughput Initiatives Benefits Benefits delivered delivered in 2013 in 2013 Benefits Benefits delivered delivered in 2014 in 2014 13
Slide 14: Sustainable Development and Social Responsibility
TRANSFORMATION PILLARS Sustainable Development and Social Responsibility Strong relationships with stakeholders, based on trust, open, honest and frequent engagement (Consultative Committee Meetings, Durbars etc) Work with stakeholders to create and share value with our investors, and society in gen
Slide 15: Sustaining the Turnaround: Action Plans and Initiatives
SUSTAINING THE TURNAROUND Action Plans and Initiatives Greater focus on maintaining and improving the cost base Total Mine Cost Control Stringent Cost Review Approach – daily and weekly. Departmental monthly peer review with all HoD’s Weekly/Monthly/Quarterly Dashboards Cost accountants assigned to
Slide 16: The Way Forward: Exploration
THE WAY FORWARD Exploration Saddle-Huni Bridge Juno East and South • Part of “Greater Damang” N • Possible dip and strike extension of • AGC down to 42m yielded 14,442oz favourable geological horizon in pit • Resource/information gap observed below • First pass drilling has given indication of 50m d
Slide 17: Thank you
Thank you