KEFI Gold and Copper PLC · LSE:KEFI
KEFI Gold and Copper — KEFI Minerals — Investor Presentation (July 2017)
30 slides from KEFI Gold and Copper's investor presentation, July 2017
Slide 1: Update July 2017
Update Disclaimer July 2017 Ethiopia Saudi Arabia Prospective Arabian‐Nubian Shield Strong partners, contractors, financiers and team 2Moz Gold in Resources, 1Moz in Reserves, Large Growth Pipeline Initial Project is Development Ready for +100,000oz pa
Slide 2: Disclaimer
Disclaimer The information contained in this document (“Presentation”) has been prepared by KEFI Minerals plc (the “Company”). While the information contained herein has been prepared in good faith, neither the Company nor any of its shareholders, directors, officers, agents, employees or advisers g
Slide 3: Corporate Overview
Corporate Overview Focus and Targets Capital Structure AIM code KEFI Develop in 2017‐18, Produce from 2019 – 115koz pa in 1st 8 years 3.93p (low) • At $1,250/oz, DFS‐level estimated cash flow of $55M pa before Share price ‐ 12 mth 11.38p (high) debt‐service & tax , $24M pa after debt‐service & tax
Slide 4: KEFI positioned itself in Arabian-Nubian Shield, then acquired and overhauled Tulu Kapi
KEFI positioned itself in Arabian‐Nubian Shield, then Disclaimer acquired and overhauled the Tulu Kapi Gold Project Entered Saudi Arabia 2008, pegged large portfolio, made a discovery & applied for Mining Licence Entered Ethiopia in 2014 via Tulu Kapi acquisition, then completely overhauled the
Slide 5: Strong Platform: Shareholders, Partners, Contractors, Financiers
Strong Platform Shareholders, Partners, Contractors, Financiers Lanstead Odey Ausdrill & Lyco Board Public 26% 16% 5% 3% 50% KEFI Minerals plc 40% c. 75% Al Rashid 60% Saudi JV Tulu Kapi Gold Mines c. 25% Gov’t of Ethiopia Oryx Finance SPV Bond Holders KEFI’s Status for Ethiopian Government: On‐site
Slide 6: Ethiopia's Ranking for Investment Attractiveness
Ethiopia’s Ranking for Investment Attractiveness Ethiopia ranked 51 of 109 countries globally in 2016 Fraser Institute Survey The table below shows Ethiopia’s ranking amongst some African countries e.g. “ahead” of Tanzania Morocco Burkina Faso Ghana Namibia Botswana Eritrea Ivory Coast Ethiopia Mada
Slide 7: Ethiopia - A country on the rise
Ethiopia ‐ A country on the rise 15 years of 7‐10% GDP growth, with a HQ for African Union, provides UN pro‐development culture, peacekeepers for region Africa’s fastest growing economy (2015 ‐ 10.2% Real GDP growth)1 Ranks ahead of Kenya, Mali, Ethiopia is Second most populous country in Mozambique
Slide 8: KEFI Poised for Significant Growth
KEFI Poised for Significant Growth Disclaimer Milestones achieved so far in 2017 for Tulu Kapi Gold Project in Ethiopia • Published 2017 DFS Update for +115Koz pa Au open pit (1 Moz LOM). AISC < $800/oz • Signed Shareholders’ Agreement with Gov’t for financing and operating off‐site infrastructure •
Slide 9: Advantages of Oryx Financing
Advantages of Oryx Financing Disclaimer • Prudent structure provides much safer start‐up funding than bank debt, due to: – Longer grace period: payments by project company TKM commence 30 mths after drawdown – Longer repayment period: term of 9 years • Debt (structured as a fixed asset lease) can be
Slide 10: Proposed Sources and Applications of Development Funding for Project Company TKM
Proposed Sources and Applications of Development Funding for Project Company TKM (excl. investment already made of c. $60M) $M Total funding needs before project financing structure, as previously reported 160 Extra funds required for project funding structure, mainly for interest during grace perio
Slide 11: Open pit cash flows support all commitments based on DFS-level assumptions
Open pit cash flows support all commitments based on DFS‐level assumptions Key Ratios for Oryx Finance Proposal1 @$1,100/oz @$1,250/oz @$1,400/oz Unleveraged Payback on Initial Capex (excl. Finance effects) 5 years 3 years 2.5 years Unleveraged NPV8% at Production Start 2019 $191M $272M $350M Based
Slide 12: Undervalued compared to peer group of pre-development companies
Undervalued compared to peer group of pre‐development companies KEFI is today “FS completed” and plans to be “In Construction” in 2017 EV/M&I Gold Company EV/NPV EV/Reserve EV/All Resource EV/Prod Resource Subgroup Averages (x) ($/oz) ($/oz) (S$/oz) ($/oz) In Construction 1.19 155 100 61 159 FS comp
Slide 13: Comparison of Current Market Capitalisation With GOE Entry Price, NPVs and Cantor Peer Stats
Comparison of Current Market Capitalisation With GOE Entry Price, NPV’s and Cantor Peer Stats 200 KEFI share price from projects in current portfolio • Lowest graphed basis for valuation is current market cap, at 4.3p share price 150 • Highest graphed basis for valuation equates to c. 45p price per
Slide 14: Implementation Steps Ahead for H2-2017
Implementation Steps Ahead for H2‐2017 Tulu Kapi community completes resettlement surveys and data updates Oryx completes detailed due diligence with final independent sign‐offs Government completes regulatory review and approval of transaction documentation Refine contingency provisions bas
Slide 15: Greatest value created from discovery and triggering development
Greatest value created from Disclaimer discovery and triggering development Location of KEFI’s exploration portfolio in the ANS Ethiopia • Development‐ready at +2g/t Au open‐pit reserve of 1Moz • Underground potential below open pit +1Moz target at +5g/t Au • Target production from initial 115Koz p.
Slide 16: Contacts
Contacts Harry Anagnostaras‐Adams, Executive Chairman John Leach, Finance Director Cyprus ‐ Group corporate team Ethiopia ‐ Development and exploration teams Saudi Arabia ‐ Exploration team Email: info@kefi‐minerals.com Website: www.kefi‐minerals.com IFC Advisory Ltd (Financial PR) Tim Metcalfe, Hea
Slide 17: Appendices
KEFI MINERALS APPENDICES
Slide 18: Directors of KEFI Minerals plc
Directors of KEFI Minerals plc Harry Anagnostaras‐Adams – Executive Chairman – MBA (Australian Graduate School of Business) Harry was founder or co‐founder of Citicorp Capital Investors Australia, investment company Pilatus Capital, Australian Gold Council, EMED Mining, KEFI Minerals and Cyprus‐base
Slide 19: Tulu Kapi Development team
Tulu Kapi Development team Wayne Nicoletto, Managing Director, KEFI Ethiopia & KEFI Chief Operating Officer – BSc Metallurgy, Grad Dip Mining (WASM) Wayne has 30 years' experience in the mining industry as a Metallurgist and a General Manager, specialising in start‐up and operation of gold mines in
Slide 20: Tulu Kapi Open Pit 2017 DFS Update confirms a financially robust project
Tulu Kapi Open Pit 2017 DFS Update confirms a financially robust project Resources and Reserves Open pit production and AISC Tonnes Grade Cont. Au AISC Production (Mt) (g/t Au) (Koz) 134 128 124 120 1,500 Probable Ore Reserves 15.4 2.12 1,050 105 105 111 93 Indicated Resources 1,000 $/oz Koz • Open
Slide 21: Highlights of 2017 DFS Update
Tulu Kapi Disclaimer Highlights of 2017 DFS Update • 2017 DFS Update incorporates due diligence and many 2017 DFS 2015 DFS Update refinements since 2015 DFS Average head grade 2.1g/t gold 2.1g/t gold • Similar financial outcomes to 2015 DFS with greater confidence Total gold production 980,000 oz 96
Slide 22: Focus on minimising ore dilution in open pit
Tulu Kapi Disclaimer Focus on minimising ore dilution in open pit • Mining dilution is a key performance parameter to achieve planned ore grade from Tulu Kapi open pit • Inadequate work on dilution by previous owner Nyota • Estimating and planning for dilution has been an important focus since KEFI
Slide 23: Selective mining in open pit
Tulu Kapi Disclaimer Selective mining in open pit Planned mining cycle • Bulk mine most material and selectively mine the rest • Mining to progress across the bench from hangingwall to footwall • 70% of ore tonnes in lodes >2.5m thick (vertical) • Bulk ore and waste (>1m thick) mined via more produc
Slide 24: Why only 5% of tonnes selectively mined?
Tulu Kapi Disclaimer Why only 5% of tonnes selectively mined? • The cross section below is through the deepest part of the pit • The two sets of yellow lines are 7.5m apart. These represent benches which intersect 8‐10 lodes to mine as a package • An average of 10 lodes to be mined per bench, thickn
Slide 25: Tulu Kapi underground mine potential
Tulu Kapi underground mine potential Potential to extend life and increase grade The underground provides strong upside Potential production profile (Koz Au p.a.)1 Thick, high‐grade gold zones below open pit Underground Open cut 150 150 150 150 135 Preliminary studies based on current resource o
Slide 26: Promising prospects near Tulu Kapi
Ethiopia Promising prospects near Tulu Kapi Guji: Visible gold in drill Core 0 1km 2km Komto: Primary gold mineralisation Source: KEFI Minerals 26
Slide 27: Greatest value created from discovery and triggering development
Greatest value created from Disclaimer discovery and triggering development Value Value build M&A 100% 13 Reach steady state 75% 11 Commissioning 12 Begin commercial production Fund “sweet spot” 10 Project construction 9 Raise funding 14 Declining production 50% 7 Reserve definition 8 Feasibility st
Slide 28: Saudi Arabia (KEFI 40%)
Saudi Arabia (KEFI 40%) Saudi Arabia (KEFI 40%) Early mover advantage in eastern Arabian‐Nubian Shield Executing to realise exploration upside Jibal Qutman Hawiah Pipeline of Targets Sufficient Resources to start Mining Potential for large Cu‐Au‐Zn VHMS Over 1,000km2 under application Licence proces
Slide 29: Hawiah: Large undrilled VHMS gossan
Hawiah Large undrilled VHMS gossan KEFI has Hawiah 7 ELAs in the Wadi Bidah Belt which cover cumulative +8km of Cu‐Au gossans BRGM drilling in 1980’s on similar gossans in the area total 1.2Mt at 6.4g/t Au for 254Koz Au Strong 2km long, 300m from surface SP anomaly (in blue >125mV) • Gossan 6km long
Slide 30: Lanstead Placing and Sharing Agreement
Lanstead Placing and Sharing Agreement £4.62 million Lanstead placing done at same price as the February 2017 placing with other investors In March 2017, KEFI received £0.69 million of the proceeds and Lanstead was issued 82.4 million shares Balance of £3.93 million invested in the Lanstead Sh