Chalice Mining Limited · ASX:CHN
Chalice Mining — Chalice Gold Mines — Africa Down Under 2011
28 slides from Chalice Mining's conference presentation, Sep 1, 2011
Slide 1: Developing a High Grade Gold Mine in Eritrea
Developing a High Grade For personal use only Gold Mine in Eritrea Africa Down Under 31 August – 2 September 2011 TSX: CXN www.chalicegold.com ASX: CHN
Slide 2: Disclaimer and Competent Persons Statement
Disclaimer and Competent Persons Statement For personal use only This presentation does not include all available Information on Chalice Gold Mines Limited and should not be used in isolation as a guide to investing in the Company. Any potential investor should also refer to Chalice Gold Mines Limit
Slide 3: Mine Development and Exploration in Eritrea
Chalice Gold Mines Limited ASX: CHN; TSX: CXN Mine Development and Exploration in Eritrea For personal use only High-grade, low cost gold development project (Koka)*: Open pittable 760,000 oz Probable Reserve @ 5.1g/t Au Forecast gold production of 104,000 oz p.a. over 7 years for Koka alone Lowest
Slide 4: Corporate Snapshot
Corporate Snapshot For personal use only ASX: CHN; TSX: CXN Capital Structure Share Price Movement 80 Share price A$0.33 70 Shares on issue 250 million 60 50 Market capitalisation ~A$82 million Cents per share 40 Options on issue 7 million 30 Debt - 20 10 Cash ~A$9 million 0 Aug10 Oct10 Dec10 Feb11
Slide 5: The Arabian-Nubian Shield
The Arabian-Nubian Shield For personal use only Centamin Barrick Sukari Jabal Sayid 15 year 10 year 500 koz pa Au 61 kt pa Cu La Mancha Chalice Hassai Zara Nevsun Sunridge 6 year 7 year Bisha Asmara 156 koz pa + VMS 104 koz pa Au >10 year 5 year Au, Ag, Cu, Zn Cu Zn Ag Au Long mining history (>1,000
Slide 6: High Grade
High Grade For personal use only 6 5 Reserve Grade (g/t) 4 3 2 1 0 Chalice Semafo Noble Teranga Avocet Adamus Banro Cluff Perseus Centamin 6
Slide 7: Gold mine cost curve – Q1 2011
Gold mine cost curve – Q1 2011 For personal use only 1,400 1,200 1,000 Cash cost, $/oz 800 Koka Gold Mine 600 US$338/oz 400 200 - 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Cumulative costed production, % Source: VM Group/Haliburton Mineral Services 7
Slide 8: NPV vs Market Cap
NPV vs Market Cap For personal use only 300 1.2 Cash balance 250 1 NPV at 8% Current share $AUD per share 200 0.8 price ($AUD millions) Market Cap 150 0.6 100 0.4 50 0.2 0 0 $1,600 $1,800 $2,000 Gold Price ($US) -Current cash balance of approximately $9 million + $32 million ENAMCO payment (US$) les
Slide 9: Current Ground Position – 1372 sq km
Current Ground Position – 1372 sq km For personal use only 9
Slide 10: For personal use only
10 For personal use only
Slide 11: Koka – Feasibility Study Cost Profile
Koka – Feasibility Study Cost Profile For personal use only Operating Cost Estimates Average mining costs (incl. pre-strip) $/t mined 2.01 Processing cost $/t milled 24.78 General and administration $/t milled 7.36 Refining charges $/t milled 0.63 11
Slide 12: Koka – Feasibility Study Production Profile
Koka – Feasibility Study Production Profile For personal use only 160 900 Enamco (40%) 800 CHN (60%) 140 Cash Costs 700 120 600 100 Cash costs Production (US$/oz) ('000 oz's) 500 80 400 60 300 40 200 20 100 - - 2014 2015 2016 2017 2018 2019 2020 2021 Financial years ended 30 June 12
Slide 13: Koka Deposit – Project Life of Mine Value
Koka Deposit – Project Life of Mine Value US$ Gold Sales $1168M Revenue For personal use only US$1168M Mining ($97M) EBITDA $866M Processing ($113M) Costs Free cash flow before tax ($302M) G&A ($34M) $735M Royalties ($58M) PP&E ($60M) Infrastructure ($28M) Capital ($131M) Pre-strip ($12M) Assumption
Slide 14: Koka Development Schedule
Koka Development Schedule For personal use only Calendar Year 2011 2012 2013 Quarter Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Shareholders Agreement Mining Agreement Mining License Project Funding Contractor Selection & Engagement Construction ramp - up Construction Pre-Strip First Production 14
Slide 15: Koka – a low risk project
Koka – a low risk project For personal use only Development Risks Risk Level Risk Mitigation Low Risk High High grade JORC/NI43-101 Resource and reserves reserves Management experience Experienced development team Geography and infrastructure Managed through project design Stable government (1
Slide 16: Key Objectives 2011
Key Objectives 2011 For personal use only Crystallise Government purchase price Q2 2011 Develop pipeline of exploration targets Q1 – 2 2011 Commence drilling of Koka near-mine targets Q2 2011 Complete mine permitting Q3 2011 Secure funding Q4 2011 Commence construction Q1 2012 16
Slide 17: Regional Geology & Mineralisation
Regional Geology & Mineralisation For personal use only 17
Slide 18: Near Mine Exploration - Koka 3D IP
Near Mine Exploration - Koka 3D IP For personal use only Long Section 18
Slide 19: Koka 3D IP – Priority Targets Koka & Koka East
Koka 3D IP – Priority Targets Koka & Koka East For personal use only W E 19
Slide 20: Zara Tenements – Other Targets
Zara Tenements – Other Targets For personal use only Zara North Prospects Koka Konate-Fah-Alidar Debre Tsaeda Debre Tsaeda Artisanal Workings Soil Geochemistry – Gold Anomalies 20
Slide 21: Mogoraib North Exploration Licence
Mogoraib North Exploration Licence Located ~10 km north of Nevsun’s For personal use only Bisha VHMS Project with similar geological setting Landsat spectral signatures similar to Bisha VTEM survey completed -~3825 line kilometres Preliminary interpretation has identified several promising targets G
Slide 22: Analysts Covering the Chalice Story
Analysts Covering the Chalice Story For personal use only Australia Europe Southern Cross Equities Ambrian Partners Limited Peter Chapman Adam Kiley E: pchapman@sceq.com.au T: +612 9231 0880 E: adam.kiley@ambrian.com T: +44 20 7634 4777 Paterson Securities Limited Simon Tonkin E: STonkin@psl.com.au
Slide 23: Forward Looking Statements
Forward Looking Statements This document may contain forward-looking information within the meaning of Canadian securities legislation and forward- For personal use only looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 (collectively, forward
Slide 24: Corporate Contact Details
Corporate Contact Details For personal use only Tim Goyder Dr Douglas Jones Dan Hrushewsky Joanne Jobin Executive Chairman Managing Director Senior VP – Corporate Development Investor Relations – North America M: +61 418 942 908 M: 61 438 872 090 M: +1 647 864 2735 M: +1 647 964 0292 tgoyder@chalice
Slide 25: Appendix 1: Eritrea Mining Act Summary
Appendix 1: Eritrea Mining Act Summary Prospecting licence For personal use only Royalties One year, not renewable & not transferrable 5% for precious metals and 3.5% for other Maximum size 100km2 metallic minerals Licence fee (US)$33.33 Annual rental (US)$3.33/km2 Government Participation 10% free-
Slide 26: Appendix 2: Joint Ownership Agreement with ENAMCO
Appendix 2: Joint Ownership Agreement with ENAMCO Signed July 27, 2011. For personal use only Chalice first in country to conclude partnership agreement with ENAMCO (as required by Mining Act). Represents a “green light” for financing & construction of the Koka Gold Project, subject to signing of Sh
Slide 27: Appendix 3: Eritrea Quick Facts
Appendix 3: Eritrea Quick Facts Independent since 1993 For personal use only Politics: transitional single party Republic Capital: Asmara Area: 121,144 square kilometers Population: ~5.9 Million Culture: 45% Islamic, 45% Coptic Christian, 10% Other Languages: Tigrinya, Arabic, Tigre, Afar, Kunama Bu
Slide 28: Appendix 4: Koka Gold Deposit
Appendix 4: Koka Gold Deposit Feasibility Study Assumptions and Parameters For personal use only Base Case Assumptions Gold price base case US$/oz 900 Foreign exchange rate ~600m strike lengthAUD/US$ 0.85 Foreign exchange rate ERN/US$ 15.00 Fuel price $/litre 1.00 Fiscal Parameters 7 years Corporate