Slide 1: Damang Mine: Swinging Back to Profitability
DAMANG MINE: SWINGING BACK TO PROFITABILITY ALFRED BAKU EVP & Head of West Africa NG Mining Summit, Cape Town, June 2015
Slide 2: Content
CONTENT GLOBAL OPERATIONS WHERE WE’VE COME FROM REVERSING THE TREND TRANSFORMATION PILLARS SUSTAINING THE TURNAROUND WAY FORWARD Damang Mine: Swinging Back to Profits | Alfred Baku | June 2015 2
Slide 3: Gold Fields Limited – Global Operations
GOLD FIELDS LIMITED – Global Operations Damang – Member of the Gold Fields group West Africa Peru South Australia Africa Damang • Located in Western Region of Ghana • 280km by road from Accra • 30km by road from Tarkwa • Concession covers an area of 25,016ha • Annual rainfall averages 2,030mm • In 2
Slide 4: Where We've Come From
WHERE WE’VE COME FROM Significant Negative Cash Flows and Financial Loss 2012 2013 Lower grades mined AISC/Gold Price Ratio (Huni Sandstone) • 2013 Average US$1,450/oz (Av. gold price US$1,412/oz) • Closure/Care & Lower gold production Maintenance considered (average 39koz per quarter) High AISC/Gol
Slide 5: Where We've Come From: Key Financial Metrics
WHERE WE’VE COME FROM Key Financial Metrics 2 500 AISC/Gold Price/Cash Flow 25,0 2 000 20,0 1 500 15,0 AISC/Gold Price (US$/oz) Cashflow (US$m) 1 000 10,0 500 5,0 0 0,0 -500 Q4 12 Q1 13 Q2 13 Q3 13 Q4 13 Q1 14 Q2 14 Q3 14 Q4 14 C2014 -5,0 -1 000 -10,0 -1 500 -15,0 -2 000 -20,0 AISC Gold price receiv
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 Turnaround Strategy
TRANSFORMATION PILLARS Damang Turnaround Strategy Safety Human Resources Processing Business Improvement Efficiency and Financial Discipline SD and Social Productivity and Cost Management Responsibility While maintaining the company’s core values of: Safety Respect Responsibility Innovation Honesty
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 • Zero tolerance approach to safety. Human Resources End of Q1 Description 2013 2014 2015 855 GF Employees; 530 Contractors Employees in Service 1,038 845 855 Rigorous Talen
Slide 9: Processing – Strategic Intervention
TRANSFORMATION PILLARS Processing – Strategic Intervention Improved on plant recovery to reduce metallurgy cost by ~25% 2012 - Metric UoM 2014 New Approach 2013 Added aqueous instead of solid lead nitrate to passivate sulphides in the leach Leach efficiency % 30.9 56.1 feed. Adsorption efficiency %
Slide 10: Process Optimization
TRANSFORMATION PILLARS Process Optimization Strategic Intervention Initiatives Adopted single stage milling. SAG mill now runs independently Improved SAG mill effect by ensuring 10-15% “oversize” rocks in the SAG mill feed Weekly planned maintenance at crushing/milling circuit Postponed US$25million
Slide 11: 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 12: 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 Damang Mine: Swinging Back to Profits | Alfred Baku | June 2015 12
Slide 13: Sustainable Development and Social Responsibility
TRANSFORMATION PILLARS Sustainable Development and Social Responsibility Strong relationships with stakeholders, based on trust, open, honest and frequent engagement Creating shared value and leaving positive legacy for host communities COMMUNITY SPEND Infrastructure 16% Education 42% Agriculture 22
Slide 14: Sustaining the Turnaround: Total Mine Cost Control
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 and use of Dashboards Departmental Interventions – GM and Finance Team will hold
Slide 15: 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 16: Thank you
Thank you