Bulyanhulu
Investor Site Tour 04.02.16 Unearthing Africa’s Potential
LSE:ACA
Bulyanhulu Investor Site Tour 04.02.16 Unearthing Africas Potential - - PowerPoint PPT Presentation
LSE:ACA Bulyanhulu Investor Site Tour 04.02.16 Unearthing Africas Potential Important Notice This presentation includes forward - looking statements that express or imply Although Acacias management believes that the expectations
LSE:ACA
This presentation includes “forward-looking statements” that express or imply expectations of future events or results as opposed to historical facts. These statements include, financial projections and estimates and their underlying assumptions, statements regarding plans, objectives and expectations with respect to future production, operations, costs, projects, and statements regarding future performance. Forward-looking statements are generally identified by the words “plans,” “expects,” “anticipates,” “believes,” “intends,” “estimates” and other similar expressions. All forward-looking statements involve a number of risks, uncertainties and
actual results and developments to differ materially from those expressed in, or implied by, the forward-looking statements contained herein. Factors that could cause or contribute to differences between the actual results, performance and achievements of Acacia include, but are not limited to, changes or developments in political, economic or business conditions or national or local legislation or regulation in countries in which Acacia conducts - or may in the future conduct - business, industry trends, competition, fluctuations in the spot and forward price
fluctuations (including the US dollar, South African rand, Kenyan shilling and Tanzanian shilling exchange rates), Acacia’s ability to successfully integrate acquisitions, Acacia’s ability to recover its reserves or develop new reserves, including its ability to convert its resources into reserves and its mineral potential into resources or reserves, and to process its mineral reserves successfully and in a timely manner, Acacia’s ability to complete land acquisitions required to support its mining activities, operational or technical difficulties which may occur in the context of mining activities, delays and technical challenges associated with the completion of projects, risk of trespass, theft and vandalism, changes in Acacia’s business strategy and ongoing implementation of operational reviews, as well as risks and hazards associated with the business of mineral exploration, development, mining and production and risks and factors affecting the gold mining industry in general. Although Acacia’s management believes that the expectations reflected in such forward-looking statements are reasonable, Acacia cannot give assurances that such statements will prove to be correct. Accordingly, investors should not place reliance on forward-looking statements contained in this presentation. Any forward-looking statements in this presentation only reflect information available at the time of preparation. Subject to the requirements of the Disclosure and Transparency Rules and the Listing Rules or applicable law, Acacia explicitly disclaims any obligation or undertaking publicly to update or revise any forward- looking statements in this presentation, whether as a result of new information, future events or otherwise. Nothing in this presentation should be construed as a profit forecast or estimate and no statement made should be interpreted to mean that Acacia’s profits or earnings per share for any future period will necessarily match or exceed its historical published profits or earnings per share. Mineral reserves and mineral resources estimates contained in this presentation have been calculated as at 31 December 2014 in accordance with National Instrument 43-101 as required by Canadian securities regulatory authorities. Canadian Institute of Mining, Metallurgy and Petroleum (CIM) definitions were followed for mineral reserves and resources. The reserves and resources figures stated are
metal will be produced and totals stated may not add up due to rounding. For more information regarding the nature of reserves and resources estimates and relevant CIM definitions, please see page 90 of African Barrick Gold plc’s 2013 Annual Report and Accounts. You are reminded that you have received this presentation on the basis that you are a person to whom this presentation may be lawfully made and delivered. You may not and are not authorised to: (i) reproduce or publish this presentation; or (ii) distribute, disclose or pass on this presentation to any other person, in whole
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2 04.02.2016 Investor Site Tour
Our Location
Producing mines Exploration properties Tintinba Project Mali West Kenya JV Kenya Bulyanhulu Tanzania Hounde Belt JVs Burkina Faso North Mara Tanzania
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Buzwagi Tanzania
Bulyanhulu
04.02.2016 Investor Site Tour
* Including produced ounces
deposit
country
lack of free cash generation
geologic potential
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Past Present
LOM focused on labour intensive
mining methods
Converted to mechanised mining
methods
Lack of investment in development 50% increase in development metres
due to bringing in contractor
Poor maintenance practices, limited
planned maintenance
Over 80% of maintenance is planned Over capitalised (too much equipment
Sustaining capital spend has more
than halved, whilst production has increased
Optimistic planning led to culture of
failure
Setting achievable targets, in tandem
with a dedicated cultural change programme
Too many people, both local and expat 50% reduction in total workforce,
with expats down by 55%
In 2013 we started the process of fundamentally re-designing Bulyanhulu
We’ve made great progress, but still more to do to achieve our goals
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0.00 0.50 1.00 1.50 2.00 2.50 3.00 3.50
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Rate
Incident frequency rates 2006 - 2014
TRIFR LTIFR
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A A ’
Schematic Cross Section
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X Y Gabbro Argillite Mineralized Qtz vn Pillow Basalts
Facing
methods) towards modern mechanised mining
Previous plan saw mine sourcing over 75% of
tonnes coming from hand held
flexibility in mine plan
dilution
endowment
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Fundamental redesign of LOM plan
Investor Site Tour 04.02.2016
78 6 13 37 33 53 9 31 25 21 25 42 26 20 40 60 80 100 2013 LOM 2014A 2015A 2016 (Plan) Percentage (%) Breakdown of Mining Method (tonnes) CCF Longhole Alimak Ore development
* 2013 planning allocated development to each of the mining method categories
1,344 1,266 1,253 999
800 900 1,000 1,100 1,200 1,300 1,400 2013 2014 2015 Q4 15
AISC per ounce sold (US$/oz)
198 235 274 Q1 - 62 Q2 - 71 Q3 - 62 Q4 -78
100 150 200 250 300 2013 2014 2015 2015
Production (koz)
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185 132 101
50 100 150 200 2013 2014 2015
Capital Expenditure ($m)
871 909 993
800 850 900 950 1,000 2013 2014 2015
Ore Tonnes hoisted (Kt)
4.1 3.9 2.8
0.0 1.0 2.0 3.0 4.0 5.0 2013 2014 2015
Average long-hole stoping width (m)
2,225 1,843 1,197
151 111 72
1,000 1,500 2,000 2,500 3,000 2013 2014 2015
Breakdown of workforce
Nationals Internationals
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2,268 2,329 2,510 2,636 2,625 2,762 1,000 1,500 2,000 2,500 3,000
H1 2013 H2 2013 H1 2014 H2 2014 H1 2015 H2 2015
Average daily ROM tonnes milled (t)
10.4 12.3 15.9
10.00 15.00 20.00 2013 2014 2015
Total Development metres (km)
Dramatic productivity improvements already realised at the mine
Expected stoping ramp-up in 2016 When developing saw divergence between reserve model and results from the production
drilling in Reef 2 series
Previous drill spacing of 100m centres, not tight enough to accurately predict variation in the
lode geometries
Spacing is the same as has been used across the mine successfully for last 15 years
programme
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Deferred ramp up whilst undertake further definition drilling
2 m 2 i 2 g
2M 2I 2G 2O 2N Reserve blocks UG Diamond Drill Holes Area Covered By Recent Drilling Reef 1
Oblique Section View Looking NE
500m
2015 reserve price of US$1,100/oz vs 2014 price of US$1,300/oz Taken more conservative view of future development rates and mining widths
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DARK GREEN: REEF 1 UPPER CENTRAL Hosts [2 %] of reserve ounces BLUE: REEF 1 LOWER WEST REEF 1 Hosts [ 50%] of reserve ounces GREEN: REEF 1 LOWER CENTRAL Hosts [13 %] of reserve ounces PURPLE: REEF 2 Hosts [ 18% ] of reserve ounces YELLOW: REEF 1 UPPER EAST Hosts [ 6%] of reserve ounces RED: REEF 1 LOWER EAST Hosts [ 7%] of reserve ounces
LIGHT BLUE: REEF 1 UPPER WEST Hosts [ 4 %] of reserve ounces LIGHT BLUE: REEF 1 UPPER WEST Hosts [ 4 %] of reserve ounces DARK GREEN: REEF 1 UPPER CENTRAL Hosts [2 %] of reserve ounces
BLUE: REEF 1 LOWER WEST REEF 1 Hosts [ 50%] of reserve ounces
RED: REEF 1 LOWER EAST Hosts [ 7%] of reserve ounces YELLOW: REEF 1 UPPER EAST Hosts [ 6%] of reserve ounces PURPLE: REEF 2 Hosts [ 18% ] of reserve ounces
GREEN: REEF 1 LOWER CENTRAL Hosts [13 %] of reserve ounces
LIGHT BLUE: REEF 1 UPPER WEST Hosts 4 % of reserve ounces BLUE: REEF 1 LOWER WEST REEF 1 Hosts 50% of reserve ounces DARK GREEN: REEF 1 UPPER CENTRAL Hosts 2 %of reserve ounces GREEN: REEF 1 LOWER CENTRAL Hosts 13 % of reserve ounces PURPLE: REEF 2 Hosts 18% of reserve ounces YELLOW: REEF 1 UPPER EAST Hosts 6% of reserve ounces RED: REEF 1 LOWER EAST Hosts 7% of reserve ounces
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Upper East 5% Zones 0 & 7 15% Zones B & C 35% Zone 2 20% Zones 9 & A 25%
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Crushing, Grinding, Gravity, Flotation, Carbon-In-Leach, Thickening, Cyanide destruction, Filtration and Paste Backfill
155tph / 1.1Mt per annum
Currently over 10% spare capacity
dore and copper concentrate
Dore bars are produced from Gravity and CIL
plants
Copper Concentrate is produced from the flotation
plant and sold to copper smelters mainly in China and Japan
2.4Mtpa Carbon in Leach (CIL) circuit to process TSF material
capacity for ROM material
Previous infrastructure only allowed for
processing of 30% of flotation tailings
Struggled to hit design recoveries
better assess long term recoveries and costs
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to 4
Management System
reduces workforce numbers
implemented to drive productivity
at site and at the face
programme (WeCare/Tunajali ) to embed a culture of safety in the workplace
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Continuing to implement changes to the workforce to improve productivity and drive
2,397 2,225 1,843 1,197 159 151 111 72
500 1,000 1,500 2,000 2,500 3,000 2012 2013 2014 2015
Breakdown of Employees Internationals Nationals
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Ensuring the mine returns to positive cash flow
Investor Site Tour
Reduction in over 600 employees compared to 2015 Majority of US$25 million group savings will be at Bulyanhulu Improving consumable usage, aided by re-commissioning of old CIL As planned maintenance is achieving targets, able to move to a condition based monitoring
approach going forward
Energy costs will benefit from reduction in price of diesel hedges 2016 hedges struck at $72/bbl vs 2015 hedges at $97/bbl Continuing to negotiate with suppliers and contractors to improve terms
2016 capex expected to be $5-10 million lower than 2015 Despite continuing investment into development
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Key CSR focus area are:
Progression to residential model Infrastructure to drive wealth creation in
community
Entrepreneurships skills for co-ops and SMEs, access to financing Agribusinesses including market linkages,
Sports programs with Sunderland Support for the performing arts and cultural events
Stakeholder engagement, Social Impact Management and Grievance mechanisms to continue
Livelihoods –Bee-keeping project for 120 youths Infrastructure – Bridge to provide year round access to markets for farmers
Creating shared value
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Extending the potential of a world class resource
Reef 1 and the Reef 2 series
Surface and Phase 1 underground drilling in 2013/14 added over
2.3Moz to resources
Current focus of drilling on Reef 2 series west of shaft position
from underground
16,000m programme due to continue into H1 2016
Completed 18 holes for 9,240m in 2015
mineralisation across a number of the reefs that make up the Reef 2 series at mineable widths and grades
Investor Site Tour 04.02.2016
fully-mechanised mine
reduction in AISC
Already seen in Q4 2015 performance
medium term
programme, primarily on the Reef 2 series.
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Consolidating progress to date to drive cash flow
Process Plant Flowsheet
Gravity Circuit Crushing & Grinding Circuit
Cu Conc SAG Mill Ball Mill Jaw Crusher
Prim cycl
Knelson CTR’s Acacia reactor
Bullion ORE from U/G
Dewatering and Paste Circuit
Larox
Flotation Circuit
U/G ops Paste Backfill Plant Ro’s
Regr Mill
Contact Cell
Flash Clnr 1 Flash flotation Clnr 1 Clnr 3 Clnr 2
Regr cycl
Clnr 4 Flash Clnr 2 Clnr Scav Acid Wash
To Paste Thickener
Pre-Leach Thickener
Quench Tank
Pregna nt Solutio n Tank Electro wining
TSF cell 4
New CIL Circuit Old CIL Circuit
Bullion A/W Elution Regeneration Kiln CIL Tanks CN Detox
TSF Reclamation
A/W Elution CIL Tanks
Quench Tank
Bullion Pregnant Solution Tank Pregnant Solution Tank
Rougher tails
Electro wining
TSF cell 1-2
Regeneration Kiln Pre-Leach Thickener
CST