September 2014
Corporate Presentation September 2014 Cautionary Notes Cautionary - - PowerPoint PPT Presentation
Corporate Presentation September 2014 Cautionary Notes Cautionary - - PowerPoint PPT Presentation
Corporate Presentation September 2014 Cautionary Notes Cautionary Notes - Information Purposes Only The information contained in this presentation is provided by OceanaGold Corporation (OGC) for informational purposes only and does not
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Cautionary Notes
Cautionary Notes - Information Purposes Only
The information contained in this presentation is provided by OceanaGold Corporation (“OGC”) for informational purposes only and does not constitute an offer to issue or arrange to issue, or the solicitation of an offer to issue, securities of OGC or other financial products. The information contained herein is not investment or financial product advice and has been prepared without taking into account the investment objectives, financial situation or particular needs of any particular person. The views, opinions and advice provided in this presentation reflect those of the individual presenters only. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusion contained in this presentation. To the maximum extent permitted by law, none of OGC or any of its directors, officers, employees or agents accepts any liability, including, without limitation, any liability arising out of fault or negligence, for any loss arising from the use of the information contained in this presentation. Furthermore, this presentation does not constitute an offer of shares for sale in the United States or to any person that is, or is acting for the account or benefit of, any U.S. person (as defined in Regulation S under the United States Securities Act of 1933, as amended (the "Securities Act")) ("U.S. Person"), or in any other jurisdiction in which such an offer would be illegal. OGC’s shares have not been and will not be registered under the Securities Act. Technical Disclosure The Mineral Resources for Didipio and Blackwater (within the Reefton Goldfield) were prepared by, or under the supervision of, J. G. Moore, whilst the Mineral Resources for Macraes and Reefton were prepared by S. Doyle. The Mineral Reserves for Didipio were prepared under the supervision of R.Corbett, while the Mineral Reserves for Macraes and Reefton were prepared by, or under the supervision of, K Madambi. C. Bautista is Exploration Manager for the Philippines. S. Doyle, K. Madambi, and J. G. Moore are Members and Chartered professionals with the Australasian Institute of Mining and Metallurgy and each is a “qualified person” for the purposes of NI 43-101. R. Corbett is a Registered Professional Engineer (Ontario) and is a “qualified person” for the purposes of NI 43-101. C. Bautista is a member of the AIG and is a “qualified person” for the purposes of NI 43-101. Messrs Moore, Doyle, Corbett, Madambi and Bautista have sufficient experience, which is relevant to the style of mineralisation and type of deposits under consideration, and to the activities which they are undertaking, to qualify as Competent Persons as defined in the 2012 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves” (“JORC Code”). The resource estimates for the El Dorado Project were prepared by Mr. Steven Ristorcelli, C.P.G., of Mine Development Associates, Reno, Nevada (who is an independent Qualified Person as defined in NI 43-101) and conforms to current CIM Standards on Mineral Resources and Reserves. For further scientific and technical information (including disclosure regarding mineral resources and mineral reserves) relating to the Reefton Project, the Macraes Project and the Didipio Project please refer to the NI 43-101 compliant technical reports available at sedar.com under the Company’s
- name. For further scientific and technical information (including disclosure regarding mineral resources and mineral reserves) relating to the El
Salvador Project please refer to the reports publicly available on SEDAR (www.sedar.com) prepared for Pacific Rim.
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OceanaGold Today
Emerging multinational gold and copper producer with strong free cash flow
Macraes – New Zealand Didipio – Philippines Reefton – New Zealand 90-Day Average Daily Liquidity2
2.6m shares
Stock Exchanges
TSX, ASX, NZX
Ticker: “OGC” Market Capitalisation2
C$790
Shareholder Geo. Breakdown1
North America 61% Australia & NZ 19% Europe 18% Asia 2%
1. Internal Report as at 31 Jul 2014 2. Metrics as at 11 Sep 2014
Shares Outstanding2
301m
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OceanaGold Value Proposition
MANAGEMENT STRATEGY OPERATIONS GROWTH SOCIAL LICENSE
Commitment Experience Execution Discipline Free Cash Flow
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- Mining engineer with over 28 years of experience
working in Australia and Argentina
- Broad operational experience in underground and
- pen pit gold, copper, lead, zinc and nickel mines
- Recent experience with Xstrata Copper
- Practising lawyer, joined OGC’s legal and company
secretarial team in 2009
- Broad range legal experience including corporate,
equity and debt financing and general commercial law
- 24 years Human Resources experience
- Industry experience includes Eldorado Gold and
Sino Gold Mining Ltd
- Significant Asian experience with multinational
corporations
- >30 years financial experience
- Capital markets
- Financial and risk management expertise
- 17 years industry experience including senior
finance roles at Newcrest Mining and Western Mining Corp.
- Over 30 years industry experience
- Developed major projects in Australia & SE Asia
- Strong Operations background in hard rock
mining
- Strong in Community and Government relations
- Extensive SE Asian experience
- Metallurgist with >30 years industry experience
- Mineral processing
- Precious metals and Sulphide minerals
- Joined predecessor company in 1991 and has held
various technical and operations responsibilities
- International capital markets experience in metals
and mining
- Appointed VP Investor Relations in 2007 and
current role in 2011
- Responsible for identifying & evaluating external
growth opportunities; & capital markets interface
Experienced Management Team
Liang Tang Company Secretary & Corporate Counsel Yuwen Ma Head of Human Resources Mick Wilkes Managing Director & Chief Executive Officer Mark Cadzow Chief Development Officer Darren Klinck Head of Business Development Michael Holmes Chief Operating Officer Mark Chamberlain Chief Financial Officer
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OceanaGold Vision & Strategy
We will be a mid-tier, multinational gold producer delivering superior shareholder returns in a safe and sustainable manner by developing and operating high quality assets. We will be the partner, employer and mining company of choice.
Maximising value from existing assets Operating efficiently Spending judiciously – capital discipline Investing in high quality assets
CORE VALUES Optimise mines Strategic capital allocation Commitment to Sustainability Strengthen balance sheet
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Strategy on Growth
Invest in high quality organic and external value add opportunities
Effective use of capital through investment in first and second quartile assets Leveraging in-house expertise to identify and evaluate new opportunities Focus on accretive transactions that increase shareholder wealth
Leveraging experience and capabilities Clear definition of investment criteria Accretive investment to increase shareholder wealth
Focus on Asia-Pacific and Americas regions
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2014 Guidance YTD Jun 2014 Q2 2014 Combined Didipio New Zealand Company Didipio New Zealand Company
Gold production
- z
275,000 to 305,000 45,266 102,133 147,399 14,786 46,045 60,831 Copper production t 21,000 to 24,000 11,185 – 11,185 4,706 – 4,706 Gold sales
- z
– 54,010 112,334 166,344 17,746 54,548 72,294 Copper sales t – 12,925 – 12,925 5,173 – 5,173 Cash costs $/oz 400 to 4501 (412)1 843 4351 (254)1 1,114 7781 All-In Sustaining Costs2 $/oz 750 to 8501 (150)1 1,226 7791
First Half 2014 Results Summary
1.Net of by-product credits 2.All-in Sustaining Costs (“AISC”) based on WGC methodology; expansionary and growth capital expenditures are excluded from the AISC
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2014 Guidance
Didipio Consolidated
1.Costs at Didipio are NEGATIVE net of copper by-product credits and assumes copper price of $3.20/lb 2.Assumes NZD/USD exchange rate of 0.80 3.All-in Sustaining Costs based on WGC methodology. expansionary and growth capital expenditures are excluded from the AISC
Cash Cost Guidance
(per ounce)
All-In Sustaining Costs3
(per ounce)
($725) – ($650)1
New Zealand Combined $400 – $4501,2 $750 – $8501,2
85,000 – 95,000
Gold Production Guidance
(ounces)
Copper Production Guidance
(tonnes)
21,000 – 24,000 190,000 – 210,000 –
275,000 – 305,000 21,000 – 24,000
$840 – $9252 ($240) – ($210)1 $1,170 – $1,2902
On track to meet full year guidance
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Financial Position (as at 30 Jun 2014)
Strengthening balance sheet from strong free cash flow generation LIQUIDITY Cash $46m Undrawn Revolving Credit Facility $82m TOTAL LIQUIDITY $128m CORE DEBT Revolving Credit Facility $118m Equipment leases $38m TOTAL DEBT $156m
Repaid approximately $95m in core debt
- ver past 18 months
Repaid over $30m in debt in 2014 Revolving credit facility of $200m with competitive fiscal terms, expires in mid- 2017 Banking syndicate: Barclays, BNP Paribas, Citibank, HSBC, Nedbank Continue to repay debt and increase cash position
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Macro & Comparatives
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Share Price Performance Comparative
Effective execution of strategy: strong results & enhanced shareholder value
Source: Bloomberg
- 80%
- 60%
- 40%
- 20%
0% 20% 40% 60% 80% 100% 120% Semafo Inc. Northern Star Resources OceanaGold Corp. Centamin plc Rio Alto Mining Primero Mining Corp. Detour Gold Corporation OZ Minerals AuRico Gold New Gold Inc. Barrick Gold B2Gold Corp. Goldcorp Golden Star Newcrest Mining Dundee Precious Metals Alacer Gold Corp. Evolution Mining Yamana Gold IAMGOLD Argonaut Gold Inc. Alamos Gold Perseus Mining Beadell Resources Kingsgate Consolidated Medusa Mining Regis Resources
Share Price Performance
(Last 12 months as at 5 September 2014)
Gold Spot Price (US$/oz) Market Vectors Junior Gold Miners ETF
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Price to Cash Flow per Share Comparative
P/CFPS multiple demonstrates opportunity for share price growth
Source: CIBC Research (9 Sep 2014)
2 4 6 8 10 12 14 16 18 OceanaGold Centerra Gold Kinross IAMGOLD Alacer Gold Dundee Precious Centamin Barrick Gold Yamana Gold Argonaut Gold B2Gold Detour Gold New Gold AuRico SEMAFO Primero Mining Agnico Eagle Goldcorp Eldorado Gold Golden Star Alamos Gold
Price to Cash Flow per Share Multiples
2014E 2015E
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Free Cash Flow Yield Comparative
Well positioned to strengthen balance sheet and invest in further value creation
Source: Macquarie Research (7 Sep 2014)
- 15%
- 10%
- 5%
0% 5% 10% 15% 20% 25% 30% 35% 40% Beadell OceanaGold Newcrest SEMAFO Barrick Gold Agnico-Eagle Yamana Alacer Alamos Argonaut Regis Resources Detour Gold Primero Eldorado Goldcorp IAMGOLD Northern Star Perseus AuRico Medusa
Free Cash Flow Yield Estimates
2014 2015
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- 800
- 600
- 400
- 200
200 400 600 800 1,000 1,200 1,400 1,600 10 20 30 40 50 60 70 80 90 100 All-in Sustaining cost ($/oz Au)
Cumulative Production (Percentile)
Q1 Q4 Q3 Q2
Didipio
Global AISC Curve Comparative
Source: Goldman Sachs Research (1 Sep 2014)
Gold Price (as at 10 Sep 2014)
All-In Sustaining Cost Curve OceanaGold Consolidated AISC 2014 Range 1st quartile AISC demonstrates strong profitability even at lower commodity prices
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Philippines Operations
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Didipio Mine
High quality, low-cost transformative asset generating significant free cash flow
First FTAA signed & in production Open pit (currently) plus underground Current Mine Life: 2029 Nominal production of 100 koz gold, 14 kt copper per year over life of mine
Lepanto / Goldfields Manila
DIDIPIO
San Fernando (Port)
Mindanao Luzon
1. Complete Reserve & Resource Table on page 39
P&P Reserves1 of 1.59 Moz gold, 210 kt copper
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Didipio Overview
Production increasing in H2 as operations advance Stage 3 into a higher grade zone of the ore body Increasing throughput rate to planned 3.5 Mtpa by end of 2014 Power grid connection development work advancing well lower operating costs early 2016 Didipio Optimisation Study complete with strong results Conducting exploration geophysical survey at depths greater than 500 metres near mine-site in Q3 2014 Didipio Results H1 2014
Gold produced
- z
45,266 Copper produced t 11,185 Gold equivalent ounces produced
- z
104,506 Cash costs (by-product) per oz ($412) Cash costs (co-product) per oz $565 AISC (by-product) per oz ($150) AISC (co-product) per oz $678
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Didipio Optimisation Study Highlights
Access to high grade material brought forward by 2 years Q3 17 Optimised design of underground and open pit resulting in 70 Mt in reduced waste Crown pillar moved higher by 80 m, underground expanded deeper by 170 m two mining domains est. Underground development to commence 1 year earlier Q1 15 Increased mining rate to 1.6 Mtpa (previously 1.2 Mtpa) by 2020
Note: Not to scale.
Original Open Pit Design Optimised Open Pit Design Larger Underground Mine
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Optimised Didipio Design
Development: Q1 2015 Production: Q3 2017 Full ramp-up: 2020 Revised Plan Mining rate: 1.6 Mtpa Mining type: long-hole open stope w/paste backfill Technical Design Update NI43-101: Late Oct Resource drilling: Immediate Resource Statements: w/NI43-101 Next Steps Pre-production: $110m / 3 yrs Annual Sustaining: $7m to $8m Capex
Study identifies significant value to be unlocked at Didipio
Limit of Oxidation Dark Diorite Dark Diorite
Previous Stage 5/6 Pit Design
AuEq g/t
New Stage 5 & 6 Pit Designs
Underground Mine
Note: Not to scale.
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New Zealand Operations
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New Zealand Optimisation
Mine optimisation and operating efficiencies over $100m in cost savings Production de-risked with zero cost collar hedging over next 18 months Evaluating organic growth opportunities New Zealand Financial De-risking Program
Macraes Reefton Remaining ounces hedged
1
154.5 koz 53.7 koz Hedge period Jan/14 – Jan/16 Jun/13 – Jun/15 Put Option Price NZ$1,500/oz NZ$1,600/oz Call Option Price NZ$1,600/oz NZ$1,787/oz
Strong New Zealand dollar persists, partly
- ffset by hedging program in NZD
1. As at 30 Jun 2014
Focused on margin by mining less waste
Mitigated downside risk of a lower gold price, optionality with a higher gold price
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New Zealand Assets
Macraes Frasers Reefton NZ Combined
Mine Type Open pit Underground Open pit Nominal production koz 90 – 120 40 – 55 50 – 70 180 – 245 P&P Reserves
1
Moz 1.23 0.12 0.19 1.54 M&I Resources
1
Moz 3.15 0.86 0.74 4.98 Inferred Resources
1
Moz 1.5 0.6 0.9 3.18 Ore milled Mtpa 5.0 0.8 1.6 7.4 Head grade g/t 0.9 – 1.1 2.0 – 2.2 1.4 – 1.5 1.0 – 1.4 Estimated mine life end of 2017 end of 2015 end of 2015
Over 8 million ounces in resource provide optionality with a higher gold price
1. Complete Reserve & Resource Table on page 39
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New Zealand Studies
Round Hill Gold/Tungsten
M&I Resource1 of 1.26 Moz gold, sterilised by current location of process plant
Evaluating new, organic growth opportunities in New Zealand
1) Refer to 2013 AIF
Resource definition and metallurgical test work underway Conceptual design includes build of new but relocated 3.0 Mtpa process plant w/Au stream and WO3 stream
Blackwater
Inferred Resource1 of 0.7 Moz Au grading 23 g/t Drill program tested for continuity below historic workings Preliminary Economic Assessment near finalisation
Near Reefton At Macraes
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Sustainability
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Foundation of Our Success
Open and transparent communications, particularly during economic downturn Unique and tailored programs for a diverse group of stakeholders Engagement throughout all stages of the lifecycle Operating to highest of environmental standards Continuous improvement to enhance social licence
A strong social license underpins success in socially complex, emerging countries
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Investing in Our Local Communities
Education Infrastructure
- Teachers salaries
- Scholarship programs
- New roads and improvements
- Bridges, waterways
Enterprise Development Building Capacity
- DiCorp: Provides mine
services, employs 300 locally
- Didipio Training Academy
- Leadership training
Working together with our communities to leave a positive, long lasting legacy
Employment
- Hire locally policy
- 98% Filipino workforce
- Investing in the reconstruction
after Typhoon Haiyan
Support
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Sustainable Development Today and Beyond
Water Management
- Water treatment plant at
Didipio
- Raise 10,000 trout a year at
foot of Macraes tailings facility
Environment Rehabilitation
- ISO14001 EMS at Didipio
- Reducing GhG emissions
- Restoring lands to match area
- Supporting agriculture
- Partnering with likeminded
- rganisations such as the IRF
An unwavering commitment to our social responsibilities beyond mining
Agroforestry
- Planting one million trees
- Commercial plantations
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Looking Ahead
Well on track to achieve full year production and cost guidance Increasing throughput rates to planned 3.5 Mtpa by year end at Didipio Identify and evaluate new value add opportunities Continue to repay debt while increasing cash position
Continue to deliver positive results through effective execution of strategy
Finalise the Didipio Optimisation Study including an update to the NI 43-101
Significant cash flow generation Strengthen the balance sheet Increase shareholder wealth
Finalise the Blackwater Preliminary Economic Assessment
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Upcoming Events
Denver Gold Forum – Denver September 15 to 17, 2014 Goldman Sachs Mining & Metals Conference – New York November 19 to 20, 2014 Canaccord Global Resources Conference – New York October 15 to 16, 2014 Q3 Financial and Operating Results Release and Webcast October 31, 2014 Didipio & New Zealand Site Visits TBD - Late Nov/early Dec, 2014
Innovation Performance Growth
- ceanagold.com
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Board of Directors
Jim Askew (Chairman) - Mr. Askew is a mining engineer with over 35 years broad international experience as a Director/CEO for a wide range of international publicly listed mining, mining finance, and other mining related companies. He has served on the board of numerous resource public companies, which currently include Evolution Mining and Asian Mineral Resources Ltd. Mick Wilkes (MD & CEO) – Mr. Wilkes is a mining engineer with over 30 years of broad international experience across Asia and Australia. Prior to OGC, Mick was Executive General Manager of Operations at OZ Minerals where he was responsible for the evaluation studies, construction and operation of the Prominent Hill copper gold project in South Australia. Preceding this, he was General Manager of the Sepon gold copper project for Oxiana in Laos. Earlier experience was in Papua New Guinea in senior roles and, at the outset of his career, at Mount Isa Mines in operations and design. Denham Shale (Lead Director) - Mr. Shale is a lawyer in practice in Auckland, New Zealand. He has been a director of listed companies for over 20 years and is President and an Accredited Fellow of the Institute of Directors in New Zealand Inc. Joey Leviste (Director) - Mr. Leviste is the current Chairman of OceanaGold's wholly-owned subsidiary company in the Philippines, OceanaGold (Philippines), Inc and Philippine resident of the Australia-Philippines Business Council. He has also been appointed by the President of the Philippines as private sector member of Governing Council of the Philippines Council for Agriculture, Aquatic and Natural Resource. Bill Myckatyn (Director) - Mr. Myckatyn is a professional mining engineer with over 30 years experience in mine development and operations. He was the former Chairman of Quadra FNX Mining Ltd., until its takeover in 2012, a company he co-founded as CEO in 2002. He is currently on the Board for First Point Minerals, San Marco Resources and Delta Gold. Dr Geoff Raby (Director) - Dr. Raby is the former Australian Ambassador to The People’s Republic of China from 2007 – 2011.
- Dr. Raby joined the Australian public service in 1986 and has held various postings throughout Asia and Europe prior to his
posting in Beijing. Dr. Raby is also a non-executive director of ASX listed Fortescue and SmartTrans. Paul Sweeney (Director) – Mr Sweeney has over 35 years experience in financial management of mining and renewable energy companies. He held management roles with Placer Dome and Gibraltar Mines, board roles with Pan American Silver and New Gold. He currently sits on the boards of Tahoe Resources, Grenville Strategic Royalty Corp., Magma Energy Corp, and Mongolia Growth Group Ltd.
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Analyst Coverage
North America Analyst BMO Capital Markets Brian Quast CIBC Jeff Killeen Cormark Securities Mike Kozak Macquarie Bank Michael Siperco National Bank Financial Raj Ray PI Financial Brian Szeto Australia Analyst Canaccord Genuity Reg Spencer CIMB David Coates Citigroup Trent Allen Credit Suisse Michael Slifirski GMP Securities Conrad Mulherin Goldman Sachs Brett Cottrell JP Morgan Mark Busuttil Macquarie Bank Ben Crowley New Zealand Analyst Forsyth Barr Andrew Harvey-Green
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USDm Q2 2014 Q1 2014 YTD Jun 2014 YTD Jun 2013
Revenue 127.5 170.4 297.8 226.9 Operating costs1 (97.9) (69.4) (167.2) (137.3) EBITDA2 29.6 101.0 130.6 89.6 Depreciation & amortisation (31.4) (33.4) (64.8) (69.4) Net interest & finance costs (2.8) (2.4) (5.3) (12.7) Earnings before tax2 (4.6) 65.2 60.5 7.5 Income tax expense 5.7 (5.4) 0.3 (3.7) Gain/(loss) on fair value undesignated hedges (4.3) (1.3) (5.6) (8.2) Impairment charge – – – (85.5) Tax benefit/(expense) on gain/(loss) on undesignated hedges & impairment 1.2 0.4 1.6 26.4 Net profit/(loss) after impairment (2.1) 58.9 56.8 (63.4) Gold price received ($ per ounce) 1,314 1,311 1,312 1,377
Consolidated Financial Results
1. Includes G&A 2. Before gain/(loss) on undesignated hedges and impairment Note: Summation subject to rounding differences
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USDm Q2 2014 Q1 2014 YTD Jun 2014 YTD Jun 2013 Opening cash balance 42.1 24.8 24.8 96.5 Operating cash inflows 52.7 73.3 126.0 31.3 Investing expenditure (31.1) (24.1) (55.2) (90.2) Free cash flow 21.6 49.2 70.8 (58.9) Financing cash inflows/(outflows) (12.6) (25.2) (37.8) (30.2) Foreign exchange effect (4.9) (6.7) (11.6) 10.5 Net cash (decrease)/increase 4.1 17.3 21.4 (78.6) Closing cash balance 46.2 42.1 46.2 17.9
Consolidated Cash Flows
Note: Summation subject to rounding differences
- Investing expenditure includes:
- Pre-strip: $17m, Sustaining: $6m, TSF & water treatment plant: $5m, Didipio process plant
debottlenecking: $2m, Exploration: $1m
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El Salvador
Underground mine = small footprint High grade, low sulphidation, epithermal deposit Continuous focus on community and stakeholder engagement
El Dorado
San Salvador
El Salvador Guatemala Belize Honduras Nicaragua Costa Rica Panama
Measured & Indicated Resources1
Gold: 1.30 Moz Silver: 9.48 Moz
M&I Average Grade
Gold: 9.42 g/t Silver: 69.0 g/t
Inferred Resources1
Gold: 0.30 Moz Silver: 1.9 Moz
El Dorado currently in international arbitration; OGC seeks a negotiated outcome to impasse2
1. Complete Reserve & Resource Table on page 39 2. Refer to OGC news release dated 8 October 2013 and “OGC to Acquire Pacific Rim Mining” presentation at www.oceanagold.com for additional details and details on the current arbitration claim
Nominal investment in a high quality resource w/ significant upside potential
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Drilling Highlights (MetEx): 31m @ 0.35 g/t Au & 0.85% Cu 28m @ 0.65 g/t Au & 0.27% Cu 13m @ 0.75 g/t Au & 0.25% Cu 7m @ 1.16 g/t Au & 0.57% Cu Rock Sampling Highlights: 8.09 g/t Au & 4.21% Cu 3.20 g/t Au & 1.73% Cu 2.86 g/t Au & 2.09% Cu 2.54 g/t Au & 1.10% Cu
FTAA Exploration Opportunities
1 KM 1.6 KM
>150 ppb Au > 80 ppb Au > 50 ppb Au 250 ppm Cu contour 200 ppm Cu contour Proposed drillhole collar (with direction)
Cabinwangan Mogambos
PPYTR05: 8m @ 0.18% Cu and 0.02 g/t Au PPYCH02: 4m @ 0.26% Cu and 0.03g/t Au 1.42 g/t Au and 6.81% Cu 2m @ 1.91 g/t Au 2m @ 1.48 g/t Au
Papaya
D’Beau
5 holes 2, 053.5 m
Luminag
2 holes , 496.4 m
Morning Star
1 hole, 461.3 m
True Blue
Didipio Au-Cu
MSDH212 DBDH202
Chinichinga
2 holes, 396.4 m
CDDH105 & CDDW105 DBDH206
San Pedro
5 holes, 1, 756.6 m
LMDH002 (ongoing) SDDH049 SDDH050 SDDH051 SDDH052 SDDH053
Near-mine
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Financial or Technical Assistance Agreement
- Capital Recovery Period
- 5 years from date of commercial production (April 1, 2013) to recover pre-operating
expenses and other allowable items dating back to 1994 (when FTAA was signed)
- Residual capital (capital unrecovered within 5 years) amortised over next 3 years
- Revenue Sharing
- After capital recovery period, sharing of “NET REVENUE”
- 40% OceanaGold
- 60% Government Share
Net Revenue Calculation Revenue LESS operating costs LESS depreciation of post development capital expenditure (excluding underground development costs) LESS underground mine development = NET REVENUE Government Share 2% Net Smelter Royalty 2% Excise Duty (2% gross sales for gold, 2% copper concentrate) Corporate Tax (current tax rate is 30%) Other taxes (e.g. Withholding tax) 8% Free Carried (entitles the holder to 8% of equity in the operating vehicle and dividends paid after recovery period)
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Mineral Resources and Reserves (as at 31 Dec 2013)
RESOURCES
MEASURED INDICATED MEASURED & INDICATED INFERRED RESOURCE
AREA
Mt Au g/t Au Moz Ag g/t Ag Moz Cu % Cu Mt Mt Au g/t Au Moz Ag g/t Ag Moz Cu % Cu Mt Mt Au g/t Au Moz Ag g/t Ag Moz Cu % Cu Mt Mt Au g/t Au Moz Ag g/t Ag Moz Cu % Cu Mt MACRAES TOTAL
31.7 1.24 1.26 . . . . 85.6 1.00 2.75 . . . 117.3 1.06 4.01 . . . . 65.0 1.0 2.1 . . . .
REEFTON TOTAL
2.01 1.70 0.11 . . . . 13.5 1.46 0.63 . . . 15.5 1.50 0.74 . . . . 7.8 3.7 0.90 . . . .
SAMS CREEK TOTAL
. . . . . . . 4.03 1.77 0.23 . . . 4.03 1.77 0.23 . . . . 4.2 1.3 0.18 . . . .
DIDIPIO TOTAL
18.0 1.26 0.73 . . 0.51 0.09 43.0 0.96 1.33 . . 0.39 0.17 61.0 1.05 2.06 . . 0.42 0.26 14.7 0.6 0.3 . . 0.2 0.03
EL DORADO TOTAL
0.78 11.30 0.28 75.7 1.90 . . 3.50 9.00 1.01 67.5 7.58 . . 4.28 9.42 1.30 69.0 9.48 . . 0.8 9.4 0.3 71.0 1.9 . .
TOTAL RESOURCE 52.4 1.41 2.38
. 1.90 . 0.09 149.7 1.24 5.96 . 7.58 . 0.17 202.1 1.28 8.34 . 9.48 . 0.26 92.4 1.3 3.7 . 1.9 . 0.03
Figures are in-situ delivered to ROM. Macraes and Reefton cut-offs are based on US$1,250/oz gold (0.4 g/t Au for Macraes Open Pit, 0.5 g/t Au for Reefton and 2.1 g/t Au cut-off for Frasers Underground). Didipio cut-offs are Net Metal Value based, using US$1,250/oz gold and US$3.25/lb copper (0.55 g/t AuEq for open pit and 1.9 g/t AuEq for underground).
RESERVES
PROVEN PROBABLE PROVEN AND PROBABLE AREA
Mt Au g/t Au Moz Cu % Cu Mt Mt Au g/t Au Moz Cu % Cu Mt Mt Au g/t Au Moz Cu % Cu Mt
MACRAES TOTAL
21.2 1.00 0.68 . . 20.8 1.01 0.68 . . 42.0 1.00 1.35 . .
REEFTON TOTAL
0.9 1.53 0.04 . . 3.3 1.40 0.15 . . 4.2 1.43 0.19 . .
DIDIPIO TOTAL
16.7 1.23 0.66 0.52 0.09 29.0 1.00 0.93 0.42 0.12 45.6 1.09 1.59 0.46 0.21
TOTAL RESERVE
38.8 1.11 1.38
- 0.09
53.2 1.03 1.76
- 0.12
91.9 1.06 3.14
- 0.21
All resources are inclusive of reserves. Macraes and Reefton Open Pit resource cut-off are based on $1,250/oz Au. Underground resources are reported within geological constraints. For Didipio: 0.47 g/t EqAu cut-off above the 2,390mRL and 1.5 g/t cut-off below the 2,390mRL. No resource reported below 2,180mRL. EqAu cut-off is gold equivalent based on US$1,450/oz gold and US$3.00/lb copper. OceanaGold retains a 40% interest in the Sams Creek project in the South Island of New Zealand. The project contains a total of 10.1 Mt @ 1.77 g/t Au for 575 koz Indicated resource, as well as 10 Mt @ 1.3 g/t Au for 440 koz of Inferred resource. 40% of the total Sams Creek inventory has been included in OceanaGold's resource table. The project is not considered material to OceanaGold. The El Dorado Project is not considered material. Please refer to www.oceanagold.com for the press release dated October 8, 2013 for more details on the status of the permit applications and arbitration for the El Dorado Project as at the end of 2013. El Dorado resource cut-offs are based on gold 2008 assumptions of US$980/oz and US$20/oz silver.