1
PRODUCING AND EXPLORING
NOVEMBER 2011
PRODUCING AND EXPLORING NOVEMBER 2011 1 CAUTIONARY STATEMENT - - PowerPoint PPT Presentation
PRODUCING AND EXPLORING NOVEMBER 2011 1 CAUTIONARY STATEMENT This presentation contains forward looking information, within the meaning of applicable Canadian securities legislation, and forward looking statements, within the meaning of
1
NOVEMBER 2011
2
CAUTIONARY STATEMENT
This presentation contains forward looking information, within the meaning of applicable Canadian securities legislation, and forward looking statements, within the meaning of applicable United States securities legislation, which reflects management’s expectations regarding Teranga Gold Corporation’s (“Teranga” or the “Company”) future growth, results of operations (including, without limitation, future production and capital expenditures), performance (both operational and financial) and business prospects (including the timing and development of new deposits and the success of exploration activities) and opportunities. Wherever possible, words such as “plans”, “expects”, “does not expect”, “budget”, “scheduled”, “estimates”, “forecasts”, “anticipate” or “does not anticipate”, “believe”, “intend” and similar expressions or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, have been used to identify such forward looking information. Although the forward looking information contained in this presentation reflect management’s current beliefs based upon information currently available to management and based upon what management believes to be reasonable assumptions, Teranga cannot be certain that actual results will be consistent with such forward looking information. A number of factors could cause actual results, performance or achievements to differ materially from the results expressed or implied in the forward looking information, including those listed in the “Risk Factors” section of the prospectus of Teranga, dated November 11, 2010 (the “Prospectus”). These factors should be considered carefully and prospective investors should not place undue reliance on the forward looking information. Forward looking information necessarily involves significant known and unknown risks, assumptions and uncertainties that may cause Teranga’s actual results, performance, prospects and opportunities in future periods to differ materially from those expressed or implied by such forward looking
described in the forward looking information, there may be other factors and risks that cause actions, events or results not to be as anticipated, estimated or
those anticipated in such statements. Accordingly, prospective investors should not place undue reliance on such forward looking information. Teranga expressly disclaims any intention or obligation to update or revise any forward looking statements, whether as a result of new information, future events or otherwise, except in accordance with applicable securities law. Forward looking information and other information contained herein concerning mineral exploration and management’s general expectations concerning the mineral exploration industry are based on estimates prepared by management using data from publicly available industry sources as well as from market research and industry analysis and on assumptions based on data and knowledge of this industry which management believes to be reasonable. However, this data is inherently imprecise, although generally indicative of relative market positions, market shares and performance characteristics. While management is not aware of any misstatements regarding any industry data presented herein, mineral exploration involves risks and uncertainties and industry data is subject to change based
In addition, please note that statements relating to “reserves” or “resources” are deemed to be forward looking information as they involve the implied assessment, based on certain estimates and assumptions, that the resources and reserves described can be profitably mined in the future. While management has confidence in its projections based on exploration work done to date, the potential quantity and grade disclosed herein is conceptual in nature, and there has been insufficient exploration to define a mineral resource, therefore it is uncertain if further exploration will result in the targets being delineated as a mineral resource. This presentation does not constitute in any way an offer or invitation to subscribe for securities in Teranga pursuant to the Corporations Act 2001 (Cth) and has not been lodged with the Australian Securities and Investment Commission.
3
COMPETENT PERSONS STATEMENT
The information in this presentation that relates to exploration results, targets, mineral resources or ore reserves within the SGO Mining License is based on information compiled by Mr. Bruce Van Brunt, who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr. Van Brunt is a full time employee of Teranga and therefore not independent. Mr. Van Brunt has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australian Code of Reporting of exploration Results, Mineral Resources and Ore Reserves”. Mr. Van Brunt consents to the inclusion of this information in the form and context in which it appears in this presentation. The information in this document that relates to exploration results, targets, mineral resources or ore reserves within the Regional Exploration Package is based on information compiled by Mr. Martin Pawlitschek, who is a member of the Australasian Institute of Geoscientists. Mr. Pawlitschek is a full time employee of Teranga and therefore not independent. Mr. Pawlitschek has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australian Code of Reporting of exploration Results, Mineral Resources and Ore Reserves”. Mr. Pawlitschek consents to the inclusion of this information in the form and context in which it appears in this presentation.
4
Ticker symbol: TGZ: TSX/ASX Shares outstanding(1): 245.6 million Stock options outstanding: 15.4 million Share price (as at November 24, 2011): C$2.14 Market capitalization: C$526 million Cash position(2)(3): US$25.8 million Debt position(2)(4): US$17.3 million
(1) As part of the demerger Mineral Deposits Ltd. retained 40 million TGZ shares and received C$50 million from the IPO proceeds. (2) As at September 30, 2011 (3) Includes short-term investments and restricted cash (4) Drawn under the mining fleet finance lease facility with Societe Generale.
FOCUSED ON GROWTH
FOCUSED ON: GROWING RESERVES GROWING PRODUCTION FINANCIAL STRENGTH
5
Large exploration land package in Senegal, W.A.
surrounding operating mill
Operating mine / mill
Strong balance sheet
Experienced management team
6
Sabodala is the only large scale gold mine in Senegal Senegal
interest in Sabodala and 3% royalty
7
First gold pour in March 2009
Mill expansion from 2 Mtpa to ~4 Mtpa underway
>200,000 oz
Well developed infrastructure
km north of the town Kedougou – paved road within 56 km of mine site
site (36 MW with mill expansion)
8
FOCUSED ON GROWING RESERVES
1.5Moz currently to …
prolific land
Senegal
FOCUSED ON GROWING PRODUCTION
140,000oz currently to …
FOCUSED ON FINANCIAL STRENGTH
Maintaining strong balance sheet to self-fund exploration…
9
Calendar Year 2011
$850 - $875/oz
equipment and capitalized Mine License exploration)
Calendar Year 2012
$625-$675/oz
(1) Excludes capital cost to develop regional deposits. Assumes increased production from regional exploration success
50 100 150 200 250 300 350 400 450 500
2011 2012 2013 2014
Production Profile (‘000 oz) Production Exploration Success
10
Maintain strong balance sheet to self-fund exploration and development
prudently ~ 165,000 oz at ~ $829/oz(2) year end 2011
profile = significant free cash flow to self-fund exploration and development strategy
(1) Assumes $1500/oz gold price and cash cost of $600/oz (2) Non-Deferred Hedge Schedule Appendix page 33 Rate of margin expansion is a function
exploration success
100 200 300 400 500 600 700 800 900 1000 2011 2012 2013 2014
Cash Margin ($/oz)1
11
12
1,51
(@1.47 g/t)
2,254
(@1.33 g/t)
774
(@1.06 g/t)
300 600 900 1,200 1,500 1,800 2,100 2,400
Proven and Probable Measured and Indicated(1)(2)(3) Inferred(1)(2)
Gold Reserves and Resources (’000’s oz)(1)
(1) See Appendix page 32 (2) M+I resources are inclusive of reserves (3) As at June 30, 2010, see Sabodala Technical Report Kedougou-Kenieba Inlier – A Birimian Greenstone Belt
13
Exploration Program (Calendar 2011)
$10 MM (~60,000m) (YTD 43,000m) 7 Drill Rigs
$25 MM (~80-90,000) (YTD 78,000m) 11 Drill Rigs TOTAL: $35 MM (140-150,000m) (+180,000m RAB) 18 drill rigs
Full drill results are posted at terangagold.com
14
GOR A
35 km radius
Budget: $25M 1,455km2 Budget: $10M 33km2
15
the Sabodala Mine License
reserves from 1.5 Moz gold to 3 Moz gold over the next 12 to 18 months increasing the mine life to ~ 10 to 15 years
16
“THE CORRIDOR”
Continuation of the main Sabodala structural trend to the north
MAIN FLAT EXTENSION
One of the principal gold hosts of the Sabodala deposit immediately adjacent to the current ultimate pit
MASATO EXTENSION
Continuation of Masato deposit
17
MINE LICENSE EXPLORATION – MAIN FLAT EXTENSION (“MFE”)
hosts in the Sabodala pit
the west, rolls flat, and then rolls to a moderate northerly dip as it exits the ultimate pit
this structure to the north beginning with in-filling holes
confirms the continuation of the mineralized zone with further drilling planned
quarter
including:
mineable reserves in addition to a similar amount in underground reserves in 2012
northwest
Full drill results are posted at terangagold.com
18
MINE LICENSE EXPLORATION – “THE CORRIDOR” and AYOUB’S
to Sabodala and Niakafiri
style albitic alteration to the north where the target remains open down dip and along strike
stripping for including deeper MFE mineralization into the ultimate pit Mylonite Shear Zone Ayoub’s Thrust Sabodala Pit
Full drill results are posted at terangagold.com
19
Sabodala Pit Masato Extensions Sambaya Hill Masato Down Dip
MINE LICENSE EXPLORATION – MASATO
strikes across onto our mine license
with high grade intervals apparent
drilling was completed at Masato confirming a strike length of 500m and a dip extent of 200m
2012
Full drill results are posted at terangagold.com
20
GOR A
35 km radius
Budget: $25M 1,455km2 Budget: $10M 33km2
21
was done on the 1,455km2 Regional Land Package due to cash constraints
drilling program currently underway
140,000m of RAB drilling completed September 30, 2011
Regional Land Package
22
“THE DONUT” GORA TOUROKHOTO TOUMBOUMBA
Budget: $25M 1,455km2
23
GORA – HIGH-GRADE QUARTZ VEIN
SYSTEM
development
potential footprint of the deposit
develop Gora as quickly as possible including exploration, permitting, and feasibility level economic analysis
Trace of blind veins from RC holes Projected to surface – high correlation with IP trends.
Full drill results are posted at terangagold.com
24
TOUMBOUMBA – NEWEST TARGET
regional deposit through the mill
cover)
Full drill results are posted at terangagold.com
25
TOUMBOUMBA – NEWEST TARGET
in April
entire structural domain
49,000m
8,748m
26
DIEGOUN NORTH – “THE DONUT”
dolerite & sediments
completed for just under 8,800m (51 holes anomalous levels of gold > 0.1 g/t)
trending structure
Sabodala Ore Body
Full drill results are posted at terangagold.com
27
663 holes
(aeromagnetics)
Full drill results are posted at terangagold.com
HONEY JAM CINNAMON
DIEGOUN NORTH – “THE DONUT”
28
by termite sampling
25 km south
from 2011 termite mound geochemistry
MTZ and a N070 trend
are weak surface gold anomalies with coincident arsenic anomalism defined by recent XRF multi- element geochemistry
to date will be subject to RC drilling in the coming dry season
TOUROKHOTO
Sabodala Ore Body
Full drill results are posted at terangagold.com
29
Kedougou-Kenieba Inlier – A Birimian Greenstone Belt
An emerging world class gold district.
30
1. Experienced Management Team 2. Largest land position in Senegal 3. Only mill in Senegal 4. Planned mill expansion 5. Extensive exploration program – ~18 drill rigs 6. Strong Balance sheet – increasing free cash flow with margin expansion
31
NOVEMBER 2011
32
SABODALA GOLD PROJECT: RESERVES & RESOURCES
Ore (000 tonnes) Grade (g/t Au) Contained Gold (000 oz Au) Proven & Probable Sabodala 24,350 1.57 1,231 Niakafiri 7,623 1.15 281 Total 31,973 1.47 1,512 Measured & Indicated Sabodala 41,892 1.39 1,869 Niakafiri 10,741 1.12 386 Total 52,633 1.33 2,254(1) Inferred Resources Sabodala 7,310 1.22 287 Niakafiri 7,248 .88 205 Niakafiri West 7,144 .82 188 Soukhoto 566 1.32 24 Gora(2) 387 5.6 70 Total 22,655 1.06 774(1)
(1) See the Sabodala Technical Report ; #’s as at June 30, 2010 (2) Gora inferred resource updated to 543,000 tonnes at 6.08 g/t containing 106,000 oz. Please see May 2, 2011 Press Release for further information.
33
NON-DEFERRED HEDGE SCHEDULE
Delivery Date Price US$/oz Ounces 17-Feb-2012 846.00 28,000 17-May-2012 846.00 28,000 15-Aug-2012 846.00 27,500 21-Nov-2012 832.92 25,000 20-Feb-2013 832.92 25,000 17-May-2013 790.66 25,000 21-Aug-2013 791.50 16,000 Total 174,500
34
MANAGEMENT
Alan R. Hill Executive Chairman & CEO
development as Executive VP of Barrick Gold
(2004 – 2007)
Richard S. Young President & CFO
Barrick Gold
Yani Roditis Vice President, Operations
Kathy Sipos Vice President, Investor Relations
David Savarie Vice President, Legal & Corporate Secretary
Bruce Van Brunt Business Development Manager
Martin Pawlitschek Regional Exploration Manager
East Asia and Africa
Mark English General Manager
and development, inclusive of greenfield start-ups