Gold Fields Limited · JSE:GFI
Gold Fields — Corporate Update (May 2015)
45 slides from Gold Fields's corporate update, May 19, 2015
Slide 1: Damang Gold Mine - Building a Gold Fields Franchise Asset
Damang Gold Mine - Building a Gold Fields Franchise Asset MARCUS BREWSTER General Manager 19 May 2015
Slide 2: Forward Looking Statements
Forward Looking Statements Certain statements in this document constitute “forward looking statements” within the meaning of Section 27A of the US Securities Act of 1933 and Section 21E of the US Securities Exchange Act of 1934. In particular, the forward looking statements in this document include
Slide 3: Visitors Responsibilities and Safety
Damang Gold Mine Visitors Responsibilities • Take reasonable care of your own health and safety during your stay at Damang Gold Mine and wear the appropriate PPE where required. • Whilst moving around at the mine site, ensure you are accompanied by an employee of the mine you are visiting or his rep
Slide 4: Itinerary
Damang Gold Mine Itinerary Depart Tarkwa to Damang 06h30 – 07h30 Breakfast at Damang 07h30 – 08h00 Presentation and Safety Briefing (Town Site Club 08h00 – 09h30 Marcus and HOD’s House) Plant visit 09h30 – 10h30 Marcus and Damang Team May 19th Visit to Mining Operations – update on Mining and 10h30
Slide 5: Location and Summary
Damang Gold Mine Location and Summary • Located in the Western Region of Ghana. • 280km by road from Accra. • 30km north of Tarkwa. • The Damang concession covers an area of 25,016ha. • Annual rainfall averages 2,030mm DAMANG MINE ACCRA TARKWA MINE Damang Gold Mine - Building a Gold Fields Franchise
Slide 6: History
Damang Gold Mine History 1989: Ranger Exploration begins exploration in the area. 1997: Open pit operations commenced. 2001: Gold Fields Ghana Ltd purchases Ranger’s 90% interest in Damang. 2005: Waste mining at Damang cutback commenced in July. Mining at Amoanda and Tomento North Pit 3, 4 and 5 com
Slide 7: Tenement Map
Damang Gold Mine Tenement Map ● Two mining leases ̵ Damang – 5,239ha ̵ Lima South – 2,872ha ● Three prospecting licenses ̵ Subiri – 10,135ha ̵ Bonsa River Forest Reserve – 1,720ha ̵ Epieso – 3,700ha Damang Gold Mine - Building a Gold Fields Franchise Asset | Marcus Brewster | 19 May 2015 7
Slide 8: Replacement of Reserves
Damang Gold Mine Replacement of Reserves Moz's Damang Reserves and Production 4.00 Greater Damang Project 3.50 3.00 2.50 2.00 Fall in Gold Price/Fiscal Conditions 1.50 Greater Damang Reserve moved into Resources 1.00 0.50 0.00 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Reserves
Slide 9: Leadership Team
Damang Gold Mine Leadership Team GENERAL MANAGER MARCUS BREWSTER MINING MANAGER SAMUEL KWESI TAKYI BSc (Geology), MSC MCSM (Mining Eng.), MSC MCSM (Mining Geology) BSc (Mining Eng.), PGD (Project Management) 18 Years experience, including Chief Geologist - 11 Years experience, including Mining Manag
Slide 10: Leadership Team (cont)
Damang Gold Mine Leadership Team (cont) OHS MANAGER ENVIRONMENT MANAGER JOHANNES GHARTEY- MOULD FRANCIS NYAME M.Sc (Mining Eng), MBA (Strategic Mgt), Grad. Dip. Dip (Civil Eng.) PGC (Env Mgmt.&Assess ment) MSc. (Mgt), Diploma in Health & Safety, Lead Auditor (Water & Env. mgmt.) AIEMA (Health & Safe
Slide 11: Infrastructure
Damang Gold Mine Infrastructure ● Residential camp ̵ 64 houses ̵ Recreational facilities, including golf course, gym, squash court, tennis courts and swimming pool ̵ Clinic ● Water sources (boreholes and stored) ● Fully equipped site clinic ● Power – power station and ECG grid (17.5MW) ● CIL process
Slide 12: Looking South
Damang Gold Mine Looking South LIMA SOUTH DAMANG TOWN FETSF JUNO ETSF DPCB SADDLE WEST DAMANG CAMP HUNI Damang Gold Mine - Building a Gold Fields Franchise Asset | Marcus Brewster | 19 May 2015 12
Slide 13: Key Infrastructure
Damang Gold Mine Key Infrastructure ROM & PRIMARY SECONDARY CRUSHER AND TERTIARY CRUSHERS PLANT MAGAZINE HME Damang Gold Mine - Building a Gold Fields Franchise Asset | Marcus Brewster | 19 May 2015 13
Slide 14: During 2012 and 2013 the mine was in crisis
Damang Gold Mine During 2012 and 2013 the mine was in crisis! ● Significant negative cash flows and financial losses ● High AIC/gold price ratio ̵ 2012 average US$1,753/oz (Average gold price US$1,668/oz) ̵ 2013 average US$1,450/oz (Average gold price US$1,412/oz) ● Lower grade mined – Huni Sandston
Slide 15: The Turn Around Strategy
Damang Gold Mine The Turn Around Strategy ● New management team and innovation driven operating philosophy ● Reduced capex without impacting long-term future of operation ● Focus on margin rather than ounces – quality rather than quantity ● Improved selective mining and grade control ● Improved mini
Slide 16: Key Metrics
Damang Gold Mine Key Metrics Unit Actual Actual Actual Actual Forecast 2011 2012 2013 2014 2015 Safety LDI 0 0 0 1 3 Ore Mined kt 4,780 4,310 4,006 3,880 5,721 Ore Mined Grade g/t 1.76 1.53 1.24 1.38 1.38 Total Waste Mined kt 18,735 29,192 26,139 15,130 17,842 Total Mined kt 23,515 33,502 30,145 19,
Slide 17: Strategic Focus and Objectives
Damang Gold Mine Strategic Focus and Objectives ● Create a ZERO HARM environment ● Maintain our social and environmental license to operate ● Target a +15% free cash flow margin at a US$1,300/oz gold price ̵ AIC of US$1,100/oz on production of 200Koz per annum ● Achieve and maintain a sustainable 10
Slide 18: Key Financial Metrics
Damang Gold Mine Key Financial Metrics 2,000 1,753 100.0 1,564 1,450 80.0 1,500 1,668 1,264 1,412 1,221 60.0 AISC/Gold Price (US$/oz) 1,192 1,000 1,220 1,176 Cashflow (US$m) 40.0 500 20.0 0 0.0 2011 2012 2013 2014 2015 -20.0 -500 STRATEGIC DECISION -40.0 TAKEN TO RE-INVEST IN -1,000 DAMANG (WASTE ,
Slide 19: Mining and Processing Cost (US$/t)
Damang Gold Mine Mining and Processing Cost (US$/t) Unit Actual Actual Actual Actual Forecast LoM Average 2011 2012 2013 2014 2015 Mining US$/t Mining Dept. US$/t 2.44 1.97 2.00 2.16 2.28 2.66 MRM Dept. US$/t 0.09 0.12 0.36 0.53 0.38 0.38 HME Dept. US$/t 0.86 1.07 0.82 1.54 1.16 1.01 Total US$/t 3.3
Slide 20: Five Year Profile (Indicative)
Damang Gold Mine Five Year Profile (Indicative) Produced - Koz 250 LoM Extended Beyond 2017 2016 Gap Eliminated 200 Exploration and 150 Resource Production (koz) Development Potential 100 50 - 2014 2015 2016 2017 2018 2019 2020 Damang Gold Mine - Building a Gold Fields Franchise Asset | Marcus Brews
Slide 21: Mining - 2015
Damang Gold Mine Mining - 2015 SADDLE Unit Total % Plan Ore kt 349 6% Grade g/t 2.25 - HUNI Unit Total % Plan Mined Ounces KOz 25 9.5% Ore kt 1,512 27% Total Tonnes t 2,820 11% Grade g/t 1.43 - Mined Ounces KOz 70 26% JUNO Unit Total % Plan Total Tonnes kt 11,464 45% Ore t 1,696 31% Grade g/t 1.56 -
Slide 22: Mining - HME
Damang Gold Mine Mining - HME Implementing business improvement initiatives to Current HME Fleet reduce major cost drivers Equipment Quantity • Heavy Components – setting up the Damang Caterpillar 777F Dump Trucks 26 Components’ Rebuild Centre (CRC) RH90 Bucyrus Excavators 1 RH120 O&K Terex Excavato
Slide 23: Geology and Dilution Control
Damang Gold Mine Geology and Dilution Control ● Best practice grade control drilling and sampling ● Electronic blast movement monitoring and survey ore block adjustment ● Close geological supervision of mining to unlock each ore block ● Selective and variable flitch mining trials to enhance grade in
Slide 24: Processing
Damang Gold Mine Processing Damang Gold Mine - Building a Gold Fields Franchise Asset | Marcus Brewster | 19 May 2015 24
Slide 25: Processing Plant Infrastructure
Damang Gold Mine Processing Plant Infrastructure ● Plant constructed in 1998 ● Crusher circuit upgraded in 2010 and ongoing improvement was achieved through crushing circuit modifications, changes in operating processes and grinding control system utilization ● 4.2 Mtpa 5,800 kW SAG mill with overfl
Slide 26: Crushing Circuit
Damang Gold Mine Crushing Circuit Damang Gold Mine - Building a Gold Fields Franchise Asset | Marcus Brewster | 19 May 2015 26
Slide 27: Milling Circuit
Damang Gold Mine Milling Circuit Damang Gold Mine - Building a Gold Fields Franchise Asset | Marcus Brewster | 19 May 2015 27
Slide 28: Extraction Circuit
Damang Gold Mine Extraction Circuit Damang Gold Mine - Building a Gold Fields Franchise Asset | Marcus Brewster | 19 May 2015 28
Slide 29: Blockflow Diagram Damang Gold Mine Debottlenecking
Damang Gold Mine Blockflow Diagram Damang Gold Mine Debottlenecking Throughput Increase Client : Gold Fields Ghana Ltd. to 4.5mtpa Rev : A Revision Date 26-Sep-2012 3 stage Crushing Plant 604 tph Secondary Ball 1 F100 800 mm 4 P100 30mm 5 P80 24mm 30mm 2 Gravity 8 Tertiary SAG 55/30mm 543 tph 3 Coar
Slide 30: Exploration – High Priority Target Areas
Damang Gold Mine Exploration – High Priority Target Areas Saddle-Huni Bridge Juno East and South • Part of “Greater Damang” • Possible dip and strike extension of N • AGC down to 42m yielded 250kt at 1.78g/t favourable geological horizon in pit (14koz) • First pass drilling has given indication of •
Slide 31: Saddle – Huni Area
Damang Gold Mine Saddle – Huni Area • 5,304m of combined RC and DD planned Structural DRC2278 Block 4 From 139.0m: 4.0m @ 10.66g/t • Drilling 100% completed DDD00205 • 5,751 samples submitted to From 166.3: [email protected]/t the assay lab; all assay results received DRC2282D X-Section 26435 From 150.0m:
Slide 32: Saddle – Huni Area: X-Section 26435mN
Damang Gold Mine Saddle – Huni Area: X-Section 26435mN March 2015 as Interim pit mined surface design Ultimate pit design LEGEND (US$1,300) Huni Sandstone Tarkwa Pyllite 26435mN Banket Hangingwall Banket Conglomerate Banket Footwall Mafic Intrusive Damang Gold Mine - Building a Gold Fields Franchise
Slide 33: Juno East Area
Damang Gold Mine Juno East Area • 1,620m of DD drilling planned at Juno East Structural Block 2 • Drilling, logging and sampling have been completed (assay X-Section results pending) (24850mN) • Visual indications of mineralisation intersected in the phyllite and on the lower phyllite-intrusive cont
Slide 34: Juno South Area
Damang Gold Mine Juno South Area Juno Pit • 2,360m of combined RC and DD planned at Juno East • Drilling is 95% complete • Strike (south) extension of the and Banket Conglomerate intersected • Visual indications of mineralisation also intersected on the lower phyllite-intrusive contact. • Logging an
Slide 35: Amoanda
Damang Gold Mine Amoanda • 1,368m of DD drilling planned at Amoanda. • Hole targeting untested wedge of Banket Footwall quartzite underneath the current pit. • 579 meters drilled (42% complete). • No assay results returned to date. • Encouraging visual indications of mineralisation intersected in cl
Slide 36: Tomento North
Damang Gold Mine Tomento North WLRC253D From 158.4: 6.6m@ 2.08g/t • Resource estimate - 209 Koz at 1.63g/t From 174.4m: 3m@ 1.17g/t • A total of 31 holes drilled to: WLDD345 From 177.9m: 11.6m@ 1.24g/t • Define major N-S structures and limits of Proposed hole ore body. WLRC254D From 130.6m: 6.9m@ 2.
Slide 37: Safety: TRIFR Moving Average Frequency Rates
Damang Gold Mine Safety 12 Month Moving Average Frequency Rates Per Million Manhours (TRIFR = Lost Time Injury + Restricted Work Injury + Medically Treated Injury per Million Manhours Worked) 6 5.59 5 TRIFR 4 3 2.65 2.56 2.61 2.72 2.55 2 1 2 1 1 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 Apr-14 May-14 Jun-14 J
Slide 38: Environment
Damang Gold Mine Environment ● Ensuring legal compliance (EPA, Minerals Commission, Water Resources Commission, Forestry Commission) ● Compliance with ISO14001 Standard ● Monitoring and reporting (blast, dust, noise, water, soil) ● Rehabilitation planning and implementation ● Environmental incident
Slide 39: Community and Social Responsibility
Damang Gold Mine Respect Responsibility Community and Social Responsibility EDUCATION • We build strong relationships with stakeholders, based on trust, open, honest and frequent engagement HEALTH (Consultative Committee Meetings, Durbars etc). • We work with stakeholders to create and share value W
Slide 40: Human Resources
Damang Gold Mine Human Resources • 845 AGL Employees. • Safety – ‘No incidents today – Zero is possible’ campaign. • Rigorous Talent Management Strategy to ensure pipeline successions, attract & retain required skills; especially nationals. • Remuneration: Review of Employee Value Proposition (EVP)
Slide 41: Finance: Key Action
Damang Gold Mine Finance: Key Action • Cost Base – Greater focus on maintaining and improving the cost base • Stringent Cost Review Approach – Daily cost reports to HoD’s in a mix of actuals and forecast to guide the team on what the monthly cost would be and where to pull the breaks. • Cost Review
Slide 42: Top Risks
Damang Gold Mine Top 5 Risks Risks Mitigation Strategies • Aggressive BI process to improve productivity and operational discipline 1 Cash Flow • Cost Control and cost discipline processes • Improve Gold Production • Contractor Mining • Pumping at DPCB has commenced. Additional pumping capacity 2 Pi
Slide 43: Top LoM Opportunities
Damang Gold Mine Top 5 LoM Opportunities Opportunities Action • Bench-marking exercise carried out in January 2015. 1 Contractor Mining • Tenders sent out to 8 companies. • Contractor would purchase current fleet and inventory. • 17km strike length. • Focus on near mine hydrothermal targets. 2 Growt
Slide 44: Conclusions
Damang Gold Mine Conclusions ● Create a ZERO HARM environment ● Maintain our social and environmental license to operate ● Target a +15% free cash flow margin at a US$1,300/oz gold price ̵ AIC of US$1,100/oz on production of 200Koz per annum ● Achieve and maintain a sustainable 10-year+ Life of Mine
Slide 45: Questions
Questions