Post on 09-Oct-2020
Growing Unhedged Gold Producer in China
Sydney Mining ClubOctober 2008
The information contained in this presentation has been prepared using the information available to Sino GoldLimited (‘Sino Gold’) at the time of preparation. This presentation contains forward-looking statements that werebased on expectations, estimates and projections as of the date of this presentation. Any forward-lookingstatement is subject to known and unknown factors which may cause actual results and developments tomaterially differ from those expressed by, or implied by the forward-looking statements in this presentation.External or other factors may have impacted on the business of Sino Gold and the content of this presentationsince its preparation. Sino Gold does not undertake to update any forward-looking statements that are containedin this presentation, except in accordance with applicable securities laws. In addition, this presentation may notinclude all relevant information regarding Sino Gold.Sino Gold has taken all reasonable care in preparation of this presentation. However, the content of thispresentation should not be relied upon in relation to any further action including investment in Sino Gold. Anyperson considering an investment in Sino Gold is advised to obtain independent financial advice prior to makingan investment decision. This presentation is not a prospectus or an offer, invitation, solicitation orrecommendation of securities for sale in the United States. Securities may not be offered or sold in the UnitedStates absent registration under U.S. Securities Act of 1933, as amended (the “Securities Act”), or an exemptionfrom registration therefrom.The information in this presentation which relates to Exploration Results, Mineral Resources or Ore Reserves ofSino Gold has been approved for release by Mr Phillip Uttley (FAusIMM), who is Sino Gold’s Chief Geologist andhas sufficient experience in relation to the style of mineralisation and type of deposit under consideration toqualify as a Competent Person as defined by the “Australasian Code for Reporting of Exploration Results,Mineral Resources and Ore Reserves” (The JORC Code 2004 Edition). JORC is a ‘recognized code andFAusIMM is a recognized designation’, under Canadian reporting standard NI 43-101. Mineral Resource. MrUttley has consented to inclusion of this information in the form and context in which it appears.In this presentation, Mineral Resources are always inclusive of Ore Reserves.
Further information about Sino Gold is available at www.sinogold.com.au.
Disclaimer
Sino Gold – Real IntegrationJune, 2008
Executive Assistant
Trudi Newman
Chief Finance Officer
Wayne Rossiter
Executive Director – CBD
Hanjing Xu
Chief Geologist Phillip Utterly
Mgr – Risk MgtLifang Zhang
Mgr, Investment Relations
Roger Howe
GM, HRYuwen Ma
GM – PGAYumin Qiu GM - JF
DianMin Chen
GM – GTSu Ping
GM – SDLong Long
GM – GR & PRYaping Wang
Consultant, Acquisition
Aaron Colleran
GM – WMAidong Yang
GM –Beyinhar
Yulin Yuan GM – BioGold
Long Long
Corp Secretary& GM, AdminIvo Polovineo
SGF Alliance Team
Chief Operations Officer
Cobb Johnstone
GM – Opt Development
Shu Zhang
President & CEOJake Klein
China – Gold Industry Evolution
1995
Subsistence mining State owned minesNo listed companiesNo mining lawNo foreign minersNo focus on safety / environment
China – Gold Industry Evolution1995
Subsistence mining State owned minesNo listed companiesNo mining lawNo foreign minersNo focus on safety / environment
2008
5 listed Chinese gold companiesZijin market cap =US$12 billion, 4th
largest global gold4 foreign gold minesOnly 5 mines >100Koz pa20,000 EL’s grantedMinisterial status for safety / environment
China – Gold Industry Evolution1995
Subsistence mining State owned minesNo listed companiesNo mining lawNo foreign minersNo focus on safety / environment
2008
5 listed Chinese gold companiesZijin market cap =US$12 billion, 4th
largest global gold4 foreign gold minesOnly 5 mines >100Koz pa20,000 EL’s grantedMinisterial status for safety / environment
2020?
Listed Chinese miners are Top 10 globallyMany listed local junior explorersNew mines assist rural development Larger scale minesGlobal mining industry leaders
Improving relative to many countries
Strategy – Prospective Districts
BioGold
Eastern Dragon
White Mountain
Beyinhar
Nibao Jinfeng
Strategy – Grow Into Assets
Note: approximate estimates, contract rates for mining costs.
China cost advantage applies in mining
Strategy - Cost Advantage
(US$’s) China Australia
Open Pit Mining $1.30/t $4.00/t
Decline Development $1,700/m $3,000/m
Shaft Sinking $4,000/m >$20,000/m
Skilled Mine Operator $20K pa >$100K pa
Senior Geologist $35K pa >$110K pa
Low staff turnover- (<3% YTD 2008)
Low expat requirement- ~1,500 staff, <50 expats- All site managers Chinese
Skilled workforce available- Deep pool of candidates
Foreign company attractive- Values & career path
Strategy – Develop Our People
Staff retention is key industry driver today
Rapidly developing into a low-cost UNHEDGED producer with several mines
Delivering on the Opportunity
3 Years Ago Now
Total Resources 3.5Moz 8.2MozTotal Reserves 2.1Moz 4.8MozJinfeng Early Construction ProducingWhite Mountain New Discovery CommissioningBeyinhar - FeasibilityEastern Dragon - Pre-Feasibility
Jinfeng (82%) High-grade, long-life mine
China’s 2nd largest gold mine
White Mountain (95%)First gold in 4Q 08
from ~70Koz pa mine
Strategic Position Established
BioGold (100%) Concentrate processing
facility now profitable
Beyinhar (95%) Potential heap leach oxide development with sulphide
zone upside
Eastern Dragon (80%)Evaluating high-grade
deposit with potential for <US$100/oz gold
+Sino Gold Fields Alliance exploring
all of China for >3Moz gold
deposits
Building a strong position in well-endowed gold belts
Nibao (70%)Evaluating & drilling
0.8Moz Resource
Jinfeng – Flagship Operation
Open Pit withUnderground Mine
5.3Moz Resource @ 4.5g/t 3.5Moz Reserve @ 5.2g/t
High-quality, efficient processing facility
>15 year mine life with district potential
China’s second largest
gold mine
Jinfeng - Low Cost ProductionFocus on OP grade 1H08 = 66Koz @
US$416/ozInitial UG ore being mined
BIOX plant now at design LTIFR =0.6
2H08 Fcst > 80Koz @ <US$400/oz
Gold production steadily increasing
Jinfeng – World Class Orebody
15 to 20 year mine life
Resource of 5.3Moz(35.9Mt @ 4.5g/t)OP Reserve of 1.1Moz(7.7Mt @ 4.4g/t)UG Reserve of 2.4Moz(13.1Mt @ 5.8g/t)Higher grade UG ore to be blended with OP oreRemains open at depth
White Mountain – The Second Mine
Underground mine with650Ktpa CIL plant
1.1Moz Resource 0.8Moz Reserve
Forecast production of70Koz @ ~300/oz
Capital cost ~US60MNear excellent infrastructure
Construction on schedule for first gold
4Q08
Commercial gold production early 2009
White Mountain Construction
Good progress continues on schedule: Commissioning of plant has commencedRequired infrastructure completeUG mine on track - stopes accessed in 2 areasProject now > 90% complete
BioGold Processing Facility
Located in China’s largest gold producing province
Treats concentrates inBacOx & CIL circuits
Base load concentratesupply secured
Successfully implemented strategic changes
Valuable experience in acquiring an operation
Beyinhar – Feasibility Progressing
Feasibility study being finalised
1.0Moz Resource 0.5Moz Reserve
Robust 2.5Mtpa (~50Koz) project
2 rigs testing for more oxide& higher grade sulphide
Potentially commence
heap leach in 2010
Eastern Dragon – Quality Asset
High-grade epithermal Au-Ag deposit
Acquired 80% For US$101M
Target is 600-800,000 ounce JORC resource4 rigs now drilling
Targeted grade 7-8g/t Au, 70-75g/t Ag
Outstanding project -
potential to become a very
low-cost operation is
being confirmed
1.6m @ 2.8 Au / 9 Ag2.2m @ 2.0 Au / 36 Ag
1.4m @ 14.1 Au / 58 Ag3.0m @ 4.3 Au / 24 Ag
5.4m @ 7.6 Au / 59 Ag4.1m @ 1.7 Au / 45 Ag
Au Gram- Metres
(Intersection widths are true thickness)
Eastern Dragon – Great Grades
Drilling to infill and extend mineralisation
5.2m @ 17.8g/t Au / 242g/t Ag
20.7m @ 10.0g/t Au / 71g/t Ag
Gram-Metre Long Section with June Quarter Results
Resource & Reserve Growth
Plus Eastern Dragon resources & reserves to be added in 2008
Jinfeng UndergroundWhite Mountain
Attractive Growth Pipeline
Building the complete gold company in China
JinfengBioGold
Beyinhar Feasibility
>60 Exploration Licences
Focussed on 3 Regions
Sino Gold Fields Alliance
EXPLORATION
Eastern Dragon PermittingEVALUATION
CONSTRUCTION
OPERATIONS
Outlook for 2H 2008
Successfully implementing growth strategy
Jinfeng gold production ↑
to >80Koz for 2H 08
Beyinhar development
decision
Initial Eastern Dragon JORC
Resource& Reserve
Growing production for further profitability:
FirstWhite
Mountain gold
Summary
Strong production growth
Low-cost production
Unhedged gold production
Strong balance sheet
Delivering on the
strategy in the world’s largest gold producing
country