past … present … future long 20minutes.pdfTumelo Motsisi Acting President and CEO Iemrahn Hassen...

past … present … future

1

October 2007

Cautionary Risk Factors and Forward Looking Statement Information

This presentation includes certain statements that may be deemed "forward-looking statements". Investors are cautioned that any such statements are not guarantees of f t re performance and act al res lts or de elopments ma differ materiall from those projected in the for ard looking statements For more information on the risksfuture performance and actual results or developments may differ materially from those projected in the forward-looking statements. For more information on the risks inherent in the Company's business, Investors should review the Company's annual Form 20-F filing with the United States Securities Commission and its home jurisdiction filings that are available at www.sedar.com. Mineral resources do not have demonstrated economic viability. Investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever achieve the status of ore reserves. A preliminary economic assessment is based on inferred resources that are geologically speculative, and as a result, there is no certainty that the economic considerations or results will be realized.All information contained relating to the Preliminary Assessment, including but not limited to statements of the project's potential and the other information under the headings "Production Parameters," "Capital Costs, Sustaining Capital Costs, and Operating Costs," "Production Summary," and "Financial Analyses," are "forward looking statements" within the definition of the United States Private Securities Litigation Reform Act of 1995. The Preliminary Assessment was prepared to broadly quantify the project's capital and operating cost parameters and to provide guidance on the type and scale of future project engineering and development work that will be needed to ultimately define the project's likelihood of feasibility and optimal production rate. It was not prepared to be used as a valuation of the project nor should it be considered to be a pre-feasibility study. The capital and operating cost estimates which were used have been developed only to an approximate order of magnitude based on generally understood capital cost to production level relationships and they are not based on any systematic engineering studies, so the ultimate costs may vary widely from theunderstood capital cost to production level relationships and they are not based on any systematic engineering studies, so the ultimate costs may vary widely from the amounts set out in the Preliminary Assessment. These factors could materially and adversely impact the projected economics of the project. As is normal at this stage of a project, data is incomplete and estimates were developed based solely on the expertise of the individuals involved as well as the assessments of other persons who were involved with previous operators of the project. At this level of engineering, the criteria, methods and estimates are very preliminary and result in a high level of subjective judgment being employed.The following are the principal risk factors and uncertainties which, in management's opinion, are likely to most directly affect the conclusions of the Preliminary Assessment and the ultimate feasibility of the project The mineralized material at the project is currently classified as inferred resources and do not constitute ore reservesand the ultimate feasibility of the project. The mineralized material at the project is currently classified as inferred resources and do not constitute ore reserves. Considerable additional work, including in-fill drilling, additional process tests, and other engineering and geologic work will be required to determine if the mineralized material is an economically exploitable ore reserve. There can be no assurance that this mineralized material can become a reserve or that the amount may be converted to a reserve or what the ultimate grade thereof will be. Final feasibility work has not been done to confirm the pit design, mining methods, and processing methods assumed in the Preliminary Assessment. Final feasibility could determine that the assumed pit design, mining methods, and processing methods are not correct. Construction and operation of the mine and processing facilities depends on securing environmental and other permits on a timely basis. No permits have been applied for and there can be no assurance that required permits can be secured on a timely basis. Data is incomplete and cost estimates have been developed in part based on the expertise of the individuals participating in the preparation of the Preliminary Assessment and on costs derived from projects which are believed to be comparable, and they are not based on firm price quotes. Costs, including design, procurement, construction, and on-going operating costs and metal recoveries could be materially different from those contained in the Preliminary Assessment. There can be no assurance that mining can be conducted at the rates and grades assumed in the Preliminary Assessment. The Preliminary Assessment assumes specified, long-term prices levels for platinum, palladium, gold, copper and nickel. Prices for these commodities are historically volatile, and Anooraq has no control of or influence on those prices, all of which are determined in international markets. There can be no assurance that the prices of theseand Anooraq has no control of or influence on those prices, all of which are determined in international markets. There can be no assurance that the prices of these commodities will continue at current levels or that they will not decline below the prices assumed in the Preliminary Assessment. Prices for platinum, palladium, gold, copper and nickel have been below the price ranges assumed in Preliminary Assessment at times during the past ten years, and for extended periods of time. The project will require major financing, probably a combination of debt and equity financing. Interest rates are at historically low levels. There can be no assurance that debt and/or equity financing will be available on acceptable terms. A significant increase in costs of capital could materially and adversely affect the value and feasibility of constructing the project. Other general risks include those ordinary to very large construction projects including the general uncertainties inherent in engineering and construction cost, the need to comply with generally increasing environmental obligations and accommodation of local and community concerns

empowered to produce 2

need to comply with generally increasing environmental obligations, and accommodation of local and community concerns.

History

2002 Pelawan established. Successful in tender for Avoca and De Kamp as a basis for JV with Anglo Platinum to form Ga Phasha

2004Pelawan concludes Reverse Takeover of ARQ bringing in the Ga Phasha project.

Announces ARQ’s intention to become a significant & sustainable BEE controlled PGM producer

2005 ARQ concludes JV agreements with Anglo Platinum on Ga Phasha PGM project

2006 ARQ lists on JSE and finalizes its capital structure through issue of BEE warrants to Pelawan

2007 ARQ concluded transaction framework agreement to acquire controlling interests of Lebowa Platinum

The past …

Platinum


p

Anooraq in Brief

• Black Economic Empowerment, Canadian incorporated, SA managed, PGM focused

• Fully diluted market cap of R6.2bn (C$830m) as at 12 Sept 2007

• 184.2m shares in issue plus 167m Pelawan warrants

• Warrants structure- Exercisable up to 31 Dec 2007 at C$1.35; From Jan 2008 exercisable at C$1.48- If exercised during equity capital raised then strike price will be the higher of 50% of

the equity raising price or C$1.48- expire 31 Dec 2008p

• Listings- Primary: TSX Venture Exchange (TSXV:ARQ) - Secondary: American Exchange (AMEX:ANO)- Secondary: JSE Limited (JSE:ARQ)

M j it BEE d (65%) b P l I t t• Majority BEE owned (65%) by Pelawan Investments

First North American listed BEE PGM company


Board

Co-Chairman

Former Premier of the North West Province in South AfricaDr Popo Molefe Former Premier of the North West Province in South AfricaMember of the National Executive Committee of the ANC

Robert (Bob) Dickinson Director Hunter Dickinson, Northern Dynasty, Great Basin Gold, Rockwell

Non Executive Directors

Rizelle Sampson Co founder of Africa Footprint, BEE women group

Ron Thiessen Director Hunter Dickinson, Northern Dynasty, Great Basin Gold

David Elliott Director Northern Dynasty, Great Basin Gold, Taesko Mines

Sipho Nkosi CEO of EXXARO Coal, Director Great Basin Gold

Wayne Kirk Former California State Attorney and General Counsel to HomestakeDirector Northern Dynasty, Great Basin Gold

Scott Cousens Director Northern Dynasty, Great Basin Gold, Rockwell

Executive Directors

Tumelo Motsisi Acting President and CEO

Iemrahn Hassen Chief Financial Officer


Harold Motaung Chief Operating Officer

Management Team | South Africa

Tumelo (Tumi) Motsisi - Acting President and CEOTumi is a qualified lawyer and seasoned business executive with substantial experience in the South Africanq y pbusiness and mining sectors. He is a director of several SA companies and was responsible for the establishmentof Kopano Ke Matla, the investment arm of South Africa’s largest trade union, COSATU

Harold Motaung – Chief Operating Officer: Technical & Business DevelopmentHarold is an mining engineer by profession including 6 years with Anglo American and former Chief Director in theDME’s Mining Inspectorate. He also holds board seats at the South African National Nuclear Regulator andMintek

Iemrahn Hassen - CFOIemrahn is a Chartered Accountant and has held various senior financial positions with a number of South Africanlisted companies, including Gold Fields and Samancor. He is the newly appointed Chief Financial officer ofAnooraq

Joel Kesler - Corporate Affairs and Business DevelopmentJoel is a South African qualified lawyer with significant experience in mining finance and business development.He currently heads up Anooraq’s corporate finance and business development team

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y p q p p

Nick James - MD OperationsNick is a Mining Engineer with 25 years operational experience, including Wits and Archean Gold deposits,M i C d P i d i d l b l l i b di h E Li bMassive Copper and Pyrite deposits and, more recently, narrow tabular platinum ore bodies on the Eastern Limbof the Bushveld Complex. Nick commenced his mining career with Anglo American on the Free State Gold fields(Freegold operations 1986-1992), was mine manager at Anglo American’s Konkola Copper mine (Zambia) for 6years (1993-1999) and, more recently was business leader at Modikwa Platinum mine, a joint venture betweenA l Pl ti d ARM (2004 2007)


Anglo Platinum and ARM (2004-2007)

Current Corporate Structure

Pelawan Investments(South Africa)

The Pelawan Trust

HDP Entity

The Pelawan Trust(South Africa) Public shareholders

R167m Warrants64.77% 35.23%

Anooraq(Canada)

Anglo Platinum(South Africa)

TSX-VJSEAMEX

100% 100%

Plateau Resources(South Africa)

RPM(South Africa)

100% 100%

50%

Rietfontein KwandaJV Project

Boikgantsho JV Project

Micawber 277(South Africa)

100% 50% 50% 50%50%

j j ( )

Ga Phasha JV Project

100%


JV Project

Mines and Projects Location


Boikgantsho PGM Project

• Located in the Northern Limb of the Bushveld ComplexLocated in the Northern Limb of the Bushveld Complex

- Adjacent to Anglo Platinum’s PPRust Mine

• Resources• Resources

- Indicated Resources 7.7 M oz 3 E & 230,000 t of Ni

Inferred Resources 4 1 M oz 3 E & 75 000 t of Ni- Inferred Resources 4.1 M oz 3 E & 75,000 t of Ni

• Drenthe Project prelim assessment released in March 2005

- Low grade 1.25g/t 3E bulk mining project with high base metal credits (0.15% Ni)

- Pre feasibility being progressed


Ga Phasha | PGM Project

• Significant reserves & resourcesSignificant reserves & resources

- Measured & Indicated Resources 24 M oz 4E

- Inferred Resources 60 M oz 4EInferred Resources 60 M oz 4E

• Originally UG2 project envisaged with potential production of approx 270,000 oz 4E

per annum via twin decline shaftsper annum via twin decline shafts

- High in situ grade of approx 6.5 g/t 4E

- UG2 & Merensky reef horizons outcrop & sub-outcrop at surface- UG2 & Merensky reef horizons outcrop & sub-outcrop at surface

• Project to be reviewed in light of acquisition of Lebowa

P t ti l i f ti ti- Potential synergies from contiguous properties


Lebowa Transaction Overview

2007: ARQ announces major transaction with Anglo Platinum• ARQ will acquire from Anglo Platinum an effective

- 51% of Lebowa Platinum Mine- 1% of Ga Phasha PGM Development Project1% of Ga Phasha PGM Development Project- 1% of Boikgantsho Exploration Project- 1% of Kwanda Exploration Projects

• Purchase price = ZAR3 6bn payable in cash• Purchase price = ZAR3.6bn, payable in cash

• ARQ acquires shareholder & management control over diversified PGM portfolio & retains Anglo Platinum as a strategic 49% minority shareholder

ARQ t k th l t f ll l t L b Pl ti• ARQ takes over the employment of all employees at Lebowa Platinum

• Key transaction conditions- Completion of confirmatory due diligence & definitive transaction agreements- Regulatory & Stock Exchange approvals- Financing- Shareholder approvals as required

• Transaction to be complete by 30 June 2008

The present …


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Lebowa & Ga Phasha | PGM Project


Transaction structure

Resultant StructureResultant Structure

Pelawan Minorities

>52%

Anooraq Anglo Platinum

51% 49%

Lebowa Holdco

Boikgantsho Kwanda Ga-Phasha Lebowa

100% 100% 100% 100%


Transaction Highlights

• Fulfills long-term strategy to become an independent & significant PGM producerg gy p g p

• Significantly increases controlled reserves & resources (through Lebowa Holdco) from 47.9 million 4E oz to 199.4 million 4E oz (105 million attributable)

• Resources support life of mine exceeding 100 years for both Ga Phasha & Lebowa

• Immediate access to existing production and cash flow from LebowaImmediate access to existing production and cash flow from Lebowa

- Current production of 140,000 tpm (85,000 tpm Merensky & 55,000 tpm UG2)

• Provides ARQ with large repository of technical & management skills at LebowaProvides ARQ with large repository of technical & management skills at Lebowa

• Shows that ARQ is in charge of own destiny & not 50/50 relationship as in the past

Transforms Anooraq into an independent and significant PGM producer


Attributable 4E Resources Oz

Attributable Oz (m) 4E

Pre transaction997.2

800

1,200

49.0 43.0 17.0262.8 178.0 105.9 61.0 44.0

0

400

0AngloPlats

Implats Lonmin Lebowa Eastern Anooraq Aquarius Elands Northam

Post transaction

Attributable Oz (m) 4E

1,200

262 8

884.2

400

800

105.0 44.0 43.0262.8 201.7 178.0 129.0 61.0

0

400

Anglo Implats Lebowa Lonmin Northam Anooraq Eastern Aquarius Elands


gPlats

pHoldCo

q q

Expansion Highlights

• Increased production & additional expansion projects on both Merensky & UG2 reef horizons provide for significant growth at Lebowa- Expected to increase production to approximately 245,000 tpm by 2012

(120 000 tpm Merensky 125 000 tpm UG2) ~ 4E production of 430 000 oz incl(120,000 tpm Merensky, 125,000 tpm UG2) 4E production of 430,000 oz, incl 200,000 oz of Pt

• By combining Lebowa & Ga Phasha, Anooraq controls an effective ~ 26km of strike length over both the Merensky & UG2 reefs, one of the largest strike lengths on the Bushveld Complex

• Existing water & power allocations as well as developed infrastructure at Lebowa• Existing water & power allocations as well as developed infrastructure at Lebowa allow for easier scale up of operations at Lebowa

Transforms Anooraq into an independent and significant PGM producer


Production Profile

Tons to Concentrator Stock PilesTons to Concentrator Stock Piles

5,000

4,000

3,000

ons

2,000

‘000

to

0

1,000

0

UG2 MER

2007 2010 2013 2016 2019 2022 2025 2028 2031 2034 2036


Anglo Platinum LTP 2008

Lebowa | Expansions

• Scale of mining operations increasing to reflect true deposit quality

• Anglo Platinum has approved 2 major expansions at Lebowa- Brakfontein Merensky expansions - R1.3bn capex announced in 2006- Middelpunt Hill (MPH) UG2 expansions - R1.7bn capex announced in 2007- UG2 & Merensky expansions to increase production to 245,000 tpm by 2012- Announced expansions to increase production to ± 430 000 4E oz pa by 2012- Announced expansions to increase production to ± 430,000 4E oz pa by 2012

• Additional expansion projects at Lebowa on both Merensky & UG2 reefs at advanced stage of evaluation- Scope for expansion at Lebowa to 350,000 tpm

• Increased production rates at Lebowa expected to lower R/tonne unit costs


Value Highlights

• Attractive acquisition based upon valuation metrics- BEE discount of 30% on acquisition price as stated by Anglo Platinum- US$8.9/oz of Measured Indicated & Inferred Resources

US$17 3/ f tt ib t bl M d & I di t d R- ±US$17.3/oz of attributable Measured & Indicated Resources

• Ability to exploit synergies between Lebowa & Ga-Phasha

Ne stand alone Lebo a Holdco ill fast track gro th projects at Lebo a & Ga Phasha• New stand alone Lebowa Holdco will fast-track growth projects at Lebowa & Ga-Phasha

Anooraq will control Lebowa Holdco,the 3rd largest PGM resource company in South Africa


Merensky Expansion | Brakfontein


Middelpunt Hill | UG2 Expansions


Lebowa | Increasing Production

ZEEKOEGATL V ti l Sh ft

Middel Punt Hill

MIDDELPUNT

DIAMAND

Lpm Vertical Shaft

B kf i D li

Um2 Incline

UMKOANESTAD

BRAKFONTEIN

Brakfontein Decline

KLIPFONTEIN

PASCHASKRAALPASCHASKRAAL

AVOCA

DE KAMP

TWICKENHAM SURBITONDE KAMP

BALMORAL

HACKNEY

Total Strike Length 26kmTotal Strike Length 26km


Mineral Reserves and Resources

Merensky UG2 Total Total attOre Grade 4PGE Ore Grade 4PGE 4PGE 4PGEmt g/t 4E oz mt g/t 4E oz oz oz

L b ¹Lebowa¹Reserves 100% 51%Proven 17.5 4.29 2.4 30.6 5.33 5.2 7.7 3.9Probable 5.5 4.31 0.8 11.9 5.23 2.0 2.8 1.4Total 23.0 4.29 3.2 42.5 5.30 7.2 10.4 5.3Resources (excl reserves)Resources (excl reserves)Measured 20.8 5.74 3.8 83.3 6.77 18.1 22.0 11.2Indicated 27.9 5.51 4.9 87.7 6.76 19.1 24.0 12.2Total measured & indicated 48.7 5.61 8.8 171.0 6.76 37.2 46.0 23.4Inferred 113.9 5.34 19.6 155.2 6.73 33.6 53.1 27.1

Ga Phasha¹ResourcesMeasured 13.4 4.61 2.0 24.9 6.50 5.2 7.2 3.7Indicated 27.6 5.33 4.7 57.5 6.56 12.1 16.8 8.6Total measured & indicated 41.0 5.09 6.7 82.3 6.54 17.3 24.0 12.2Inferred 122.4 5.41 21.3 185.8 6.47 38.6 59.9 30.6

Platreef Total Total Total Total att Total att Total attOre Grade Ni Cu Ni Cu 4PGE 4PGE Ni Cumt g/t 3E % % 000t 000t oz oz 000t 000t

Boigantsho²Boigantsho²Resources 100% 100% 100% 51% 51% 51%MeasuredIndicated 176.4 1.35 0.13% 0.08% 2229.3 141.1 7.7 3.9 117.0 72.0Total measured & indicated 176.4 1.35 0.13% 0.08% 230.3 141.1 7.7 3.9 117.0 72.0Inferred 104 0 1 23 0 14% 0 09% 145 6 93 6 4 1 2 1 74 3 47 7

Notes:

Inferred 104.0 1.23 0.14% 0.09% 145.6 93.6 4.1 2.1 74.3 47.7

Total reserves 10.4 5.3Total measured & indicated (incl reserves) 88.1 44.9 117.0 72.0Total inferred resources 117.2 59.8 74.3 47.7


Notes:1. Source: Anglo Platinum 31 December 20062. Source: Independent QP G.J van der Heever, November 2004

Share Price Performance

Anooraq price and volume 12 months Relative Performance 12 months

May 1, 2006 = 100

8003.5 400 000

Anooraq price and volume 12 months Relative Performance 12 months

600

7003.0

$)

300 000

400 000

400

500

2.0

2.5

shar

e pr

ice

($

Vol

ume

200 000

200

300

1 0

1.5

Ann

oraq

V

100 000

100

0Sep Oct Dec Jan Feb Apr May Jul

0.5

1.0

0Sep Nov Jan Apr Jun Aug

2006 2007 2006 2007

Ridge Anooraq Eastern Platinum

Nkwe PTM Platinum Australia


Jubilee Platmin Wesizwe

An Exciting Project Pipeline to be controlled by ARQ following transaction

• Existing production from Merensky & UG2 of 140 ktpm producing 200 000 oz

Lebowa

• Existing production from Merensky & UG2 of 140 ktpm producing 200,000 oz 4E from MR & UG2

• Approved expansion 245 ktpm producing 430,000 oz 4E by 2012Believe further expansion possible to 345 ktpm• Believe further expansion possible to 345 ktpm

• Progressing pre feasibility studyGa Phasha • Review optimal resource exploitation strategy in light of Lebowa transaction &

potential synergies with Lebowa mine

Boikgantsho • Progressing pre feasibility

Kwanda • Early stage exploration activities


Contact Details

S th Af iSouth Africa

43 Wierda Road WestWierda ValleySandton, 2196South Africa

Tel: +2711 883 0831Fax: +2711 883 0836Cell: +2782 454 5556

Joel KeslerHead of Corporate Services & Business Developmentp [email protected]


past … present … future long 20minutes.pdfTumelo Motsisi Acting President and CEO Iemrahn Hassen...

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Transcript of past … present … future long 20minutes.pdfTumelo Motsisi Acting President and CEO Iemrahn Hassen...