Crystallex International Corporation Denver Gold Forum September 2007.

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Crystallex International Corporation Denver Gold Forum September 2007

Transcript of Crystallex International Corporation Denver Gold Forum September 2007.

Page 1: Crystallex International Corporation Denver Gold Forum September 2007.

Crystallex International CorporationDenver Gold ForumSeptember 2007

Page 2: Crystallex International Corporation Denver Gold Forum September 2007.

Disclosure Statement

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS: This slide presentation contains forward-looking statements within the meaning of the United States Private Securities Litigation Reform Act of 1995 and applicable Canadian securities laws, including: statements relating to the estimated reserves and resources at Las Cristinas; anticipated results of drilling programs, feasibility studies or other analyses; the potential to increase reserves and expand production, at Las Cristinas; Crystallex's projected construction and production schedule, and cost and production estimates, for Las Cristinas; and management's statements regarding its expectations regarding mining in Venezuela. Forward-looking statements are based on estimates and assumptions made by Crystallex in light of its experience and perception of historical trends, current conditions and expected future developments, as well as other factors that Crystallex believes are appropriate in the circumstances. Many factors could cause Crystallex's actual results, performance or achievements to differ materially from those expressed or implied by the forward looking statements, including: gold price volatility; impact of any hedging activities, including margin limits and margin calls; discrepancies between actual and estimated production, between actual and estimated reserves, and between actual and estimated metallurgical recoveries; mining operational risk; regulatory restrictions, including environmental regulatory restrictions and liability; risks of sovereign investment; speculative nature of gold exploration; dilution; competition; loss of key employees; additional funding requirements; and defective title to mineral claims or property. These factors and others that could affect Crystallex's forward-looking statements are discussed in greater detail in the section entitled "Risk Factors" in Crystallex’s Annual Information Form (which is included in the Annual Report on Form 40-F that Crystallex files with the United States Securities and Exchange Commission (the "SEC") and elsewhere in documents filed from time to time with the Canadian provincial securities regulators, the SEC and other regulatory authorities. These factors should be considered carefully, and persons reviewing this press release should not place undue reliance on forward-looking statements. Crystallex has no intention and undertakes no obligation to update or revise any forward-looking statements in this press release, except as required by law.

NOTE TO U.S. SHAREHOLDERS: The terms "Proven Reserve" and "Probable Reserve" used in this slide presentation are Canadian mining terms as defined in accordance with National Instrument 43-101 - Standards of Disclosure for Mineral Projects under the guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum ("CIM") Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council on August 20, 2000 as may be amended from time to time by the CIM. These definitions differ from the definitions in the SEC's Industry Guide 7. The terms, "Measured Resource", "Indicated Resource" and "Inferred Resource" used in this press release are Canadian mining terms as defined in accordance with National Instruction 43-101 - Standards of Disclosure for Mineral Projects under the guidelines set out in the CIM Standards. While the terms "Measured Resource", "Indicated Resource", and "Inferred Resource" are recognized and required by Canadian regulations, they are not defined terms under Industry Guide 7 and normally are not permitted to be used in reports and registration statements filed with the SEC. As such, information contained in this report concerning descriptions of mineralization and resources under Canadian standards may not be comparable to similar information made public by U.S. companies in SEC filings. With respect to "Indicated Resource" and "Inferred Resource" there is a great amount of uncertainty as to their existence and a great uncertainty as to their economic and legal feasibility. It can not be assumed that all or any part of an "Indicated Resource" or "Inferred Resource" will ever be upgraded to a higher category. Investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves. For a detailed discussion of resource and reserve estimates and related matters see the Company's technical reports, the Annual Information Form and other reports filed by the Crystallex on www.sedar.com and www.sec.gov. A qualified person has verified the data contained in this presentation.

Page 3: Crystallex International Corporation Denver Gold Forum September 2007.

Crystallex Share DataTrading Symbol: KRY Exchanges: TSX and AMEX

262 million I/O approx I 292 million FD approx

US$ 2.86 I Cdn$ 2.89

US$ 749 million I Cdn$ 757 million

Cash US$ 39 millionTotal Assets: US$ 329 millionTotal Debt: US$ 82 millionShareholders’ Equity: US$ 233 million

At June 30, 2007

Market Cap

Price (September 14, 2007)

Common Shares (at June 30, 2007)

Average daily trading volume(trailing 3 months)

AMEX:2.1 million shares (approx)TSX: 1.0 million shares (approx)

Page 4: Crystallex International Corporation Denver Gold Forum September 2007.

Profile & Investment Highlights

● Developing intermediate Canadian gold mine developer and operator

● Las Cristinas reserves of 16.9 million ounces calculated at $550/oz.

● Design and Engineering for the Las Cristinas project in Venezuela is essentially complete; awaiting final permit to commence construction

● Hedge free

● Significantly undervalued relative to peer group on the basis of Proven and Probable Reserves

● Good share trading liquidity on TSX and AMEX

Page 5: Crystallex International Corporation Denver Gold Forum September 2007.

Management Team

Gordon Thompson, President, CEO and Director

Hemdat Sawh, CFO

Robert Crombie, Senior VP Corporate Development

William Faust, COO and Senior Vice President

Dr. Richard Spencer, VP Exploration

Page 6: Crystallex International Corporation Denver Gold Forum September 2007.

Crystallex’s History in Venezuela

● Investor in mining projects since early 1990’s

● Crystallex has permitted, constructed and operated 3 mines in Venezuela since early 1990’s

● Las Cristinas is the 4th gold mine under development by Crystallex in Venezuela

● 2004 – Crystallex received the “Outstanding Citizen Award” in Bolivar State for its community programs

● Committed to local communities through corporate and social responsibility programs

Page 7: Crystallex International Corporation Denver Gold Forum September 2007.

Corporate & Social ResponsibilitySupporting local communities with long-term employment, training, education, economic development, local infrastructure and health care

● Construction of 30 new homes for local residents

● Installed 3 water treatment plants and associated reticulation

● Constructing sewage treatment plant

● Installed sewer networks

● Paved local roads

● Upgraded local medical centre, providing doctors, and ongoing medical supplies for the centre

● Funding local education scholarship programs

● Providing ongoing job training programs to small miners’ associations

● Sponsoring training programs for local communities

● On a yearly basis, train University Technical Graduates; up to 25 per year

● Established government requested anti-malaria facility at site

Page 8: Crystallex International Corporation Denver Gold Forum September 2007.

Crystallex Project Location Map

Good Access &

Infrastructure

- Deep water port at Puerto Ordaz, 360km from site

- Site is 6km from paved international highway

- Paved Airstrip at site

Hydro-electric Power: - Substation 6 km from

site

- Cost approximately 3c USD per kwh

Fuel cost approximately 20 cents USD per gallon

Bolivar State, Venezuela

Page 9: Crystallex International Corporation Denver Gold Forum September 2007.

Conventional operations

Simple technology

Conventional mining fleet

- 18 m3 shovels- 90 tonne trucks

Conventional Metallurgical Process (89% gold recovery)

- SAG & ball mills- Carbon-in-leach- Gravity circuit, doré

EnvironmentalDesigned to exceed Venezuelan & World

Bank Standards

- Clean effluent discharge- Low earthquake risk (zone one)- Acid mine drainage risk is low

Page 10: Crystallex International Corporation Denver Gold Forum September 2007.

Las Cristinas Milestones

● Sept 2002 - Crystallex Signs Mine Operating Agreement PR – Sep 17, 2002

● February 2003 - Retains SNC-Lavalin PR - Feb 12, 2003

● September 2003 - Crystallex Completes Feasibility Study; Confirms Attractive Economics PR – Sep 10, 2003

● March 2004 - CVG Approves Feasibility Study PR – Mar 8, 2004

- SNC-Lavalin Awarded EPCM Contract PR – Mar 25, 2004

● April 2004 - Submitted Environmental Impact Study (EIS)

● May 2004 - Crystallex Releases 40,000 tpd Pre Feasibility Study PR – May 3, 2004

● August 2004- Crystallex Confirms receipt of Land Occupation Permit PR – Aug 4, 2004

● August 2005 - Crystallex Revises Reserves and Resources; Updates 2003 Feasibility Study PR – Aug 31, 2005

● March 2006 - Crystallex Receives Ministry of Mines (MIBAM) Approval of feasibility study PR – Mar 26, 2006

● June 2007 - Crystallex Receives Confirmation that Ministry of Environment (MinAmb) approved EIA PR – June 14, 2007

- Crystallex posts Bond and Taxes to MinAmb, Receives confirmation that all permit requirements have been fulfilled PR – June 14, 2007

Page 11: Crystallex International Corporation Denver Gold Forum September 2007.

Las CristinasEngineering & Procurement Progress

● Engineering essentially complete

● All Long Lead Items fabricated and/or secured

● Expenditures to date US$120 million under the EPCM contract

● 19km access road upgraded and in use

● Construction camp refurbished

● Airstrip extended to 1,000m and tarred

● 13,500 metre drilling program completed February 2007

● Resource & Reserve update: Proven & Probable Reserve 16.9Moz

Page 12: Crystallex International Corporation Denver Gold Forum September 2007.

Las CristinasLas Cristinas Mining Fleet on Docks Geared Up and Ready To Go

Page 13: Crystallex International Corporation Denver Gold Forum September 2007.

Las Cristinas MillDorbyl Mill Shells Fabricated…

Page 14: Crystallex International Corporation Denver Gold Forum September 2007.

N

Prior to 06-07 program

1 km

Post 06-07 program

Planned Conductora pit

Planned Conductora pit

Planned Mesones-Sofia pit

2006-2007 Drill Program Summary of Results:Comparison of grade-thickness maps for Au

Page 15: Crystallex International Corporation Denver Gold Forum September 2007.

1 km

Planned Conductora $350/oz pit

Morrocoy zone Planned Mesones-Sofia

$350/oz pit

Diorite dyke

Cordova zone

N

Las Cristinas: Distribution of Gold ZonesPlan showing 1 g/t gold ore shells

Page 16: Crystallex International Corporation Denver Gold Forum September 2007.

Las Cristinas: Reserves and Resources (CIM standards)

Tonnes(millions)

Grams pertonne

Ounces(millions)

Reserves: $550 /oz

464 1.13 16.9 Proven & Probable

Resources* Measured & Indicated * 629 1.03 20.8

Inferred 230 0.85 6.3

● Gold Price: US$550/oz, cut-off 0.4 g/t and higher

● Low Strip Ratio of 1.38:1

● 500m maximum depth

● Expected average metallurgical recovery of 89%

● Open at depth

● Further potential to increase reserves through exploration

* Includes Reserves

Reserves and Resources calculated by Mine Development and Associatesin accordance with Canadian NI 43-101

Page 17: Crystallex International Corporation Denver Gold Forum September 2007.

Las Cristinas: Growth in estimated resources

Reserves and Resources calculated by Mine Development and Associates in accordance with Canadian NI 43-101

Measured Resource

Indicated Resource

Measured, Indicated & Inferred Resource

Page 18: Crystallex International Corporation Denver Gold Forum September 2007.

Las Cristinas: Reserve details

Reserves and Resources calculated by Mine Development and Associates in accordance with Canadian NI 43-101

Changes to Contained Ounces - Las Cristinas Reserves

Effect of op cost increase: $7.66 to $9.81

Net Proven & Probable Reserve at

$550/oz

Exploration Success14.01

5.31

3.41 (5.86)

16.86

0.00

5.00

10.00

15.00

20.00

25.00

Co

nta

ined

Ou

nce

s (M

illio

ns)

Proven & Probable

Reserves at $450/oz at Feb 2007

Increase in Gold Price from $450 to $550/oz

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Las Cristinas: growth in Proven & Probable Reserves

Reserves and Resources calculated by Mine Development and Associates in accordance with Canadian NI 43-101

Formal exploration commences

$350/oz

$375/oz $325/oz

Prior exploration

18-hole, 7,120m drill

program

Estimated op costs rise from

$6.46/t to $7.66/t

14-hole, 5,523m drill

program

46-hole, 13,568m drill program, estimated op

costs rise from $7.66 to $9.81/t

Crystallex

$350/oz

$550/oz

$450/oz

$400/oz

Page 20: Crystallex International Corporation Denver Gold Forum September 2007.

Las Cristinas Gold Price SensitivityLerchs-Grossman pit shell sensitivity

Reserves and Resources calculated by Mine Development and Associates in accordance with Canadian NI 43-101

Page 21: Crystallex International Corporation Denver Gold Forum September 2007.

Las Cristinas: Production overview - 20,000 tonnes per day

First 5 years Life of Mine

Annual Gold Production

256,000 oz 233,000 oz

Total Cash Costs US$244/oz** US$339/oz**

Capital Costs excluding VAT*

US$293 million

Mine Life 65 years

* Based upon August 2005 Development Plan capital cost estimate

** Includes a 3% exploitation tax and 3% royalty payable to the CVG based on a US$550/oz gold price

Page 22: Crystallex International Corporation Denver Gold Forum September 2007.

400 m1 – 2 g/t>0.6 - 1.0 g/t

0.2 - 0.4 g/t

>2 g/t

0.4 - 0.6 g/t

Las Cristinas:Sheet-like, tabular ore zones

- Host 95% of the gold reserve

Page 23: Crystallex International Corporation Denver Gold Forum September 2007.

100m

Monzonite sill

Cone-shaped ore zone at Mesones

Cone-shaped ore zone at Sofia

Diorite dyke

Las Cristinas: Cone Shaped Mineralized Zones

Page 24: Crystallex International Corporation Denver Gold Forum September 2007.

0 25 50 75 100 125

Newmont

Barrick

Gabriel

Agnico-Eagle

Meridian

Eldorado

CRYSTALLEX

Gold Reserve

GoldCorp

Source: Company Regulatory Filings

IAMGold

Yamana

Kinross

Proven & Probable ReservesComparison with other North American Based Gold Companies

Proven and Probable Reserves Net of Recoveries (million oz)

Page 25: Crystallex International Corporation Denver Gold Forum September 2007.

Source: Mineweb – September 14, 2007

* This # reflects the acquisition by GFI when gold was trading around $500/oz

Meridian $1,450

Agnico Eagle $516

Bolivar Gold* $276

Barrick $231

Eldorado $231

Yamana $231

IAM Gold $229

Newmont $215

GoldCorp $195

CRYSTALLEX $44

Gabriel $42

Market Capitalization – Comparison with other North American Based Gold Companies

Market Capitalization per Reserve Ounce (US$) Net of Recoveries

Page 26: Crystallex International Corporation Denver Gold Forum September 2007.

For public and media inquiries, or copies of the Company’sannual report, quarterly reports or press releases, please contact:Richard MarshallVice President, Investor RelationsTel: (800) 738-1577

18 King Street East, Suite 1210Toronto, ON M5C 1C4

Tel: (416) 203-2448Fax: (416) 203-0099Email: [email protected]: www.crystallex.comGordon Thompson, President & CEO

Hemdat Sawh,CFOWilliam Faust, COO & Senior Vice PresidentDr. Richard Spencer, VP Exploration

Crystallex shares trade under the symbol KRY on the Toronto and American Stock Exchanges.

The Company’s filings with the Ontario Securities Commission can be viewed on SEDAR at www.sedar.com

The Company’s filings with the U.S. Securities and Exchange Commission can be viewed on EDGAR at www.sec.gov