Troy – Moving to Where the Gold is - Troy Resources · Troy – Moving to Where the Gold is A t...
Transcript of Troy – Moving to Where the Gold is - Troy Resources · Troy – Moving to Where the Gold is A t...
Troy – Moving to Where the Gold isSydney Mining Club4 February 2010
Forward Looking Statements
This presentation contains certain forward-looking statements and forecasts which includewithout limitation expectations regarding future performance costs production levels orwithout limitation, expectations regarding future performance, costs, production levels orrates, reserves and resources, the financial position of Troy Resources NL (the “Company”),industry growth or other trend projections.
Although such forecasts and forward-looking statements reflect current beliefs and arebased on information currently available and assumptions believed to be reasonable there isno assurance that actual results will be consistent with such forecasts and forward-lookingstatements. A number of factors could cause actual results, performance, or achievement todiffer materially from the results expressed or implied in such forecasts and forward-lookingstatements. For a description of such factors please see the section entitled “Risk Factors”in the Company’s amended and restated preliminary prospectus dated January 10 2008in the Company s amended and restated preliminary prospectus dated January 10, 2008available under the Company’s profile at sedar.com.
Nothing in this presentation should be construed as either an offer to sell or a solicitation ofg pan offer to buy or sell securities.
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Snapshot
Growing junior gold producer with a clear growth strategy
Proven record of fast-track mine development, strategic acquisitions and exploration discoveries
No debt and no hedging
A$7 2 million exploration expenditure including over 20 000m of A$7.2 million exploration expenditure including over 20,000m of drilling.
On track to achieve its vision of becoming a profitable mid tier gold On track to achieve its vision of becoming a profitable mid-tier gold producer.
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What We Own
Gold Assets Sandstone Gold Mine - Australia Andorinhas Gold Mine - Brazil Casposo Development Project - BRAZIL
BelémAndorinhasGold Mine
Casposo Development Project Argentina
Rio de Janeiro
Belo Horizonte
Brasilia
Rio de Janeiro
Buenos Aires
San Juan
Casposo Au/Ag Deposit
Sao Paulo
Other Assets Approx A$40M cash and bullion
Deposit
Sandstone Gold Mine
Approx. A$40M cash and bullion Andorinhas, Brazil – Iron-Ore Daly River, Australia – Zinc Sandstone, Australia – Nickel JV
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Corporate Snapshot
Troy Share Price Board & Senior Management
Troy has an experienced board and executive management team committed to achieving the company’s vision of growing a profitable mid-tier gold company:gold company:
Non-Executive Directors
John Dow, Non-Executive Chairman
Gordon Chambers Non E ec ti e Director Gordon Chambers, Non-Executive Director
David Dix, Non-Executive Director
John Jones, Non-Executive Director
Robin Parish Non Executive Director Robin Parish, Non-Executive Director
Senior Management Paul Benson, CEO
Ken Nilsson, Executive Director Operations
Peter Doyle, VP Exploration & Bus. Development
D id S d CFO & C S t
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David Sadgrove, CFO & Company Secretary
Troy – Moving to Where the Gold is
A t li h b ll l d f ld Australia has been well explored for gold
Future discoveries are more likely to be low grade or deeply buried with implications for size and capital
Smaller companies are drawn to countries where more attractive deposits can be found
Investors will see the largest gains from picking the winners – both in terms of geology and management
How does Troy stack up against these criteria?
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The Introduction of New Leaching Technology Played a Significant Role in Making Low-Grade Deposits Economic
Australian Gold Ore Processed
7
8
16000000
18000000
Tonnes milled
5
6
12000000
14000000 Grade milled
4
5
80000000
10000000
Grade
g/t
Tonn
es
2
360000000
G
120000000
40000000
7
00
Gold Price Played a Similarly Important Role
World Gold Production vs Price 1970‐2008
900
1000
80,000,000
90,000,000
World Gold Production vs Price 1970‐2008
700
800
60,000,000
70,000,000
Rest of World
500
600
40,000,000
50,000,000
USD
/oz
Oun
ces
Rest of World
China
USSR/Russia
Australia
200
300
400
20,000,000
30,000,000
, ,Canada
United States
South Africa
Gold Price USD
0
100
200
0
10,000,000
20,000,000
8
00
Initially the Increase in Gold Production Came Just From the Opening of More Small Mines
N b f O ti d G ld P d ti i A t li
g
10000000
12000000
100
120Number of Operations and Gold Production in Australia
8000000
10000000
80
100
ons
No of ops
Ounces
600000060
ounces
o of ope
ratio
2000000
4000000
20
40no
00
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Mines have got Bigger to Compensate for Falling Grades and Increasing Capex
Average Output per Operation
g g p
200000
Average Output per Operation
150000
nnum
100000
ces pe
r an
50000
ounc
0
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Small Mines are Disappearing – this has an Impact on the Likely Returns for Investors
100%Australian Gold Production by Annual Output
p y
80%
90%
100%
60%
70%
80%
>500,000ozpa
40%
50%
60%
250,000‐500,000ozpa
100,000‐250,000ozpa
50,000‐100,000ozpa
20%
30%
<50,000ozpa
0%
10%
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Evolution of the Australian Gold Industry –Implications for Investorsp cat o s o esto s
Its hard to create value out of large low grade deposits unless you are a major
Difficult to fund for a junior
Value leakage to the banks via options and/or hedging Value leakage to the banks via options and/or hedging
Reopening old mines comes with its own risks
A move offshore requires a clear view on the country – not all developing countries are created equal!
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Issues for Offshore Operations
Political Risk Political Risk
Corruption
Fiscal Regime, Tax and Royalties
Infrastructure—power, water, transport
Land Use
Community Issues Community Issues
Have a clear view of Management and the Board
How Does Troy Measure Up?
Troy has a track record of low cost mine development and production
We focus on low-capex relatively high-grade gold deposits in jurisdictions we are comfortable operating in
− Sandstone, WA
− Sertao, Brazil
− Andorinhas, Brazil
− Casposo, Argentina
Troy has paid A$30.5M in ten consecutive fully franked cash Troy has paid A$30.5M in ten consecutive fully franked cash dividends
Troy has been operating in South America since 2002 and Troy has been operating in South America since 2002 and Casposo will be the 3rd mine we have built and operated there.
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San Juan Province Mineral Endowment, Mines & Casposo Project Accessp j
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Casposo Project Update
All major permits in place All major permits in place Site civil and earthworks commenced Tanks manufactured locally have begun arriving on sitey g g Gold processing plant held in storage in Australia was shipped to
Argentina in December 2009 Other pieces of plant purchased in Canada, Australia, Germany and
the USA Although still in the early stages of project development Troy expects Although still in the early stages of project development, Troy expects
Casposo to be: On schedule (first production September quarter 2010); and Under budget (US$41.5M capital spend to first production)
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Casposo Project – October 2009
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Cobar Plant in Transit to the Port of Newcastle – November 2010e cast e o e be 0 0
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Cobar Plant in Transit to the Port of Newcastlee cast e
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Casposo Project – January 29, 2010
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Casposo Project – January 29, 2010Plant Leach Tanks Looking Westa t eac a s oo g est
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Casposo Project – January 29, 2010Access Road Development and Pre-Strip of Kamila Deposit
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Casposo Project – January 29, 2010Julieta Vein Looking WestJulieta Vein Looking West
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Conclusions
Troy recognised early the need to move to where the gold is
We build mines quickly, efficiently and at low costq y, y
We have two operating mines and an exciting growth prospect
W h f ll b ilt kf b l i l ll We have successfully built our workforce by employing locally
Maintained a strong balance sheet-no hedging
Developing local knowledge as a platform for expansion and further value creation
Thank youy
Appendix A
Competent Person Statement
Information of a scientific or technical nature in this report was prepared under the supervision of Peter J Doyle Vice President ExplorationInformation of a scientific or technical nature in this report was prepared under the supervision of Peter J. Doyle, Vice President Exploration and Business Development of Troy, a “qualified person” under National Instrument 43-101 – “Standards of Disclosure for Mineral Projects”, and is a member of the Australasian Institute of Mining and Metallurgy. Mr. Doyle has sufficient experience, which is relevant to the style of mineralization 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 “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr. Doyle has reviewed and approved the information contained in this report. For further information regarding the Brazil, Australia and Argentina pp p g g gprojects, including a description of Troy’s quality assurance program, quality control measures, the geology, samples collected and testing procedures in respect of the Troy’s project please refer to the technical report which are available under the Company’s profile at www.sedar.com.
Notes to preparation of Mineral Resources and Mineral Reserves for CasposoNotes to preparation of Mineral Resources and Mineral Reserves for Casposo
1. Mineral Resources are estimated using a US$1,000/oz gold price and US$15/oz silver price. An economic function that includesoperating costs, metallurgical recoveries and royalty costs has been applied.
2. Rounding as required by reporting guidelines may result in apparent differences between tonnes, grade and contained metal content.3. Tonnage and grade measurements are in metric units. Gold ounces are reported as troy ounces.4. All Mineral Reserves are reported in the Probable category5. Mineral Reserves are estimated using a gold price of US$690/oz and US11.80/oz silver price and an economic function that includes
operating costs, metallurgical recoveries and royalty costs.6. Cut-off grades for Mineral Resources were 0.8g/t gold equivalent for open pit and 2.0g/t gold equivalent for underground. Goldg g g q p p g g q g
equivalent grades for Mineral Resources were based on metal prices of US$915/oz gold and US$13/oz silver and processingrecoveries of 93.7% for gold and 80.6% for silver.
7. Cut-off grades for Mineral Reserves were 1.56g/t gold equivalent for open pit and 3.5g/t gold equivalent for underground. Goldequivalent grades for Mineral Reserves were based on metal prices of US$690/oz gold and US$11.8/oz silver and processingrecoveries of 93.7% for gold and 80.6% for silver.
8. The information regarding Mineral Reserves is drawn from the technical report entitled “NI 43-101 Technical Report, Casposo Project– Argentina” June 2009 that was filed on 11 June 2009 by Troy under its profile on SEDAR at sedar.com.
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Troy Resources NL2009 Reserve and Resource Statement
Comparison of 2008 and 2009 Reserve/Resource StatementRESOURCES BY CATEGORYRESOURCES BY CATEGORY
2008 2009 Change
TonnesGrade(g/t)
Ounces TonnesGrade(g/t)
Ounces
Measured 777 000 1 95 48 800 582 000 1 40 26 400 ‐45 9%Measured 777,000 1.95 48,800 582,000 1.40 26,400 45.9%Indicated 4,504,400 3.51 507,300 6,250,000 4.30 867,000 70.9%M&I 5,281,400 3.28 556,100 6,832,000 4.05 893,400 60.7%
Inferred 2,857,000 2.03 186,000 13,357,600 1.50 648,400 248.6%
Satellite resources at Sandstone are currently being investigated for potential to
TOTAL 8,138,400 4.97 742,100 20,189,600 3.74 1,541,800 107.8%
Satellite resources at Sandstone are currently being investigated for potential to supply
Millfeed to processing facility. Drilling at Two Mile Hill will test high grade Banded Iron Formation (BIF)Iron Formation (BIF)
Drilling and development at Mamão Underground mine at Andorinhas will target resource/reserve extensions to known mineralisation
Exploration will commence shortly at Casposo to test extensions to known vein systems and to infill gaps in current resource model
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Troy Resources NL2009 Reserve and Resource Statement
RESOURCE AND RESERVE SUMMARY In addition to gold the 2009
Category TonnesGrade(g/t)
Ounces
Gold Mineral Reserves
Proved 582,000 1.4 26,400
Reserve/Resource Statement contains significant quantities of Silver. This is contained within the Casposo deposit and will be mined and processed
Probable 2,742,000 5.8 513,100
TOTAL 3,324,000 5.0 539,500
Silver Mineral Reserves
concurrently with the gold reserves
Current mine plans have about 1moz of silver produced annually from Casposo in
Silver Mineral Reserves
Probable 1,734,000 120.0 6,695,500
TOTAL 1,734,000 120.0 6,695,500
addition to 50,000oz of gold
Gold Mineral Resources
Measured 582,000 1.4 26,400
Indicated 6,250,000 4.3 867,000
Inferred 13,358,000 1.5 648,400
Silver Mineral Resources
Indicated 2,369,000 201.7 15,363,000
Inferred 261,000 255.1 2,141,000Inferred 261,000 255.1 2,141,000
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