Corporate Presentation April 2015

Metallon Corporation
An African Gold Mining and Exploration Company – April 2015
Disclaimer
Disclaimer
This presentation has been created to provide general information, solely for the reader’s general knowledge, about Metallon Corporation (“Metallon”), its subsidiaries,
properties and activities, as well as the countries it operates in.
Although Metallon believes that the information included in this presentation is accurate and current, such information is not intended to be a comprehensive review
of all matters and developments concerning Metallon and Metallon does not warrant or make any representations or claims as to the authenticity, validity, accuracy,
completeness or currency of the information provided in this presentation.
Moreover, Metallon, its directors and officers assume no responsibility for the information or representations contained in this presentation and shall not be liable or
responsible for any claim or damage, direct or indirect, arising out of the interpretation, reliance upon or other use of the information provided herein.
No information in this presentation constitutes a solicitation, offer or recommendation to engage in any investment activity, to effect any transactions, or to conclude
any legal act of any kind whatsoever.
Forward-looking statements
Certain statements included in this presentation constitute “forward-looking statements” which, based on numerous assumptions, involve known and unknown risks,
uncertainties and other factors which are beyond Metallon’s control that may affect the results, performance or achievements of Metallon.
In certain cases, forward-looking information can be identified by the use of words such as "aim", "plans", "expects" or "does not expect", "is expected", "budget",
"scheduled", "estimates", "forecasts", "intends", "continues", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that
certain actions, events or results "may", "could", "would", "should", "might" or "will be taken", "occur" or "be achieved" and include the negative variation of such
phrases.
With respect to forward-looking information contained in this presentation, Metallon has made assumptions regarding, among other things, Metallon’s ability to
generate sufficient cash flow from operations and access to existing credit facilities and capital markets to meet its future obligations, the regulatory framework in its
countries of operation with respect to, among other things, permits, licenses, authorizations, royalties, taxes and environmental matters, and Metallon's ability to
obtain qualified staff and equipment in a timely and cost-efficient manner to meet Metallon's demand.
Although Metallon believes that its expectations reflected in forward-looking information are reasonable, such forward-looking information involves known and
unknown risks, uncertainties and other factors that may cause the actual results, performance or achievements of Metallon or Metallon's projects in its countries of
operations, or any of them, to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information.
Such factors include, but are not limited to, risks related to failure to convert estimated mineral resources to reserves, conclusions of economic evaluations, changes
in project parameters as plans continue to be refined, future prices of gold, unexpected increases in capital or operating costs, possible variations in mineral
resources, grade or recovery rates, failure of equipment or processes to operate as anticipated, accidents, labour disputes and other risks of the mining industry,
labour risks, delays in obtaining governmental consents, permits, licences and registrations or financing or in the completion of development or construction activities,
risks of title to properties, partner risks, legal and litigation risks, political risks arising from operating in Africa, risks relating to changes in governmental regulations
and in operating internationally, risks relating to the infrastructures, uncertainties relating to the availability and costs and availability of financing needed in the
future, indebtedness risks, changes in equity markets, inflation, changes in exchange rates, exchange control and export restriction risks, fluctuations in commodity
prices and uninsured risks.
Although Metallon has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forwardlooking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that
forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Past
performance of Metallon or its shares cannot be relied on as a guide to future performance. Accordingly, readers should not place undue reliance on forward-looking
information. The forward-looking information contained herein, unless stated otherwise, is made as of the date of this presentation and Metallon makes no
responsibility to update them or to revise them to reflect new events or circumstances, except as required by law.
2
Corporate overview
A Private African Gold Mining and Exploration Company
•
Five underground mines in Zimbabwe, with exploration assets in Zimbabwe,
Tanzania & DRC
•
Globally significant Mineral Resource of 9.7Moz of gold (JORC compliant) and
exploration targets of between 4-6Moz
•
Gold production of 99,000oz in 2014 and target of approx. 150,000 ounces in
2015
•
Low cost producer – all-in-costs of US$946/oz in 2014 and approx. US$883/oz
expected in 2015
•
Revenue of US$115m and net profit of US$10m in 2014
•
Rising free cashflows from ramp- up expansion plans to become a 500,000oz
pa producer by 2019
3
Operations: Zimbabwe
Operating mines
•
•
•
•
How Mine
Shamva Mine
Mazowe Mine
Arcturus Mine
Mine under development
• Redwing Mine
Development potential
• Motapa
• Midwinter
Metallon’s assets are considered to be the best gold mines in Zimbabwe
– high grade, low cost operations
4
Zimbabwe – a golden opportunity
 Quality operations and world class mineral resources – efficient, professionally run mines
 High-grade, shallow underground gold mines
– group average mined grade of 4.5g/t & reserve grade of 3.7g/t
 Low cost production – all-in-costs US$946/oz in 2014
 Massive upside with additional on- and near- mine mining, tailings retreatment and highly
prospective exploration targets
 Good infrastructure and skilled experienced labour force
 On grid power – ring-fenced electricity at 12c kw/h
 Supportive local communities
 Security of tenure provided by the Zimbabwe Mine and Minerals Act Chapter 21.05
 Indigenisation plan submitted to the Zimbabwe Government
 Government understands that mining is essential to economic growth
5
Leading assets amongst our peers
Source: CapitalIQ, SNL Metals & Mining,
Broker research, Company estimates
High reserve grade of 3.7g/t
Reserve grade (g/t)
12
11.83
8
4.74
4
4.57
3.74
3.67
3.60
3.58
3.38
2.81
2.67
2.24
2.24
2.01
1.65
1.62
1.56
1.35
1.35
1.20
1.11
0.89
0.85
2.53
1.09
0.40
-
World class resource of 9.7Moz
40
38.89
32.18
Resource Moz
30
30.28
28.63
21.61
20
10
14.62
12.01 11.21
10.26
9.80
9.66
8.64
8.49
6.49
5.57
5.01
4.48
2.88
1.07
-
6
Lowest cost producer amongst our peers
One of the lowest cost African gold producers
Company
1,400
DRDGold
Perseus
1,300
Harmony
2015E AISC (US$/oz)
1,200
IAMGOLD
1,100
1,000
Mwana
Resolute
Sibanye
Centamin
Golden Star
Pan African
Acacia
Endeavour
Caledonia
Teranga
900
Avocet
Metallon
Randgold
800
SEMAFO
Aureus
Randgold
Shanta
Metallon
Avocet
Endeavour
Teranga
Caledonia
Acacia
Centamin
Pan African
Golden Star
Sibanye
IAMGOLD
Resolute
Harmony
DRDGold
Mwana
Perseus
Shanta
Aureus
700
SEMAFO
600
0
1
2
3
4
Reserves grade (g/t Au)
5
6
Reserve
grade (g/t)
2015E
AIC ($/oz)
2015E
Prod (koz)
2.81
3.38
3.60
4.57
3.74
2.01
2.24
1.35
3.67
4.74
1.11
3.58
2.24
1.65
1.35
1.56
0.85
0.40
2.67
1.20
695
789
802
855
883
923
932
938
972
982
988
1,006
1,065
1,110
1,124
1,169
1,250
1,250
1,304
1,318
257
55
1,084
85
150
129
487
238
42
802
420
198
279
1,480
897
315
1,310
155
65
226
Source: CapitalIQ, SNL Metals & Mining,
Broker research, Company estimates
7
Steady gold production in 2014
12,000
1200
10,000
1000
8,000
800
6,000
600
4,000
400
2,000
200
-
0
Jan-14
How
Feb-14
Arcturus
Mar-14
Apr-14
Shamva
May-14
Redwing
Jun-14
Jul-14
Mazowe
Aug-14
Sep-14
Oct-14
C1 cost per oz (US$)
Nov-14
Dec-14
All-in-cost per oz (US$)
8
Cost per oz (US$)
Gold production (oz)
Gold production per mine & cost per oz
Gold production
• Gold production of 150,000oz expected in 2015 – approx. 30% of Zimbabwe’s total production1
• All gold bullion produced is sold to Fidelity Printers, a subsidiary of the Zimbabwean Reserve Bank
• 100% of the spot gold price is paid on delivery, minus the 5% Government royalty
– royalty reduction from 7%, effective 1st October 2014. Added incentive for gold sector growth
Note (1) As per estimates from the
Zimbabwe Chamber of Mines
Gold pour at Mazowe Mine – April 2014
9
Track record of delivery
Increasing Production
Financial Discipline
Improved Delivery
• Reopened four mines
successfully
• Low cost mining with all-incosts of US$946/oz in 2014
• Production increasing to
150,000 ounces in 2015
• Expected all-in-costs of
US$883/oz in 2015
• Increased mineral
resource from 8.6Moz to
9.7Moz in 2015
• Redwing to recommence
production in 2015
• Major expansion plans in
Zimbabwe paid for by free
cash flow & bank debt
• Sands treatment to
commence at Mazowe in
2015
• Expansion plans being
undertaken
• Delivering free cash flow
• Planning to be a consistent
dividend player by 2016
• Diversification by
acquiring assets in DRC &
Tanzania
• Focused exploration
programme
• Looking at further M&A
opportunities
• Targeting production of
500,000 ounces by 2019
10
Historical financial summary
FINANCIALS
(US$m)
FY 2011
FY 2012
15 Months
FY 2013
Revenues
138.6
147.2
148.6
69.3
115.1
Operating Cost
(94.1)
(107.6)
(123.2)
(49.1)
(76.7)
Operating Profit
44.5
39.5
25.4
20.1
38.4
EBITDA
31.8
21.5
10.2
13.8
26.2
Net Profit
23.7
9.0
4.0
5.1
10
Current debt position:
US$19m
Treasury Bills:
US$25m
Current cash position:
US$5m
6 Months
HY 2014
Unaudited
FY 2014
11
Gold production and costs 2014 & 2015E
Production for
2014 (oz)
Unaudited
C1 costs for
2014 (US
$/oz)
Unaudited
all-in-costs
for 2014
(US $/oz)
Estimated
Production for
2015 (oz)
Estimated C1
costs for 2015
(US $/oz)
Estimated
all-in-costs
for 2015
(US $/oz)
How Mine
55,008
541
562
60,850
504
679
Shamva Mine
24,037
932
940
31,796
773
933
Mazowe Mine
11,380
1,057
1,110
27,813
627
799
Arcturus Mine
8,316
1,506
1,567
19,749
901
1,059
Redwing Mine
104*
n/a
n/a
10,034
833
1,427
98,845
776
946
150,242
658
883
GROUP
* Sands processing discontinued at Redwing Mine
12
2015 CAPEX
CAPEX spend in 2015 to achieve 150,000oz and future production growth
Capacity Ramp Up
Total US$42.88m
–
–
–
How Mine
Arcturus Mine
Shamva Mine
US$0.3m
US$2.2m
US$18.7m
–
Mazowe Mine
US$8.0m
–
Redwing Mine Restoration
–
Shamva Slimes Dam – turnkey construction
–
Mazowe Slimes Dam – turnkey construction
–
Dewatering, mine & plant rehabilitation
US$4.5m
US$4.3m
US$4.8m
How Sands Plant - turnkey project
Total US$9.3m
Mazowe Sands Plant - turnkey project
Total US$7.3m
Sustaining & other CAPEX
TOTAL
Total US$18.9m
US$78.3m
•
Capital expenditure is to be funded from internal cash flows and local bank facilities
•
Detailed capital expenditure at each operation is available
13
Future gold production growth & costs
Estimated future gold production & costs 2014 - 2019
600,000
556,082oz
1000
900
500,000
473,145oz
400,000
700
336,422oz
300,000
600
238,857oz
500
200,000
150,242oz
Costs (US$)
Gold Production (oz)
800
400
98,845oz
100,000
300
-
200
2014
How
Arcturus
2015
Shamva
2016
Redwing
2017
2018
Mazowe
C1 cost (US$)
2019
All-in-costs (US$)
Targeting gold production of > 500,000oz pa by 2019
14
Financial information modelled on expansion plans
2015 - 2019
For the year ended 31 Dec
Total gold production (oz)
Unaudited
2014
2015E
2016E
2017E
2018E
2019E
98,845
150,242
238,857
336,422
473,145
556,082
5
78
82
64
42
31
115
178
283
399
561
659
Operating profit (US$m)
38
79
130
202
331
393
EBITDA (US$m)
26
53
101
164
282
339
Net profits (US$m)
10
22
59
109
233
277
Free cash flow (US$m)
12
(36)
(6)
45
203
262
C1 cost (US$/oz)
776
658
641
584
487
479
All-in-costs (US$/oz)
946
883
794
715
600
584
Capital expenditure approx.
(US$m)
Revenue (US$m)
•
All expansion plans and CAPEX requirements still require detailed feasibility studies
•
Most capital expenditure will be funded by operating profit. 2015 – 2019 total capital expenditure is US$297m
•
The gold price used in forward-looking assumptions is US$1,200/oz
15
Growth strategy 2015 – 2019
MINE
ACTIVITY
RESOURCE
HOW
•
•
•
•
16NY shaft deepening
How South raise-bore sliping
How South Exploration
Plant expansion to 80ktpm
SHAMVA
•
•
•
•
Shaft upgrade
Sands retreatment project
Surface exploration - Shamva Hill
Plant expansion to 140,000tpm
MAZOWE
•
•
•
•
Shaft upgrade and deepening
Sands retreatment project with 80ktpm plant
Underground development & exploration
Plant expansion
ARCTURUS
• Shaft upgrade
• Shaft sinking
• Development & exploration
REDWING
• Mine decline to 6 Level
• Shaft sinking & mechanised mining
• Development & exploration
IMPACT BY
2019
US$69m
Increase
production to
100,000oz/an
US$54m
Increase
production to
96,000oz/an
1.975Moz
US$52m
Increase
production to
141,000oz/an
1.046Moz
US$46m
Increase
production to
108,000oz/an
2.471Moz
US$73m
Increase
production to
111,000oz/an
9.755Moz
US$294m
~556,000oz/an
1.475Moz
2.788Moz
TOTAL
CAPEX
16
CAPEX – sustaining, restoration & expansion
CAPEX Sustaining, Restoration & Expansion Operations
Revenue & Operating Profit 2015 - 2019
80
$78m
700
$82m
600
70
$64m
500
CAPEX (US$m)
60
50
400
$42m
40
$31m
30
300
200
20
Revenue & Profit (US$m)
90
100
10
-
2015
Sustaining
2016
Restoration
2017
Expansion
2018
Other
Revenue
2019
Operating Profit
17
CAPEX – by mining operation
Capital Expenditure by Mining Operation 2015 - 2019
90
80
$82m
$78m
CAPEX (US$m)
70
$64m
60
50
$42m
40
$31m
30
20
10
2015
2016
How
Arcturus
2017
Shamva
2018
Redwing
2019
Mazowe
18
World class gold resources & further potential
• Globally significant Mineral Resource of 9.755Moz of gold (JORC compliant June 2014)
• Exploration results category contains about 4-6Moz from satellite ore bodies to operating
mines (SRK 2013)
• All five mines have open-ended depth and are under-explored across strike extensions
• Historic drilling records were used to compute 3.5Mt @ 2.5-3.5g/t at Redwing, at shallow
depth (120m to 180m) in 2013
• Conceptual target sizes of:
− Mazowe Mine: 2.5 - 3Moz
− Redwing Mine: 5 - 8Moz
• Rich quartz veins offer
exploration upside potential
• Metallon is focused on increasing
production to mine these resources
19
Additional gold exploration projects
• Zimbabwe – Motapa
− Brownfield project with sands & sulphide-gold resources (in-house estimate
of 2.4Moz is not included in the 9.7Moz Group Resource Statement)
− Successful ultrafine grinding metallurgical processing tested (the Albion
process)
− Contains the richer Motapa camp deposits (3-10g/t) of Club, B&S, Fossicker,
Pluvius and Jupiter
• Zimbabwe – Midwinter
− Laterite-gold deposits in meta-sediments
− Successfully re-modelled lateritic gold mineralization in 2013
− Step-out drilling east of Aurora Pit planned
• Democratic Republic of Congo
− 4 exploration properties secured in the Maniema province near Bukavu
• Tanzania
− Currently securing mineral rights located near the Lake Victoria
gold fields
Building an African footprint
20
Indigenisation – working with local communities
• Indigenisation
− Indigenisation proposal submitted to the Zimbabwe Government
− Suggested structure includes 10% employee share schemes, 10% local communities, 10%
Nat. Indigenisation & Empowerment Board
− Liaising further with the Zimbabwe Government and awaiting approval in 2015
• Supportive local communities
− Metallon is a good corporate citizen and is committed to maintaining its social licence to
operate
− Long-established track record of social delivery to employees & local communities:
education, health, housing, other services
− Platform for further, sustained socio-economic development through community trust model
21
Positioning for growth
•
A golden opportunity
– 9.7Moz world class resource
– established infrastructure
– skilled labour
Expansion projects at
existing operations
More investment in Zimbabwe
More jobs, revenue
Future exploration projects
Focused M&A activities
GOLD PRODUCER
+500,000oz/pa
22
Appendices
23
Biographies: Board of Directors
Sir Nicholas Bonsor
Independent Non-Executive Chairman
Sir Nicholas Bonsor joined Metallon as Independent Non-Executive
Chairman in March 2011 and is Chairman of the Nominations Committee.
He serves on the Boards of several listed companies and is currently
Chairman of Tomco Energy Plc. He started his career as a barrister,
practising in a Common Law Chambers from 1967 to 1975 and as a
specialist in regulatory and commercial law from 2003 to 2011. He was a
member of British Parliament from 1979 to 1997. He holds a MA in
Jurisprudence from Oxford University.
Robert Robertson
Senior Independent Non-Executive Director
Robert Robertson joined the Board of Metallon in March 2011. He is a
Senior Independent Non-Executive Director and Chairman of the Audit,
SHE and Remuneration Committees. He is a Director of BlackRock Smaller
Companies Trust plc and Lowland Investment Company plc. He was
previously chairman of West China Cement, a Director at Avocet Mining
plc and Buro Happold Engineers, and Chief Executive of Tarmac Group
and Anglo American's Industrial Minerals division. His early career was in
finance, working in London, Paris, Johannesburg, New York and Rio de
Janeiro. He holds a MA in History from Oxford University.
Dr Tomaz A. Salomão
Non-Executive Director
Dr Tomaz Salomão joined the Board of Metallon in December 2014. He is
the former Executive Secretary of the Southern African Development
Community (SADC) and served from 2005 - 2013. Dr Salomão has made
significant contributions to the development of Mozambique and the
Region in senior positions for 22 years. During this period, he also served
as Governor for Mozambique at the African Development Bank, IMF and
World Bank. Dr Salomão is qualified as Certified Public Accountant, has
Bachelor of Arts and Master of Arts Degrees in Economics. He is currently
the Chairman of the Board of Directors of the Standard Bank,
Mozambique (non executive), and a visiting Research Fellow at the Wits
School of Governance at the University of Witwatersrand in Johannesburg.
Mzilikazi Khumalo
Chief Executive & Deputy Chairman
Mzilikazi Khumalo founded Metallon in 2001 and is the main shareholder
of the Company. He purchased the assets in Zimbabwe from Lonmin in
2002. He has held the position of chairman at various companies
including JCI Limited, Capital Alliance Holdings Limited and Point
Waterfront Corporation, as well as having been Non-Executive Director at
Mintek, Telkom, McCarthy Retail Limited, Ridge Mining and Anglo
American Corporation. He holds a Bachelor of Commerce degree from
UNISA.
Andile Reve
Non-Executive Director
Andile Reve joined Metallon in 2002 as Chief Executive and became a
Non-Executive Director in August 2010. He was an analyst at Kwazulu
Finance and Investment Corporation from 1987 to 1991 and a
Commercial Manager at Eskom from 1991 to 1996. He joined the Rennies
Group as an Executive Director in 1996 and in 1998 he moved to the
Industrial Development Corporation as Executive Vice President –
industrial finance. He holds an MBA from Rutgers University, State of
New Jersey, USA, B .Com (Hons), UNISA and B.Com, Kwazulu-Natal.
Kwaku Akosah-Bempah
Non–Executive Director
Kwaku Akosah-Bempah joined the Board of Metallon in August 2010. He
was previously the chief financial officer of AngloGold Ashanti Limited’s
West Africa Region, having previously served as general manager:
corporate finance at Ashanti Goldfields Company Limited. He has also
held several senior roles as finance director at Freda-Rebecca mine in
Zimbabwe. He holds a Bachelor of Commerce (Hons) Degree and a
Diploma in Education from the University of Cape Coast, Ghana, and an
MBA from the Columbia Business School, USA. He is also a chartered
accountant and member of the Institute of Taxation, Ghana.
24
Biographies: Executive Management
Ken Mekani
Chief Executive Officer Designate
Ken Mekani has been with Metallon for 27 years after joining the then
Lonrho Mining as Graduate Trainee Metallurgist in June 1987. After
completing the Graduate Trainee Programme, Ken was appointed Plant
Metallurgist. He spent several years in the group’s various operations
where he worked his way up the ranks and was involved in major
Metallurgical projects. In December 2012, he was appointed Acting COO
for Metallon Gold Zimbabwe and in June 2013 was appointed General
Manager for the group’s flagship operation, How Mine. From August 2010
to August 2013, Ken was non-Executive Director and Chairman of the
Technical Committee of Sabi Gold Mine, a wholly owned subsidiary of the
Zimbabwe Mining Development Corporation. Ken holds a BSc.
Metallurgical Engineering (1987) from New Mexico Institute of Mining and
Technology (USA) and a Masters in Business Administration (MBA) from
the University Of Zimbabwe Graduate School Of Management (2006).
Mark Tsomondo
Director, Exploration and New Business
Mark Tsomondo joined Metallon in 2010 as Group Exploration Manager.
In that capacity, he undertook an in-depth review of Mineral Resource
estimation for the Company. In January 2014 Mark became Chief
Operating Officer and in September 2014 he was made Director Geology and New Business. Mark’s experience spans over 30 years and
covers mining and exploration for gold, platinum, chrome and copper.
Joining Union Carbide Zimbabwe in Kwe Kwe in 1981, he worked on the
Great Dyke deposits and gold in greenstone belts rising through the ranks
from Junior to Chief Geologist. Mark formed Midlands Geological Services
in 1992, a consultancy that lasted for over a decade. He also worked as
Mine Manager for an open pit operation for 4 years, including a recent
stint as Non-Executive Director of ZMDC. He holds a BSc (Hons) from
University of Rhodesia and an MSc and D.I.C. in Mineral Exploration from
Royal School of Mines, London (1985).
Dr Isadore Matunhire
Technical Director
Dr Isadore Matunhire joined Metallon in November 2013 as Head of
Technical Services and in April 2014 became Technical Director. He is
responsible for leading the expansion programmes, bankable feasibility
studies and business integration. He has advised Metallon as an
Independent Consultant since January 2013. He has over 20 years
operational mining experience and 5 years in the mining consultancy field.
He has worked for Zimbabwe Mining Development Corp and Bindura
Nickel Corp in senior roles. He worked for TWP Projects as Lead Mining
Engineer/ Project Manager where he completed feasibility and due
diligence studies for Lonmin Platinum, African Consolidate Resources,
Metallon, Anglo Platinum, Zimasco Chrome, Wesizwe Platinum, and BCL
Selebi-Phikwe. He has also lectured in the Mining Engineering Department
at the University of Pretoria and worked as Corporate Affairs Director for
Mwana Africa. He graduated with a PhD in Mineral Economics from
University of Nottingham, England and MSc in Management from City
University, London.
Tulani Sikwila
Finance Director
Tulani Sikwila joined Metallon in 2005 and became Group Finance
Director in March 2012. He has a decade of operational, accounting and
finance expertise in the mining industry having started his career at Ernst
& Young in 2001, where he spent 4 years as an Audit Supervisor. A
chartered accountant by trade, he holds a B.Com in Accounting from
Rhodes University, B. Compt (Honours) from UNISA,
and a Diploma in Management Accounting (CIMA).
25
World class mineral resource – 9.7Moz
Proved and Probable Reserves
as at 30th June 2014
Proved
Ton
(kt)
How
U/g
Probable
Grade Ounce
(g/t) s (oz)
Ton
(kt)
Measured and Indicated Resources
as at 30th June 2014
Total
Grade Ounce
(g/t) s (oz)
Ton
(kt)
Measured
How – U/g
–
763
5.6
136
2,311
3.5
261
3,074
4.0
397
1.1
2.9
30
291
817
3,891
1.1
3.4
30
427
5.1
140
1,150
5.4
199
Surface
Arcturus
– U/g
763
5.6
136
817
3,128
296
6.19
59
854
296
Shamva –
U/g
Ton
(kt)
Grade Ounce
(g/t) s (oz)
6.19
59
854
5.1
140
1,150
5.4
2.85
2.85
79
79
3452
3452
2.93
2.93
325
325
4,315
4,315
2.9
2.9
Arcturus –
U/g
Surface
199
404
404
Mazowe
– U/g
TOTAL
24
24
336
336
2,282
2.9
2.9
5.67
5.67
4.6
2
2
61
61
337
108
108
273
273
7,815
2.8
2.8
5.56
5.56
3.2
10
10
49
49
132
132
609
609
815 10,097
2.8
2.8
5.6
5.6
3.5
12
12
110
110
1,152
5.5
326
Ton
(kt)
Total
Grade Ounce
(g/t)
s (oz)
Ton
(kt)
Inferred
Grade Ounce
(g/t)
s (oz)
2,745
817
3.9
1.1
342
30
4,600
817
4.5
1.1
668
30
1,855
5.5
326
3,562
3.3
372
5,417
4.0
698
359
1,272
6.7
1.1
77
45
2,471
5.2
413
2,830
1,272
5.4
1.1
490
45
1,631
2.3
122
2,471
5.2
413
4,102
4.0
535
1,936
2.6
160
817 10,537
–
8,601
3.0
2.9
977
Surface
2,401
0.8
61
2,401
0.8
61
Surface 2
167
1.2
6
167
1.2
6
160 11,169
2.5
885 13,105
2.5
1,045
1,936
Redwing
– U/g
Grade Ounce
(g/t)
s (oz)
Surface
Shamva
U/g
863
863
1,855
Indicated
Inferred, Measured and Indicated Resource
as at 30th June 2014
Redwing –
U/g
Surface
Sands
Mazowe –
U/g
Surface
TOTAL
1,534
2.6
2.5
127
7,989
4.0
1,020
9,523
3.8
1,147
9,906
0.3
105
9,906
0.3
105
1,125 19,429
2.0
1,252
1,311
4,967
8.2
0.8
348
125
6,278
2.3
473
1,534
2.5
127 17,895
2.0
517
4,967
9.5
0.8
159
125
794
7.4
5,484
1.6
284
794
12,441
2.5
1,019 35,891
7.4
2.6
189
189
2,984 48,331
2.6
Ton (kt)
How – U/g
Surface
Arcturus –
U/g
Surface
Shamva
U/g
Measured & Indicated
Grade Ounces
(g/t)
(oz)
Ton
(kt)
Total
Grade Ounces
Grade Ounces
Ton (kt)
(g/t)
(oz)
(g/t)
(oz)
3,774
3.4
418
4,600
4.5
668
8,374
4.0
10,393
1.1
359
817
1.1
30
11,210
1.1
1,086
389
14,167
1.7
777
5,417
4.0
698
19,584
2.3
1,475
3,229
4.9
511
2,830
1,272
5.4
1.1
490
45
6,059
1,272
5.1
1.1
1,001
45
3,229
4.9
511
4,102
4.0
535
7,331
4.4
1,046
12,122
9,227
9,353
2.4
0.5
2.2
917 10,537
153
2,401
674
167
2.9
0.8
1.2
977
61
6
22,659
11,628
9,520
2.6
0.6
2.2
1,894
214
680
30,702
1.8
1,744 13,105
2.5
1,045
43,807
2.0
2,788
14,457
2.6
1,219
9,523
3.8
1,147
23,980
3.1
2,366
9,906
0.3
105
9,906
0.3
105
–
Surface
Redwing –
U/g
Surface
Sands
Mazowe –
U/g
Surface
14,457
2.6
1,219 19,429
2.0
1,252
33,886
2.3
2,471
5,546
7.3
1,293
1,311
8.2
348
6,857
7.4
1,641
1,300
5.0
209
4,967
0.8
125
6,267
1.7
334
6,846
6.8
1,502
6,278
2.3
473
13,124
4.7
1,975
69,401
2.6
5,753 48,331
2.6
4,003
117,732
2.6
9,756
4,003
TOTAL
Note (1) Redwing Mineral Reserves were reclassified as a Resource due to mine flooding below 6 level
26
How Mine – Flagship Mining Operation
Key information
History
Underground mine in production since
1942
Processing
Central facility, using a combination of
conventional milling, gravity recovery &
carbon-in-leach process
JORC Resource
1.475Moz (JORC resource June 2014)
Current hoisting capacity
32 ktpm
Current milling capacity
30 ktpm
2014 production
55,008oz
2014 all-in-cost
$562/oz
2015 production
60,850oz (expected)
2015 all-in-cost
$679/oz (expected)
Av. mined grade
5g/t
Exploration upside
How South extension
New orebody 350N discovered by
exploration drilling
Headgear at How Mine – April 2014
Underground at How Mine – April 2014
27
Shamva Mine
Key information
History
Underground mining since 1893.
2.45Moz mined to date
Processing
Conventional crushing, milling, gravity
recovery and combination of carbon-insolution & -pulp processes
JORC Resource
2.78Moz (JORC Resource June 2014)
Current hoisting capacity
45 ktpm
Current milling capacity
33 ktpm
2014 production
24,037oz
2014 all-in-cost
US$940/oz
2015 production
31,796oz (expected)
2015 all-in-cost
US$933/oz (expected)
Av. mined grade
3g/t
Exploration upside
Additional potential of 19Mt grading
1.7g/t scoped as open-pittable by SRK
in 1999
Shamva mine and plant – April 2014
Workers at Shamva Mine – April 2014
28
Mazowe Mine
Key information
History
Historic underground mining since 1890
Processing
Conventional crushing, milling, free gold
recovery and carbon-in-leach facility
JORC Resource
1.975Moz (JORC Resource June 2014)
Current hoisting capacity
19 ktpm
Current milling capacity
10.5 ktpm
2014 production
11,380oz
2014 all-in-cost
US$928/oz
2015 production
27,813oz (expected)
2015 all-in-cost
US$799/oz (expected)
Av. mined grade
5g/t
Exploration upside
Conceptual target size of 2.5 - 3Moz in
up to 25 high-grade quartz reefs in BSV
sections and down to 1000m depth
Conveyor at Mazowe Mine – April 2014
Headframe at Mazowe Mine – April 2014
29
Arcturus Mine
Key information
History
Underground mine production since
1907. Mine reopened in October 2013
Processing
Ore is processed through conventional
crushing, milling, gravity recovery and a
combination of carbon-in-solution & pulp processes
JORC Resource
1.046Moz (JORC Resource June 2014)
Current hoisting capacity
15 ktpm
Current milling capacity
15 ktpm
2014 production
8,316oz
2014 all-in-cost
US$1,567/oz
2015 production
19,749oz (expected)
2015 all-in-cost
$1,059/oz (expected)
Av. mined grade
4.2g/t
Future upside
Production ramp up to capacity
Working at Arcturus Mine – May 2012
Miners at Arcturus Mine – May 2012
30
Redwing Mine
Key information
History
Historic underground mining since 1889.
Mine flooded in recent years.
Dewatering to be completed Q1 2015 &
production to commence in 2015
Processing
Combined underground and sand
retreatment operation
JORC Resource
2.471Moz (JORC Resource June 2014)
2015 production
10,034oz (estimate)
Ramp up of plant
capacity
23000tpm by December 2015
83000tpm by April 2017
193,000tpm by October 2018
Av. quartz grade
5.5g/t
Exploration upside
Conceptual exploration targets in
multiple quartz-veins is 5 - 8 million
ounces
Shaft headframe at Redwing – April 2014
Mine planning and development– April 2014
31
Company group structure
Metallon Corporation
Limited (UK)
Metallon Gold
Zimbabwe
(Private) Limited
Bulawayo
Mining
Goldfields of
Shamva
Goldfields
of Mazowe
Company
Company
Company
How Mine
Shamva Mine
Mazowe Mine
& Arcturus Mine
Metallon
Management
Services
King’s Daughter
Pazia Mining
Oria Mining
Company
Company
Company
Redwing Mine
Midwinter
Mining Location
Motapa Mining
Lease
32
Metallon Corporation
Address: 78 Pall Mall, London, SW1Y 5ES
www.metcorp.co.uk
Tel No: +44 (0) 203 178 7431