Buzwagi - Site Presentation. March 2014

Transcription

1 African Barrick Gold Buzwagi - Site Presentation March 2014

2 Contents 1. Introduction 1 2. Life of Mine 7 3. Processing Operations Cost Improvements Summary 27 1

3 Biography Philbert Rweyemamu was appointed Buzwagi General Manager in October 2014 having been General Manager of Tulawaka since September Prior to this Philbert has worked in a variety of roles within ABG including Mining Manager at North Mara and as Government Relations Manager. Philbert is one of the most experienced Tanzanian mining executives, has more than 30 years professional mining experience and has previously worked for DeBeers, Shanta Mining and Namaqualand Mines. Philbert holds a Masters of Science degree in Mining Engineering, Geomechanics, from the University of Exeter, Camborne School of Mines in England. He also holds a Bachelor of Engineering in Mining Engineering from Camborne School of Mines and a Mining Technology Diploma from Hailey School of Mines, Ontario in Canada. 2

4 Location 3

5 Overview and history Gold mineralisation first recognised on this property in the 1950s Exploration began in under the direction of Anmercosa (Exploration Arm of Anglo American Corporation) Pangea Minerals Ltd (PML) continued exploration from Pre-Feasibility study in December 2005 Feasibility study in 2006 Mineral Development Agreement and EIA approved in February 2007 Special Mining Licence approved, 25 th July 2007 Site Access, 20 th August 2007 Commenced ore mining and stockpiling, October 2008 Plant commissioning: Q First gold pour: Q Project cost: $402M 4

6 Safety and environment Impressive safety performance in 2013 with TRIFR 0.27 and one LTI Obtained first stage of ICMI Certification in 2014 Designed as a zero discharge mine TRIFR TRIFR Low rainfall environment (c. 900mm per annum) Constructed 73 hectare rain water catchment area to minimise environmental impact 5

7 Mine site Water Storage ROM pad Water Harvest Buzwagi Pit Tailings Dam Village Waste rock storage 6

8 Contents 1. Mine Operations Overview 1 2. Life of Mine 7 3. Processing Operations Cost Improvements Summary 27 7

9 Life of Mine: options review In June 2013 work began to assess mine planning options to reverse Buzwagi's negative cashflow: Survival mode in the short to medium term, generate maximum possible free cashflow in the next 5 years Possibility of future re-capitalisation to continue the mine to its designed end life Such re-capitalisation will be dependant on prevailing future gold price and the extent of funds required for ramping up back to full production Key strategies adopted in June 2013 were: Minimising capital expenditure, including capitalised waste stripping Deferring any rebuild or major component replacements not required for meeting the 5-year objective Maximising the mill feed grade Major labour and associated cost reduction across the board Minimising the hauling distances 8

10 Life Of Mine 9

11 Life of Mine: 2012 vs 2013 year end ore reserves Tonnes (000's) 2013 YE 2012 YE Variance Grade Au Ounce Tonnes Grade Au Ounce Tonnes Grade Au (g/t) (000's) (000's) (g/t) (000's) (000's) (g/t) Ounce (000's) Proven and Probable 24, ,120 63, ,697-39, ,577 Mineral Resource 49, ,038 14, , ,551 3,500 - Ounces (koz) 3,000 2,500 2,000 1,500 2, ,033 1, ,120 - End 2012 Depletion - H1 Mining Cost Gold Price Process Cost Others (cost) Depletion - H2 Scope Change End

12 Buzwagi resource / reserve model Reserve Mode Stage 2 Stage 3 Stage 4 Resource Model below Stage 3 11

13 Plans of stage 2 and 3 pits with location of orebody Stage 2 Stage 3 12

14 Section of stage 2 and 3 pits with orebody Stage 3 Stage 2 13

15 Life of Mine: options comparison Waste Mined Mined Grade Mt Grade (g/t) LOM 2014 LOM LOM 2014 LOM 2013: LOM of over 10 years with a 2.7 Moz Reserve 2014: LOM of 5 years with a 1.1 Moz Reserve 14

16 Gold production profile Annual Gold Produced (Koz) 300 Accelerated Stage 2 and 3 mining 200 Koz 100 Treating of low grade stockpiles LOM (Exc Cut 4) 2013 LOM (Inc Cut 4) Re-worked plan in 2014 to achieve budgeted ounces post isolated SE western wall instability 15

17 Ore mined Million Tonnes Annual Total Tonnes Mined Reduced tonnes mined Standing down equipment 2014 LOM (Exc Cut 4) 2013 LOM (Inc Cut 4) Annual Ore Tonnes Mined Ore Tonnes (Million) LOM (Exc Cut 4) 2013 LOM (Inc Cut 4)

18 Contents 1. Mine Operations Overview 1 2. Life of Mine 7 3. Processing Operations Cost Improvements Summary 27 17

19 Processing overview Capacity Capacity of 4.4 million tonnes milled per annum (c.12,000tpd) Process Gravity, flotation & CIL to produce dore and copper concentrate Concentrate trucked to port and sold to smelter Infrastructure 107 km power line, 400 person village 73 ha water harvest area Full back-up power capacity 18

20 Processing improvements and future strategies Achieved the plant designed capacity of 4.4 Mt in 2013 due to: Higher mill throughput rates Reduced unplanned shutdowns Implementation of short interval controls (SICs) Future strategies to maintain and exceed the nameplate capacity for LOM: Improved mill throughputs Mining to Mill ore blend strategy Reduced planned & un-planned shutdown times Maintain high crushed ore stockpile Better plant control strategies by SICs 19

21 Contents 1. Mine Operations Overview 1 2. Life of Mine 7 3. Processing Operations Cost Improvements Summary 27 20

22 Cost savings 350, , , , , ,000 50,000 - Progression of Total Site Costs 2012A 2013A 2014E Labour Energy/Diesel Consumables Maintenance Contracted services G&A costs Sales related costs Sustaining Capital Activity/One-off cost adjustment Total Direct Costs - Absolute Total Direct Costs - Activity adj Key 2014 cost saving initiatives are: Labour - FY impact of expat labour reduction Power Grid power mix Maintenance improved condition-based monitoring and root cause analysis processes Mining consumables focused on tyre life management program and improved control around fuel and lubrication issuing Processing consumables trialling of more cost efficient grinding media in progress/ short interval control system on CIL External services improved contract management (rates and fixed cost reduction) Working capital management - centered on supplies on hand and initiatives include category management 21

23 Cost saving: labour head count reductions 1,400 Life-of- Mine Human Resources - Total Head Count 2013 versus ,200 1, LOM 2014 LOM 120 Life-of- Mine Human Resources - Internationals Head Count 2013 versus LOM 2014 LOM 22

24 Impact of LOM change on capital requirements Current LOM (excluding Stage 4) compared to previous LOM(including stage 4) 2013 LOM Total 2014 LOM Total Sustaining Capex Mining based Plant based General Site Continuous Improvements Other Total Capitalised Stripping LOM

25 Improvements in power supply mix 24

26 Leading to power cost savings 14 Increasing Grid Power as a Proportion of Power Mix Site Generation MWh Tanesco Grid MWh 8 MWh Jan-13 Feb-13 Mar-13 Apr-13 May-13 June-13 July-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 25

27 2014 Business Improvement priorities Mine to mill productivity improvements Improve grade control and block model Mining process improvements (fragmentation, services) Mining fleet optimisation (dispatch upgrade, payloads, reduced idling time) Improve overall equipment effectiveness Maintenance Increase mean time between failure (MTBF) and spares management Reduced maintenance cost per hour, reduce downtime and mean time to repair (MTTR) Process plant Improve stockpile management and blending to drive improved mill throughput and plant recoveries Appropriate maintenance strategies in place Other costs Supply chain optimisation (warehouse and inventory improvements) Labour optimisation (right people, right structure and motivation) Integrate asset protection into business processes 26

28 Contents 1. Mine Operations Overview 1 2. Life of Mine 7 3. Processing Operations Cost Improvements Summary 27 27

29 Summary Life of Mine has been rescheduled, in order to deliver: a significant reduction in material moved an improved grade profile reduced capital spend Together, these mean that the mine is expected to be cash flow positive in each year of the LOM 28