CERRO CORONA MINE. Gold Fields First Foot Print in South America. Creating Value Through Regional Diversification

Transcription

1 CERRO CORONA MINE Gold Fields First Foot Print in South America Creating Value Through Regional Diversification Investor Presentation Cerro Corona, Hualgayoc July 9, 2008

2 Introduction SAFETY In Case Of Emergency.. Alarm will sound and announcement made Evacuate building through exit points Congregate outside EPCM building where safety wardens will provide further information 2

3 Introduction Cautionary Statement This document and any materials distributed in connection with this document are not directed to, or intended for distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation. This presentation does not constitute or form part of an offer to sell or issue, or any solicitation of an offer to buy or subscribe for, any securities referred to herein. The capital raising and other information in connection with the capital raising in certain jurisdictions may be restricted by law and persons into whose possession any document or other information referred to herein comes should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. The securities mentioned herein have not been, and will not be, registered under the U.S. Securities Act of 1933 (the "Securities Act"), and may not be offered or sold in the United States (as such term is defined in Regulation S under the Securities Act) unless they are registered under the Securities Act or pursuant to an exemption from registration. No public offer of the securities is being made in the United States. This document is not an offer of securities for sale in any jurisdiction. Certain statements in this presentation constitute forward looking statements within the meaning of Section 27A of the US Securities Act of 1933 and Section 21E of the US Securities Exchange Act of Such forward looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of the company to be materially different from the future results, performance or achievements expressed or implied by such forward looking statements. Such risks, uncertainties and other important factors include among others: overall economic and business conditions in South Africa, Ghana, Australia, Venezuela and elsewhere; the ability to achieve anticipated efficiencies and other cost savings in connection with past and future acquisitions; the success of exploration and development activities; decreases in the market price of gold; the occurrence of hazards associated with underground and surface gold mining; the occurrence of labor disruptions; availability, terms and deployment of capital; changes in relevant government regulations, particularly environmental regulations and potential new legislation affecting mining and mineral rights; fluctuations in exchange rates, currency devaluations and other macroeconomic monetary policies; and political instability in South Africa, Ghana, regionally in Africa or in Venezuela. These forward looking statements speak only as of the date of this document. Gold Fields undertakes no obligation to update publicly or release any revisions to these forward looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events. 3

4 AGENDA Cerro Corona: key for GFL Strategy Operational Overview Community and Social Strategy 4

5 STRATEGY The Gold Fields Franchise Simple corporate structure Diversified - 40% EBITDA from outside SA Unhedged Ghana Tarkwa Damang. Peru Cerro Corona Liquid - 100% free float Daily volume 8 million shares Listed on the NYSE, JSE, DFIX South Africa Driefontein Kloof Beatrix South Deep Australia St Ives Agnew Operating mines Developing mine Production: ~4 moz Reserves: 92moz Resources: 252moz Mines: 9 5

6 STRATEGY Growth Strategy UNHEDGED SAFETY Securing the Future Operational Excellence Growing Gold Fields Notional Cash Expenditure Free Cash Flow Margin Growth Maintain the Franchise of Few, Large, High Quality Assets BUT Also Smaller Projects For Exceptional Returns Leverage Existing Positions Strategic Alliances With Juniors Targeted US$100m Exploration Programme Growth Focused In Four Regions AGGRESSIVE INTERNATIONAL GROWTH 6

7 STRATEGY South America: Driver of Growth Ghana Tarkwa Damang. Peru Cerro Corona Target: 1 moz Current 375koz Target: 1 moz Base load: 2 moz Operating mines Developing mine South Africa Driefontein Kloof Beatrix South Deep Australia St Ives Agnew Target: 1 moz Production: 4 moz Reserves: 92moz Resources: 252moz Mines: 9 7

8 STRATEGY South America Expansion Strategy Phase I: Cerro Corona (CC) First shipment in 1Q FY09 Production: 375k eq oz per year Phase II: Growing CC JV with BVN (Consolidada Hualgayoc) Increasing CC reserve base potential for 10.1M oz equivalent reserves (resource conversion) Focus: Consolidada de Hualgayoc Phase III: Regional Expansion Expanding within South America North / Central America Greenfields exploration + JVs / M&A Delivered September In Progress Early Stage HIGH POTENTIAL FOR GROWTH 8

9 Cerro Corona Project Status Key Milestones Mechanical Work Completed for all main Areas Power line and Cerro Corona Substation completed and energized TMF embankment for start-up completed; water supply guaranteed Pre-commissioning completed Transition to operations completed required permits obtained Commercial contracts signed CERRO CORONA ON TRACK 9

10 Cerro Corona Start Up Schedule Commissioning by mid July START-UP SCHEDULE Rock in the plant by mid July TMF Completion Phase I August / Starter Level Ready Full production capacity by December Shipping Concentrates Late August / Early September SHIPMENTS: Q1 FY 09 10

11 Cerro Corona Key Performance Indicators Key Performance Indicators Unit Ops Plan FY09 Average Yearly Life of Mine Ounces produced Equivalent koz 356 ~375 Au produced k oz 142 ~140 Cu produced k tm 28 ~25 Cash Cost US$/oz 340 ~330 Sustaining Capital US$/oz 226 ~50 All-in Cost (NCE) US$/oz 586 ~400 Operating Margin % 54 ~50 CERRO CORONA WILL DELIVER VALUE 11

12 Production Ramp up Summary FY 09 3,500 3,219 3,229 3, ,000 2, , t 2, eq koz 1,500 1,510 1,529 1, ,000 1, Q1 F2009 Q2 F2009 Q3 F2009 Q4 F2009 Mined Milled Au eq oz F2009: 356k eq oz produced (Au: 142k oz, Cu: 214k eq oz) 12

13 Cerro Corona Main Challenges Successful transition from project to operation and production ramp up Manage construction of Tailings dam within cost limitations and timelines Production costs optimization Maintain a stable relationship with communities Successful delivery of concentrate to smelters READY FOR A SUCCESSFUL START-UP 13

14 SOUTH AMERICA HIGH PROSPECTIVE BELTS 80 0'0"W 70 0'0"W 60 0'0"W 50 0'0"W 40 0'0"W 10 0'0"N 0 0'0" Two highly prospective belts in South America: Peru North Subprovince - Northern Peru 10 0'0"S 20 0'0"S Chile Central Subprovince 30 0'0"S 40 0'0"S - Central Chile Porphyry and epithermal style Au/Cu mineralization Actively exploring the area through regional exploration and opportunistic approach 50 0'0"S 14

15 Consolidada Hualgayoc JV - Location & Status 80 W 78 W 76 W 4 S 6 S 8 S 10 S Rio Blanco Cañariaco La Granja La Zanja Sipan Chiclayo Pacasmayo Lagunas Norte Trujillo La Virgen Minas Santa Rosa EQUADOR Pierina Huarmey GBAR Northern Peru Polygon Hualgayoc JV Cerro Corona Cajamarca Minas Conga Yanacocha Michiquillay Huaraz La Arena Poderosa PERU Buldibuyo Antamina Highly endowned area: 185 M oz Au 50:50 JV - GF La Cima & Buenaventura JV commenced F ,900 hectares GF spend: US $2.25M 9,300 meters drilled 3 targets tested A Lima 15

16 Consolidada Hualgayoc JV Airborne Magnetics & Target Locations Pujupe Targets drilled Firenze Pan de Azucar Las Venadas Cerro Corona Tres Cruces Cº Jesus Titan - Arabe Targets AFE 3 Other Targets Mining Concession Colquirrumi GFLC Corona Project (JV) Quijote Lola 4 Km RTP Mag 16

17 Americas Region Gold Fields Projects Canada Generative Vancouver Redstar JV Denver Mexico Generative DR JV Tapajos Active Disposals Offices Hualgayoc JV Lima SBX JV Santiago Garrafao JV N & S Peru Generative 17

18 South America Chile Central Subprovince " " " " Chile Central subprovince " " "" " " " " "" """ " " " " PL " " " " " " " " " " " " V " " " LF " VA " SBX JOINT " VENTURE Maricunga belt +90 M F oz El Indio belt Chile Central Subprovince " " 26 AC " BA Qt volcanic-sedimentary rocks Tt volcanic-sedimentary rocks Kr volcanic-sedimentary rocks Jr volcanic-sedimentary rocks Kr intrusives Jr intrusives P -Paleozoic rocks '0"S 28 0'0"S 30 0'0"S 32 0'0"S 18

19 Chile Maricunga Belt Exploration Projects Isla 7160 SBX JV 4 projects to be advanced and drill tested in 2008/ Esperanza La Falda Project La Coipa-Puren Endowment (Moz) 3.7 Au, 178 Ag La Coipa Puren Marte Lobo 7.9 Au Volcan 7.1 Au km La Pepa Volcan Marte-Lobo Refugio 8.1 Au Refugio Valle Ancho 19

20 Introduction AGENDA Cerro Corona: key for GFL Strategy Operational Overview Community and Social Strategy 20

21 SAFETY AND HEALTH MANAGEMENT Management Reviews Safety and Occupational Health Policy Verification and Corrective / Preventive Actions Continuous Improvement Planning Implementation and Operation Safety and Occupational Health System Elements for a Successful Management 21

22 HEALTH AND SAFETY FIRST 25 LDI/MTI Frequency Rate Q Q Q Q Frequency Rate 22

23 ROM PAD June 08 23

24 CERRO CORONA PIT June 08 24

25 MINE PRODUCTION FY 09 3,600 3,200 3,219 kt 3,228 kt 3,121 kt 2,800 2,800 kt 2,400 2,000 38% 48% 47% 50% Total F2009: 12,368 kt 1,600 1, % 42% 40% 46% % 10% 13% 3% Qtr1 Qtr2 Qtr3 Qtr4 Oxide Sulphide Waste 25

26 ORE STOCKPILE JUNE 08 26

27 MINING FLEET Loading Tools 1 Loader CAT Shovel Terex RH-120 MA: 85% / Usage: 75% Trucks 6 Trucks CAT Trucks Komatsu 330M MA: 85% / Usage: 75% AncillaryFleet MA Usage 01 Dozer D8 84% 45% 01 Dozer D9 84% 45% 02 Graders % 52% 03 Loader CAT 988* 89% 66% 01 Excavator % * (02 coming in July 08) Drill Rigs 2 IR DM-45 1 Pantera Sandvick (for pre-splitting) MA: 90% / Usage: 60% CONTRACT MINING Five year contract with Minera San Martin 27

28 PROCESS FACILITIES Jun 08 28

29 PLANT TREATMENT FY 09 1,750 1,500 1,510 kt 1,529 kt 12% 10% 1,546 kt 17% 1,250 1, ,065 kt 3% 23% 66% 58% 54% Total F2009: 5,650 kt % % 32% 28% 0 Qtr1 Qtr2 Qtr3 Qtr4 Mixed Supergene Hypogene 29

30 PLANT RAMP UP RAMP UP TONS / DAY % 75% 80% 90% 100% Jul Aug Sep Oct Nov MONTH 30

31 PRODUCTION PROFILE - CONCENTRATE PRODUCED kt 37.0 kt kt Total F2009: kt kt AU g/t 37.1 AU g/t 33.9 AU g/t AU g/t Qtr1 Qtr2 Qtr3 Qtr4 31

32 PRODUCTION PROFILE - METALS PRODUCED Total F2009: 356 Equivalent koz Qtr1 Qtr2 Qtr3 Qtr4 Gold koz Copper Equiv Koz 32

33 CONCENTRATE SHIPMENTS THROUGH SALAVERRY Cerro Corona- Cajamarca Cajamarca - Pacasmayo Pacasmayo - Salaverry Total 84 Km 190 Km 129 Km 403 Km LOS PIRCOS SANTA CRUZ CHOTA BAMBAMARCA CERRO CORONA HUALGAYOC TANTAHUATAY LA ZANJA EL EMPALME SIPAN YANACOCHA C. CARACHUGO MAQUI MAQUI PANAMERICANA CERRO NEGRO SAN JOSE CAJAMARCA Salaverry Port PACASMAYO CHILETE 33

34 SALAVERRY PORT INFRASTRUCTURE Ship loader under commissioning Target deadline July 30th 34

35 CAPITAL EXPENDITURE - $M Sustaining Capital Ramp-up Capitalised interest Project completion Total

36 EIA ENVIRONMENTAL MANAGEMENT PLAN (EMP) EIA approved by the MEM Preventive measures to mitigation and compensate potential environmental impacts for every stage of the Project: Construction, Operation and Closing Compliance with the Cerro Corona EIA commitments The EMP was implemented since the beginning of the Operation stage 36

37 ENVIRONMENTAL MANAGEMENT KEY ACTIVITIES Environmental Management System Implementation ISO (2004) Environmental Emergency Response System Implementation of the Awareness and Preparedness of Response to Emergencies Program to Local Level (APELL) Environmental audits Geotechnical Testing 37

38 AGENDA Cerro Corona: key for GFL Strategy Operational Overview Community and Social Strategy 38

39 Cerro Corona Mine site

40 Cerro Corona Mine site

41 Cerro Corona Mine site

42 GENERAL PERCEPTION ABOUT MINING SOUNDS FAMILIAR? It contaminates; damages the environment Government supports only mining companies Doesn t make any positive impact in the local economy. Only take away Doesn t promote any development No transparency Not compatible with any other productive activity, as for example agriculture 42

43 Community of El Tingo 2004 WHERE THE STORY BEGINS 43

44 So.. WHAT COULD THE PROBLEM BE? SOME IDEAS: Political Perspective Presence of Government Existence of big impacts and social conflicts, Government's national strategy? Ministry of Environment... Excludes mining Private actions Free space for anti mining actions Does it worth to talk about CANON From National to District level. And communities where the project takes place? Voluntary Contribution 44

45 So.. WHAT COULD THE PROBLEM BE? SOME IDEAS: Social Perspective: Who is visiting who? Concession vs Land We look for immediate results: SOCIAL LICENSE Social Base Line, what is it for? Everything has to do with Perception Common Denominators: do not be exposed Expectations over 3,000 mts Is it enough to comply with the law? Little information about benefits mining provides, changing strategies NGO s point of view Use the bridge 45

46 WE FOLLOWED THE GF WAY SECURING THE FUTURE - Social programs: an investment not a cost - Open dialogue - Coexists with other economic activities like agriculture, cattle, tourism, among others - Large investment to develop - Creates labor opportunities, carefully - Complies with regulations, keep an eye on EM - Is formal and pays taxes - Is subject to permanent supervisions and inspections 46

47 But TRUST IS EASILY DESTROYED Keep people informed Make Commitments In Good Faith Fulfill All Commitments in a timely manner 47

48 CERRO CORONA MINE Gold Fields First Foot Print in South America Creating Value Through Regional Diversification Investor Presentation Cerro Corona, Hualgayoc July 9,