Swiss Mining Conference

Transcription

1 TSX:TGZ / OTCQX:TGCDF Building The Next Multi-Asset Mid-Tier West African Gold Producer Swiss Mining Conference March 21-22, 2018

2 Sepanta Dorri Vice President, Corporate & Stakeholder Development 2

3 Forward-Looking Statements This document contains certain statements that constitute forward-looking information within the meaning of applicable securities laws ("forward-looking statements"), which reflects management's expectations regarding Teranga's future growth opportunities, results of operations, performance (both operational and financial) and business prospects (including the timing and development of new deposits and the success of exploration activities) and other opportunities. Wherever possible, words such as plans, expects, does not expect, scheduled, trends, indications, potential, estimates, predicts, anticipate, to establish or does not anticipate, believe, intend, ability to and similar expressions or statements that certain actions, events or results may, could, would, might, will, or are "likely" to be taken, occur or be achieved, have been used to identify such forward looking information. Specific forward-looking statements include, without limitation, all disclosure regarding possible events, conditions or results of operations, future economic conditions and anticipated courses of action. Although the forward-looking statements contained in this document reflect management's current beliefs based upon information currently available to management and based upon what management believes to be reasonable assumptions, Teranga cannot be certain that actual results will be consistent with such forward-looking information. Such forward-looking statements are based upon assumptions, opinions and analysis made by management in light of its experience, current conditions and its expectations of future developments that management believe to be reasonable and relevant but that may prove to be incorrect. These assumptions include, among other things, the ability to obtain any requisite governmental approvals, the accuracy of mineral reserve and mineral resource estimates, gold price, exchange rates, fuel and energy costs, future economic conditions, anticipated future estimates of free cash flow, and courses of action. Teranga cautions you not to place undue reliance upon any such forward-looking statements. The risks and uncertainties that may affect forward-looking statements include, among others: the inherent risks involved in exploration and development of mineral properties, including government approvals and permitting, changes in economic conditions, changes in the worldwide price of gold and other key inputs, changes in mine plans and other factors, such as project execution delays, many of which are beyond the control of Teranga, as well as other risks and uncertainties which are more fully described in Teranga's Annual Information Form dated March 30, 2017, and in other filings of Teranga with securities and regulatory authorities which are available at Teranga does not undertake any obligation to update forward-looking statements should assumptions related to these plans, estimates, projections, beliefs and opinions change. Nothing in this document should be construed as either an offer to sell or a solicitation to buy or sell Teranga securities. All references to Teranga include its subsidiaries unless the context requires otherwise. This presentation is as of March 20, All references to Teranga include its subsidiaries unless the context requires otherwise. This presentation contains references to Teranga using the words we, us, our and similar words and the reader is referred to using the words you, your and similar words. All dollar amounts stated are denominated in U.S. dollars unless specified otherwise. 3

4 Building The Next Multi-Asset Mid-Tier West African Gold Producer The Gambia Senegal Sabodala Gold Mine 1.4Moz production since IPO in late 2010 Mali Burkina Faso Niger Guinea- Bisseau Wahgnion Development Project Expect to close financing and commence construction in Q Teranga has nearly 4.0 million ounces of gold reserves from its Sabodala Gold Mine and its Wahgnion Development Project (1)(2) Guinea Sierra Leone Mahepleu Liberia Dianra Guitry Côte d Ivoire Golden Hill Exploration JV Tiassale Ghana Afema Togo Gourma Exploration JV Benin Refer to Appendix Endnotes (1) and (2) Sangaredougou 4

5 FY2017 Highlights Achieved record production of 233,267 oz of gold Increased Sabodala reserves by 400,000 oz and filed updated NI (2) Announced positive feasibility for Wahgnion Project including reserves of 1.2 million oz (1) More positive drill results from Golden Hill Entered into joint venture on Afema land pcakage in Côte d lvoire Refer to Appendix Endnotes (1) and (2) 5 5

6 Our resettlement has really improved our lives 6

7 Creating Long-Term Sustainable Value for Our Stakeholders Through Responsible Mining Shareholder Value Risk Management Improve Local Livelihoods Deliver projects on time and on budget Trust-based relationship with all stakeholders Safeguard reputation Ability to grow footprint in West Africa Avoid community unrest & conflict Avoid work stoppages Avoid legal action Avoid withdrawal of operating licenses Local recruitment Local progression & promotion Local procurement &other capacity building 7

8 Sharing the Benefits of Responsible Mining 10,000 Trees produced for rehabilitation in Bags of seeds collected for forestry rehabilitation 928 Women working in 10 market gardens producing 350 tons of vegetables since inception $1.7M Sustainable investments in 2016 as determined by the communities 725 Farmers supported in 2016 $139M Local procurement in % National employees out of 1,258 site employees in Progressions and promotions of national employees in ,000 People benefiting from malaria spray program in

9 Garnering International Awards & Recognition United Nations Global Compact Network Canada Sustainability Award Three Time Winner of Corporate Knights Future 40 Responsible Corporate Leaders in Canada Capital Finance International: Best ESG Responsible Mining Management West Africa Prospectors & Developers Association of Canada 2017 Environmental & Social Responsibility Award 9

10 Managing Two World-Class Resettlements: Sabodala and Wahgnion Resettlements led by ERM Group, experienced global sustainability consultants The resettlements comply with the IFC Performance Standards and reflect international best practice in resettlement and livelihood Members of the affected communities participate in all areas of decision making Our mission is to leave the communities better off than before we arrived Resettlement of Communities Household and farmland surveys Community negotiations on physical resettlement Permitting and urban planning Financial compensation for land, crops, trees, inconvenience, annexes Resettlement site construction Livelihood restoration Monitoring and evaluation and continued support 10

11 Sabodala Senegal, West Africa 11

12 Largest Gold Mine in Mining-Friendly Senegal 2.7 Million Ounces in Proven & Probable Reserves Mali 4.4 million ounces in measured and indicated resources (9) 13-year mine life (9) Focused on resource definition and resource conversion at Niakafiri to expand reserves and extend mine life Life of Mine Summary (2) 5 years ( ) 13 years ( ) Annual production 213koz 176koz All-in sustaining costs $885/oz $893/oz Total free cash flow $230M $556M Refer to Appendix Endnotes (2) and (9) Sabodala Mill Niakafiri Goumbati West Sabodala Mine License & Regional Land Package (Senegal) Exploration Prospects Mineral Resources Masato Style Bulk Tonnage Gold Trend Golouma Style High- Grade Gold Trend Mining Concession Exploration Permits Previous Mine License 12

13 Replacing Reserves & Increasing Production and Cash Flow Proven and Probable Reserves (2) (Moz) 250, , , ,000 5-Year Production Profile (oz) Maki Medina , June Dec (8) 5-Year Cash Flow (6) Before Taxes and Other ($1,250/oz) Updated Sabodala Technical Report: Annual Average Production of 176Koz at AISC* of Less Than $900/oz $80 $60 $40 $20 $0 ($20) ($40) *Refer to Appendix Non-IFRS Performance Measures Refer to Appendix Endnotes (2) and (6) June Dec

14 Wahgnion Project Burkina Faso, West Africa 14

15 Strategic Pillar of Teranga s Growth Plan Wahgnion is Ideally Situated on a Prolific Gold Belt Mali Permitted mining license that covers 89 km 2 Exploration licenses covering +1,000 km 2 Burkina Faso Niger Initial Feasibility Study Includes only 4 deposits: Nogbele, Stinger, Samavogo and Fourkoura Proven and probable reserves of 1.2Moz Measured and indicated resources of 1.8Moz Inferred resources of 0.7Moz Tongon Côte d Ivoire Bobo-Dioulasso Wahgnion Ghana Togo Benin Life of Mine Summary 5.5 years LOM (9 years) Annual production (1) 131koz 119koz Wahgnion Project All-in sustaining costs* $807/oz $843/oz Total free cash flow* $302M $409M Samavogo Pre-production capital ($232M) Net cash flow $176M *Refer to Appendix Non-IFRS Performance Measures Refer to Appendix Endnote (1) Nogbele Stinger Fourkoura Proposed Plant Site 15

16 Significantly Increasing Production and Improving Free Cash Flow Teranga Consolidated Production Profile (koz) (3),(4),(7) Sabodala + Wahgnion ~350Koz annual production Opportunities to maintain production and free cash flow through resource conversion & discoveries at Sabodala & Wahgnion 350Koz ~$100M annual free cash flow* (11) ~$70M annual free cash flow* (5) *Refer to Appendix Non-IFRS Performance Measures Refer to Appendix Endnotes (3), (4), (5), (7) and (11) 16

17 Golden Hill Burkina Faso 17

18 M&I Resources are inclusive of P&P Reserves Uniquely Positioned and Advancing Quickly Siou Pit M&I: 0.89 Moz ¹ Mana M&I: 3.63 Moz ¹ Situated in the Heart of the Houndé Belt in Burkina Faso 468 km 2 situated ~200km NE of Wahgnion gold project One of the most prospective gold belts in the world today On the Houndé belt in close proximity and along strike to other large deposits Houndé M&I: 2.55 Moz ³ Yaramoko M&I: 0.81 Moz ² One of the Best High-Grade Exploration Projects in West Africa Plan to release an initial resource for Golden Hill s most advanced prospects by end of 2018 Acacia JVs ⁴ Teranga s JV Golden Hill Project $25 million financing secured for the future advancement of Golden Hill feasibility study Joint Venture with Boss Resources (51%, earning 80%) Sarama Permits Teranga, as the operator, can earn an 80% interest in the JV upon delivery of a feasibility study and the payment of AUD2.5 million Sources ¹ Semafo Corporate Presentation (Mar 2017) ² Roxgold Corporate Presentation (Feb 2017) ³ Endeavour Corporate Presentation (Feb 2017) ⁴ Acacia Preliminary Results (Feb 2017) ⁵ Savary Corporate Presentation (Mar 2017) Karankasso JV Inf: 0.67 Moz ⁵ South Houndé JV Inf: 2.10 Moz ⁴ 18

19 High-Grade with Significant Potential Five Prospects Within ~5-Kilometre Radius of Central Point In just one year, there have been three discoveries at Golden Hill To date Golden Hill has produced a series of high-grade, near-surface drill results at the first five prospects: Ma Jackhammer Hill Peksou C-Zone Nahiri The close proximity of these targets and prospects lends itself to a central mill/multi-deposit operation similar to Sabodala and Wahgnion For full details on Golden Hill, please visit 19

20 Côte d Ivoire Exploration Guitry & Afema 20

21 Exciting Opportunities in Côte d Ivoire Dianra Randgold Initial 5 Greenfield Exploration Tenements Totaling +1,800 km 2 Positive preliminary results at the Guitry prospect have made it a priority 3 km x 7 km gold-in-soil geochemical anomaly Initial drilling evaluation being undertaken with 4000-metre RC drill program underway Recently Added 1,400 km 2 Afema Land Package Afema mine license Mahepleu Endeavour Three exploration permits (Ayame, Mafere, Aboisso) Endeavour Côte d Ivoire Newcrest Perseus Tiassale Guitry Operating Gold Mine/ Development Project Sangaredougou Afema 21

22 Afema: Looking to Confirm and Improve Historical Resource* of 2Moz of Gold Well Located Geologically Along trend and within the same gold belts of a number of high profile producing mines in Ghana JV With Sodim Limited (51%, earning 70%) Teranga can earn a 70% interest in the Afema mining license and exploration permits through: completion of a 3-year $11M exploration and community relations work program; and Côte d Ivoire 3 Afema Exploration Permits Sefwi-Bibiani Gold Belt Ahafo 17 Moz Newmont Bibiani 7 Moz Resolute Mining Chirano 5 Moz Kinross Ghana Edikan 6.6 Moz Perseus Asankrangwa Gold Belt Essase 5.19 Moz Kumasi Obotan 5.5 Moz Asanko Konogo 1.4 MozSignature Metals Akyem Newmont Obuasi 41 Moz Anglo Gold Ashanti Kubi 0.9 MozAsaute Gold Corporation Ashanti Gold Belt delivery of an updated technical study Teranga will sole fund and manage the exploration programs and studies Bogoso/Prestea18 Moz Gold Star Damang 7.1 Moz Goldfields Tarkwa 24 Moz Winneba-Kibi Gold Belt Upon delivery of an updated technical study, Sodim can elect to maintain 30% or convert to a 3% NSR Afema Mining Permit Iduapriem 8.2 Moz AngloGold Ashanti Cape Coast *Refer to Appendix Afema Mine License Historical Resource Estimate 22

23 Wrap-Up 23

24 Strong Financial Position to Fund Construction of Second Mine $88 Million Cash balance as at December 31, $90 Million (6) Estimated cash flow from Sabodala $165 Million $165M (net $150M) project debt facility expected to close in Q Solid Financial Position to fund pre-production capital cost of building second mine (Wahgnion) Refer to Appendix Endnote (6) 24

25 2018 News Flow and Milestones Golden Hill Regular exploration updates starting in Q1 Maiden resource Wahgnion Close project financing Commence mill construction Update reserves Update NI technical report Côte d Ivoire Senegal Project updates from Guitry and Afema Production of 210Koz-225Koz Commence Niakafiri relocation 25

26 Capital Structure and Recent Share Price Performance Capital Structure (at December 31, 2017 unless otherwise noted) Common shares outstanding 107.3M Stock options outstanding 4.5M Fully diluted 111.8M Number of shares owned by insiders 23.8M Market capitalization (March 14, 2018) Cash / Net cash Top 10 Shareholders % of o/s Shares Owned shares as at March 7, Tablo Corporation 21.7% 23,322,400 2 Van Eck Associates Corporation 6.1% 6,573,022 3 Heartland Advisors 4.5% 4,800,000 4 Ruffer LLP 4.3% 4,607,243 5 Oppenheimer Funds 3.2% 3,460,828 6 Dimensional Fund Advisors 2.9% 3,100,539 7 Franklin Advisers 2.5% 2,707,200 8 Universal-Investment Gesellschaft 1.6% 1,735,000 9 LSV Asset Management 1.6% 1,719, Konwave AG 1.6% 1,698,197 Source: IR Insight on March 13, 2018 C$446M/ US$343M US$88M / US$70M Share Price Performance (TSX: TGZ) (Closing price on December 12, 2017 March 14, 2018) TGZ-TSX GDXJ Gold Price ASX Delisting Completed Compulsory Sale Facility before markets open on December 13 stock price hit low of $2.30 (compared to $2.42 closing price on December 12) +72% +7% +5% 26

27 Potential for Significant Share Appreciation Teranga s Share Price vs. Net Present Value* (NPV) (12) per Share Data Source: BMO GoldPages published March 12, 2018 EV/2P Reserves ($/oz) B2Gold Roxgold Endeavour % Golden Star Semafo Teranga Alacer 91 US$3.20 US$5.56 US$6.12 Asanko Perseus EV/2018E EBITDA Share Price 0.70x Current TGZ NPV Trading Multiple (12) BMO NPV per Share (Spot) Revalued Share Price 1.1x Average NPV Multiple for Medium Producers (12) Alacer Endeavour B2Gold Semafo Roxgold Teranga Golden Star 3.4 *Refer to Appendix Non-IFRS Performance Measures Refer to Appendix Endnote (12) Asanko

28 Deep Value US$5.81 NPV* Per Share based on cash & 2P reserves (1)(2) US$3.20 TGZ Current Share Price (closing price Mar 14, 2018) Excludes potential value from: Wahgnion infill drill program Golden Hill Afema and Côte d Ivoire assets US$0.79 US$1.09 US$3.93 Cash balance as at December 31, 2017 Wahgnion Project NPV 5% based on 2P (1) Sabodala NPV 5% based on 2P (2) *Refer to Appendix Non-IFRS Performance Measures Refer to Appendix Endnotes (1) and (2) USD/CAD FX rate 0.77 $1,300 Gold Price per Ounce Assumption 28

29 TSX:TGZ / OTCQX:TGCDF Trish Moran Head of Investor Relations 77 King Street West, Suite 2110 Toronto, ON M5K 2A1 T: E: investor@terangagold.com W: terangagold.com