On the road to production

Transcription

1 TSX: AKG NYSE: AKG On the road to production Investor Presentation September 2013

2 FORWARD LOOKING INFORMATION This document has been prepared by Asanko Gold Inc. (the Company ) solely for informational purposes. This presentation is the sole responsibility of the company. Information contained herein does not purport to be complete and is subject to certain qualifications and assumptions and should not be relied upon for the purposes of making an investment in the securities or entering into any transaction. The information and opinions contained in the presentation are provided as at the date of this presentation and are subject to change without notice and, in furnishing the presentation, the company does not undertake or agree to any obligation to provide recipients with access to any additional information or to update or correct the presentation. No securities commission or similar regulatory authority has passed on the merits of any securities referred to in the presentation, nor has it passed on or reviewed the presentation. Cautionary note to United States investors - the information contained in the presentation uses terms that comply with reporting standards in Canada and certain estimates are made in accordance with National Instrument ( NI ) - standards for disclosure for mineral projects. The presentation uses the terms other resources, measured, indicated and inferred resources. United States investors are advised that, while such terms are recognized and required by Canadian securities laws, the SEC does not recognize them. Under United States standards, mineralization may not be classified as ore or a reserve unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. United States investors are cautioned not to assume that all or any part of measured or indicated resources will ever be converted into reserves. Further, inferred resources have a great amount of uncertainty as to their existence and as to whether they can be mined legally or economically. It cannot be assumed that all or any part of the inferred resources will ever be upgraded to a higher category. Therefore, United States investors are also cautioned not to assume that all or any part of the inferred resources exist, or that they can be mined legally or economically. Under Canadian rules, estimates of inferred resources may not form the basis of feasibility or pre-feasibility studies except in limited cases. Disclosure of contained ounces is permitted disclosure under Canadian regulations; however, the Securities Exchange Commission (SEC) normally only permits issuers to report mineralization that does not constitute reserves as in place tonnage and grade without reference to unit measures. Accordingly, information concerning descriptions of mineralization, mineral resources and mineral reserves contained in the presentation, may not be comparable to information made public by United States companies subject to the reporting and disclosure requirements of the SEC. The presentation may contain forward looking statements within the meaning of the United States private securities litigation reform act of 1995 and forward looking information with the meaning of applicable Canadian securities legislation concerning, among other things, the size and the growth of the company s mineral resources and the timing of further exploration and development of the company s projects. There can be no assurance that the plans, intentions or expectations upon which these forward looking statements and information are based will occur. Forward looking statements and forward looking information are subject to a variety of risks, uncertainties and assumptions, including those that are discussed in the company s annual information form. Some of the factors which could affect future results and could cause results to differ materially from those expressed in the forward looking statements and information contained herein include: market prices, exploitation and exploration successes, continued availability of capital and financing and general economic, market, business or governmental conditions. Forward looking statements and information are based on the beliefs, estimates and opinions of management at the date the statements are made and are subject to change without notice. The company does not undertake to update forward looking statements or information if management believes, estimates forward or opinions or other circumstances should change. The company also cautions potential investors that mineral resources that are not material reserves do not have demonstrated economic viability. 2

3 STRATEGY Near term Production: Flagship development asset: Esaase Gold Project in Ghana Robust Pre-Feasibility Study: May 2013 Low capital cost of $286m for 200,000oz/yr gold for 11 years Competitive operating costs of $736/oz cash costs and $843/oz all-in costs 1 Robust economics: NPV 5% $355m, IRR 23% $1,400/oz gold) Definitive Feasibility Study, permitting & construction: Q Targeting first gold production: 2015 Growth: Strategy to grow via M&A Opportunity to act as consolidator Capital Resources: Management team with proven mine building & operating expertise Significant financial strength with $190m in cash Debt financing for Esaase significantly progressed 3 1 World Gold Council definition Note: All $ figures expressed in US$

4 CORPORATE INFORMATION CAPITAL STRUCTURE (as at September 1, 2013) Ordinary Shares 85,034,338 Options & Warrants 17,219,750 Share Price $3.10 Market Cap $264m Treasury (June 30, 2013) $190m Total Enterprise Value (TEV) $74m TEV per Gold Resource Ounce $12.43 BOARD All $ figures expressed in US$ Shawn Wallace, Non Executive Chairman Peter Breese, President & CEO Colin Steyn, Independent Marcel de Groot, Independent Keith Minty, Independent Gordon Fretwell, Independent Robert Sali, Independent MAJOR SHAREHOLDERS (source: TSX Q Reporting) Highland Park Group 9.6% Van Eck & Associates 6.9% Beutel, Goodman & Company Ltd. 6.4% Mackenzie Investments 4.4% Fidelity International 4.2% Standard Life Assurance Co. 3.4% Sprott Asset Management 3.4% Management & Insiders ~ 12% Institutional Ownership ~ 50% Shareholder Information 38% 12% 50% Institutional Management & Insiders Other 4

5 Asanko s Vision: Become a Mid-Tier Gold Producer by Developing & Operating Mines Transparency Innovation Production Growth Commitment Develop Esaase Value Creating Project M&A 400,000 oz/yr 2018 Integrity Resources Human & Financial Caring Teamwork 5

6 TEAM WITH PROVEN CREDENTIALS Peter Breese Director, President & CEO Tony Devlin Chief Operating Officer Greg McCunn Chief Financial Officer Ben Adoo Managing Director Ghana Hugo Truter General Manager Projects Patrick von Kpekpena General Manager Operations Josephat Zvaipa General Manager Organisational Capability Former CEO of Mantra Resources & Norilsk Nickel International, COO of LionOre, 25 years mining development & operations experience in Africa, Australia & Europe Over 30 years of executive, operational & project management experience in Africa. Former MD of Mantra Tanzania, Williamson Diamonds in Tanzania plus a number of executive management positions with Anglo American including CEO of Zimbabwe Alloys A mining executive with over 20 years of international experience in technical, operational, corporate development and financial roles with Teck, Placer Dome & several junior mining companies in Canada & Australia. Most recently as CFO of Farallon Mining A mining engineer with over 40 years of gold and bauxite experience in Ghana. Former MD of Ghana Bauxite Co. Ltd., General Manager of Prestea, Tarkwa & Dukwa Goldfields in Ghana. Past President & Honorary Member of Council of the Ghana Chamber of Mines Former Head of Engineering at Mantra Resources, previously Engineering Manager and Project Manager for Tati Nickel s DMS construction project in Botswana. Over 25 years operational, project management & engineering experience in the gold, nickel & uranium industries. Ghanaian mining engineer with more than 25 years project management and operations experience in Ghana, South Africa, Tanzania & Canada with a number of major mining companies including Gold Fields, De Beers, and most recently Endeavour Mining Over 25 years of experience in Human Resources, Training & Development & Operational Management. Previously Operations Executive at Zimasco in Zimbabwe, Head of HR at LionOre Africa & Zimasco and Head of Training at Hwange Colliery in Zimbabwe. 6

7 DOING BUSINESS IN GHANA Long history of large scale, low cost gold production Second largest gold producer in Africa with 2.6Moz per year Over 20 operating mines with 3 new mines in production in the last 5 years Stable and functioning democracy Highly trained and educated available work force Government of Ghana 10% free-carried interest in Esaase NSR Rryalty of 5.5%, corporate tax rate of 35% 7

8 ESAASE: RESERVES & RESOURCES RESERVES Reserve Category 1 Tonnes (Mt) Gold Grade (g/t) Resource Category 2 Tonnes (Mt) Gold Grade (g/t) 1 NI Technical Report filed on SEDAR on June 27, 2013 Contained Gold (Moz) Proven Probable RESOURCES Total P&P Contained Gold (Moz) Measured Indicated Total M&I Inferred Mineral Resources stated using a 0.6 g/t Au cut-off; M&I Resources are inclusive of P&P Reserves; NI Technical Report filed on SEDAR November 23, 2012

9 ESAASE: PRE FEASIBILITY STUDY HIGHLIGHTS Robust and Low Capital Cost Project Ore Mining and Processing Weighted Average Grade and Recovery Average Annual Gold Production Operating Cost Total Capital Cost (incl. infrastructure) 5 million tonnes per year for 11 years Plant Feed 1.41 g/t and 90.1% recovery LOM average 200,000 ounces per year $736/oz cash operating cost $843/oz all-in sustating cash costs 1 $990/oz all inclusive costs post-tax $286.4m based on contract mining Gold Price (USD) NPV 5% (US$m) IRR (%) Ave. Annual Cash Flow (Post tax US$m) 1, , , , , World Gold Council 9

10 ESAASE: PFS CAPITAL & OPERATING COSTS CAPITAL COSTS ($m) Process Plant 82.9 Mining (Pre-Production) 15.9 Power Infrastructure 36.0 Buildings, Offices 5.1 TSF, WRD, ROM, Water Supply 41.1 Roads and Temporary Camp 12.9 Owners Team & G&A 41.6 EPCM 20.6 Spares & Consumables 4.3 Sub-Total Contingency (10%) 26.0 Total OPERATING COSTS ($/oz Au) Waste Mining 300 Ore Mining 114 Processing 254 G&A 62 Refining 5 Total Cash Operating Cost 736 Royalties 77 Total Cash Costs 813 Sustaining & Deferred Capex 30 All-in Sustaining Cash Cost Pre-Tax 843 Taxation 147 All-in Sustaining Cash Costs Post-Tax 990 Note: All $ figures expressed in US$ 10

11 ESAASE: MINING Mineralization outcrops at surface Low pre-strip due to topography PFS Mine Plan: Whittle optimization then detailed mine design and schedule Contract mining average life of mine cost of $3.20/t mined Strip ratio 4.3:1 DFS Mine Plan: Geotechnical studies to increase pit slope angles Increasing resource conversion to reserves SOUTH PIT MAIN PIT MEASURED INDICATED INFERRED ZPFS Pit Outline Potential to bring into DFS 11

12 ESAASE: MINERAL PROCESSING CRUSHING GRINDING <10% FLOTATION >90% CIL PROCESS Extensive metallurgical testing and full trade-off study of flotation versus whole ore leach Flotation reduces capex by +15% & opex by +40% over whole ore leach Gravity circuit recovers 40-60% of gold Average life of mine recovery 90.1% 12

13 ESAASE: DEFINITIVE FEASIBILITY STUDY Definitive Feasibility Study (DFS) commenced in May with DRA as lead engineering firm Key items being addressed in the DFS: Mining new mine plan using PFS modifying factors, improved resource conversion Process further metallurgical test work to optimise flotation Capital cost and operating cost detailed estimates to DFS standards Typical DFS work that takes long periods of time already completed: Environmental baseline studies Infill drilling Hydrological drilling Metallurgical testing DFS to be completed in Q

14 ESAASE: PERMITTING Public Hearings successfully held by EPA on May 7, 2013 Positive endorsement for the project received from stakeholders and EPA Environmental Impact Statement (EIS) completed and submitted Environmental permits expected in Q Temporary mining permit and environmental permit to allow site earth works to proceed by November 2013 if required 14

15 ESAASE: PROJECT FINANCING Well positioned with $190m cash on hand 1 Warrants 2 with strategic shareholder Highland Park have potential to raise $37m Balance of funding expected to be ~$150m including working capital and corporate costs Engaged financial consultants and borrower s counsel Debt financing is well advanced Independent Technical Experts (ITE) working alongside DFS consultants as part of bank due diligence Credit committee approved debt facility to be in place by end As at June 30, The Highland Park financing announced October 15, 2012 includes 9,443,500 warrants priced at $4.00/share for 2 years 15

16 ESAASE: DEVELOPMENT SCHEDULE Permitting DFS Project Financing Long lead contracts & orders Detail design Early site works Main construction Commissioning Commercial production Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 16

17 ASANKO S INVESTMENT PROPOSITION Well funded with $190m in cash 1 Esaase Project robust: 200,000 oz per year by 2015 Free cash flow of $87m per year 2 to fuel growth Funded by cash on-hand and project debt Permitting well advanced Clearly defined strategy: to create value through building and operating mines Opportunity to be a consolidator Management team in place to execute strategy 1 As of June 30, Based on PFS and $1,400 /oz gold price 17 Note: All $ figures expressed in US$

18 Investor Relations Contacts Alex Buck Peter Breese Greg McCunn Investor Relations President & CEO CFO London, UK Johannesburg, South Africa Vancouver, Canada