empowered to produce 15 APRIL 2008 RBC PLATINUM DAY THE PENN CLUB : NEW YORK CITY

Transcription

1 15 APRIL 2008 RBC PLATINUM DAY THE PENN CLUB : NEW YORK CITY

2 Cautionary Risk Factors and Forward Looking Statement Information This presentation includes certain statements that may be deemed "forward-looking statements" within the definition of the United States Private Securities Litigation Reform Act of All statements in this presentation, other than statements of historical facts, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that Anooraq expects are forward looking statements. Anooraq believes that such forward looking statements are based on reasonable assumptions, including the assumptions that: the Lebowa acquisition will complete; Lebowa will continue to have production levels similar to previous years; the planned Lebowa expansions will be completed and successful; Anooraq will be able to obtain future debt and equity financing on favourable terms. Forward-looking statements, however, are not guarantees of future performance and actual results or developments may differ materially from those in forward looking statements. Factors that could cause actual results to differ materially from those in forward looking statements include market prices, exploitation and exploration successes, changes in and the effect of government policies with respect to mining and natural resource exploration and exploitation and continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and those actual results or developments may differ materially from those projected in the forward looking statements. Investors should review the Company's annual Form on 20-F with the United States Securities and Exchange Commission and its home jurisdiction filings that are available at This presentation uses the terms "measured resources", "indicated resources" and "inferred resources". Anooraq advises investors that although these terms are recognized and required by Canadian regulations (under National Instrument Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize them. Investors are cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted into reserves. In addition, "inferred resources" have a great amount of uncertainty as to their existence, and economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies, or economic studies except for a Preliminary Assessment as defined under National Instrument Investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable. Factors that could cause actual results to differ materially from those in forward looking statements include market prices, exploitation and exploration successes, changes in and the effect of government policies with respect to mining and natural resource exploration and exploitation, and general economic, market or business conditions. In addition, actual results may be affected by the following specific risk factors. Data in the technical report referred to herein is not complete and cost estimates have been developed, in part, based on the expertise of the individuals participating in the preparation of such technical report, and on costs at projects believed to be comparable, and not based on firm price quotes. Costs, including design, procurement, construction and on-going operating costs and metal recoveries could be materially different from those discussed herein. There can be no assurance that mining can be conducted at the rates and grades assumed in the technical report referred to herein.. There can be no assurance that infrastructure facilities can be developed on a timely and cost-effective basis. Energy risks include the potential for significant increases in the cost of fuel and electricity, and fluctuation in the availability of electricity. Projected metal prices have been used herein. The prices of these metals are historically volatile, and Annoraq has no control of or influence on the prices, which are determined in international markets. There can be no assurance that the prices of platinum, palladium, rhodium, gold, copper and nickel will continue at current levels or that they will not decline below the prices assumed herein. The Lebowa project will require major financing, probably a combination of debt and equity financing. Interest rates are at historically low levels. There can be no assurance that debt and/or equity financing will be available on acceptable terms. A significant increase in costs of capital could materially adversely affect the value and feasibility of constructing the expansions at Lebowa. Other general risks include those ordinary to large construction projects, including the general uncertainties inherent in engineering and construction cost, the need to comply with generally increasing environmental obligations, and accommodation of local and community concerns. The economics are sensitive to the currency exchange rates, which have been subject to large fluctuations in the last several years. Investors are cautioned that any such statements are not guarantees of future performance and those actual results or developments may differ materially from those projected in the forward looking statements. 2

3 Introduction Overview of Anooraq Lebowa Platinum Mines Lebowa Transaction Highlights Conclusion 3

4 Anooraq In Brief Black Economic Empowerment, Canadian incorporated, SA managed, PGM focused Listings - Primary: TSX Venture Exchange (TSXV:ARQ) - Secondary: American Stock Exchange (AMEX:ANO) - Secondary: JSE Limited (JSE:ARQ) Majority BEE owned by Pelawan Investments (62%) Market Cap of C$ 640 M (Fully Diluted C$ 1,214 M) - 7 April 2008 Total Shares Outstanding: 186 million & 167 million BEE warrants First North American listed BEE PGM company 4

5 Anooraq Mines and Projects Location KWANDA Legend Mining Licences Joint Venture BOIKGANTSHO Namibia Botswana Zimbabwe Mozambique Prospecting Permits Lonmin PLC Northam Platinum Limited Southern Platinum Impala Platinum Mines POTGIETERSRUST PLATINUMS LIMITED MOKOPANE (POTGIETERSRUS) POLOKWANE (PIETERSBURG) Polokwane Smelter ð LEBOWA PLATINUM MINES Republic of South Africa AMANDELBULT KWANDA LIMPOPO GA PHASHA JV TWICKENHAM NORTHAM BELA BELA (WARMBATHS) MODIKWA BURGERSFORT Union Smelter ð UNION BAFOKENG/RASIMONE STYLDRIFT JV DER BROCHEN BOOYSENDAL JV LYDENBURG NORTH-WEST ð RUSTENBURG RUSTENBURG Wateval Smelter PANDORA JV GAUTENG PRETORIA MPUMALANGA WITBANK ± Kilometres 5

6 Lebowa Transaction Overview 2007: ARQ announced major transaction with Anglo Platinum ARQ will acquire from Anglo Platinum an effective 51% of Lebowa Platinum Mines and 1% control interest in existing Joint Venture projects ARQ and Anglo Platinum to combine assets under one corporate group structure ARQ acquires control over diversified PGM portfolio Anglo Platinum retained as a strategic 49% minority shareholder 6

7 Lebowa Holdco Resultant Transaction Structure Pelawan Public >52% Anooraq Anglo Platinum 51% 49% Lebowa Holdco 100% 100% 100% 100% Boikgantsho Kwanda Ga-Phasha Lebowa 7

8 Lebowa Transaction Highlights ARQ will control Reserves & Resources in excess of 200 million PGM oz ARQ acquires 56 million additional PGM Oz for US$ 8,30/ Oz Total resources support LOM exceeding 100 years at Lebowa Immediate access to existing production and cash flows from Lebowa 16km of strike length over both the Merensky & UG2 reefs Existing infrastructure (incl. water & power) positions Lebowa for expansion Concentrate sale agreement: 5 years, renewable for 5 years at election of ARQ Lays foundation for ARQ to become a mine to market PGM company Transforms Anooraq into an independent and significant PGM producer 8

9 Lebowa Transaction Update Technical due diligence complete NI Technical Report complete Definitive Transaction Agreements complete Financing Strategy: being optimized with Advisory Team Progressing with regulatory consents - SARB - SA Competition Authorities - DME 9

10 Lebowa Platinum Mines Nick James MD Mining Operations 10

11 Lebowa: Safety Demonstrated commitment to Anglo American Zero Harm principle 11

12 Lebowa Expansion Strategy Current production 70ktpm 42ktpm E oz per annum Scale of mining at Lebowa will increase to reflect the true quality and scale of the large Lebowa resource Technical studies indicate that Lebowa value is maximised at: Steady state 120ktpm Steady state 255ktpm Stage 1 - expand MER & UG2 production to 245ktpm by ktpm 125ktpm Stage 2 further expand production to 375ktpm by 2020 Source: NI ~ E oz per annum ~ E oz per annum

13 Lebowa Topographical Map DIAMAND ZEEKOEGAT N Middel Punt Hill LPM Vertical Shaft UM2 Incline MIDDELPUNT Brakfontein Decline UMKOANESTAD BRAKFONTEIN KLIPFONTEIN PASCHASKRAAL AVOCA DE KAMP TWICKENHAM SURBITON BALMORAL Total Strike Length 26km HACKNEY 13

14 Lebowa Orebody km Strike length UG2: 2500 m UG2 MERENSKY 350 m separation between MR and UG2 UG m MR 5.7km UG2 7.3km

15 Lebowa Mining Sequence UG2 MER Vent shaft Vertical shaft Surface Declines -650 m m X cut to reef X cut to reef X tram haulage Sub vertical shaft 0-35 yrs yrs yrs m X cut to reef 15

16 Lebowa MER depletion strategy 0-35 yrs MER Diamand Vert # P1 L3 19.8Mt@5.86g/t@91cm MER Zeekoegat L2c 13.3Mt@6.07g/t@89cm 94%Meas. 6%Ind. 0%Inf. MER Vertical # L1 3.8Mt@5.01g/t@93cm 100%Meas. 0%Ind. 0%Inf. N MER UM2 # L1 0.8Mt@4.38g/t@107cm 99.5%Meas. 0.5%Ind. 0%Inf yrs MR sub-outcrop yrs MER Diamand Vert # P2 L3 35.1Mt@5.62g/t@92cm MER Middelpunt Vert # P1 L3 30.1Mt@5.23g/t@90 MER Brakfontein # L1 26.3Mt@5.10g/t@99cm 70%Meas. 29%Ind. 1%Inf. MER Brakfontein Vert # P1 L3 27.6Mt@5.14g/t@92cm 650m MER Middelpunt Vert # P2 L3 18.2Mt@5.26g/t@90cm L1 = Current Operations & Approved projects L2b = Pre Feasability L2c = Scoping Study L3 = Conceptual Study MER Brakfontein Vert # P2 L3 11.2Mt@5.11g/t@92cm

17 Merensky Expansion Brakfontein 17

18 Lebowa UG2 depletion strategy 0-35 yrs UG2 Zeekoegat L2c 58% Meas. 28%Ind. 0%Inf N UG2 MPH 45 L1 11.6Mt@6.64g/t@102cm 68%Meas. 32%Ind. 0%Inf Bifurcated UG2 Reef UG2 Outcrop yrs yrs UG2 Diamand Vert # P1 L3 32.7Mt@6.81g/t@96cm UG2 Diamand Vert # P2 L3 53.5Mt@6.67g/t@96cm UG2 MPHDelta 80 L1 29.6Mt@6.50g/t@101cm 72%Meas. 28%Ind. 0%Inf UG2 Middelpunt Vert # P1 L3 45.2Mt@6.80g/t@97cm UG2 Middelpunt Vert # P2 L3 35.9Mt@6.83g/t@97cm UG2 Brakfontein L2b 44.7Mt@6.66g/t@98cm 70%Meas. 23%Ind. 7%Inf. UG2 Brakfontein Vert # P1 L3 53.4Mt@6.85g/t@101cm 650m L1 = Current Operations & Approved Projects L2b = Pre Feasability L2c = Scoping Study L3 = Conceptual Study UG2 Brakfontein Vert # P2 L3 30.6Mt@6.94g/t@104cm

19 Middelpunt Hill UG2 Expansions 19

20 Lebowa Indicative MER and UG2 Mix 255 ktpm steady state UG2 MERENSKY 120 ktpm steady state Source: NI

21 Lebowa: Opex 5, ,500 4, ,500 ZAR M 3,000 2,500 2, ,500 1, years tonnes treated opex Source: NI LOM Cash Costs R384/t Real 21

22 Lebowa Management & Transitional Arrangements Lebowa to be operated as a stand alone mining operation ARQ to have board and management control at Lebowa Anglo Platinum to still play an important role as a significant minority shareholder Lebowa to be taken over as a going concern, together with entire employee base Key services supplied by Anglo American Group at Lebowa will continue under the shared services agreement during transitional phase All Lebowa employees to be incentivised through employee ownership plan in ARQ

23 Anooraq Power 2008: Eskom power supply is a major concern for the SA mining industry until ~2014 Eskom has limited the SA mining industry, including Anglo Platinum, to 95% of its average consumption for 2007 Eskom has committed to supplying 95% of power requirements for approved expansion projects going forward To date Lebowa production has not been affected by Eskom s 95% power supply limit Relative advantages for Anooraq: - Anglo Platinum has not reduced targeted output for the Lebowa operations and expansion projects - Lebowa Phase 1 (35 year) expansions all above 650 m i.e. no refrigeration required - Lebowa has contracts in place with Eskom approving expansion to tpm - Anglo Platinum as strategic minority shareholder - Lebowa mine management have been successful at reducing power usage to 95% of 2007 consumption 23

24 Lebowa Transaction Update Highlights Joel Kesler: Corporate Finance & Business Development 24

25 Lebowa Transaction Update Fixed Purchase price = ZAR 3,6 billion (US$ 460 million) as per 1 June 2007 Anglo Platinum to facilitate funding to ensure optimal growth strategy for Lebowa Middelpunt Hill UG2 Expansion Project Term Debt Facility ZAR 1,6 billion, subordinated, 8 year term, 1 year payback holiday at a facilitation interest rate Anglo Platinum to incur for its own account the first ZAR 200 million for project development Standby Facility: ARQ has access to 80% of total Lebowa cash flows for senior debt financing purposes Anglo Platinum will facilitate ESOP for current Lebowa workforce & Community Trust 5 year Offtake secured with Anglo Platinum at competitive market rates + 5 yr renewal Anglo Platinum extends ARQ option to acquire ownership interest in Polokwane Smelter 25

26 Lebowa Transaction Financial Highlights NI Technical Report: Economic Analysis Mine Economics and Assumptions Robust mine economics: Mine NPV7.5% ZAR 17bn Lower LOM cash costs driven by new MER Mine NPV 10% and UG2 expansions Mine NPV 7.5% Real Long Term Economic Assumptions (2012 Analyst Consensus) US$:ZAR 8.09 Platinum Palladium Rhodium Gold Nickel Copper $1,273/oz $332/oz $4,669/oz $741/oz $8.64/lb $1.67/lb Mine NPV 5% LOM LOM Cash Costs (real) LOM Capex (real) Expansion Stay in business LOM 4E Basket Price ZAR 12.5bn ZAR 17bn ZAR 24bn 123 g/t 4E (34 Years) ~18 Moz R384/t US$ 329/4E oz ZAR 7.7bn ZAR 3.4bn US$1,048/oz ZAR 272,144/kg 26

27 Comparative Attributable 4E Resources Oz Attributable Oz (m) 4E 1, Anglo Plats Pre transaction Implats Lonmin Lebowa Eastern Anooraq Aquarius Elands Northam 1, Attributable Oz (m) 4E Post transaction Anglo Plats Implats Lebowa HoldCo Lonmin Northam Anooraq Eastern Aquarius Elands 27

28 Enterprise Value / Inventory (oz) EV/ oz of Measured and Indicated Resources EV/ oz of Total Inventory (Measured, Indicated and Inferred Resources) $ $300 $280 $ EV / M&I (US$/oz) $210 $140 $70 $0 Platinum Australia Aquarius Platinum Anglo Platinum Impala Lonmin Northam Platinum Eastern Platinum Wesizwe Platinum Platmin Anooraq Platinum Group Metals Anooraq PF Ridge Source: Bloomberg, Company Announcements z - Jubilee Platinum EV / MI&I (US$/oz) $200 $150 $100 $50 $0 Aquarius Northam Platinum Australia Impala Lonmin Wesizwe Platinum Anglo Platmin Platinum Group Metals Eastern Anooraq Notes 1. Market capitalization as of April 9, 2008 using basic shares outstanding, inclusive of market value of listed warrants; converted at spot exchange rates 2. Enterprise value equals market capitalization plus debt less cash balances 3. Attributable 4 PGE resources calculated including any earn-in, out arrangements 4. Aquarius market capitalization and attributable resources assumes BEE group Savannah Consortium converts its interests in AQPSE (54% held by Aquarius Platinum Limited) into Aquarius; Inferred Resources exclude Chieftans Plain and Walhalla 5. UG2 resources only at Eastern Platinum's Spitzkop/Kennedy's Vale project 6. Anooraq shown current (including the Pelawan warrant exercise) and Proforrma (PF) Lebowa acquisition; excludes Avoca and De Kamp UG2 and Merensky inferred resources 7. Resources based upon WBJV Assets only, excludes Northern Limb Anooraq PF 17 Ridge 10 Jubilee Platinum 4 28

29 Anooraq An Exciting Project Pipeline & Growth Strategy Lebowa Ga Phasha Existing production from Merensky & UG2 of 112 ktpm Approved expansion 245 ktpm by 2013 Further expansion possible to 375 ktpm Progressing pre feasibility study Review optimal resource exploitation strategy in light of Lebowa transaction & potential synergies with Lebowa mine Production Advanced Exploration Boikgantsho Progressing pre feasibility Advanced Exploration Kwanda Early stage exploration activities Early Stage Exploration 29

30 Anooraq Contact Details South Africa 4 th Floor 82 Grayston Drive Sandton, 2146 South Africa Tel: Fax: Joel Kesler Corporate Finance & Business Development joel@anooraqresources.co.za 30

31 Q & A 31

32 Appendices -History -Management -Boikgantsho Project -Ga Phasha Project -Reserve & Resource Table 32

33 History 2002 Pelawan established. Successful in tender for mineral properties as a basis for Joint Venture with Anglo Platinum on Ga Phasha PGM project 2004 Pelawan concludes Reverse Takeover of ARQ bringing in the Ga Phasha PGM project. ARQ announces its intention to become a significant & sustainable BEE controlled PGM producer ARQ concludes Joint Venture agreement with Anglo Platinum on Ga Phasha PGM project 2006 ARQ lists on JSE and finalizes its capital structure through issue of warrants to Pelawan 2007 ARQ concludes Transaction Framework Agreement to acquire a controlling interest in Lebowa Platinum Mines & Ga Phasha PGM Project Pelawan effects conditional exercises of its warrants 33

34 Management Team South Africa Tumelo (Tumi) Motsisi - Acting President and CEO Tumi is a qualified lawyer and business executive with substantial experience in the South African business and mining sectors. He is a director of several SA companies and was responsible for the establishment of Kopano Ke Matla, the investment arm of South Africa s largest trade union, COSATU. Harold Motaung Chief Operating Officer: Technical & Business Development Harold is an mining engineer by profession with 6 years of experience within the Anglo American group. He is the former Chief Director in the South African Department of Minerals and Energy s Mining Inspectorate and currently is the Chairman of Mintek, South Africa s national mineral research organization. Iemrahn Hassen - CFO Iemrahn is a Chartered Accountant and has held various senior financial positions with a number of South African listed companies, including Gold Fields, Samancor and Mobile Telephone Networks (MTN). Joel Kesler - Corporate Finance and Business Development Joel is a South African qualified lawyer with significant experience in mining finance and business development. He currently leads Anooraq s corporate finance and business development team. Nick James - MD Operations Nick is a Mining Engineer with 25 years operational experience, including Wits and Archean Gold, massive Copper and Pyrite and, more recently, narrow tabular platinum ore bodies on the Eastern Limb of the Bushveld Complex. Nick commenced his mining career with Anglo American on the Free State Gold fields (Freegold operations ), was mine manager at Anglo American s Konkola Copper Mines (Zambia) for 6 years ( ) and, more recently, was business leader at Modikwa Platinum mine, a joint venture between Anglo Platinum and ARM ( ). 34

35 Boikgantsho PGM Project Located on the Northern Limb of the Bushveld Complex - adjacent to Anglo Platinum s PPRust Mine Resources - Indicated Resources 7.7 M oz 3 E & 230,000 t of Ni - Inferred Resources 4.1 M oz 3 E & 75,000 t of Ni Boikgantsho PGM Project preliminary assessment released in March 2005:- - (1.25g/t 3 PGM) with high base metal credits (0.15% Ni) - Potential Open Pit operation 32 year mine tpm Strip Ratio: 1,7:1 - Pre feasibility being progressed 35

36 Ga Phasha PGM Project Significant Resources: Measured & Indicated 24 M oz 4E, Inferred 60 M oz 4E Located between Anglo Platinum s Twickenham Mine & Lebowa Platinum Mines Originally envisaged as UG2 project with potential production of approx 270,000 oz 4E per annum via twin decline shafts Project to be reviewed on completion of Lebowa acquisition - potential synergies between adjacent properties 2008: Anglo Platinum approves Twickenham expansion plan (ZAR 5,9 billion) 36

37 Mineral Reserves and Resources Pro Forma Merensky UG2 Total Total att Grade 4PGE Grade 4E 4E 4E M t g/t 4E oz M t g/t 4E oz oz oz Lebowa¹ Reserves 100% 51% Proven Probable Total Resources (excl reserves) Measured Indicated Total measured & indicated Inferred Ga Phasha 2 Resources Measured Indicated Total measured & indicated Inferred Platreef Total Total Total Total att Total att Total att Grade Ni Cu Ni Cu 3E 3E Ni Cu M t g/t 3E % % 000t 000t oz oz 000t 000t Boikgantsho 3 Resources 100% 100% 100% 51% 51% 51% Measured Indicated % 0.08% Total measured & indicated % 0.08% Inferred % 0.09% Total Proforma Total reserves Total measured & indicated (incl reserves) Total inferred resources Source: Anglo Platinum 31 December 2007; assumes completion of acquisition of a 51% interest in Lebowa by Anooraq 2. Qualified Person G. Chunnett, Pr.Sci.Nat., Anglo Platinum October Source: Independent QP G.J van der Heever, November The mineral resources are based on a US$20 gross metal value per tonne cut-off. Gross Metal Value per tonne (GMV/t) is sum of Pt, Pd, Au, Cu and Ni grades multiplied by the following metal prices: Pt - US$650/oz; Pd - US$250/oz; Au - US$375/oz ; Ni - US$4/lb; Cu - US$1/lb. Metallurgical recoveries assumed to be 100%. 37