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Scotia CapitalMining Conference 2011
Cautionary statementAll monetary amounts in U.S. dollars unless otherwise statedCAUTIONARY NOTE REGARDING FORWARD-LOOKING ...
Cautionary statement (cont’d)CAUTIONARY NOTE TO U.S. READERS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESO...
OverviewLeading intermediate gold producer           Three producing assets            Three fully-funded growth projects ...
Management and Board of DirectorsEXECUTIVE MANAGEMENT TEAM              BOARD OF DIRECTORSRandall Oliphant, Executive Chai...
Capitalization and liquidity                            Cash (US$ mm)(1)                                                  ...
Diversified asset portfolio(1)                                                                                            ...
Operational execution    Gold production(1) (000s ounces)         400                                                     ...
Year-to-date operating performance                                                                                    YTD ...
Margins continue to grow                                                                                               $1,...
New Afton – Underground production started                                                     Fully-funded, fully-permitt...
El Morro (30%) – A world class project                            Reserves(1) – 2.6 Moz gold; 1.8 Blbs copper             ...
Blackwater – An exciting new discovery                         Resources(1) – M&I: 5.4 Moz; Inferred: 1.2 Moz             ...
Blackwater – Theoretical size perspectives(1)                                     600                                     ...
Robust gold production pipeline                                                                                           ...
Net asset value per share appreciation                Net Asset Value                                                     ...
Peer leading cash flow growth and value                            Enterprise Value                                       ...
The New Gold investment thesis          EXPERIENCED BOARD AND MANAGEMENT   FULLY FUNDED COMPANY WITH STRONG BALANCE SHEETD...
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  1. 1. Scotia CapitalMining Conference 2011
  2. 2. Cautionary statementAll monetary amounts in U.S. dollars unless otherwise statedCAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTSCertain information contained in this presentation, including any information relating to New Golds future financial or operating performance may be deemed "forwardlooking". All statements in this presentation, other than statements of historical fact, that address events or developments that New Gold expects to occur, are"forward-looking statements". Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words"expects", "does not expect", "plans", "anticipates", "does not anticipate", "believes", "intends", "estimates", "projects", "potential", "scheduled", "forecast", "budget"and similar expressions, or that events or conditions "will", "would", "may", "could", "should" or "might" occur. All such forward-looking statements are based on theopinions and estimates of management as of the date such statements are made and are subject to important risk factors and uncertainties, many of which arebeyond New Golds ability to control or predict. Forward-looking statements are necessarily based on estimates and assumptions (including that the business ofRichfield will be integrated successfully in the New Gold organization) that are inherently subject to known and unknown risks, uncertainties and other factors that maycause actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking statements.Such factors include, without limitation: significant capital requirements; fluctuations in the international currency markets and in the rates of exchange of thecurrencies of Canada, the United States, Australia, Mexico and Chile; price volatility in the spot and forward markets for commodities; impact of any hedging activities,including margin limits and margin calls; discrepancies between actual and estimated production, between actual and estimated reserves and resources and betweenactual and estimated metallurgical recoveries; changes in national and local government legislation in Canada, the United States, Australia, Mexico and Chile or anyother country in which New Gold currently or may in the future carry on business; taxation; controls, regulations and political or economic developments in thecountries in which New Gold does or may carry on business; the speculative nature of mineral exploration and development, including the risks of obtaining andmaintaining the validity and enforceability of the necessary licenses and permits and complying with the permitting requirements of each jurisdiction that New Goldoperates, including, but not limited to, Mexico, where New Gold is involved with ongoing challenges relating to its environmental impact statement for the Cerro SanPedro Mine; the lack of certainty with respect to the Mexican and other foreign legal systems, which may not be immune from the influence of political pressure,corruption or other factors that are inconsistent with the rule of law; the uncertainties inherent to current and future legal challenges the company is or may become aparty to, including the third party claim related to the El Morro transaction with respect to New Golds exercise of its right of first refusal on the El Morro copper-goldproject in Chile and its partnership with Goldcorp Inc., which transaction and third party claim were announced by New Gold in January 2010; diminishing quantities orgrades of reserves; competition; loss of key employees; additional funding requirements; actual results of current exploration or reclamation activities; changes inproject parameters as plans continue to be refined; accidents; labour disputes; defective title to mineral claims or property or contests over claims to mineralproperties. In addition, there are risks and hazards associated with the business of mineral exploration, development and mining, including environmental hazards,industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold bullion losses (and the risk of inadequate insurance or inability to obtaininsurance to cover these risks) as well as "Risk Factors" included in New Golds disclosure documents filed on and available at www.sedar.com. Forward-lookingstatements are not guarantees of future performance, and actual results and future events could materially differ from those anticipated in such statements. All of theforward-looking statements contained in this presentation are qualified by these cautionary statements. New Gold expressly disclaims any intention or obligation toupdate or revise any forward-looking statements, whether as a result of new information, events or otherwise, except in accordance with applicable securities laws. 2
  3. 3. Cautionary statement (cont’d)CAUTIONARY NOTE TO U.S. READERS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCESInformation concerning the properties and operations discussed herein has been prepared in accordance with Canadian standards under applicable Canadian securitieslaws, and may not be comparable to similar information for United States companies. The terms "Mineral Resource", "Measured Mineral Resource", "Indicated MineralResource" and "Inferred Mineral Resource" used in this presentation are Canadian mining terms as defined in accordance with NI 43-101 under guidelines set out in theCanadian Institute of Mining, Metallurgy and Petroleum ("CIM") Standards on Mineral Resources and Mineral Reserves adopted by the CIM Council on December 11,2005. While the terms "Mineral Resource", "Measured Mineral Resource", "Indicated Mineral Resource" and "Inferred Mineral Resource" are recognized and required byCanadian regulations, they are not defined terms under standards of the United States Securities and Exchange Commission. Under United States standards,mineralization may not be classified as a "reserve" unless the determination has been made that the mineralization could be economically and legally produced orextracted at the time the reserve calculation is made. As such, certain information contained in this presentation concerning descriptions of mineralization andresources under Canadian standards is not comparable to similar information made public by United States companies subject to the reporting and disclosurerequirements of the United States Securities and Exchange Commission. An "Inferred Mineral Resource" has a great amount of uncertainty as to its existence and as toits 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. UnderCanadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. Readers are cautioned not to assume that all orany part of Measured or Indicated Resources will ever be converted into Mineral Reserves. Readers are also cautioned not to assume that all or any part of an "InferredMineral Resource" exists, or is economically or legally mineable. In addition, the definitions of "Proven Mineral Reserves" and "Probable Mineral Reserves" under CIMstandards differ in certain respects from the standards of the United States Securities and Exchange Commission.TECHNICAL INFORMATIONThe scientific and technical information in this presentation has been reviewed by Mark Petersen, a Qualified Person under National Instrument 43-101 and employeeof New Gold.TOTAL CASH COST“Total cash cost” per ounce figures are calculated in accordance with a standard developed by The Gold Institute, which was a worldwide association of suppliers of goldand gold products and included leading North American gold producers. The Gold Institute ceased operations in 2002, but the standard is widely accepted as thestandard of reporting cash cost of production in North America. Adoption of the standard is voluntary and the cost measures presented may not be comparable to othersimilarly titled measures of other companies. New Gold reports total cash cost on a sales basis. Total cash cost includes mine site operating costs such as mining,processing, administration, royalties and production taxes, but is exclusive of amortization, reclamation, capital and exploration costs. Total cash cost is reduced by anyby-product revenue and is then divided by ounces sold to arrive at the total by-product cash cost of sales. The measure, along with sales, is considered to be a keyindicator of a company’s ability to generate operating earnings and cash flow from its mining operations. This data is furnished to provide additional information and isa non-IFRS measure. Total cash cost presented do not have a standardized meaning prescribed by IFRS and may not be comparable to similar measures presented byother mining companies. It should not be considered in isolation as a substitute for measures of performance prepared in accordance with IFRS and is not necessarilyindicative of operating costs presented under IFRS. A reconciliation will be provided in the MD&A accompanying the quarterly financial statements. 3
  4. 4. OverviewLeading intermediate gold producer Three producing assets Three fully-funded growth projects C$4.5 billion market capitalization $433 million in cash Strong Board and Management 4
  5. 5. Management and Board of DirectorsEXECUTIVE MANAGEMENT TEAM BOARD OF DIRECTORSRandall Oliphant, Executive Chairman James Estey, DirectorRobert Gallagher, President & CEO Robert Gallagher, President & CEOBrian Penny, Executive VP and CFO Vahan Kololian, Director Martyn Konig, Director• Board and Management hold 15 million shares of Company Pierre Lassonde, Director – ~$150 million investment Craig Nelsen, Director Randall Oliphant, Executive Chairman Raymond Threlkeld, Director 5
  6. 6. Capitalization and liquidity Cash (US$ mm)(1) Average Daily Trading $433 10 $100 9 ~$85mm $90 ~8mm 8 $80 Undrawn Credit Facility (US$ mm)(2) 7 $70 $120 Million shares 6 $60 Million C$ 5 $50 4 $40 3 $30 Total Financial Liquidity (US$ mm) $553 2 $20 1 $10 0 $0 Debt Convertible Debenture Shares Value (US$ mm)(1) (US$ mm)(3) $198 $43 2011 YTD(4)Notes: 1. Cash and debt positions as of September 30, 2011. Debt is inclusive of face value senior notes C$187 million and El Morro project funding loan. 2. $30 million of $150 million undrawn facility allocated for Letters of Credit. 3. C$55 million face value convertible due June 2014 with C$9.35 per share exercise price. Conversion would result in issuance of 5.9 million shares. 6 4. Year-to-date through October 31, 2011 based on combination of TSX, Alpha, Pure and NYSE Amex.
  7. 7. Diversified asset portfolio(1) New Afton Blackwater 8.5 Moz Cerro San Pedro Gold Reserve Mesquite 17.9 Moz M&I Resource(1) Peak El Morro Mines Operating assets Development projectsNotes: 1. Refer to appendix for detailed disclosure on Reserve and Resource calculations. Measured and Indicated Resources inclusive of Reserves. 7
  8. 8. Operational execution Gold production(1) (000s ounces) 400 383 380-400 300 330-360 302 270-300 287 200 233 100 0 2008 2009 2009 2010 2010 2011 Actual Guidance Actual Guidance Actual Guidance/YTD(2) Total cash cost(1) ($/oz) $600 $500 $566 $470-$490 $390-$410 $400 $465 $455-$465 $428 $409 $300 $200 $100 $0 2008 2009 2009 2010 2010 2011 Actual Guidance Actual Guidance Actual Guidance/YTD(2)Note: 1. Refer to Cautionary Statement and note on Total cash cost. 2. Year-to-date through September 30, 2011. 8
  9. 9. Year-to-date operating performance YTD Gold sales Cash cost(1) (000s ounces) ($/oz) Mesquite • Tracking below cost guidance despite year- 117 $628 over-year diesel price appreciation Cerro San Pedro • Excellent year continues though cyanide 110 $73 supply impacted third quarter Peak Mines • Costs impacted by Australian dollar, cost 65 $580 pressure, recoveries and timing of concentrate sale 292 $409Note: 1. Refer to Cautionary Statement and note on Total cash cost. 9
  10. 10. Margins continue to grow $1,430 $1,500 $1,021 $1,194 $1,250 $987 $766 Realized gold price (US$/oz) $1,000 $863 $522 Margin (US$/oz) US$/oz $297 $750 Cash Cost(1) (US$/oz) $500 $566 $465 $428 $409 $250 $0 2008A 2009A 2010A YTD 2011ANote: 1. Refer to Cautionary Statement and note on Total cash cost. 10
  11. 11. New Afton – Underground production started Fully-funded, fully-permitted Less than 7 months to production Multiple drawbells blasted – caving successfully initiated Remaining capital ~$200 million Average annual cash flow ~$225 million(1) Additional resource potential Overview of mill building and conveyor discharge Underground development crusher Interior of mill buildingNote: 1. Using spot commodity prices per appendix. 11
  12. 12. El Morro (30%) – A world class project Reserves(1) – 2.6 Moz gold; 1.8 Blbs copper Higher grade resource at depth – 1.3Moz gold(1) Goldcorp updated capital cost to $3.9 billion (100% basis) New Gold’s 30% share of capital fully funded ~$300 million cash flow potential(2)Note: 1. Refer to appendix for detailed disclosure on Reserve and Resource calculations. El Morro Reserves shown on attributable 30% basis. 2. Using spot commodity prices per appendix. 12
  13. 13. Blackwater – An exciting new discovery Resources(1) – M&I: 5.4 Moz; Inferred: 1.2 Moz Deposit open in all directions/at depth Located in central B.C. – near infrastructure Recent transactions consolidate project/grow land position Able to fund exploration/development internally N Private Claims Represents approximate location of current Blackwater gold resource Scale – Above map shows area covering approximately 12.5 kilometres by 8.5 Looking south over Blackwater camp kilometres. All blue claims 100% owned by New Gold.Note: 1. Shows total project resources, including portion currently attributable to Silver Quest Resources. Refer to appendix for detailed disclosure on Reserve and Resource calculations. 13
  14. 14. Blackwater – Theoretical size perspectives(1) 600 2.0 Comparable Capital Costs Blackwater September 2011 Resource Tonnes Grade Gold Ounces • Number of comparable Category (Mt) (g/t) (Moz) Canadian mining projects Indicated 165 1.01 5.4 have been assessed for Inferred 39 0.94 1.2 500 1.7 benchmarking of capital Gold production (thousand ounces) Silver production (million ounces) costs • Focus on bulk-tonnage, open-pit operations including 400 1.4 – Canadian Malartic, Quebec – Detour Lake, Ontario – Mt. Milligan, British 300 1.1 Columbia 200 0.8 Comparable capital 30,000 Tonnes per day(2) 60,000 costs(3) ~20 million per ~140 Mt ~280 Mt thousand tonnes per day Tonnes required for 13-year mine lifeNotes: 1. Current resource is in Indicated and Inferred categories and significant additional work needs to be completed, including drilling, environmental, economic studies and permitting before a mineable resource is fully defined. 2. The foregoing is not, nor is it based on any economic analysis, preliminary assessment or other type of similar studies. Mill sizes are theoretical in nature and not reflective of options being considered by New Gold. Shown only to demonstrate impact of mill size on production when using grades and recoveries representative of those disclosed in March 2011 Technical Report. A preliminary assessment and or a feasibility study will be required to define the economic viability of the project. 14 3. Based on publicly disclosed figures from: feasibility studies, pre-feasibility studies, preliminary economic assessments and other updates provided related to the comparable projects shown above. There are no assurances that the Blackwater project will be comparable to the above projects.
  15. 15. Robust gold production pipeline Average Mine Life Year of Impact (years) New Afton ~20% gold production 1 growth < 1 year 2017(1) 10-15(2) 2 El Morro ~20% gold production Blackwater growth ~5/6 years El Morro Blackwater ~50% to 100% gold 2016/2017 ~95Koz/year 15 3 production growth in 6 years 2012/2013 New Afton 12 ~85Koz/year Today Mesquite, Cerro San Pedro, ~6-13 Peak ~400Koz/yearNotes: 1. Blackwater start date based on indicative timeline which is dependent on continued exploration success, permit approvals and the determination that the deposit is economically viable. There is no assurance this timeline will be achieved nor that the deposit will ever reach the production stage. 2. Mine life range shown is theoretical in nature. Ultimate mine life to be determined by maximizing project economics when comparing mineable resource against 15 upfront capital and ongoing operating costs.
  16. 16. Net asset value per share appreciation Net Asset Value $14.00 New Gold $13.50 Share Price New Gold announces Closing of announces 6/1/09 Today $13.00 higher El Morro proposed Richfield acquisition acquisition $12.50 NAVPS Reserves and of Richfield $12.00 Resources Operating Portfolio(1) $11.50 Completed $11.00 $1.2bn business Monetized equity combination with ~ $875 $2,056 $10.50 position in Western Beadell for Net US$ NAV and Share price $10.00 Goldfields Proceeds of $9.50 A$60mm New Afton $9.00 $8.50 New Afton analyst tour ~ $120 $1,099 $8.00 Exercised El $7.50 Closing of Morro Right of Amapari sale $7.00 First Refusal El Morro(2) $6.50 and announced $6.00 partnership $5.50 with Goldcorp ~ $40 $761 $5.00 $4.50 Blackwater(3) $4.00 $3.50 $3.00 $-- $994 $2.50 $2.00 345% increase in NAVPS 220% increase in share price $1.50 Development Projects $1.00 10-Aug-11 18-Nov-11 1-Jun-09 18-Dec-09 9-Sep-09 28-Mar-10 6-Jul-10 2-May-11 22-Jan-11 14-Oct-10 25-Nov-11 ~ $160 $2,854Source: Broker Reports, Company Estimates and Announcements, Bloomberg.Notes: 1. Street consensus NAV for Mesquite, Cerro San Pedro and Peak Mines. 2. Current street consensus NAV for El Morro; Includes $50mm cash payment received from Goldcorp as part of transaction consideration. 16 3. New Gold purchased Richfield for C$480 million. The deal closed on June 1, 2011.
  17. 17. Peer leading cash flow growth and value Enterprise Value $4.1 billion Consensus El Morro Value $0.8 billion Consensus Blackwater Value $1.0 billion Enterprise Value(excl. El Morro and Blackwater) $2.3 billion Cash Flow from Operations ($ millions) $600 ~$550m $500 $400 $300 $200 $182m $100 $79m $0 2009A 2010A 2013E Spot Prices(1) Trading at ~4.3x 2013E cash flow at spot pricesNotes: 1. Using spot commodity prices per appendix. 17
  18. 18. The New Gold investment thesis EXPERIENCED BOARD AND MANAGEMENT FULLY FUNDED COMPANY WITH STRONG BALANCE SHEETDIVERSIFIED ASSET BASE IN MINING FRIENDLY JURISDICTIONS ORGANIC GROWTH OPPORTUNITIES/METAL OPTIONALITY PRODUCTION GROWTH/MARGIN EXPANSION INCREASING UNDERLYING ASSET VALUE MULTIPLE CATALYSTS COMPELLING INVESTMENT PROPOSITION 18
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