Partnering with International Capital to develop West African minerals: Australian/ Nigeria case study

WEST AFRICAINVESTMENT CONFERENCE Accessing the Australian Market: How to Partner with Australians to Establish an African Mining Project Michael Tilley – Chairman, Terrain Capital MOEVENPICK AMBASSADOR HOTEL IN ACCRA, GHANA ● MONDAY-WEDNESDAY, 7-9 MAY 2012 www.ObjectiveCapitalConferences.com

WEST AFRICA INVESTMENT CONFERENCE

Accessing the Australian Market: How toPartner with Australians to Establish anAfrican Mining ProjectPresented by Michael TilleyChairman of Terrain Capital LimitedApril 2012 3

Presentation Overview1. Introducing Terrain Capital Limited2. Preparing the Mining Project3. Early Stage Exploration – Verifying the Asset4. Seeking Outside Capital5. Building an Australian Company6. Recent Terrain African Mining Transactions 6.1 TGP Australia Pty Ltd (now Energio Limited, ASX:EIO) 6.2 Nigeria Gold Pty Ltd (now Australian Mines, ASX:AUZ)7. Terrain Capital’s Contact Details 4

1. Introducing Terrain Capital Limited  Terrain Capital Limited (“TCL”) is a Corporate Advisory Firm that provides investment banking services to public and private companies  We specialise in raising capital (equity and debt), strategic merger and acquisition advice, organise business sales and assist in growth for clients  We have a long history in advising and advancing mining projects  We partner with our clients to ensure long term success  Terrain Capital holds an Australian Financial Services Licence No. 240276 which allows Terrain Capital to provide corporate advisory and investment banking services  The specialist advisory services provided by Terrain Capital ensures detailed planning and a high level of research to present the offer in the most appropriate way 5

2. Preparing the Mining Project  Collate & Document Asset Information: proof of ownership, licenses, historical drilling results, any geological reports or information  Clear Ownership: assets should be incorporated into a company which has a clear ownership and shareholding structure  Managed Financial Accounts: ensure that the company can illustrate a clear summary of Assets & Liabilities and provide any interested investor with accounts that can be easily audited by an outside accountant 6

3. Early Stage Exploration - Verifying the Asset Build an Early Stage Exploration Program: this program should be built on the Asset information that provides the most prospective starting point and then determine the gaps that need to be filled in ― Qualify and utilises the skills of a Geologist ― Likely undertakings: assays, sampling & potentially aeromags ― Always search all avenues for historical information, try the appropriate Government Ministry Department, it is less expensive and it helps focus exploratory expenditure ― Ensure that a geological report is written as the final stage of the exploratory program Build a Budget: the budget will determine whether the Company has adequate funding to complete the Exploratory Program Assess Cost versus Cash: should the Exploratory program cost exceed the cash reserves there are two choices: 1. Prune Exploratory Program to areas that add the most value 2. Consider the raising of private seed capital 7

4. Seeking Outside Capital Prepare & Organise Key Information: transparency and completeness of required information plus efficiency builds trust ― Asset Information: including geological report and all available historical information ― Financial Accounts: does not need to be audited but must be auditable ― Proof of Ownership: clear and complete documentation of licenses and their ownership (and they must be in good standing) ― Capital Requirement: how much cash is required to take the asset through to the next logical stage of capital raising ― Capital Raising Marketing Materials: a story needs to be written that includes all key information from above, so that an outside investor understands the history, the present, the potential future and the opportunity  Determine Target Investors: private investor or public markets?  Commence Marketing the Opportunity: how to capital raise  Be Ready for Due Diligence: organised information will lower risks associated with Due Diligence. Prospective investors will target, financial accounts, legality of asset ownership and prospective quality of asset 8

5. Building an Australian Company Geological Requirements: geological report must be written by a JORC qualified (or Canadian or South African equivalent) geologist Surety of Capital: the Company should have cash reserves to prove a meaningful Indicated JORC resource Exploration Program: key is to prove a JORC resource and the likely economic feasibility of mining the asset and making a profit Human Capital: the Company must attract professionals with the expertise and track record to deliver ― Board / Director Level ― Executive / Exploration Level 9

6. Recent Terrain African Mining Transactions6.1 TGP Australia Pty Ltd (now Energio Limited, ASX:EIO)TGP Australia Pty Ltd (“TGP”) was a privately owned iron ore explorer in the Agbaja region of Nigeria. Terrain advised and coordinated the:- raising of early stage private capital to undertake preliminary exploration of tenements;- acquisition of key Nigerian iron ore tenements;- building of a core exploratory team & formation of a preliminary exploration program and its associated budgets; &- appointment of Don Carroll (ex-BHP executive and Terrain consultant) to TGP’s Board.By March 2012, TGP’s iron ore assets were publicly listed as Energio Limited (ASX:EIO), had raised additional capital sufficient to develop an Indicated JORC Resource and implement the associated drilling program. EIO has completed 36% of the planned 20,000 metres of Reverse Circulation drill holes needed to develop an iron ore Indicated JORC Resource, estimated at 400Mt. The ultimate target for all tenements is an iron ore Indicated JORC Resource of 1,000Mt to 2,000Mt. Market Capitalisation: $54m Cash Available: $6m (31/3/12) 10

6. Recent Terrain African Mining Transactions6.2 Nigeria Gold Pty Ltd (now Australian Mines, ASX:AUZ)Nigeria Gold Pty Ltd (“Nigeria Gold”) was a privately owned gold explorer in the goldfields of northwest Nigeria. Terrain led and coordinated the:- identification and acquisition of key Nigerian gold tenements;- building of a core exploratory team & formation of a preliminary exploration program and its associated budgets and raising of seed private capital to undertake preliminary exploration of tenements;- public listing of Nigeria Gold as Australian Mines (ASX: AUZ) with Terrain’s Managing Director, Michael Ramsden as Chairman of AUZ and commencing the construction of an Executive team with gold exploration experience; &- development of an exploration program, including drilling, and raising sufficient capital to fund this program through until 2014.As of March 2012, AUZ had identified 4 major prospective gold projects at Yargarma, Kasele, Kagara and Tsauni. Each project is at various stages of exploration including rock sampling, high-resolution aeromagnetic surveying & drill testing. AUZ anticipates to undertake accelerated explorations on Market Capitalisation: $12m all programs. Cash Available: $6m (31/3/12) 11

7. Terrain Capital’s Contact Details Michael Tilley - Chairman Address: Terrain House, 8 Chapel Street, Richmond VIC 3121, Australia Phone: +613 9665 2444 (switch) +61 418 372 589 (mobile) Fax: +613 9665 2455 Email: mtilley@terraincapital.com Website: http://www.terraincapital.com 12

WEST AFRICA INVESTMENT CONFERENCE

Partnering with International Capital to develop West African minerals: Australian/ Nigeria case study

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