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Exploring past gold producers


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Objective Capital's Africa Resources Investment Congress 2011
Ironmongers' Hall, City of London
14-15 June 2011
Day 1: Africa Resources
Speaker: Peter Hooper, Kilo Goldmines

Published in: Business, Technology
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Exploring past gold producers

  2. 2. Investor PresentationJune 2011J 2011 TSX Venture:  KGL Frankfurt:  02K
  3. 3. DisclaimerThe particulars contained herein were obtained from sources which we believe reliable but are not guaranteed by us and may be incomplete. The opinions expressed are based upon our analysis and interpretation and are not to be construed as a solicitation or offer to buyour analysis and interpretation and are not to be construed as a solicitation or offer to buy or sell the securities mentioned herein.This presentation contains confidential information and by viewing this presentation, the viewer agrees that all the information contained herein will be used by the reader solely to determine his/her interest in Kilo Goldmines Ltd., and that such information shall be retained exclusively for the benefit of Kilo Goldmines Ltd. The viewer agrees that he/she will  t i d l i l f th b fit f Kil G ld i Ltd Th i th t h / h illnot, without the express consent of Kilo Goldmines Ltd., make use of, disseminate or in any way disclose any of the confidential information to any person, firm or business, except to the extent necessary for negotiations, discussions, and consultations with personnel or authorized representatives of the reader for the purpose of determining such interests in Kilo Goldmines Ltd. Kil G ld i LtdNo securities commission or other similar regulatory authority has reviewed or passed on the merits of this presentation and any representation of the contrary is an offence. This presentation is not, and under no circumstances is to be interpreted as, a prospectus, public information, solicitation or advertisement for the sale or trade of securities.  information solicitation or advertisement for the sale or trade of securitiesTSX Venture:  KGL         Frankfurt:  02K 3
  4. 4. Senior Management g Klaus Eckhof, President and CEO, Director Geologist with 20+ years experience developing mineral  G l i t ith 20 i d l i i l deposits throughout Africa, South America, Asia, Australia  and Russia.  Founded Spinifex Gold, Lafayette Mining, and  Moto (20+ M oz Au in DRC acquired by Randgold in 2009). Moto (20+ M oz Au in DRC acquired by Randgold in 2009) Peter Hooper, Executive Chairman , Director B.Sc., Mining Engineering with 40+ years experience including  gold exploration and production in South Africa, Ghana,  Canada, Australia, and China.  Extensive global relations and  Board experience; close corporate ties in 20+ countries.TSX Venture:  KGL         Frankfurt:  02K 4
  5. 5. Management and Board gStanley Robinson A Canadian geologist, Stanley Robinson is a graduate of Sir George Williams and the University ofGeologist Ottawa, with over thirty years exploration and management experience in Canada and Africa, including six years with International Gold and Ashanti Goldfields in Burkina Faso and Ghana. For Lakota Resources Inc., Mr. Robinson was responsible for organizing and managing the Companys exploration projects and joint ventures in Tanzania. In Burkina Faso Mr. Robinson delineated a resource of 1.3 million ounces of gold on the Youga project; Youga is now in commercial production.Philip GibbsPhilip Gibbs A Chartered Management Accountant with extensive financial management experience in large g g p gCFO corporate environments in the manufacturing and retail sectors, both in North America and in Africa. Philips multi‐disciplinary exposure includes areas of Market Research, Logistics and IT Systems implementations, providing a broad base of business acumen suited to growing businesses.Jacques BouchardJacques Bouchard A partner at Heenan Blaikie, Jacques Bouchard is the firm’s Director of International Business. He acts firm sDirector as advisor for several governments, public corporations, multilateral development banks and major companies. Over the past few years, he has been lead counsel for many international mandates on behalf of clients from various countries.Jim MustardJim Mustard Jim Mustard formerly Senior Mining Analyst Vice President at Haywood Securities Inc is a Mustard, Analyst, President, Inc.,Director professional geologist and registered professional engineer. With over 25 years of industry experience with major Canadian, international mining companies, and the Government of Canada, Jim’s interest focuses on the junior exploration sector to identify early stage opportunities.TSX Venture:  KGL         Frankfurt:  02K 5
  6. 6. Shareholders and Fundamentals Top 14 Institutions (~60% of all shares) * p ( ) Common Shares 164.2 M JVAR Capital, 1.2% Anson Group, 1.2% DPX Capital Inc, 1.2% Options 16.6 MPicton Mahoney , 1.5% Sequoia , 1.5%Pinetree, 2.5%Pinetree 2 5% Warrants  61.0 M Libra, 12.3% RBC, 2.7% Fully Diluted 241.8 M Insiders and Retail Market Value $29.6M RMB, 3.1% RMB 3 1% 54.9% (7 June 2011 @ $0.18/share) Sprott, 3.7% Altus Capital, 9.6% Randgold,  4.9% 4 9% Mackenzie  Galena Asset  Financial, 6.1% Mgmt, 7.7%* Data obtained from a variety of sources including Thomson and may not be representative of actual ownership.TSX Venture:  KGL         Frankfurt:  02K 6
  7. 7. Flanked by 2 Mega M oz Deposits y g pTSX Venture:  KGL         Frankfurt:  02K 7
  8. 8. NE DRC Exploration & Mining Activity p g y Banro (Twangiza Project) ‐ mine currently under  construction; slated to begin production in Q4 2011. Randgold (Kibali Project) ‐ aims to produce first gold in  mid‐2013, six months earlier than planned. Ashanti Goldfields (Mongbwalu Project) ‐ mine  construction to begin mid‐2011 with production and  construction to begin mid 2011 with production and operations to commence in 2013 Kilo Goldmines (Somituri Project) – initial inferred  resource estimate of 2.0 MMoz Au released Q1 2011 for  Adumbi Deposit; further exploration underway. Mwana Africa (Zani‐Kodo) ‐ updated M+I resource  estimate of 1.3 MMoz Au released in Q3 2010; further  p y exploration underway.  Loncor ‐ no resource estimate to date; exploration ongoing. Rio Tinto ‐ no resource estimate to date; iron ore  exploration program underway.  Key targets include joint  exploration program underway. Key targets include joint venture project with Kilo ERW properties (iron ore only).TSX Venture:  KGL         Frankfurt:  02K 8
  9. 9. Kilo Properties pTSX Venture:  KGL         Frankfurt:  02K 9
  10. 10. KGL Somituri Project j8 Permis d’Exploitation (PE’s)  9694Covers ~606 km sq. of the Ngayu  9692Archaean Greenstone Belt Includes colonial era gold producers; Adumbi Kitenge Adumbi, Kitenge, Manzako & Maipunjie mines (PE  138 1379691) Isiro ADUMBI & AREA OVERVIEW 140 9691 HISTORIC GOLD (ounces) Production: 291,000 Resources (Adumbi): 930,000 Past Gold Producer Bagbaie Adumbi 0 1 2 3 4 km 9695 Manzako 9693 Kitenge NiaNia Imbo RiverRef: Royal Museum for Central Africa Tervuren, Belgium (2007) Maipinji Bugeco Intl (1988)Kilo has not verified the historical data,or re-calculated the historical resources. re calculated resourcesThe data is non NI43-101 compliant TSX Venture:  KGL         Frankfurt:  02K 10
  11. 11. KGL Somituri – Adumbi Deposit Drill Holes & Section LinesDrill ResultsD ill R l• 2.60 g/t Au over 136.80m (1 Feb 2011)• 2.38 g/t Au over 89.45m (5 Jan 2011)• 2.07 g/t Au over 58.8m (7 Dec 2010)• 5.01 g/t Au over 21.0m (23 Nov 2010)• 3 33 g/t Au over 11 45m (21 Oct 2010) 3.33 g/t Au over 11.45m (21 Oct 2010)• 2.01 g/t Au over 83.70m (19 Oct 2010) TSX Venture:  KGL         Frankfurt:  02K 11
  12. 12. KGL Somituri – Adumbi DepositSimplified Vertical Cross Section pTSX Venture:  KGL         Frankfurt:  02K 12
  13. 13. KGL Somituri – Adumbi DepositResource EstimateGraded Mineral Resource Estimates (Inferred)Cut off Tonnes above Grade above Tonnage above Million ounces Au(g/t Au) cut off cut off (g/t Au) cut off above cut off 0.50 46 307 259 1.37 80% 2.03 1.00 1 00 27 337 071 1.80 1 80 47% 1.58 1 58Estimated strike length of 1.2 km that appears to be  2010 Somituri Explorationhosted within a regional lineament in excess of 5 km h t d ithi i l li ti f5k • 9,746 m diamond drilling length along which artisanal gold mining activity occurs • 734 m trenching      • 592 m adit samplingThe deposit remains open at depth p p p • 1,233 soil samples                     1 233 soil samplesOpen‐pittable, starts at surface, favourable/simple CIL metallurgy (30% oxide, potential heap leach) 13
  14. 14. Adumbi Hill (Looking from SE to NW)Historic Workings (1927 to 1959)
  15. 15. Adumbi Hill(Looking from NW to SE)
  16. 16. KGL Somituri 2011 Exploration Plan pTSX Venture:  KGL         Frankfurt:  02K 16
  17. 17. KGL Somituri 2011 Exploration Plan p Strike Length Width Target Area Target g (km) (km) (Square km) (Square km) Adumbi North Prospect 0.5 0.50 0.25 Adumbi Gold Deposit – 2.03 Moz* p 1.2 0.20 0.24 Canal Prospect 1.5 0.10 0.15 Libreville – Monde Arabe Prospect 3.0 0.75 2.25 Vatican Prospect 1.0 0.75 0.75 Kitenge Prospect 1.2 0.80 0.96 Manzako prospect 2.5 0.50 1.25 Total 5.85TSX Venture:  KGL         Frankfurt:  02K 17
  18. 18. KGL Somituri Kitenge and Manako Prospects g p MANZAKO PROSPECT • Strike length:  +2.0km • 1015 m drilled in 2010 • Recent results: 9.92 g/t Au over 5.00m (Jan 2011) 9 92 / A 5 00 (J 2011) 9.37 g/t Au over 4.70m (Oct 2011) KITENGE PROSPECT • Strike length: +2.0km • 1711m drilled in 2010 • Recent results: l 21.4 g/t Au over 0.95m &           1.89 g/t Au over 8.15m (Jan 2011)TSX Venture:  KGL         Frankfurt:  02K 18
  19. 19. KGL ERWRio Tinto JV for Iron Ore Rio Tinto  Cash  Title  Title Min. Work  Payments  Ownership Expenditure Rio ‐> KiloPhase 1 Phase 1 51% Rio  51% Rio $15.75 M $ $7.25 M $(2009 – 2013) 49% KiloPhase 2 75% Rio $50 M $50 M $10 M $10 M(2014 – 2018) 25% Kilo ‐ ‐ Kilo has the option Phase 3 to convert its’  equity for cash (2019 +)(2019 +) plus an NSR Kilo / Rio JV  Properties (KGL ERW)Rio Tinto to manage and conduct all iron‐ore exploration activities.TSX Venture:  KGL         Frankfurt:  02K 19
  20. 20. Iron Ore JV – Early Indications y Rio has identified a 10km2 surface outcrop Direct shipping ore; +64%, low phosphorus h % l h h Two rigs operational Q3, 2011; drill pad  locations have already been scoped Exploration to date: $7.6M 2011 Exploration budget: $4.5M 20
  21. 21. Investment Rationale 2.0 Million oz Au at 1.4g/t Au (0.5g/t Au cut‐off) initial inferred mineral  resource estimate for the Adumbi Deposit, Somituri Project resource estimate for the Adumbi Deposit Somituri Project Adumbi Deposit starts at surface of a hill 130m above base level (i.e.  open pittable; very low stripping ratio) and has favourable/simple CIL  open‐pittable; very low stripping ratio) and has favourable/simple CIL metallurgy (30% oxide, potential heap leach) Experienced management team with a history of success in Africa & DRC Strategic partnership with Rio Tinto for iron ore assets Established camp with good infrastructure Blue sky potential TSX Venture:  KGL         Frankfurt:  02K 21
  22. 22. Next Steps p Increase number of drills turning from 2 to 4;  20,000 additional metres of drilling and an  additional 2M oz Au (inferred) additional 2M oz Au (inferred) Drilling targets include: • Adumbi Deposit – expand resource estimate by  p p y drilling along strike and at depth; turn inferred  resources to measured (2 drills) • Further drilling on nearby Kitenge and Manzako prospects; and drill Vatican and Adumbi North • Initial drilling on PE 9692 (NW Somituri) Additional metallurgical test work is in progress  Addi i l ll i l ki i and petrographic studies are planned Mapping, trenching, soil sample of other Somituri  PEs to determine new potential drill targets 22
  23. 23. Contact Information Web site: Email: Phone: +1‐416‐867‐ +1‐416‐867‐8094 Head Office: 141 Adelaide Street West Suite 1200 Toronto, Ontario  M5H 3L5TSX Venture:  KGL         Frankfurt:  02K 23
  24. 24. Appendix 1 Gold ComparablesTSX Venture:  KGL         Frankfurt:  02K 24
  25. 25. Public Trading Comparables g p Reserves and Resources Au Moz (Total + Historic) 16.0 14.0 DRC Peers 12.0 10.0 8.0 6.0 4.0 2.0 0.0TSX Venture:  KGL         Frankfurt:  02K 25
  26. 26. Public Trading Comparables g p Enterprise Value ($US millions) 800 700 DRC Peers 600 500 400 300 200 100 0TSX Venture:  KGL         Frankfurt:  02K 26
  27. 27. Capital Raised to Date p LONCOR KILO 25‐Sep‐09 $          2,250,000  $      0.75  01‐Feb‐06 $              477,884  $      0.10  18‐Feb‐10 $        10,208,125  $      1.25  01‐Nov‐06 $          1,005,884  $      0.30  18‐Feb‐10 $          5,000,000  $ 5 000 000 $      1.25  $ 1 25 NEM Mar‐07 $          3,009,000  $ 3 009 000 $      0.60  $ 0 60 16‐Dec‐10 $          3,900,000  $      1.95  Mar‐08 $          3,150,000  $      1.50  01‐Feb‐11 $        19,975,000  $      2.35  24‐Sep‐09 $        10,015,500  $      0.45  01‐Feb‐11 $          3,995,000  $      2.35  NEM 05‐Aug‐10 $          1,037,060  $      0.20  25‐Aug‐10 $              300,000  $      0.20  $        45,328,125  $ 45,328,125 07‐Oct‐10 $          3,662,940  $      0.20  08‐Nov‐10 $          4,748,000  $      0.20  12‐May‐11 $        10,000,000  $      0.20  $        37,406,268 TSX Venture:  KGL         Frankfurt:  02K 27
  28. 28. Appendix 2 Social ResponsibilityTSX Venture:  KGL         Frankfurt:  02K 28
  29. 29. KGL FoundationKGL FoundationThe main objectives of the Foundation are to help the communities  j paround the KGL exploration sites improve their lives:• by building the capacity of these communities by building the capacity of these communities  to identify their needs and establish priorities;• by collaborating with stakeholders and interest  groups to design, monitor, and evaluate  groups to design monitor and evaluate programs and strategies; and,• by partnering with local, national, and  international organizations already in the area. 29
  30. 30. KGL Foundation ProjectsKGL Foundation Projects 30
  31. 31. KGL Foundation ProjectsKGL Foundation Projects 31
  32. 32. Appendix 3 Project Photos – Dec. 2010TSX Venture:  KGL         Frankfurt:  02K 32