This document summarizes the state of the mining market in Africa from a presentation by IntierraRMG. It finds that mining faced falling metal prices and high costs in early 2013. Exploration activity and drilling reports had significantly decreased over the prior 17 months. However, Africa remains an important focus for future resource development, though challenges around issues like resource nationalism must still be overcome. IntierraRMG provides mining market intelligence and hosts conferences to further examine trends in Africa and globally.

1. State of the Market
State of Africa Mining
Presenter: Chris Hinde / Glen Jones
Research: Jeremy Thompson
marketing@intierraRMG.com
Mining On Top: Africa – London , 25 June 2013

2. About IntierraRMG
Leadership: Over 30 years of providing mining information
(through two databases, consultancy, maps, conferences/
seminars and published reports)
Information: Lease locations and ownership, company
intelligence, drilling data, project pipeline, due diligence
reports, production statistics, finance and M&A activity
Reports: Quarterly examination on trends in exploration,
mine development and metals production, analysis of the
market and financing, and expert comment on the industry
Disclaimer:
IntierraRMG makes reasonable and diligent efforts to obtain accurate information for our clients and presentations. No warranty, expressed or implied is made regarding the accuracy, adequacy,
completeness, reliability, or usefulness of any information contained herein. Neither IntierraRMG nor the contributors of data to this presentation shall be held liable for any improper or incorrect use of
the information contained herein and assume no responsibility for the use of the information.

3. Outline
• Global
Overview
• Africa
Exploration
Development
Production

4. State of the Market: Mining
By the end of the March quarter, the mining industry
had found itself between a rock and a hard place:
Rock: Falling metals prices, with little prospect of an
early recovery because of lacklustre demand.
Hard Place: Pressure on operating costs and a
heightened threat of resource nationalism.
Problems compounded by the restricted supply of
finance, especially for mineral exploration.
Disclaimer:
IntierraRMG makes reasonable and diligent efforts to obtain accurate information for our clients and presentations. No warranty, expressed or implied is made regarding the accuracy, adequacy,
completeness, reliability, or usefulness of any information contained herein. Neither IntierraRMG nor the contributors of data to this presentation shall be held liable for any improper or incorrect use of
the information contained herein and assume no responsibility for the use of the information.

5. Base Metals Gloom (but Gold OK)

6. All-Time High For Gold
1000
Gold floods into Europe
from Spanish conquests
in 16th century, causing
inflation spiral
900
800
REAL (£/oz)
Gold at record real-price
of over £1,000/oz
1489: Royal Mint issues
Sovereign (£1 = 0.5oz)
700
600
500
1717: Isaac Newton
fixes £1 at 0.235oz
400
300
200
100
0
USA discovered (1492)
|----100 years---|

7. Prices Stall for Coal, Iron and Copper

8. Shape of an Industry
Mid-2012 Prices
MINED
(‘000t)
PRICE
(US$/t)
VALUE PA
(US$ bn)
Coal
Iron Ore
Gold
7,700,000
1,980,000
2.57
90
120
51,440,000
693
238
132
Copper
Bauxite
Nickel
Zinc
PGMs
Diamonds
Lead
Top Ten Total
16,300
7,500
203,000
350
1,400
16,400
12,000
1,900
0.38
38,560,000
0.032 350,000,000
4,000
1,900
9,916,700
(134)
122
71
23
23
15
11
8
1,336

9. Drilling Trends
17 month decline

10. Drilling Reports
Drill Announcements
Mar Q 2013
Dec Q 2012
Mar Q 2012
Gold Prospects
651
702
1,119
Copper Prospects
192
238
315
Silver Prospects
154
174
274
63
72
104
Zinc Prospects

11. Reported Ore Reserves (contained metal)
Metal Deposits
Mar Q 2013
Dec Q 2012
Mar Q 2012
Gold (‘000oz)
23,752
15,665
50,059
Copper (‘000t)
1,110
5,239
8,537
Silver (Moz)
574
469
309
Zinc (‘000t)
2,264
872
1,901

12. Copper/Gold Open-Pit Developments
Copper and gold deposits that have received a capital expenditure
forecast (during the past two years) for an open-pit development

13. Metals M&A Activity
Metals Deals: US$11.9
billion in March quarter
(US$14 billion in Dec Q)

14. An Industry Devalued
20 month
decline
6 month
recovery

15. Copper Discovery Rates
Average
Feasibility
Study Grade

16. Gold Discovery Rates
Average
Feasibility
Study Grade

17. Funds Raised (US$m)
Company Size
(US$m)
Q1 2013
Q4 2012
Q1 2012
<10 Market Cap
246
179
593
10 – 49
537
954
1,181
50 – 100
301
498
1,182
>100
4,075
5,137
2,914
Total
5,159
6,768
5,870 Falling total, and
Explorers
1,451
3,405
3,418 smaller share
Producers
3,710
3,364
2,454
End-2012 corporate cash holdings of US$300 billion
(under US$15 billion of this held by explorers)

18. Regional Spending

19. Operating Costs Held at Base Metals Mines
Up only
12% on
2008

20. But Costs Soar at Gold Mines
Up 62%
on 2008

21. Africa Focus

22. African Exploration
•
•
•
•
•
•
Prospecting
Sampling
Exploration drilling
Resource definition drilling
Surveying
Preliminary metallurgical

23. Exploration Capital Raisings
2 Year Total US$ 829M
Southern Africa,
$148,641,000
West Africa,
$341,438,000
18%
41%
Other Africa,
$338,736,000
41%

24. Exploration Capital Raisings
2 Year Total US$ 829M
56.4%
7.9%
7.9%
6.3%
5.1%

25. Drilling Activity - Africa

26. Conclusions
• Exploration activity significantly decreased
• New or expanded resources at risk
• Africa has significant future in resource
development
• Must overcome many of the issues discussed
in the next two days

27. Thank You
Inquire about subscription to:
• State of the Market – Africa
• State of the Market – Mining and Finance
• State of the Market - Exploration
• IntierraRMG data base
Sponsorship of:
• Africa series of maps
• Africa Mines and Deposit map
marketing@intierraRMG.com