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A DEEP VALUE OPPORTUNITY A DEEP VALUE OPPORTUNITY Nick Holland - - PowerPoint PPT Presentation

A DEEP VALUE OPPORTUNITY A DEEP VALUE OPPORTUNITY Nick Holland Chief Executive Officer Denver Gold Forum 22 September 2010 Forward Looking Statements Certain statements in this document constitute forward looking statements within the


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SLIDE 1

A DEEP VALUE OPPORTUNITY A DEEP VALUE OPPORTUNITY

Nick Holland Chief Executive Officer Denver Gold Forum 22 September 2010

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SLIDE 2

Forward Looking Statements

Certain statements in this document constitute “forward looking statements” within the meaning of Section 27A of the US Securities Act of 1933 and Section 21E of the US S iti E h A t f 1934 Securities Exchange Act of 1934. Such forward looking statements involve known and unknown risks, uncertainties and

  • ther important factors that could cause the actual results, performance or achievements

f th t b t i ll diff t f th f t lt f

  • f the company to be materially different from the future results, performance or

achievements expressed or implied by such forward looking statements. Such risks, uncertainties and other important factors include among others: economic, business and political conditions in South Africa, Ghana, Australia, Peru and elsewhere ; decreases in the market price of gold and/or copper; hazards associated with underground and surface the market price of gold and/or copper; hazards associated with underground and surface gold mining; labour disruptions; availability terms and deployment of capital or credit, changes in government regulations, particularly environmental regulations; and new regulation affecting mining and mineral rights; changes in exchange rates; currency devaluations; inflation and other macro-economic factors industrial action temporary devaluations; inflation and other macro economic factors, industrial action, temporary stoppages of mines for safety and unplanned maintenance reasons; and the impact of the AIDS crisis in South Africa. These forward looking statements speak only as of the date of this document. The company undertakes no obligation to update publicly or release any revisions to these forward looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events.

Denver Gold Forum, 22 September 2010

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SLIDE 3

What Gold Fields Offers ….

Our Value Proposition

A Quality Reserve Base 78 million ounces of reserves A Rising Production Profile 3.6 million ounces annualised Safety Strategy Delivering Second record year in succession Strong Free Cash Flow US$250 million in Q4 F2010 Strong Free Cash Flow US$250 million in Q4 F2010 Strong Growth Pipeline Targeting 5 moz in production or development by 2015 development by 2015 Strong Balance Sheet Net debt only 0.5 of annual EBITDA Unhedged Full exposure to gold price

The Global Leader In Sustainable Gold Mining

3

Denver Gold Forum, 22 September 2010

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SLIDE 4

What Gold Fields Offers ….

Our Value Proposition

16X

2009 Trailing EV/EBITDA

10.6X 6.2X

AngloGold Ashanti Barrick Gold Gold Fields

Source: BMO Nesbitt Burns

A Deep Value Opportunity

4

Denver Gold Forum, 22 September 2010

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SLIDE 5

What We Delivered In F2010

Our Value Proposition

  • Attributable Production up 2% to 3.5 moz

– Driefontein, Kloof and Beatrix more stable – South Deep up 52% to 265koz

Sweating Our Assets

p p – Cerro Corona up 80% to 394koz – Tarkwa up 20% to 721koz NCE Margin up 2% to 15%

  • NCE Margin up 2% to 15%

– Targeting 20% NCE Margin in 2011 – Business Process Re-design Launched

Growing Gold Fields

  • Organic growth at international assets
  • Chucapaca JV, Peru – Initial resource of 5.6 moz
  • Yanfolila, Mali – Land consolidation and accelerated drilling
  • New Safety Culture Gaining Traction

Securing Our Future

  • South Deep Mineral Rights Converted
  • 2014 BEE Ownership Targets by December 2010

Margin Per Ounce and Ounces Per Share

5

Denver Gold Forum, 22 September 2010

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SLIDE 6

What We Delivered In F2010

Our Value Proposition

F2010 NCE Margin = 15%

1200 800 1000 $/oz 400 600 $ 200 Q1F2010 Q2F2010 Q3F2010 Q4F2010 Gold Price NCE Cash Cost

Q4 F2010 NCE Margin 18%

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Denver Gold Forum, 22 September 2010

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SLIDE 7

Strategic Focus Going Forward

Our Value Proposition

g g

Four Strategic Deliverables

Stability at SA Mines

  • Safe production
  • Ore reserve development

Deliver South Deep

  • Production build-up to 750 koz to 800 koz

by end of 2014

  • Capital Projects

Capital Projects

Grow NCE Margin to 20%

  • Business Process Reengineering

No M & A Heroics

Deliver Growth Pipeline

  • No M & A Heroics
  • Exploration increased to US$150m p.a.
  • 60 Geoscientists on 5 continents

p

  • Organic Growth Projects
  • Greenfields Projects

Margin Per Ounce and Ounces Per Share

7

Denver Gold Forum, 22 September 2010

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SLIDE 8

Growth: South Africa Region

South Deep Project p j

600 800

  • z)

200 400 600

  • duction (o

200 F2009 F2010 F2011 F2012 F2013 F2014 Pro

2 3 Rbn) 1 F2009 F2010 F2011 F2012 F2013 F2014 Capital ( F2009 F2010 F2011 F2012 F2013 F2014 Plan Actual

Momentum Towards 750 koz to 800 koz by End of 2014

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Denver Gold Forum, 22 September 2010

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SLIDE 9

South Deep Project

Growth: South Africa Region

p j

F2010 F2011 F2012 F2013 F2014 Status

Capital Programme: 2010 to 2014

Refrigeration Plant

  • Twin Vent Shaft

Tailings Storage Facility

  • Tailings Storage Facility

Plant Expansion to 450ktpm

  • New Mine Development

A t l

R1 6bn

  • Total Capital

Actual

R1.6bn

Base Plan

R1.8bn R1.9bn R2.1bn R1.5bn R1.2bn

Note: Capital estimates in July 2009 money

Capital Efficient and on Track

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Denver Gold Forum, 22 September 2010

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SLIDE 10

St Ives Gold Mine, Argo-Athena Camp

Growth: Australasia Region

, g p

Cave Rocks

Significant land position

Greater Revenge Area

(60 x 30 km)

Leviathan Lefroy Mill

10 moz mined to date Argo-Athena Camp Current reserve 2.3 moz p

Junction

Argo – Athena Camp

60km X 30km land position

g p

  • 3.5 moz defined endowment
  • +5.0 moz potential

Most Significant New Discovery in Western Australia

Denver Gold Forum, 22 September 2010

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SLIDE 11

Growth: Australasia Region

St Ives Gold Mine, Argo-Athena Camp , g p

Argo 1 moz Produced Athena 771 koz Resource Hamlet 1 moz Resource C t ti Q1 2011 Yorrick 889 koz Resource Under Construction Construction Q1 2011

Defined Endowment +3.5 moz – Potential +5 moz

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Denver Gold Forum, 22 September 2010

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SLIDE 12

Growth: Australasia Region

Agnew Gold Mine - Waroonga Deposit g g p

Rajah Kim 450 South Main South Main North

12

Creating A Longer Life Mine

Denver Gold Forum, 22 September 2010

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SLIDE 13

Growth: Australasia Region

Far South East Project, Philippines

  • Located in Northern Luzon, 250km north
  • f Manila

j , pp

  • f Manila
  • Established infrastructure including:

Tarred Access roads and existing power g p lines and substations Close proximity to Poro Point port facilities with two road transport routes Established camp, community facilities and landing strip on site Tailings facilities with capacity

  • Established and supportive workforce

based on site

  • Existing mineral tenure

Denver Gold Forum, 22 September 2010

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Potential To Be A World Class Deposit

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SLIDE 14

Growth: Australasia Region

Far South East Project, Philippines Deal Terms j , pp

Southwest Northeast

  • 18-month option to acquire 60% in

FSE for pre-agreed price of $340m

750 m

  • Gold Fields to conduct material drill

program and feasibility studies $54 i ti f d d t

  • $54m in option fee and down-payment

payable upon signature

  • Further $66m down-payment after 12

AuEq g/t

p y months if Gold Fields elects to proceed

  • Final payment of $220m prior to expiry
  • f option period

900 m

  • f option period
  • 691m @ 2.5 g/t Au and 0.9% Cu

907m @ 1.5 g/t Au and 0.5% Cu 953 @ 1 3 /t A d 0 6% C

Denver Gold Forum, 22 September 2010

14 900 m 953m @ 1.3 g/t Au and 0.6% Cu

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SLIDE 15

Solid Operations and an Exciting Growth Project

Growth: West Africa Region

p g j Tarkwa Gold Mine A ld l i i

Mali

A world class open pit mine 10 moz Reserve

Bamako

Damang Gold Mine Creating a long life mine 2 R

Accra Ghana

Yanfolila Project

2 moz Reserve

Tarkwa Damang

Yanfolila Project, Mali Targeting a five million ounce camp

Damang

Well Positioned in Fastest Growing Gold Province

Denver Gold Forum, 22 September 2010

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SLIDE 16

Damang Gold Mine

Growth: West Africa Region

g

Juno Juno Damang Pit Cut Back Damang Pit Cut Back Huni Huni

1

1 9 1

6 3

1 6 3 9 6 Current Strike Length Potential Strike Length

New Secondary Crusher commissioned Targeting Growth to 250 koz p.a. Targeting a 15 to 20 year life Aggressive exploration drive gg p

  • Greater Damang and Greater Damang

Greater Damang “Super Pit”

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Denver Gold Forum, 22 September 2010

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SLIDE 17

Yanfolila Project - Mali

Growth: West Africa Region

j 163

196

112 163

112 163 20

YANFOLILA PROJECT Sadiola Essakane

20

20

Loulo Morila S Siguiri Sadiola Syama

An Emerging Camp in Elephant Country

Denver Gold Forum, 22 September 2010

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SLIDE 18

Growth: West Africa Region

Yanfolila Project - Mali j

KW

Komana West Komana East

Targeting 2 moz reserve within 30km radius of Komana within 3 years

Three Years To Construction

18

Denver Gold Forum, 22 September 2010

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SLIDE 19

Growth: West Africa Region

Yanfolila Project - Mali j

11m@2.6g/t from 34m

3 High grade zones

18m@4.5g/t from 33m

3 High grade zones

2m@5.7g/t from 34m 22m@4.8g/t from 7m

Shallow oxide opportunities

21m@20.8g/t from 53m 53m@6.5 g/t from 8m

Free dig potential

51m@4.1 g/t from 0m 35m@2.1 g/t from 32m

Open to North South and at depth Open to North, South and at depth

Komana East Deposit

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Denver Gold Forum, 22 September 2010

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SLIDE 20

Growth: South America Region

Cerro Corona Mine Exceeding expectations Production and reserve growth

Cerro Corona Mine

Production and reserve growth

Lima

Chucapaca Project

Chucapaca Joint Venture Project A 5.6 moz initial resource

Growing Gold Fields In Peru

Denver Gold Forum, 22 September 2010

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SLIDE 21

Cerro Corona Mine, Peru

Growth: South America Region

, Oxide Treatment Opportunity 7 5 t f id @ 1 37 /t

  • 7.5 mt of oxide ore @ 1.37 g/t
  • Majority stored on surface stockpiles
  • ~300 koz of recoverable gold
  • ~300 koz of recoverable gold
  • Detailed engineering for Oxide Plant
  • Construction Q1 2011
  • Construction Q1 2011

Resource Conversion Project

  • 8.1 moz au eq resource
  • 5.0 moz reserve

Li it d b t ili t i t

  • Limited by tailings constraints
  • Alternatives under investigation

Expansion and Life Extension Opportunities

Denver Gold Forum, 22 September 2010

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SLIDE 22

Chucapaca Joint Venture, Peru

Growth: South America Region

p , Ch

Chucapaca JV

Chucapaca Joint Venture 51% Gold Fields 49% B ena ent ra 163

196

49% Buenaventura

Canteras del Hallazgo – 12,700Ha

MINING CONCESSIONS

Gold Fields - 94,100Ha Buenaventura – 18,400Ha Aruntani

SYMBOLOGY

Dirt Road Back Road Main Road !

S O OG

Dominant Land Position in a Rapidly Emerging Gold Camp

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Denver Gold Forum, 22 September 2010

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SLIDE 23

Growth: South America Region

Chucapaca Joint Venture, Peru

  • Discovery hole drilled September 2008

p ,

Canahurie

  • Canahuire drilling to date: 22,290m
  • 18 months from discovery to resource
  • Amenable to open pit mining
  • Positive metallurgical recoveries

Cerro Chucapaca

g

  • Canahuirie Initial resource of 5.6m eq oz
  • Mineralisation potential beyond current

112

Katrina

  • Mineralisation potential beyond current

drilling

  • Pre-feasibility commenced

20

20

GF

Katrina South

  • New round of in-fill and step-up drilling

BVN

Three Years to Construction Decision

23

Denver Gold Forum, 22 September 2010

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SLIDE 24

Growth: South America Region

Chucapaca Joint Venture, Peru p , W E

CCP09-63 40m @ 7.84g/t Au 1.3km 350m

100E 700W 300W

Looking North

CCP09-60 127.4m @ 8.55g/t Au uncut

Canahurie Resource Model & Pit Shell

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Denver Gold Forum, 22 September 2010

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SLIDE 25

Estimated Contribution: Greenfields and Brownfields Projects

Growth Pipeline

j

5.0 moz Target*

Greenfields Exploration Portfolio

AL TS GAP ~500koz

Arctic Platinum Project, Finland Talas JV, Kyrgyztan Uranium Project, South Africa

POTENTIA PROJECT

Far South East

Chucapaca Project, Peru Yanfolila Project, Mali S th D P j t S th Af i Argo - Athena Camp, St Ives, Australia Cerro Corona Oxides Project

Potential ~1 moz

Maintain Current Operations

Damang Growth Project, Ghana South Deep Project, South Africa

3.5 moz F2010 F2015

Maintain Current Operations

3.5 moz

*Five Moz In Development or Production by 2015

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Denver Gold Forum, 22 September 2010

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SLIDE 26

Growth Pipeline

F2010 F2015 Target

Regional Diversification 55%

g

40% 55% 40%

South Africa Australasia West Africa South America South Africa Australasia West Africa South America

F2015 Production Targets *

South Africa Region Australasia Region West Africa Region South America Region

~2 moz ~1 moz ~1 moz ~1 moz

* In development or production

International Growth & Diversification From A Strong SA Base

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Denver Gold Forum, 22 September 2010

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SLIDE 27

Gold Fields at an inflection point …

Conclusions

Rising production trend from existing mines p Rising production trend from existing mines Building a free cash flow margin of 20% Building a free cash flow margin of 20% S th D P j t t k South Deep Project on track Solid growth pipeline towards 5 million ounces Superior balance sheet to fund growth

A DEEP VALUE OPPORTUNITY

Denver Gold Forum, 22 September 2010

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SLIDE 28

CAN YOU AFFORD CAN YOU AFFORD NOT TO OWN A PIECE OF GOLD FIELDS?

Investor Relations Willie Jacobsz Senior Vice President Head of Investor Relations Investor Relations Nikki Catrakilis-Wagner Investor Relations Manager Head of Investor Relations (office) 508 839-1188 (mobile) 857 241-7127 willie.jacobsz@gfexpl.com Investor Relations Manager (office) +27 11 562 9706 (mobile) +27 83 309 6720 nikki.catrakilis-wagner@goldfields.co.za