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Marcus Evans Conferences

Greenland and Arctic Mineral Exploration and Exploitation Forum

2nd & 3rd November 2011

The Cumberland Hotel, London, UK

Growth within Greenland

THE ANGEL MINING STORY

History 1

1998 Became an AIM listed mineral exploration company to develop

rare earth exploration projects (tantalum)

2005 Commenced exploration at Black Angel zinc/lead mine

2007 Decided to mine the Black Angel

$12.5m loan from Cyrus to fund BFS

NH recruited

2008 Completed BFS

Mining licence for Black Angel

Obtained offer of project finance

Banking crisis

Project finance offer is withdrawn

Survival plan

History 2

2009 Off take agreement with MRI

Purchase of Nalunaq

Plan to build plant for $12m

2010 Recruitment of new senior operations team

2011 Nalunaq commences production

Installed a cable car to access the Black Angel mine

New feasibility study for Black Angel

Focussed on Greenland

• Highly prospective and underexplored land mass

• Greenland is seeking to increase economic independence as Danish subsidy is reduced

• Opportunities in gold, zinc, lead, coal, iron ore, rare earths and precious stones, etc.

• Angel is currently the only operational mining company in Greenland

Greenland

Anything you want to do in Greenland is difficult !• No road or rail transport• No local distributors of mining equipment or

consumables• Purchase order lead time – at least 1 week

(assuming air freight)• Very little skilled labour• Ice (fjord freezes over for 6 months, or may be

blocked with ice floes)• Bureaucracy can frustrate

Greenland experience to date

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NALUNAQ• Bought a bargain• Honest but bureaucratic regulators • Good conceptual project plan• Poor plant design (now rebuilt with design modifications)• Poor management of subcontractors & poor recruitment (new team now working

well)• Poor selection of equipment (refurbished or replaced)• Impractical mine plan (new mine captain, new plan, now producing to target)

BLACK ANGEL

• Huge opportunity

• Good conceptual plan

• Poor approach to engineering economic feasibility (new feasibility plan will be completed by year end)

Nalunaq Gold Mine

• Zero JORC resource but life expectancy of 2 years is anticipated producing c. 50,000 ozs of gold.

• Production commencing now

• Grade 5 gpt to 100+ gpt (average for Crew was 14.5 gpt)

• Cash cost forecast at $900 per ounce

• Cash generation potential at current gold price $40m ($800 per ounce)

• Invested to date $25m

Black Angel

• A high grade zinc/lead mine

• Operated by Cominco from 1976 and closed in 1990

• JORC resource of 4.5m tonnes of medium to high grade ore

• Capex estimate to build the mine - $80m

• Programme –

- 2011 complete installation of cable car for mine access

- 2012 mine chamber for plant, install plant, entrap first pillars

- 2013 commence production

• Annual target output 30,000 tonnes of Zn and 9,000 tonnes of Pb

• Cash generation potential of first 5 years (pillar extraction) at $2,500 per tonne of metal - $190m

Why Develop Nalunaq ?

• Existing mine infrastructure• Perceived to be low risk• Learn how to work in Greenland• Build a competent team• Generate cash to help fund Black Angel

Was this a good decision? Time and costs have overrun dramatically.

The gold price has increase from $800 per ounce to $1,700 per ounce

Making Nalunaq Economically Viable

• Crew Gold shipped ore to Newfoundland for processing

• They could not get approval for a process plant on site due to environmental risk

• Angel had the idea of locating the process plant inside the mine

• NERI supported the plan• We now have the world’s first underground

cyanide leaching plant

Nalunaq: Operational Cash Forecast

11/12 12/13 13/14 14/15 15/16 16/17 17/18NalunaqGold ounces 5,000 24,000 19,000

$'000 $'000 $'000 $'000 $'000 $'000 $'000

Sales sales $1,700 8,500 40,800 32,300

cash cost $900 -4,500 -21,600 -17,100

Operational Cash Flow 4,000 19,200 15,200 0 0 0 0

Nalunaq CIP tanks

Nalunaq Leaching Tanks

Nalunaq Elution

The Harbour The Mine

The Camp

The Harbour The Mine

The Camp

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Nalunaq Gold Mine

• Annual production target of 24,000 ounces

• Average target grade of 13.5 grams/tonne

• First commercial production in April 2011

• Cyanide plant will allow recovery of circa 92%

• Ramp up to mining and full production Q1 2012

• Expected mine life of 2 years with opportunities

for possible extensions

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Nalunaq: Mine Profile

Black Angel zinc and lead mine

Mine Entrance

Mine Camp

Area CategoryTonnage

('000t)Zn % Pb % Ag g/t

Angel Zone (BA Mine) Proven 791 13.0 4.5 25.0

Cover Zone (BA Mine) Proven 522 8.3 2.4 18.0

Other Zones (BA Mine) Indicated 697 10.4 3.3 13.0

South Lakes Glacier Indicated 1,726 6.9 2.5 14.5

ARK Prospect Inferred 492 4.7 2.2 20.4

Nunngarut (N2) Indicated 196 9.0 3.4 31.0

Nunngarut (N2) Inferred 0.7 4.5 1.9 9.0

TOTAL 4,425 8.6 3.0 17.9

Black Angel Resource

Area CategoryTonnage

('000t)Zn % Pb % Ag g/t

Angel Zone (BA Mine) Proven 791 13.0 4.5 25.0

Cover Zone (BA Mine) Proven 522 8.3 2.4 18.0

Other Zones (BA Mine) Indicated 697 10.4 3.3 13.0

South Lakes Glacier Indicated 1,726 6.9 2.5 14.5

ARK Prospect Inferred 492 4.7 2.2 20.4

Nunngarut (N2) Indicated 196 9.0 3.4 31.0

Nunngarut (N2) Inferred 0.7 4.5 1.9 9.0

TOTAL 4,425 8.6 3.0 17.9

Black Angel: an established mining system

Black Angel: future exploration potential

NUNNGARUTIndicated Resources:

0.2 Mt @ 9.0% Zn & 3.4% Pb

ARKMeasured Resources:

492kt @ 4.7% Zn & 2.2% Pb

DEEP ICE ZONEDrill intersection with 6.9 metres @ 19.5% Zn & 13.1% Pb

SOUTH LAKESMeasured and

Indicated Resources: 1.7Mt

@ 6.9% Zn & 2.5% Pb

Making Black Angel Economically Viable

• Cominco built a process plant at Maarmorilik• For 15 years, tailings were disposed into the

fjord• Lead contamination poisoned the local fish• Boliden dredged the tailings into very deep

water – pollution cleared• Angel plan is to build a process plant in the

mine and dispose the tailings as part of the roof support

• First 5 to 6 years will be mining pillars

Black Angel: Operational Cash Flow

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11/12 12/13 13/14 14/15 15/16 16/17 17/18Black AngelZn/Pb tonnes 10,000 38,000 38,000 38,000 38,000

$'000 $'000 $'000 $'000 $'000 $'000 $'000

sales $2,500 25,000 95,000 95,000 95,000 95,000

cash cost $1,500 -15,000 -57,000 -57,000 -57,000 -57,000

Operational Cash Flow 0 0 10,000 38,000 38,000 38,000 38,000

The Future

We have already learned a great deal,

much of it – the hard way.

There is still much more to learn and even more to do.

To continue development of our team

Improve training

Achieve highest practical level of operational efficiency

To set the standard for mining in Greenland

Develop NGM, BA and other Greenlandic projects

Images of Greenland

Winter at Black Angel

Nalunaq Harbour – June 2011

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Camp Visitors at Nalunaq

A Recent (Rare) Visitor to Nalunaq

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