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TSX: AYX. Growing Gold Resources in Namibia. MINEAfrica | Africa Investor Series | October 29, 2010. Disclaimer/Forward Looking Statement. - PowerPoint PPT Presentation
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Growing Gold Resources in Namibia
|MINEAfrica | Africa Investor
Series | October 29, 2010
TSX: AYX
Growing Gold Resources in Namibia
Growing Gold Resources in Namibia
TSX: AYX
2
Disclaimer/Forward Looking Statement
This presentation contains "forward-looking information" within the meaning of applicable Canadian securities legislation and United States federal securities laws. Forward-looking information includes, but is not limited to: information with respect to the proposed business combination between Auryx Gold Corp. (the “Company”) and Tova Ventures Inc.; the proposed subscription receipt financing transaction and acquisition of 92% of the Otjikoto Gold Project; the intended use of proceeds from the proposed subscription receipt financing transaction; future exploration and development plans; the adequacy of the Company's financial resources, business plans and strategy and other events or conditions that may occur in the future. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects", or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", or "does not anticipate", or "believes" or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur", or "be achieved". Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including risks associated with the exploration, development and mining industry such as economic factors as they effect exploration, future commodity prices, obtaining financing, market conditions, changes in interest rates, actual results of current exploration activities, government regulation, political or economic developments, environmental risks, insurance risks, capital expenditures, operating or technical difficulties in connection with development activities, personnel relations, the speculative nature of gold exploration and development, including the risks of diminishing quantities of grades of resources and reserves; contests over title to properties, and changes in project parameters as plans continue to be refined. Forward-looking information is based on the reasonable assumptions, estimates, analysis and opinions of management made in light of its experience and its perception of trends, current conditions and expected developments, as well as other factors that management believes to be relevant and reasonable in the circumstances at the date that such statements are made, but which may prove to be incorrect. Assumptions have been made regarding, among other things: the Company's ability to successfully complete the proposed business combination with Tova Ventures Inc.; the proposed subscription receipt financing and acquisition of a 92% interest in the Otjikoto Gold Project; the timely receipt of any required approvals; the price of gold; the ability of the Company to obtain qualified personnel; equipment and services in a timely and cost-efficient manner; the ability of the Company to operate in a safe; efficient and effective manner; the ability of the Company to obtain financing on acceptable terms; the accuracy of the Company's resources estimates and geological; operational and price assumptions on which these are based and the regulatory framework regarding environmental matters. Readers are cautioned that the foregoing list is not exhaustive of all factors and assumptions which may have been used. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Accordingly, readers should not place undue reliance on forward-looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.
Investors are advised that National Instrument 43-101 of the Canadian Securities Administrators requires that each category of mineral reserves and mineral resources be reported separately. Mineral resources that are not mineral reserves do not have demonstrated economic viability.
This presentation uses the terms “Measured”, “Indicated” and “Inferred” Mineral Resources. United States investors are advised that while such terms are recognized and required by Canadian regulations, the United States Securities and Exchange Commission does not recognize them. “Inferred Mineral Resources” have a great amount of uncertainty as to their existence, and as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. United States investors are cautioned not to assume that all or any part of Measured or Indicated Mineral Resources will ever be converted into Mineral Reserves. United States investors are also cautioned not to assume that all or any part of an Inferred Mineral Resource exists, or is economically or legally mineable.
Growing Gold Resources in Namibia
TSX: AYX
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Company Highlights
Windhoek, Namibia
Growing Gold Resources in Namibia
TSX: AYX
Project History
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1999: Otjikoto was discovered by ARM’s predecessor Avmin (100%
owned)
2009: Vale purchased 35% public float of TEAL + an additional 15% from ARM
2005: ARM spun Teal out retaining 65% ownership while 35% was listed on the TSX
Sept 2009: Vale initiated process to divest Otjikoto
Feb 2010: Auryx was named preferred bidder for Otjikoto
65%
35%
50%
50%
8% 92%
June 2010: Auryx closed the transaction to purchase 92% ownership in Otjikoto for USD 28 million
2007: EVI purchased 8% ownership in Otjikoto from Teal Minerals
Growing Gold Resources in Namibia
TSX: AYX
Project Highlights
OTJIKOTO GOLD PROJECT Advanced-stage gold property 1.2 Moz of indicated & 0.7 Moz of
inferred gold resources Excellent potential to expand
resources USD 26 million spent historically &
>76,000 m drilled Significant development work
completed by past operator Same age & tectonic environment to
Navachab, Anglogold’s operating mine in the jurisdiction.
Large concession: >240,000 Ha with an additional 720,000 Ha in application
5
Namibia’s B1 National Highway
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Share Structure
Cash (in CAD) $14.4 millionCommon Shares Outstanding 127,122,680Fully Diluted 144,135,245Agent Options Outstanding* 7,015,065Options Outstanding** 9,997,500Insider Ownership ~12%Institutional Ownership ~80%
*Exercisable at $0.50 24 months from the closing of Auryx’s financing
**Auryx has a 10% rolling option plan
Information current as at October 19, 2010
Growing Gold Resources in Namibia
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Management & Directors
MANAGEMENT & EXECUTIVE DIRECTORS
TIM SEARCY– President Over 15 years of experience in the mining businessFormer President, CEO & Founder of Luna Gold Corp
and former VP, Business Development & Founder of Nautilus Minerals Inc.
HEYE DAUN– President, Africa & OperationsQualified mining engineer with extensive mine
building and finance experience Former Mine Superintendent at AngloGold’s Sadiola &
Yatela Mines and a former Mine Manager at Gold Field’s Tarkwa mine in West Africa
Engaged in mining project finance and fund management in Africa and currently a partner with South Africa’s Bright Group
ALAN FRIEDMAN–VP, Corp. Development South African qualified attorney Extensive experience in the acquisition of various
assets, financings, and go-public transactions for client companies
Currently a director and co-founder of Adira Energy Ltd, Tova Ventures Inc and Rivonia Capital Inc. He is a director of the Canada-South Africa Chamber of Business
NON-EXECUTIVE DIRECTORS
BONGANI MTSHISI– ChairmanCurrently President of BSC Mining – a private, South
African exploration and development companyMining Engineer and formerly with Anglo Platinum,
Debeers/HUF Joint venture, and Sub Nigel GoldGEORGE PIRIEFormer President & CEO of Breakwater Resources
and former President & CEO of Placer Dome (Canada) Ltd.
Over 25 years in all facets of the mining industry, including finance, operations, exploration, and development
TONY HARWOODJohannesburg based junior mining executive and
director, with 25+ years in explorationSpent 8 years as VP of Generative Exploration in
Africa and Asia for Placer Dome. Dr. Harwood previously lectured at Universities in South Africa and the UK
DAVID HODGSONEmployed by the Anglo American and De Beers
group of companies for over 30 yearsServed as the Chief Operating Officer of Anglogold
Ashanti from November 2001 through to his retirement in April 2005
Growing Gold Resources in Namibia
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Namibia: A Premier Mining JurisdictionSTABLE, MINING FRIENDLY Mining >8% of GDP, >50% of forex earnings Sparsely populated with highly skilled
professionals available locally Stable democratic government, economy, legal
and mineral title regime Political and social support of mining with
stated ambitions to develop mineral resources Significant mining operations include:
EXCELLENT INFRASTRUCTURE Project area is linked by highways and railways
to Namibia’s port of Walvis Bay National highway, railway, high voltage (33, 66,
220, & 400 kV) overhead grid power, and water supply in nearby vicinity of project
Located between 2 fully serviced local towns, no need for mine village construction
Growing Gold Resources in Namibia
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Otjikoto Land Package
LOCATED WITHIN A HIGHLY PROSPECTIVE GOLD DISTRICTLicense Granted: >240,000 Ha; Current Applications: ~720,000
Ha
FIRST WORLD INFRASTRUCTURE3 km from a paved national highway “B1”3 km from railhead15 km from a power grid “right-of-way”~30 km from a water grid tie inSignificant aquifer on site
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SRK 43-101 Mineral Resources
NI 43-101 resource estimate by SRK (August, 2009):
Indicated resource of 28.4 Mt @ 1.34 g/t Au (1.2 Moz contained Au) Inferred resource of 17.2 Mt @ 1.28 g/t Au (0.7 Moz contained Au)
Note: Auryx Gold has retained an external 43-101 compliant resource estimation specialist (Peter Bloy of BMRE), who is a recognized expert in modeling coarse gold mineralization.
0.4 g/t cut-off and capped at 15 g/t
Ore Type
Classification
kT Au (g/t)
koz
Oxide Indicated 2,941 1.36 129Inferred 182 1.13 6
Fresh Indicated 25,474
1.33 1,093
Inferred 16,989
1.29 702
Total Indicated 28,415
1.34 1,222
Inferred 17,170
1.28 708
Growing Gold Resources in Namibia
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Cross Section – Line 7000N
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Growing Gold Resources in Namibia
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Long Section
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High-Grade Structure at Otjikoto– high potential exists to continue hitting parallel structures with more step out drilling
Growing Gold Resources in Namibia
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Genesis of the Damara Belt
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The Damara Orogenic belt represents the remnants of a failed continental rift from the late Proterozoic
1) Rift opens2) Fills with clastic sediments, shallow
marine sediments, MOR volcanism commences
3) Rift fails and closesa) Kalahari craton collides with the
Congo cratonb) Deep seated fractures are
created (020)c) Increase temperature and
pressure, generates partial melts and squeezes fluids out of the sediments
d) These fluids migrate through the recently created fractures, dropping their mineralization in favourable horizons
Navachab
Otjikoto
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AURYX ROMARCO ANGLOGOLD
Background Information
Deposit Otjikoto Haile* NavachabLocation Namibia South Carolina, USA NamibiaSize of Concession (ha) ~240,000 1190 Metres Drilled to Date >76,000 >169,000 Discovery 1999 2008 (1768) 1984
Geology
Host Rock Metasedimentary Metasedimentary - Metavolcanic MetasedimentaryAlteration Albite w lesser amphibolite-chlorite Silicification Veining Po, Py, Mag, Qtz, Carb, Grt Amph Qtz, Py, Po Fe-Amph, Qtz, Cpx, Grt, Po, Cpy, PyMetamorphism Amphibolite Greenschist Greenschist - AmphiboliteAge (in millions) 530 - 490 550 - 530 ~510Tectonic Environment closing of continential rift accretionary island arc closing of continential riftFluid Source deep seated deep seated deep seated
Infrastructure
Road Paved Highway - B1 Paved Highway - 601 Paved Highway - B2Power grid grid gridWater grid and groundwater Potable water lines piped in (water grid)
Resource (Moz)
Measured - 1.47 0.33Indicated 1.2 0.697 2.51Inferred 0.7 2 1.49Reserve - 1.3 1.34Average Grade 1.3 g/t 1.3 g/t 1.1 g/t
MetallurgyRecovery (%) mid 90's 80 100+Method milling, gravity, flotation, & cyanidation
of concentratesmilling, flotation, & cyanidation of
concentrate milling & CIP
ProductionStrip Ratio ~4.5:1 ~5:1 6.2:1Production Rate (oz/yr) - - 68,000
*Haile 43-101 Technical Report by Gustavson Associates, LL December 3, 2009
Comparable Deposits to Otjikoto
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Otjikoto occurs at the northern end of a long and intensive alteration system
Only one of the first ten holes at Otjikoto hit economic mineralization
7 holes have been drilled in the 7 km of strike south of Otjikoto, and one hit gold mineralization, 1.5m of 0.8 g/t Au, within an envelope of albitite alteration
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Potential for Upside at Otjikoto
1.92 Moz resource
recent addition of 0.170 Moz
10 km long alteration zone
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2010-2011 Drill Targets
Mineralization occurs in “shoots” on three different levels
Some zones have not been fully tested down or up-shoot
Potential for the discovery of new, parallel shoots still exists
Mineralized calcrete has not been modeled in the resource
Hole OT96, 200m E of the “pit”, hit 8m of 1.2 g/t Au
Hole WHD 91, 600m N of the “pit” hit 9m of 0.8 g/t Au
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Metallurgical Test Work
Rock Hardness Oxides: Very soft Bond Ball Work Index of 6.5
kWh/t Sulfides: Moderately soft to hard Bond Ball Work
Index of 11.4 kWh/t Coarse, Visible Gold
50 grains found >500 µm 40% >106 µm
Gravity and Leaching Knelson
Oxide: 80 – 85% recovery with a 1 – 5% mass pullSulfide: 80 – 85% recovery with a 1 – 5% mass pull
FalconOxide: 70 – 80% recovery with a 20% mass pullSulfide: 80 – 90% recovery with a 20% mass pull
Intensive Leaching – 97% leach in 6 hours Gold Only Flotation
Oxide: 85% recovery with a 1-4% mass pull Sulfide: 90 – 95% recovery with a 3 – 8% mass
pull
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Technical Work Completed
Metallurgical Testwork (Mintek) Process Route identified (Mintek & Gecko Systems) Geotechnical studies & slope design (SRK) Scoping study updated (Aug 2009: GRD Minproc & Minxcon) Geohydrological studies ESIA close to completion, first Public Participation Meeting
conducted Further project development dependent on “right-sizing”
New Resource Re-estimate – Q1 2011 Exploration Program – 15,000 m of DD and 10,000 m of RC drilling Development work to focus on ESIA and Geohydrology
Completed CompletedCompletedCompleted On-going On-going On-going
Going Forward – Focus of the Next 12 Months
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19Growing Gold Resources in Namibia
THANK YOU!
Tim SearcyPresident & Director
Elina ChowInvestor Relations Manager
120 Adelaide Street WestSuite 1204
Toronto, Ontario M5H 1T1 Canada
+1 (416) 361 2213 (office)+1 (416) 400-0149 (mobile)
+1 (416) 361 6455 (fax)[email protected]