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April 6th, 2017 , KRUMOVGRAD, BULGARIA
DUNDEE PRECIOUS METALS KRUMOVGRAD
KRUMOVGRAD GOLD PROJECT
2Dundee Precious Metals
Chelopech Mine, Bulgaria
KRUMOVGRAD GOLD PROJECT
Chelopech Mine, Bulgaria
This presentation contains “forward looking information” or "forward looking statements" that involve a number of risks and uncertainties.
Forward looking information and forward looking statements include, but are not limited to, statements with respect to the future prices of
gold and other metals, the estimation of mineral reserves and resources, the realization of mineral estimates, the timing and amount of
estimated future production and output, costs of production, capital expenditures (including sustaining capex, non-discretionary capex
and discretionary capex), costs and timing of the development of new deposits, success of exploration activities, permitting time lines,
currency fluctuations, requirements for additional capital, government regulation of mining operations, environmental risks, unanticipated
reclamation expenses, title disputes or claims, limitations on insurance coverage and timing and possible outcome of pending litigation.
Often, but not always, forward looking statements can be identified by the use of words 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 statements are based on the opinions and estimates of management as of the date such statements are
made, and they involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or
achievements of the Company to be materially different from any other future results, performance or achievements expressed or implied
by the forward looking statements. Such factors include, among others: the actual results of current exploration activities; actual results of
current reclamation activities; conclusions of economic evaluations; changes in project parameters as plans continue to be refined; future
prices of gold; possible variations in ore grade or recovery rates; failure of plant, equipment or processes to operate as anticipated;
accidents, labour disputes and other risks of the mining industry; delays in obtaining governmental approvals or financing or in the
completion of development or construction activities, fluctuations in metal prices, as well as those risk factors discussed or referred to in
this presentation under and in the Company’s annual information form under the heading "Risk Factors" and other documents filed from
time to time with the securities regulatory authorities in all provinces and territories of Canada and available at www.sedar.com. Although
the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those
described in forward-looking statements, there may be other factors that cause actions, events or results not to be anticipated, estimated
or intended. There can be no assurance that forward looking statements will prove to be accurate, as actual results and future events
could differ materially from those anticipated in such statements. Accordingly, readers are cautioned not to place undue reliance on
forward looking statements.
FORWARD LOOKING STATEMENTS
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MINERAL RESERVE
Ada Tepe Mineral Reserves as at 21st March 2014
CategoryTonnes Gold Silver
(Mt) Grade (g/t) Ounces (Koz) Grade (g/t) Ounces (Koz)
Proven 2.59 5.39 449 2.82 235
Probable 3.61 3.08 358 1.79 208
Total 6.20 4.04 807 2.22 443
CIM compliant Mineral Reserves Summary (DPM, 2014)
CIM compliant Mineral Reserves Summary (by material type) as at 21st March 2014
Category
Wall Zone (0.8 g/t Au cut-off)
Tonnes Gold Silver
(Mt) Grade (g/t) Ounces (Koz) Grade (g/t) Ounces (Koz)
Proven 1.48 6.83 325 3.50 166
Probable 0.11 5.54 20 2.93 11
Total 1.59 6.74 345 3.46 177
Category
Upper Zone (0.6 g/t Au cut-off)
Tonnes Gold Silver
(Mt) Grade (g/t) Ounces (Koz) Grade (g/t) Ounces (Koz)
Proven 1.11 3.46 124 1.91 68
Probable 3.50 3.00 337 1.75 197
Total 4.61 3.11 461 1.79 266
5Dundee Precious Metals
Chelopech Mine, Bulgaria
CAPEX
CAPITAL COST ESTIMATE SUMMARY
Item Total ($M)
Direct costs 117.1
Indirect costs 48.7
Contingency P50 (7.5% of direct + indirect costs) 12.4
Total Initial Construction Capital 178.2
Sustaining capital 6.2
Closure and rehabilitation costs 6.0
6Dundee Precious Metals
Chelopech Mine, Bulgaria
OPEX
OPERATING COST ESTIMATE SUMMARY
Item $/t ore processed
Mining costs 15.03
Processing costs 19.39
Tailings treatment & IMWF costs 1.88
General & administration 5.33
Royalty 3.78
Total Annual Operating Costs 45.41
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PROJECT SUMMARY
Key Project Operating and Financial Metrics Life of Mine Average
Annual tonnes processed 775,000 tpy
Gold grade 4.04 g/t
Silver grade 2.22 g/t
Strip ratio 2.6:1 waste:ore (t:t)
Gold recovery 85%
Silver recovery 70%
Annual gold production 85,700 oz
Annual silver production 38,700 oz
Total cash cost per oz AuEq $404
Annual EBITDA $66 million
Total gold production 685,549 oz
Total silver production 309,915 oz
NPV at a discount rate of 5.0%, after-tax $187.6 million
Internal rate of return, after-tax (“IRR”) 24.8%
Payback period, after-tax (from start of production) 2.4 years
Mine life 8 years
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KRUMOVGRAD GOLD PROJECT
Permitting &
Approvals
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Concession Agreement
• Concession granted for 30-years - February 2011
• Related Concession Documents approved by ME:
• Life of Mine Plan
• Update of Overall Closure and Rehabilitation Plan
• Mine Waste Management Plan
• Cut off Grade, Reserves & Resources Recalculation
• Annual Working Project for 2017
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Chelopech Mine, Bulgaria
Permitting / Approvals
• Remaining construction-related approvals for the new site access road and the waste water
discharge pipeline are expected in the first half of 2017, and are not pre-requisites for construction
at the site.
Permit / Approval Status
EIA Approval 2013
Main Construction Permit August 2016
Water extraction / discharge Received
Water well construction permit Received
Water supply pipeline construction permit Received
Central mine offices construction permit Received
Existing access road upgrade By KMC, construction in progress
New access road DDP In progress
Permanent power connection In progress (by power utility)
Waste water discharge pipeline DDP In progress
Operating permits Apply in 2018
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KRUMOVGRAD GOLD PROJECT
CSR Related
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Community Relations
• Memorandum of Understanding with
Municipality of Krumovgrad signed;
• Stakeholders Engagement Plan;
• Social Management Plan.
Proactive Company Actions
• Company information center;
• Local Consultative Forums - operating at
8 settlements;
• Grievance Mechanisms;
• Training of local business is part of
project development
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Environmental Monitoring and Management
Environmental Monitoring:
• Coordinated by environmental authorities and presented to
Krumovgrad Municipality and EBRD;
• Water Monitoring – 22 monitoring points
for surface and ground water;
• Soil Monitoring – 6 monitoring points;
• Biodiversity Monitoring – flora and fauna.
• Noise and vibrations measurement – 7 points (2014)
• Implementation of Biodiversity Action Plan;
• Real-time dust measurement system installed (June, 2015);
• Available at: http://krumovgrad.webnoise.eu/
Regular monitoring to municipality and competent authorities
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KRUMOVGRAD GOLD PROJECT
Mining
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OWNER VS CONTRACTED MINE ACTIVITIES
Mine Activity Contract or DPMKr
Drilling and Blasting Contract
Load and Haul to PP / IMWF DPMKr
Stripping DPMKr
Grade Control Drilling Contracted
Technical Services Shared service with Chelopech
Fleet Equipment Maintenance Contract (OEM)
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EQUIPMENT FLEET
Item Size Units
Excavator 3.7 m3 2
Excavator (IMWF) 2 m3 1
Rigid Truck 40 tonne 4
Articulated Truck 40 tonne 4
FEL 6.4 m3 1
Bulldozer 230 kW 2
Grader 100-120 kW 1
Water Truck 10 kLitre 1
IT (tool carrier) 130 – 150 kW 1
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OPEN PIT DESIGN AND STAGES
Open Pit DesignLong Section Showing the Four Mining Phases
Y1
Y2
Pit phases and sequencing exposesthe wall zone ore in early stages ofthe project.
Pit ramp avoids north eastern highwall.
Ramp exists at south west.
Y2 Y1 Stage 1Stage 2
Stage 3
Stage 4
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PIT STAGES
N
STAGE 1
N
STAGE 2
N
STAGE 3
N
STAGE 4
The pit advances north bymining out each phaseprogressively from stage 1through to stage 4.
The pit stages are mined to thefinal wall on the east side ofthe pit and a temporary wall tothe north is established.
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MINE PLAN ASSUMPTIONS
Three (3) months pre-stripping;
Mill throughput of 105 t/hr for upper zone and 90 t/hr for wall zoneore;
Excavating capacity starts from 8,000 t/d in year one and increase to9,500 t/d in the last five years due to high stripping in stages 3 and 4over the life of the mine;
About 27 days per annum considered as loss due to extremeweather conditions;
Waste rock to build IMWF cells.
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MINE AND MILL PRODUCTION GRAPHS
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PRE-PRODUCTION PLANS (Q2 2017)
GRADE CONTROL
Trial Grade Control Program (Grade Control Orientation Grid).
o 5x5 over 50m x 50m area in Phase 1 pit, targeting high and lowgrades in upper and wall zones.
o Sensitivity review after drilling GCOG.
o Optimize drill pattern
o Appropriate grade control modelling method.
GC Drilling using optimized drill pattern.
o GC sampling improves confidence in short
term mine plans.
o GC model use for ore block-out and monthly
reconciliation.
Metallurgical testworks Grade Control Optimisation Program
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GC MODEL - METHODOLOGY
Mining Ore mark-out.
o ‘As Designed’ block-out polygons provided to surveyor as pointfile showing point numbers (after adjustment for blastmovement).
o Surveyors mark out the points on top flitch after blasting.
o Geology visually check the mark-out and tape/paint the digboundaries after adjustment based on geological observations.
Blast movement adjustment.
o Blast movement has a major impact on ore loss and dilution.
o BMT technology will be used to measure movement for oreoutline adjustment.
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BMT Technology
It is very important to estimate blast displacement in order to minimize ore loss and dilution
• Blast movement can be controlled but not prevented.
• Blast movement cannot be modelled accurately.
• Movement varies with depth, so each flitch must be
displaced separately.
• Even small displacement can mean large losses.
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GEOTECHNICAL
Geotechnical Recommendations
o Detailed geotechnical mapping of pit faces as they are exposed;
o Slope observation and monitoring;
o Observation of groundwater behavior; and
o Consideration of trial slopes
DPM Corporate IT is testing LIDAR scanning technology that couldgive continuous pit slope monitoring down to mm accuracy whichwould show any change in movement over the entire pit walls.
SRK consultants to provide open pit procedures and training.
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OPPORTUNITIES FOR DIGITAL
Drilling and Blasting
o Export design to drill rigs electronically.
o Drill rigs capable of uploading real time information about rock characteristics etc.
o Blast simulation package for optimal design and capable of predicting blast displacements,vibrations etc.
Geotech
o LIDAR scanning technology capable of continuous pit slope monitoring.
Fleet Management System
o Real time monitoring.
o Real time optimization and assignment (Dispatch)
Excavation
o Tools that enable quality mining with a high level of accuracy and fully integrated withplanning tools.
BMM Technology
o Estimates blast displacement in order to minimize ore loss and dilution.
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KRUMOVGRAD GOLD PROJECT
Process Plant
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Process Plant Overview
Process Plant Summary:
Conventional grind / float flowsheet
Gold Recovery – 85%
Silver Recovery – 70%
24 hours/day (crushing 12hrs/day), 365 days/year operations
840k tpa (based on year 3 mine plan)
Plant feed rate, design 105tph
Concentrate 2t Bulk bags
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Process Plant Flowsheet
KRUMOVGRAD PROCESS FLOWSHEET
OreRun of
mine pad
Primary
crushingSAG mill
Primary
regrind
Pebble
crusher
Roughers ScavengersThickened
tailings plantIMWF
Tailings
deposition
Ultra-fine
grinding
Process water
tank
RPWR /
SWOR
Water
Treatment
Environ-
ment
Cleaner 1Concentrate
thickener
Filter
press
Final
concentrate
Cleaner
scavengerCleaner 2
Crusher Thickener
Mill Filter
Flotation Water
Legend:
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Plant Area
Crushing (0100)
Coarse ore
Storage (0100)
and Pebble
Crushing (0200)
Flotation (0300)
Conc Thickening
and Filtration
(0400)
Grinding (0200)
Tailings Thickening
Plant (1400) and HV
Area (0900/1050)
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Integrated MineWaste Facility
IMWF
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IMWF General Overview Integrated Mine Waste
Facility (IMWF)
Open Pit
IMWF Haul Roads
and sump access
road
Raw and Process Water
Reservoir / Storm water
Overflow Reservoir
Grout Curtain
Pump
station
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IMWF - Details
• Area of 42 Ha
• Cells constructed from mine waste rock
• Cells filled with tailings pumped from the thickening plant
• Tailings allowed to consolidate
• Is progressively rehabilitated with selected native species of grasses,
shrubs, and trees;
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IMWF – Construction
Grout Curtain
SumpFirst ‘Lifts’
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IMWF - Construction
South Valley
Starter Berm
North Valley
Starter Berm
First ‘Lifts’
First ‘Lifts’
Sumps
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IMWF – Safety Features of Facility
• River water protection through water management
• Exceeds all required standards, shown through:
• Seismic analysis and 2D and 3D stability analyses;
• Provisions for tailings disposal in an Emergency Disposal Pond
• Materials analysis and mitigation measures:
• Consolidation test work
• Additional drainage to promote consolidation
• Layering of waste rock and tailings in initial phases
• Ability to ‘work’ tailings in cells to improve consolidation
• Conservative safety factor in earthworks design
• Independent 3rd Party Reviews
• Construction and operation manuals prepared during design phase.
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Grout Curtain
North Sump
South Sump
Grout Curtain
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Grout Curtain
Krumovitsa Rivergroundwater
Captured and Pumped to Sumps
IMWF groundwater
Grout Curtain
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Key Outcomes - IMWF
• Design is compliant with BGN, EU, and international standards;
• High level of confidence in structural stability
• Contingency measures and safety features built into design
• Meets all EIA commitments
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KRUMOVGRAD GOLD PROJECT
Implementation
Plan
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High Level Schedule
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KRUMOVGRAD GOLD PROJECT
Construction
by Quarter
BULK EARTHWORKS ACTIVITIES – START Q1
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46
Pilot Roads and
Initial EW:
1. Site Access
2. Thickener to
ROM Pad Area
(West)
3. Plant Area and
ROM Pad Area
(East)
4. Access Road and
Tipping Wall
5. Plant Cut to ROM
Pad Phase 1 Fill
1
2
3
4
5
BULK EARTHWORKS ACTIVITIES – Q2
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47
Works Continue
Throughout
Main EW Activities:
• Rippable cut to fill
• Drill & Blast to fill
• Import drainage
material
• Import wearing
course
BULK EARTHWORKS ACTIVITIES – Q3
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48
Works Continue.
Areas Progressively
Completed.
Main EW Activities:
• Rippable cut to fill
• Drill & Blast to fill
• Import wearing
course
BULK EARTHWORKS ACTIVITIES – Q4
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49
Works Continue. All
Areas Completed.
Main EW Activities:
• Drill & Blast to Fill
• Fill from stockpile
• Import wearing
course (finishing
roads)
• Pre-strip Open Pit
Phase 1
Q2 FOUNDATIONS, START MAJOR EQUIPMENT CONCRETE
PLINTHS
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50
Q4 FOUNDATIONS, STEEL STRUCTURE AND MAJOR EQUIPMENT PLACED,
STARTED PLATEWORK, PROCESS PIPING, E&I
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Q7 STEEL STRUCTURES & PLATEWORK COMPLETE, ELECTRICAL,
INSTRUMENTATION IN PROGRESS, FIRST POWER, PRE-COMMISSIONING, START
CLADDING INSTALL
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Q8 FINAL BUILDINGS COMPLETE, ELECTRICAL & INSTRUMENTATION COMPLETE,
PRE-COMMISSIONING COMPLETE AND HANDOVER TO COMMISSIOING
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KRUMOVGRAD GOLD PROJECT
Operational
Readiness
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TRAINING PLAN
• TRAINING PLAN
• DPMK will set up local training centre in 2017;
• DPMK will cooperate with local schools. The first mutual programme
focused on basic mechanical fitter skills will be launched in May 2017;
• DPMK will introduce apprenticeship programmes within production and
maintenance divisions upon the start of operations;
• DPMK has consistent practice in running summer internship programs as
of 2012. Company appoints talented interns from Krumovgrad to prepare
them for senior positions;
• Trainings for operational personnel will include safety, on the job training
at the production site of Chelopech, on the job training in Krumovgrad;
• Detailed training plans per position are under preparation. To be
completed in 2017.
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ORGANISATIONAL STRUCTURE
DPMK operations head
• Operations Director
Divisions
• Production head – Production Superintendent
o Mine, Process Plant, IMWF, Mine planning, Geology
• Maintenance head – Maintenance Superintendent
o Mechanical, Electrical and Automation, Maintenance Planning
• Administration – shared services - combines shared management for
DPM Bulgaria and minimum local hires
o Finance, Purchasing, Legal, HSE, HR, Administration, PR, TS
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STAFFING PLAN
12/0
4/20
5
7
• Production personnel - phased hiring;
• Operations must be fully staffed and ready to operate in Q4 2018;
• Total number of employees – up to 230;
• 90% local hires;
• Mobile equipment operators – recruited from Krumovgrad area, trained
at Chelopech
• Support functions (Finance, HR and Administration, Supply, HSE etc.)
o DPM Bulgaria shared services.
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Operational Readiness Plan
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Operational Readiness Status
• Functional Heads hired
Operations Director July 2016 completed
H&S Supervisor Dec 2016 completed
Production Superintendent Jan 2017 completed
Maintenance Superintendent Jan 2017 completed
Production Supervisor July 2017 in progress
IMWF Supervisor July 2017 in progress
Mechanical Supervisor July 2017 in progress
Electrical and Automation Supervisor July 2017 in progress
Technical Services July 2017 to be organized
Mobile equipment operators
IMWF, Mine - partially Dec 2017 to be organized
Operators, Fitters, Workers 2018 to be organized
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KRUMOVGRAD GOLD PROJECT
Current Project
Status
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Chelopech Mine, Bulgaria
PROJECT MILESTONES
Milestone Actual / Expected Completion
Completion of the detailed project execution plan Q1 2016 (complete)
Complete detailed engineering Q1 2016 (complete)
Updated capital cost estimate and baseline project schedule Q1 2016 (complete)
Land re-designation and purchase Q1/2 2016 (both complete)
Approval of technical packages Q2 2016 (complete)
Construction permit RECEIVED AUGUST 9, 2016
Mobilize earthworks contractor to site Q4 2016 (complete)
Commence main civil/mechanical/electrical construction Q2 2017
Commissioning and start up Q3 2018
First concentrate production Q4 2018
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Krumovgrad Project – Construction Milestones
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Item Timing Current
Status
1. Mobilise earthworks contractor Q4 16 Complete
2. Upgrade temporary access road Q4 16 Complete
3. First blast at the site Q4 16 Complete
4. Place PO for grinding mills Q4 16 Complete
5. Pour first concrete Q2 17
6. Award SMP & EI contract Q2 17
7. Begin SMP followed by EI works Q3 17
8. Start Pre-commissioning Q2 18
9. Start Hot Commissioning Q3 18
10.First Concentrate Q4 18
Current Status:
On target Some issues Off target
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Current Cost Forecast
Category
Project To Date (End Feb 2017)
Budget
(US$M)
Forecast
(US$M)Var (%)
Committed
(US$M)
Incurred
(US$M)
Processing Plant 38.0 38.0 20.2 3.6
Mining/Earthworks 55.8 56.3 0.9% 46.5 5.7
Buildings, Infrastructure and Other
Equipment21.3 21.3 2.1 0.7
Total Direct Costs 115.1 115.6 0.4% 68.8 10.0
Indirect Costs 50.8 50.8 10.7 5.5
Contingency (P50) 12.4 11.9 -4.0%
Total Project Execution 178.3 178.3 79.5 15.5
Physical Progress at End February – 11% complete