interim results 2010 - koza altın · dedeman group 2005 2006 2007 ovacık mine Çukuralan...

Koza Altın İşletmeleri A.Ş.

Interim Results 2010

Ismet Sivrioglu, GMIsmet Sivrioglu, GM

Zafer Kara, AGM Mining &Geology

Ozlem Ozdemir, AGM Finance

Okan Bayrak, AGM Investor Relations

Disclaimer

The information in this presentation has been obtained by KOZA ALTIN İŞLETMELERİ A.Ş. (KOZA ALTIN ) from the sources believed to be reliable are subject to change without notice, however, KOZA ALTIN cannot guarantee the accuracy, completeness, or correctness of such information. This document has been issued for information purposes only. The financial reports and statements announced by KOZA ALTIN to the public and/or the relevant corporations are accepted to be the sole material. KOZA ALTIN does not accept any liability whatsoever for any direct or consequential loss arising from any use of this document or its contents due to the misleading information in this document. All estimations contained in this presentation are the opinions of KOZA ALTIN and can be subject to change without notice. This document can not be interpreted as an advice, offer to sell, or an invitation to subscribe for or purchase, any of the shares in any jurisdiction to any person or to the investors and KOZA ALTIN can not be held responsible for the results of investment decisions made on account of this document. This presentation has been issued specially to the person, whom the document is concerned and may not be reproduced, distributed or shared with third parties for any purpose. The distribution of this presentation in certain jurisdictions may be restricted by law. Persons into whose possession this document comes are required by KOZA ALTIN and the managers to inform themselves about and to observe any such restrictions. No persons has been authorized to give any information or to make any representation. In making an investment decision, investors must rely on their own examination of KOZA ALTIN, including the merits and risks involved. This document is personal to whom it is delivered by the managers.

While the information contained herein has been prepared in good faith, neither the KOZA ALTIN nor any of its shareholders, directors, officers, agents, employees or advisers give, have given or have authority to give, any representations or warranties (express or implied) as to, or in relation to, the accuracy, reliability or completeness of the information in this Presentation, or any revision thereof, or of any other written or oral information made or to be made available to any interested party or its advisers (all such information being referred to as "Information") and liability therefore is expressly disclaimed. Accordingly, neither the KOZA ALTIN nor any of its shareholders, directors, officers, agents, employees or advisers take any responsibility for, or will accept any liability whether direct or indirect,express or implied, contractual, tortious, statutory or otherwise, in respect of, the accuracy or completeness of the Information or for any of the opinions contained herein or for any errors, omissions or misstatements or for any loss, howsoever arising, from the use of this Presentation.This Presentation should not be considered as the giving of investment advice by the KOZA ALTIN or any of its shareholders, directors, officers, agents, employees or advisers. Each party to whom this Presentation is made available must make its own independent assessment of the KOZA ALTIN after making such investigations and taking such advice as may be deemed

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to whom this Presentation is made available must make its own independent assessment of the KOZA ALTIN after making such investigations and taking such advice as may be deemed necessary. In particular, any estimates or projections or opinions contained herein necessarily involve significant elements of subjective judgment, analysis and assumptions and each recipient should satisfy itself in relation to such matters. This Presentation includes certain statements that may be deemed “forward-looking statements”. All statements in this discussion, other than statements of historical facts, that address future activities and events or developments that the KOZA ALTIN expects, are forward-looking statements. Although the KOZA ALTIN believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking statements. Factors that could cause actual results to differ materially from those in forward-looking statements include market prices, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in forward-looing statements.

Koza Altın – At a Glance

Acquisition of remaining 50% of Mastra from Dedeman Group

2005 2006 2007

Ovacık mine

Çukuralan

Acquisition of Normandy’s Turkish gold operations

Küçükdere (264koz)

Çoraklık Tepe

Acquisition of several goldproperties from Eldorado

Production start up at Küçükdere

Mine development at Mastra

20052005 20062006 20072007 2002008820020088MarchMarch20052005

Construction of Mastra Plant

Acquisition of gold

Çukuralan Open Pit Mine – August 2010

Çukuralan Underground Mine -2011

Kaymaz Open Pit Mine - 2011

2010 and 2010 and beyond: growthbeyond: growth2002009920020099

Mastra ore processing plant commenced operations

33

2005200520052005

1.3moz of gold resources (4 projects)

0.4moz of gold reserves

14 licenses

1 operating mine

Production of 101koz (2004)

Gelintepe

Narlıca

Mastra (50%)

Kaymaz (218koz)

Production restart at Ovacık

Acquisition of gold properties from Newmont

Diyadin Hub - Mollakara(3.0moz)

2 operating mines

1 mine in advanced development

2 pre-feasibility stage projects

8 projects

191 total licenses

2007200720072007

____________________

Source: Koza Gold.

(1) Resources inclusive of reserves.

2 operating mines (Ovacık and Mastra)

3 projects in advanced development (Çukuralan, Çoraklık Tepe, and Kaymaz), 1 project in pre-feasibility (Mollakara)

8.0moz¹ of gold resources (17 projects)

1.8 moz of gold reserves

Kaymaz Open Pit Mine - 2011

Küçükdere open pit was depleted

Kaymaz Processing Plant - 2011

Acquisition of Newmont Altın

About 495 exploration licences and 25 operation licences

YearYear--end 2009end 2009YearYear--end 2009end 2009

operations

Strategic Objectives

Our goal is to develop our portfolio of existing gold assets and find, develop and selectively

acquire gold projects in Turkey to grow our resource base and maximise profitable production

This goal aims to capitalise on our position as the leading gold producer in Turkey, our hub

operating strategy and our track record of successfully growing resources and production

We also seek to provide leadership in safety, stewardship of the environment, including

responsible rehabilitation of the completed areas, and social responsibility to local communities

We intend to achieve our strategic objectives by:

44

Expanding our existing facilities and leveraging existing infrastructure for additional growth

Leveraging our regional and operational expertise to develop new mines while maintaining efficiency to

ensure low-cost operational performance

Focusing our exploration activities on brownfield as well as greenfield opportunities

Continuing to expand resource base and continuing to prove up resources to reserves

Growing our resources and production through a selective M&A strategy

Seeking to succeed in partnership with our communities by respecting the values of local residents,

employees and other stakeholders

H1 2010: Strong Operational Performance

H1 2010 production of 123 thousand attributable gold

ounces, up 31.6% from H1 2009

Cash costs of US$320 per ounce, up from US$302

per ounce in H1 2009, primarily due to the change in

the exchange rate

Mining Operations in Çukuralan Project expected to

begin in August 2010. The haulroads are under

construction. Ore transportations to Ovacik to start

55

construction. Ore transportations to Ovacik to start

in November 2010

Production increased in Mastra

Construction commenced for Kaymaz Project. First

Metallurgical results are very positives for Mollakara

Project. Pre-feasibility started for Himmetdede

Project

Invested TL 45.0 million in capital expenditure and

TL 6.0 million in explorationOn track to achieve 2010 production target of On track to achieve 2010 production target of

over 250over 250 kozkoz

H1 2010: Strong Financial Performance

H1 2010 revenue of TL 207.9m, up 65.3% from

H1 2009

Costs remain in-line with expectations

EBITDA of TL 148.7m, up 78.7% from H1 2009

EBITDA margin of 71.5% (vs. margin of 66.2%

in H1 2009)

66

in H1 2009)

Profit before tax of TL 123.4 m, up 106.9% from

H1 2009

Cash dividend of TL 27.5m distributed in H1

2010

Solid financial position – net cash of TL 73.5m

(comprising total debt of TL 36.5m and cash of

TL 110.1m)

H1 2010: Delivering Increasing Profitability

EBITEBITDA DA 11((TLmTLm))EBITEBITDA DA 11((TLmTLm)) EBITEBIT 22((TLmTLm))EBITEBIT 22((TLmTLm))

118,7 114,3125,0

244,7

148,7

80,0%

85,0%

90,0%

95,0%

100,0%

100,0

120,0

140,0

160,0

180,0

200,0

220,0

240,0

260,0

96,086,0

99,2

183,6

120,5

70,0%

80,0%

90,0%

100,0%

80,0

100,0

120,0

140,0

160,0

180,0

200,0

77

____________________

Source: Audited CMB consolidated financial statements at 31-Dec-2009 and reviewed at 30 June 2010 and 30 June 2009

(1) EBITDA defined as operating profit plus depreciation and amortisation as part of Cost of Sales

(2) EBIT defined as operating profit.

Mastra production startMastra production start--up and increase in gold price resulted in an increase in EBITDA and EBIT in 1st Half 2010 when up and increase in gold price resulted in an increase in EBITDA and EBIT in 1st Half 2010 when compared with the same period in 2009compared with the same period in 2009

83,2

66,7% 66,6%63,7%

71,5%

66,2%

71,5%

60,0%

65,0%

70,0%

75,0%

0,0

20,0

40,0

60,0

80,0

100,0

2006 2007 2008 2009 2009 6m 2010 6m

EBITDA % Margin

63,753,9%

50,1% 50,6%53,6%

50,6%

58,0%

40,0%

50,0%

60,0%

0,0

20,0

40,0

60,0

80,0

2006 2007 2008 2009 2009 6m 2010 6m

EBIT % Margin

Income Statement

YE 31-Dec (TLm) 2006 2007 2008 2009 2009 6M 2010 6M

Revenue 178.1 171.6 196.1 342.4 125.8 207.9

% Growth (3.6%) 14.3% 74.6% 65.3%

EBITDA¹ 118.7 114.3 125.0 244.7 83.2 148.7

88____________________

Source: Audited CMB consolidated financial statements at 31-Dec-2009 and reviewed at 30 June 2010 and 30 June 2009

(1) EBITDA defined as operating profit plus depreciation and amortisation as part of Cost of Sales

EBITDA margin 66.7% 66.6% 63.7% 71.5% 66.2% 71.5%

Operating profit 96.0 86.0 99.2 183.6 63.7 120.5

Operating margin 53.9% 50.1% 50.6% 53.6% 50.6% 58.0%

Profit for the period/year

79.9 74.2 80.3 146.8 47.9 101.9

Profit margin 44.9% 43.2% 40.9% 42.9% 38.1% 49.0%

Cash Flow Statement

YE 31-Dec (TLm) 2006 2007 2008 2009 2009 6M 2010 6MCash flows from operating activities Profit before taxation on income 100,79 88,47 101,14 183,36 59,64 123,39

Depreciation and amortisation 21,87 29,07 30,50 75,02 19,54 28,23

Interest expense 1,89 1,75 2,48 0,65 0,61 0,68

Interest income (4,21) (6,70) (2,16) (0,96) (0,41) (2,67)

Exploration costs 4,17 3,85 8,22 9,98 3,65 6,01

Taxes paid (22,91) (13,43) (19,26) (26,44) (8,79) (27,44)

(Gain)/loss from sales of property, plant and equipment and intangible assets- net

(0,06) (0,15) 0,12 (0,63) (0,01) (0,05)

Other (1,24) (29,80) (11,13) (64,99) (3,83) 16,26

Net cash generated from operating activities 100,30 73,06 109,90 175,99 70,41 144,41

Cash flows from investing activities Purchases of property, plant and equipment (38,85) (41,15) (117,30) (95,17) (37,35) (46,38)

99____________________

Source: Audited CMB consolidated financial statements at 31-Dec-2009. and 30 June 2010. and 30 June 2009.

Purchases of property, plant and equipment (38,85) (41,15) (117,30) (95,17) (37,35) (46,38)

Other (24,97) 35,67 17,79 4,15 10,89 23,07

Net cash used in investing activities (63,81) (5,48) (99,52) (91,02) (26,46) (23,31)

Dividends paid (22,37) (65,46) (53,45) (69,65) (69,65) (27,50)

Other (2,71) 1,89 34,09 (3,06) 18,64 (4,47)

Net cash used in financing activities (25,08) (63,57) (19,36) (72,71) (51,02) (31,97)

Net (decrease)/increase in cash and cash

equivalents 11,41 4,01 (8,97) 12,26 (7,07) 89,13

Cash and cash equivalents of previous

period/year0,52 13,82 17,45 8,57 8,51 20,94

Cash and cash equivalents at end of

period / year 11,93 17,82 8,48 20,83 1,44 110,06

Balance Sheet and Debt Structure

Balance Sheet Balance Sheet ((3030--JuneJune--22010010))Balance Sheet Balance Sheet ((3030--JuneJune--22010010)) Net Debt StructureNet Debt Structure ((3030--JuneJune--22010010))Net Debt StructureNet Debt Structure ((3030--JuneJune--22010010))

30-June (TLm)

Assets

Cash and cash equivalents 110,06

Trade receivables from related parties 0,00

Other receivables from ralated parties 0,04

Other receivables 4,30

Inventories 58,45

Other current assets 0,78

Total current assets 173,63Non-current assets Property, plant and equipment 209,42

Intangible assets 0,80

Goodwill 15,30

Deferred income tax assets 7,08

Other non-current assets 6,99

(TLm)

Total bank borrowings 36,53

Total short-term bank borrowings 12,30

Total long-term bank borrowings 24,23

Cash and cash equivalents 110,06

Net debt -73,53

1010____________________

Source: CMB reviewed consolidated financial statements at 30-June-2010.

Other non-current assets 6,99

Total non-current assets 239,58Total assets 413,21Liabilities and Equity Current liabilities Borrowings 12,30

Trade payables to related parties 0,11

Trade payables to other parties 14,08

Other payables to related parties 0,06

Other payables to other parties 5,10

Current income tax liabilities 12,62

Provisions 9,54

Other Current liabilities 2,10

Total current liabilites 55,91Non-current liabilities Borrowings 24,23

Provisions 16,51

Provision for employment benefits 1,90

Other Non-Current liabilities 9,69

Total non-current liabilities 52,32Total liabilities 108,23Minority interest in equity 0,00Total equity 304,98Total liabilities and equity 413,21

Exploration Footprint Driving Growth

8.1 moz

12.5 moz

+ Minimum of potential range: 2.0 moz

Current Gold Reserves, Resources and ‘Mineral Potential’Current Gold Reserves, Resources and ‘Mineral Potential’Current Gold Reserves, Resources and ‘Mineral Potential’Current Gold Reserves, Resources and ‘Mineral Potential’

+ Maximum of potential range: 4.4 mozPlus further potential from the

June 2010 acquisition of

Newmont Altın

1111

1.9 moz

+4.4 moz

+1.9 moz

Reserves M&I Resources Inferred Resources TOTAL Reserves &

Resources

'Mineral Potential' TOTAL including

'Mineral Potential'

Considerable Brown and Greenfield Upside PotentialConsiderable Brown and Greenfield Upside Potential

____________________

Source: Competent Person’s Report by SRK (Jan-2010).

Newmont Acquisition

On June 29th, 2010, Koza Gold announced the acquisition of Newmont Altın Madencilik

Limited Şirketi (“Newmont Altın”) for US$8.5m

� Considerations payable in 3 installments - US$3m immediate, US$3m as the Diyadin Project commences operatations and $2.5m one year following the second payment

� The consideration also covers the license fee for the Diyadin Project

� With this purchase, the purchase and sale agreement with option signed with Newmont Altin on October 25th, 2008 for the Diyadin project has been cancelled and there will not be royalty payment for the Diyadin licence

1212

there will not be royalty payment for the Diyadin licence

Close to the Koza Gold’s North Anatolian operations, the project is in an important porphyry

gold and copper belt. Limited exploration and drilling activity results show up to 6.04 gr/t

gold and 1.32% copper figures

Another project in the same porphyry gold and copper belt is located approximately 40 km

west of Koza Gold’s Mastra Project. Limited exploration and drilling activity (total 19

drillings) in that region indicates 125m @ 0.69 gr/t gold (24.2m @ 2.39 gr/t gold in 125 m

zone)

Results obtained from the 50 rock samples taken from the north of a vein that is identified

from studies at 3 fields in West Anatolia result in 4.27 gr/t gold and 49 rock samples from

the south of the vein result in 1,59 gr/t gold

Exploration Footprint Driving Growth

High Exploration PotentialHigh Exploration PotentialHigh Exploration PotentialHigh Exploration Potential FirstFirst--Mover Advantage in TurkeyMover Advantage in TurkeyFirstFirst--Mover Advantage in TurkeyMover Advantage in Turkey

Current operations are underpinned by a significant pipeline of development and exploration projects

Track record of project Development

– Successful transition to

Operating MinesOperating Mines

Advanced DevelopmentAdvanced Development

Ovacık

Kaymaz

Çukuralan

CurrentCurrent

20020099

20092009--20102010

Mastra

Dri

ve U

p V

alu

e C

ha

in

1313

underground operations at Ovacık

– Mastra plant commenced doré production in March 2009

– Cukuralan Open pit earth moving commenced, we aim to transport Çukuralan ores to the Ovacık hub beginning from November 2010

– Kaymaz plant is planned to begin production as the 3rd hub in 2011

Exploration Exploration ProspectProspect

G F

R

A

Building the Building the PipelinePipeline

495 exploration licenses…

Çukuralan

… covered by a team of 20 exploration geologists with a 2010 budget of $15m

… over 640k ha throughout western, north-eastern and south central Turkey

PrePre--FeasibilityFeasibility20092009--20102010

2010+2010+

20120111++

Narlıca

Mollakara

____________________

Source: Koza Gold

Please note that Gıcık ceased mining in December 2009 and Küçükdere ceased mining in 2010.

Please note that 495 exploration licenses includes those attributable in the “Exploration Prospect” segment

Dri

ve U

p V

alu

e C

ha

in

Gelintepe

Torul Kıratlı Söğüt

Büyükpınar

Karapınar

KubaşlarAhatlar

Bulancak

Işıkdere

Hapan Ağadeve and Küçükdoğu Tepe

Çakilli Tepe TaşkapiMastra

North

Plus the June 2010

acquisition of Newmont

Altın

Coraklitepe

Himmetdede

Turkey Turkey ––UnderUnder--explored and explored and Highly ProspectiveHighly Prospective

Turkey Turkey ––UnderUnder--explored and explored and Highly ProspectiveHighly Prospective

Koza Gold – Value Proposition

Gold FundamentalsGold FundamentalsGold FundamentalsGold Fundamentals

11

33

22

77

DividendsDividendsDividendsDividends

88

1414

Strong Financial Strong Financial Performance and Performance and

ReturnsReturns

Strong Financial Strong Financial Performance and Performance and

ReturnsReturns

Unmatched Turkish Unmatched Turkish Gold experienceGold experience

Unmatched Turkish Unmatched Turkish Gold experienceGold experience

Resource ConversionResource Conversionand Production Expansionand Production Expansion

Track RecordTrack Record

Resource ConversionResource Conversionand Production Expansionand Production Expansion

Track RecordTrack Record

Exploration Footprint Exploration Footprint Driving GrowthDriving Growth

Exploration Footprint Exploration Footprint Driving GrowthDriving Growth

Hub Strategy: LowHub Strategy: Low--Cost Cost Developer and OperatorDeveloper and OperatorHub Strategy: LowHub Strategy: Low--Cost Cost Developer and OperatorDeveloper and Operator

33

44

55

66

77

AppendixAppendix

151515

Unmatched Turkish Gold ExperienceUnmatched Turkish Gold Experience

İsmet Sivrioğlu Zafer KaraAssistant General Manager

More than 20 years of experience in mining and exploration,

Mining & GeologyMining & GeologyMining & GeologyMining & Geology

Özlem Özdemir Assistant General Manager

Finance & CommercialFinance & CommercialFinance & CommercialFinance & Commercial

More than 10 years of experience in budgeting, finance & accounting,

Serhan UmurhanAssistant General Manager

TechnicalTechnicalTechnicalTechnical

More than 5 years of experience in project management

BSc in Chemical Engineering

General ManagerGeneral ManagerGeneral ManagerGeneral Manager

1616Experienced Team Spearheading the Management for the First DomesticallyExperienced Team Spearheading the Management for the First Domestically--Owned Turkish Gold Mining EnterpriseOwned Turkish Gold Mining EnterpriseExperienced Team Spearheading the Management for the First DomesticallyExperienced Team Spearheading the Management for the First Domestically--Owned Turkish Gold Mining EnterpriseOwned Turkish Gold Mining Enterprise

____________________

Source: Koza Gold.

Hayrettin Öğüt Assistant General Manager

mining and exploration,in budgeting, finance & accounting,

supply,project management

Cemalettin Çetin Assistant General Manager

AdministrationAdministrationAdministrationAdministration

Served in several public and private corporate management posts

HR & PRHR & PRHR & PRHR & PR

More than 15 years of experience in community and public relations in mining industry

BSc in Chemical Engineering

Vice-Chairman of the Gold Mining Association

13 years of service in several production plants and management positions of Etibank Corporate

General manager since 2005

10 years of service as General Manager of Kutahya Silver Mine

Assistant General Manager of Etibank Corporate for 4 years

Chairman of Executive Board at Cayeli Copper Operations Inc

Advisor to the Minister of State during the period 1997-1998

General Manager for Community and Government Relations at Eurogold, Normandy and Newmont Mining (at Ovacık, prior to acquisition by Koza)

Okan BAYRAKAssistant General Manager

Investor Investor RelationsRelationsInvestor Investor

RelationsRelations

More than 10 years of experience in capital markets

Koza Gold – Asset Overview

Asset Status Type Date of commencement of operation

Operating Projects

Ovacık Processing Plant Production Processing Plant 2001

Ovacık Underground Mine Production Underground 2005

Mastra Open Pit Mine Production Open Pit 2008

Mastra Underground Mine Production Underground 2009

Mastra Processing Plant Production Processing Plant 2009

Advanced Development Projects

Çukuralan Open Pit Mine Development Open Pit Planned 2010

Çukuralan Underground Mine Development Underground Planned 2011

Çoraklık Tepe Development Open Pit Planned 2013

Kaymaz Open Pit Mine Development Open Pit Planned 2011

Kaymaz Processing Plant Development Processing Plant Planned 2011

Pre-Feasibility Project

Mollakara Pre-Feasibility Open Pit N/A

Exploration Prospects

Narlıca Exploration Open Pit Projected 2012

1717

____________________

Source: Kozagold

LongLong--Term Objective: Maximise Resources and Profitable ProductionTerm Objective: Maximise Resources and Profitable Production

Narlıca Exploration Open Pit Projected 2012

Gelintepe Exploration Open Pit Projected 2014

Himmetdede Exploration Open Pit N/A

Torul Exploration Prospect N/A

Kıratlı Exploration Prospect N/A

Söğüt Exploration Prospect N/A

Büyükpınar Exploration Prospect N/A

Karapınar Exploration Prospect N/A

Kubaşlar Exploration Prospect N/A

Ahatlar Exploration Prospect N/A

Bulancak Exploration Prospect N/A

Hapan Exploration Prospect N/A

Işıkdere Exploration Prospect N/A

Ağadeve and Küçükdoğu Tepe Exploration Prospect N/A

Çakilli Tepe Exploration Prospect N/A

Taşkapi Exploration Prospect N/A

Mastra North Exploration Prospect N/A

Ovacık

Two primary vein systems are found on the property

� The M Vein system tends to be higher grade and shallower dipping and is mined using a cut and fill method

Reserves and ResourcesReserves and ResourcesReserves and ResourcesReserves and Resources

Tonnage Grade Content

(Mt) Au (g/t) Ag (g/t) Au (Moz) Ag (Moz)

Reserves¹

Proved 0.39 6,19 4,21 0.08 0.05

Probable 0.42 2,36 1,64 0.03 0.02

Total 0.82 4,21 2,88 0.11 0.08

Resources²

Measured 1.89 6.07 3.89 0.37 0.24

Indicated 0.73 5.43 2.29 0.13 0.05

Inferred 0.51 7.24 2.64 0.12 0.04

Total 3.13 6.11 3.31 0.62 0.33

(Ovacık – Our First Hub)

¹ Inclusive of stockpiles

² Inclusive of Reserves, exclusive of stockpile

Geographic locationGeographic locationGeographic locationGeographic location

Ovacık is Koza Gold’s flagship operation

A new ore zone to the west of the M vein was identified in Ovacik

M297 7.60m@ 23.78 g/t

Drilling still continue

Since acquiring Ovacık, Koza Gold has significantly increased Ovacık’s production and exploration potential

� 263koz gold reserves pre-2005

1818

� The S Vein is lower grade, steeper and mined using a shorthole open stoping method with backfill

Mine life of current reserves extends until 2012

Resource potential available

Processing via carbon-in-pulp procedure, using a conventional free-milling gold circuit

Operating StatisticsOperating StatisticsOperating StatisticsOperating Statistics

Operator Year Tonnes Au g/t Ag g/t Au oz Ag oz

Normandy 2001 153,283 9.93 13.74 45,862 53,813

Normandy 2002 373,768 12.28 18.43 138,319 182,708

Normandy 2003 483,967 11.75 12.97 172,325 159,595

Normandy 20041 299,869 10.97 11.05 100,912 82,778

Koza 20051 277,889 15.68 12.57 134,959 82,606

Koza 2006 587,521 10.37 10.26 187,171 131,805

Koza 2007 658,050 9.14 8.38 187,372 116,788

Koza 2008 758,382 7.18 11.57 167,059 170,330

Koza 2009 808,136 5,74 11,93 140,468 175,197

Koza 2010 6M 438,573 4,85 8,13 65,434 55,887____________________

Source: Koza Gold

Mine Model StatisticsMine Model StatisticsMine Model StatisticsMine Model Statistics

Parameter Unit Amount

Mining Cost UG $/t 40.35

Milling Cost $t/ore 17.14

G&A Cost $t/ore 7.79

Gold Price $/oz 950

Gold Recovery % 95

Royalty % Revenue 3

Royalty % Revenue 1

____________________

Source: Kozagold

� 263koz gold reserves pre-2005

� 111 koz of reserves as of 31-Dec-2009

� Net additions of 434koz

� Greenfield opportunities to feed the plant

Küçükdere(Ovacık Hub Satellite)


Küçükdere located 80km by road from Ovacık

Open Pit mining was depleted

Rehabilitation process is on going

Business model to be replicated at Narlıca, Gelintepe, Çukuralan and Kıratlı

The Küçükdere deposit is a high to low angle, epithermal quartz-carbonate vein deposit

� The mineralization forms two sub-parallel zones (east and west) and a third zone that connects these two that strikes nearly perpendicular

The vein zone is currently being exploited in a series of shallow, low stripping ratio (3:1) pits which provide feed for the Ovacık Mill

Mining method is based on conventional truck and shovel open-pit mining operations

The transport cost associated with hauling ore from site to the Ovacık processing facility currently stands at about US$8/t ore



Reserves¹

Proved 0.35 4.91 11.61 0.06 0.13

Probable 0.43 1.68 6.44 0.02 0.09

Total 0.77 3.13 8.75 0.08 0.22

Resources2

Measured

Indicated 0.98 2.13 6.87 0.07 0.22

Inferred 0.38 2.02 4.88 0.02 0.06

Total 1.37 2.10 6.31 0.09 0.28



1919



Mining Cost OP $/t 1.84

Rehabilitation Cost OP $/t waste 0.2


Transport Cost $t/ore 8.00

Selling Cost $/oz 5.31

Gold Price $/oz 950

Silver Price $/oz 12

Gold Recovery % 94

Silver Recovery % 75

Royalty % Revenue 1

Cut Off Grade OP g/t 1.30


2005

• Acquired the property from Eldorado Gold

• Core drilling programme

1999–2003

• Preliminary exploration and drilling

1998

• Discoveryof Küçükdere deposit by Eldorado

2007

• Production continued 2006

• Production start-up

2008

• Expansion of open-pit operations

2009

• Main pit completed and open pit backfill started.

____________________

Source: Kozagold

Source: Koza Gold. Competent Person’s Report by SRK (Jan-2010).

2010

Kucukdere Reserve was depleted

Çukuralan




(Ovacık Hub Satellite)

Çukuralan is a good example of our exploration expertise – Koza Gold discovered the asset in 2006

Çukuralan exhibits a very large vein system with significant potential

� Only 50% of vein system has been drilled to date, hence there is considerable upside potential from further exploration

Çukuralan open pit mining is planned to commence in August 2010.



Reserves1

Proved 2.11 6.53 3.09 0.44 0.21

Probable 1.67 5.58 2.62 0.30 0.14

Total 3.78 6.11 2.89 0.74 0.35

Resources2

Measured 3.15 6.25 3.07 0.63 0.31

Indicated 3.48 5.69 2.68 0.64 0.30

Inferred 3.66 4.50 2.02 0.53 0.24

Total 10.30 5.44 2.57 1.80 0.85



2020

Drilling programDrilling programDrilling programDrilling program

2005

• License area acquired by Koza Gold

1995

• Regional exploration by Normandy

2007

• Definition of resources

• Intensified drilling program

• Target reserve conversion

2006

• Discovery of Çukuralan deposit by Koza Gold

2008

• Intensive exploration drilling

• Initial resource model created

2009

• Infill drilling started.

• Resource model updated

• Exploration drilling extended

in August 2010.



Mining Cost UG $/t 40,35



G&A Cost $t/ore 7,79

Grade Control & Ore Rehandling OP $t/ore 1,77

Transport Cost $t/ore 8,00


Gold Price $/oz 950


Gold Recovery % 94


Royalty % Revenue 1

Cut Off Grade UG g/t 2.81


Holes PQ (m) HQ (m) NQ (m) Total (m)

2006 23 - 3,114 202 3,326

2007 60 - 18,559 632 19,191

2008 73 - 20,818 1400 22,218

2009 107 - 25,532 412 25,944

Total 236 - 68,023 2,646 70,669

____________________

Source: Kozagold


2010

• Open pit mining will start in August 2010

Kubaslar Project(Ovacık Hub Satellite)

1.4 km long low sulphidation style quartz vein and brecciate zone

14 diamond drilling were completed by Eldarado and MTA

Soils sampling was completed (total 391samples and up to 2140 ppb)

Significant regional potential


2121

Mastra(Mastra – Our Second Hub)

Reserves and ResourcesReserves and ResourcesReserves and ResourcesReserves and ResourcesGeographic locationGeographic locationGeographic locationGeographic location

Mastra is our second hub

� We started with a feasibility study in 2006

� Operations commenced at the open pit in 2008 and active operations commenced at the underground mine in January 2009

� In March 2009, the process plant commenced

� Targeting production of 160koz

� Mastra is a high-grade ore that is cost-effective to produce.

The plant flowsheet for Mastra is almost identical to that operated at Ovacık

� Designed for a treatment rate of 60tph

� Production commenced March 2009



Reserves¹

Proved 1.14 8.94 4.32 0.33 0.16

Probable 0.58 6.77 5.53 0.13 0.10

Total 1.72 8.20 4.73 0.45 0.26

Resources2

Measured–OP 0.34 11.54 6.23 0.13 0.07

Measured–UG 0.53 8.71 4.66 0.15 0.08

Indicated–OP 0.40 8.85 8.38 0.11 0.11

Indicated–UG 0.28 6.48 5.10 0.06 0.05

Inferred 0.80 7.01 8.88 0.18 0.23

Total 2.36 8.30 7.01 0.63 0.53

2222

Drilling programDrilling programDrilling programDrilling program


� For example, mining 450kt of ore at Mastra is expected to produce about the same yield as mining 650kt a Ovacık

There is significant potential in this hub area

Infill drilling continue and receiving very good resultsKZM126 [email protected] g/t AuKZM127 [email protected] g/t AuKZM128 [email protected] g/t Au



Mining Cost UG $/t 39.57


Milling Cost OP $t/ore 25.00

Milling Cost UG $t/ore 21.00

G&A Cost UG $t/ore 10.51


Gold Price $/oz 950


Gold Recovery % 92


Royalty % Revenue 2


Cut Off Grade UG g/t 2.84

Source: Kozagold

� Production commenced March 2009

Holes PQ (m) HQ (m) NQ (m) BQ (m) Total (m)

1992 3 261 - - - 261

1993 22 1,356 196 832 110 2,494

1994 23 1,825 1,649 - - 3,474

1995 56 936 7,181 320 - 8,437

2003 4 - 931 - - 931

2005 20 - 945 2,576 - 3,521

2006 36 - 2,127 3,780 - 5,907

2007 10 - 1,411 535 1,946

2008 66 - 11,213 3,496 14,709

2009 50 - 9,774 111 9,885

Total 166 4,378 354,27 11,651 110 51,566


² Inclusive of Reserves, exclusive of stockpiles

Kaymaz(Kaymaz – Our Third Hub)

Kaymaz will be Koza Gold’s third hub

� Koza Gold acquired Kaymaz in 2005

Pre acquisition, Koza Gold performed a significant amount of due diligence to help ensure the asset and its surrounding areas had significant potential

Since the acquisition, a number of exploration projects, which continue to be progressed, have been identified

Reserves and ResourcesReserves and ResourcesReserves and ResourcesReserves and ResourcesGeographic locationGeographic locationGeographic locationGeographic location


(kt) Au (g/t) Ag (g/t) Au (koz) Ag (koz)

Reserves

Proved 1.37 6.12 5.51 0.27 0.24

Probable 0.54 4.92 4.83 0.09 0.08

Total 1.91 5.78 5.32 0.36 0.33

Resources

Measured 1.66 5.77 5.32 0.31 0.28

Indicated 0.98 4.49 4.50 0.14 0.14

Inferred 0.93 3.14 3.53 0.09 0.10

Total 3.57 4.74 4.63 0.54 0.53



2323

1993–96

• Regional exploration performed by Tuprag

1988

• Discoveryof Kaymaz

2007

• Intensified exploration program

• First target definition drilling

2006

• Soil sampling performed by Koza

1997

• Completion of pre-feasibility study

2005

• Property acquired by Koza Gold

2008

• Infill drilling program for 2008 completed

2009

• Resource modeling completed. Pit design and plant design completed. Site preparation will start in 2010

____________________

Source: Koza Gold.







Gold Price $/oz 950


Gold Recovery % 83


Royalty % Revenue 1



2010

• Construction started

Kaymaz - New drill sections

New Significant intersections from drill hole

KM030 22.7m@ 4.4 g/t Au KM028 22.8m@ 3.77 g/t AuKM009 31.8m@ 3.18 g/t AuKM041 12.10m@ 4.94 g/t AuKM046 6.30m @ 9.26 g/t AuKM051 21.10m @ 10.33 g/t Au

New zone have been identified

Resources category turned from inferred to indicated and measuredDrilling on goingKaymaz Plant Construction commenced

(Kaymaz – Our Third Hub)

24

Kaymaz Plant Construction commencedProduction is planned to begin in the second half of 2011

24

Sögüt(Kaymaz Hub Stallite)

Geographic locationGeographic locationGeographic locationGeographic locationSögüt is a sediment hosted, structurally controlled gold

mineralizations

Three different quartz vein system they are named as:

1-Akbastepe

2-Korudanlik

3-Hayriye

Drilling on going and significant high results are receivedAKD03 15,8 m @ 5,52 g/tAKD13 26,03 m @ 16,16 g/tAKD14 33 m @ 8,46 g/tAKD08 8 m @ 2,24 g/tAKD04 13 m @ 2,85 g/tSKD06 6,40 m @ 3,94 g/t

Sogut is a good example of our exploration expertise – Koza Gold discovered the asset in 2008

SKD06 6,40 m @ 3,94 g/t

Visible gold were observed

Significant regional potential

AKD14 (45-46m ) @ 69.1 ppm AuAKD14 (45-46m ) @ 69.1 ppm AuAKD14 (45-46m ) @ 69.1 ppm AuAKD14 (45-46m ) @ 69.1 ppm AuAKD14 (45-46m ) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69 .1 ppm AuAKD14 (45-46m) @ 69 .1 ppm AuAKD14 (45-46m) @ 69 .1 ppm AuAKD14 (45-46m) @ 69 .1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69.1 ppm AuAKD14 (45-46m) @ 69 .1 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30 .7 ppm AuAKD14 (47-48m) @ 30 .7 ppm AuAKD14 (47-48m) @ 30 .7 ppm AuAKD14 (47-48m) @ 30 .7 ppm AuAKD14 (47-48m) @ 30 .7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30.7 ppm AuAKD14 (47-48m) @ 30 .7 ppm AuAKD14 (47-48m) @ 30 .7 ppm AuAKD14 (47-48m) @ 30 .7 ppm AuAKD14 (47-48m) @ 30 .7 ppm AuAKD14 (47-48m) @ 30 .7 ppm AuAKD14 (47-48m) @ 30.7 ppm Au

25

Diyadin(Mollakara – Potential Mine at Satellite)

Significant potential - 3.4Moz oxide & sulphite deposit

Open pit mining and heap leaching

The resource is open in all directions

Pre feasibility study on-going

SGS started for metallurgical test

First metallurgical results are positive for oxide zone

Significant regional exploration potential

Geographic locationGeographic locationGeographic locationGeographic location Reserves and ResourcesReserves and ResourcesReserves and ResourcesReserves and Resources


(kt) Au (g/t) Ag (g/t) Au (koz) Ag (koz)

Oxide Resources

Measured

İndicated 6.00 1.16 0.53 0.22 0.10

İnferred 38.65 0.65 0.17 0.81 0.21

Total 44.65 0.72 0.22 1.03 0.31

Sulphide Resources

Measured

Indicated 11.08 1.01 0.29 0.36 0.10

Inferred 74.17 0.83 0.21 1.98 0.50

Total 85.26 0.85 0.22 2.34 0.60

2626

2008

• Acquired the property from Newmont

2009

• Core Drilling commenced by Koza

2010E

• Drilling continuing

2005

• Discovery of Mollakara

2006

• Soil sampling IP gradient performed by Newmont

2007

• Core Drilling commencedby Newmont

____________________

Source: Koza Gold.

Size: 3.4Moz Oxide & Sulphite DepositSize: 3.4Moz Oxide & Sulphite DepositSize: 3.4Moz Oxide & Sulphite DepositSize: 3.4Moz Oxide & Sulphite Deposit

High grade gold shoots developed within Intermediate Sulphidation style veins in Çakilli Tepe

Massive sil-py altered volcanic breccias indication high fluid flow proximal to intrusive source at Taşkapi

Gold mineralisation at Agadeve and Küçükdoğu Tepe, is associated with multiply rebrecciated, colloform banded qtz-specularite, specularite-cemented breccias, and irregular quartz veinlets, hosted in argillised and locally silicifed dacitic Miocene volcanics

Ore ReservesAs of 31-Dec-2009

2727

Mineral Resources, Inclusive of ReservesAs of 31-Dec-2009

2828_Source: Competent Person’s Report by SRK (Jan-2010).

Exploration potential at Exploration potential at KozaKoza PropertiesPropertiesExploration potential at Exploration potential at KozaKoza PropertiesProperties

interim results 2010 - koza altın · dedeman group 2005 2006 2007 ovacık mine Çukuralan...

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