Investor Presentation Investor Presentation January 18, 2010 www.dundeeprecious.com
FORWARD–LOOKING STATEMENTS This presentation contains “forward-looking information” or "forward-looking statements" that involve a number of risks and uncertainties. t i ti Forward-looking information and forward-looking statements include, but are not limited to, statements with respect to the F d l ki i f ti d f d l ki t t t i l d b t t li it d t t t t ith t t th 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, costs of production, capital expenditures, 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 news release 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 y g , y , 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. 1
DPM SNAPSHOT DPM DPM – TSX (Jan. 15, 2010): TSX (J 15 2010) C$3 77 C$3.77 Market Cap (Jan. 15, 2010): C$368M Shares Outstanding: Shares Outstanding: 97 5M 97.5M At Sept. 30, 2009: Cash and Short-Term Investments: C$74M Working Capital (incl. Cash & ST Invts): C$113M Plus Restricted Cash: C$10M Plus Marketable Securities: C$26M Total Debt: Total Debt: C$21M C$21M Debt to Total Capitalization: 4.3% Institutional Shareholders: ~55% 2
DPM PROPERTIES Ch l Chelopech gold/copper underground mine, Bulgaria h ld/ d d i B l i Krumovgrad feasibility stage gold project, Bulgaria Deno copper/gold/zinc underground mine Kapan Armenia Deno copper/gold/zinc underground mine, Kapan, Armenia Serbian exploration properties (gold, copper, molybdenum, rhenium) 3
CHELOPECH MINE, BULGARIA , 100% ownership acquired in 2003 Largest underground gold/copper mine in Europe Largest underground gold/copper mine in Europe Long life cash flow producer Potential to significantly increase resource Mine/mill expansion from 1 to 2 mtpa underway, expected completion mid-2011 completion mid-2011 4
CHELOPECH MINE: Mineral Resources and Mineral Reserves Mi l R d Mi l R Chelopech Mineral Reserves – Sept. 2008 Gold G ld C Copper Tonnes Grade Pounds Category (M) Grade (g/t) Ounces (M) (%) (M) Proven Proven 11.68 11.68 3.89 3.89 1.46 1.46 1.42 1.42 366.03 366.03 Probable 12.69 3.53 1.44 1.15 321.86 Total 24.37 3.70 2.90 1.28 687.89 Chelopech Mineral Resources – Sept. 2008 Gold Copper Silver Tonnes Grade Ounces Grade Pounds Grade Ounces Category Category (M) (M) (g/t) (g/t) (M) (M) (%) (%) (M) (M) (g/t) (g/t) (M) (M) Measured 15.70 4.1 2.07 1.47 508.9 10.8 5.45 Indicated 19.08 3.52 2.16 1.10 462.6 7.42 4.55 M&I M&I 34 78 34.78 3 78 3.78 4 23 4.23 1.27 1 27 971 5 971.5 8 94 8.94 10 00 10.00 Inferred 9.79 2.72 0.86 0.87 187.8 11.44 3.60 3.2g/t AuEq Cut-Off Grade; Cut-off Grade AuEq formula: Au (g/t) + 2.5 x Cu (%). Mineral Resources are inclusive of Mineral Reserves. 5
CORPORATE SOCIAL RESPONSIBILITY AND HSE STANDARDS AT WORK AND HSE STANDARDS AT WORK Bulgarian and European environmental award winner Community initiatives support English language school, hospitals, technical schools and universities and many other local community projects Environmental standards meet or exceed EU standards Safety statistics comparable to N. America/ Australia 6
G Gross profit from mining operations of $36.7M in first nine months fit f i i ti f $36 7M i fi t i th 2009, compared to gross profit of $28.1M in first nine months 2008 12% increase in ore processed over first nine months 2008 due to 12% i i d fi t i th 2008 d t higher process plant utilization 41% i 41% increase in concentrate production over first nine months 2008 i t t d ti fi t i th 2008 due to higher gold and copper grades and increased recoveries 14% reduction in unit cash cost over first nine months 2008 to 14% reduction in unit cash cost over first nine months 2008 to US$51.98 per tonne ore processed, excluding royalties (10% reduction, including royalties) Metals contained in concentrate increased 25-43% over first nine months 2008 (Au – 43%; Cu – 41%; Ag – 25%) 7
CHELOPECH - MINE AND MILL OPERATIONS Ore Processed Gold Production (000 tonnes per year) (000’ tonnes per year) (000’ oz) (000 oz) 75 74 953 71 71 913 901 852 741 57 2005 2006 2007 2008 Sept. YTD 2009 2005 2006 2007 2008 Sept. YTD 2009 Copper Production EBITDA (lbs in millions) (in US$ millions) 57.8 57.7 43.9 25.4 24.6 24.6 23.6 23.6 20.5 20 5 19 9 19.9 28 8 28.8 19.6 2005 2006 2007 2008 Sept. YTD 2005 2006 2007 2008 Sept. YTD 2009 2009 2009 8
CHELOPECH EXPANSION PROJECT CHELOPECH EXPANSION PROJECT (1) Mine/Mill Expansion Expand mine and upgrade mill to 2.0 mtpa (approx. 140-150K tonnes con/yr ) Concentrate sales secured to 2020 (LOM) through contract and proposed smelter acquisition Sept YTD 2009 operating cost per tonne of ore - US$57.56 $ Estimated cost, upon completion of the expansion - US$34/tonne Total capital cost of US$102M excluding sustaining cap and Total capital cost of US$102M, excluding sustaining cap and special projects SAG mill and concentrator expansion underway p y Scheduled completion Q2 2011 9
CHELOPECH EXPANSION PROJECT CHELOPECH EXPANSION PROJECT (2) Metal Processing Facility (MPF) Construct plant to produce finished metal (Cost ~US$126M) Government has ability to own 25% of MPF New sliding scale royalty of 2-8% based on profitability of 10-60%, payable on start of construction July 2008 EIA approval revoked by Court Nov 2009; decision being appealed being appealed On care and maintenance pending resolution of appeals and permitting delays permitting delays 10
ACQUISITION OF TSUMEB SMELTER, NAMIBIA ACQUISITION OF TSUMEB SMELTER, NAMIBIA P Purchase Price: h P i US$18M in cash US$15M in DPM shares @ C$3 50 per share US$15M in DPM shares @ C$3.50 per share Assumption of US$17M in third party obligations AFRICA US$11.4M settled with US$2M cash and US$9.4M in DPM shares @ C$3.50/share Capacity: Capacity: Currently – 120,000 tonnes/year Expansion underway to 240,000 tonnes/year Tsumeb Smelter, Namibia Namibia Further low cost expansion potential 11
OUR STRATEGY – TSUMEB SMELTER OUR STRATEGY TSUMEB SMELTER Enables DPM to control its own destiny Increase profitability through cost savings initiatives and improved efficiencies Adds strategic value through processing of complex concentrates Broadens scope for future acquisitions of challenging ore bodies b di 12
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