ITY CIL Project › September 20, 2017
SPEAKERS TABLE OF CONTENT SÉBASTIEN DE MONTESSUS 1 ITY CIL PROJECT OVERVIEW Chief Executive Officer, President & Director 2 JEREMY LANGFORD ITY CIL PROJECT DETAILS Chief Operating Officer 3 APPENDIX VINCENT BENOIT EVP – CFO and Corporate Development PATRICK BOUISSET EVP – Exploration and Growth Note : All amonts are in US$
ITY CIL OPTIMIZATION STUDY ITY CIL PROJECT TO BECOME OUR NEXT FLAGSHIP ASSET Construction launched based on robust optimization study results STRONG LOW ROBUST EXPLORATION PRODUCTION AISC ECONOMICS UPSIDE PROFILE Long 14-year mine life $494/oz on average over At $1,250/oz: On track to meet our 5- first 5 years year discovery target of High production level: ‒ After-tax IRR of 40% 4-6Moz $549/oz on average over ‒ 235kozpa on average ‒ After-tax NPV 5% of $710m first 10 years ‒ 1.5Moz already over first 5 years At $1,000/oz: $580/oz on average over added over last 12- ‒ +200kozpa on average months mine life ‒ After-tax IRR of 23% over first 10 years ‒ Many near-mine ‒ After-tax NPV 5% of $343m ‒ 173kozpa on average targets identified over mine life ‒ Maiden resource on Le Plaque expected by year-end 3
ITY CIL OPTIMIZATION STUDY SUMMARY OF OPTIMISATION STUDY Significant improvement over 2016 Feasibility Study 2017 2016 VARIANCE OPTIMIZATION FEASIBILITY KEY CHANGES INCLUDE: KEY CHANGES INCLUDE: (OS VS. FS) STUDY STUDY LIFE OF MINE PRODUCTION › › Indicated resource inventory Strip ratio, w:o 1.9 2.1 (10%) Tonnes of ore processed, Mt 57.0Mt 41.0Mt +39% increased by 1.5Moz following Grade processed, Au g/t 1.57 g/t 1.42 g/t +10% exploration success Gold content processed, Moz 2.87 Moz 1.88 Moz +53% LOM Average Gold recovery, % 86% 83% +3% › Added Bakatouo high-grade deposit Gold production, Moz 2.47 Moz 1.56 Moz +58% Mine life, years 14.3 years 13.7 years +4% upfront Average annual gold production, koz 173 Koz 114 Koz +52% Cash costs, $/oz $554 $528 +5% › Mill size increased from 3Mtpa to AISC, $/oz $580 $603 (4%) AVERAGE FOR YEARS 1 TO 5: 4Mtpa Gold production, kozpa 235 koz 165 koz +42% Cash costs, $/oz $472/oz $446/oz +6% › Process plant design optimized to AISC, $/oz $494/oz $507/oz (3%) AVERAGE FOR YEARS 1 TO 10: maximize construction and operating Gold production, kozpa 204 koz 135 koz +51% synergies with Houndé Cash costs, $/oz $523/oz $488/oz +7% AISC, $/oz $549/oz $559/oz (2%) CAPITAL COST › Improved recovery rates Initial capital cost, $m $412m $307m +34% - of which equipment lease, $m $61m $25m +160% › Optimized site layout Upfront capital cost, $m $351m $282m +24% ECONOMICS (BASED ON $1,250/OZ) After-tax IRR 40% 36% +12% After-tax NPV ( 0% discount rate) $990m $607m +63% After-tax NPV ( 5% discount rate) $710m $411m +73% Payback period 1.8 years 2.1 years (17%) 4
ITY CIL OPTIMIZATION STUDY SIGNIFICANT INCREASE IN RESERVES Mill size increase to capture value created from exploration success Mill size and reserves growth 4.0Mtpa Mill Size Reserve +1.0 Moz 3.0Mtpa OS vs FS reserves 2.0Mtpa 1.5Mtpa 2.9Moz +53% 1.9Moz 1.4Moz OS vs FS reserves 0.8Moz 2014 2015 2016 2017 Scoping Study PFS FS Optimisation 5
ITY CIL OPTIMIZATION STUDY LONG-LIFE LOW-COST PROJECT Significantly improved production profile Production Profile OS production FS production AISC for OS 235 koz 250koz 250koz 238koz 224koz Exploration potential average production 213koz 201koz over first 5 years 190koz 162koz 159koz 151koz $494 /oz $677/oz $643/oz $612/oz $598/oz $602/oz $567/oz $532/oz $484/oz $493/oz average AISC over $407/oz first 5 years Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 6
ITY CIL OPTIMIZATION STUDY SIGNIFICANT EXPLORATION UPSIDE On-track to achieve exploration discovery target of 4-6Moz M&I Resource Evolution 4-6Moz Discovery Target 1.5Moz added 2.3Moz 3.8Moz 2016 5-Year Discovery Target 2017 (published Nov. 2016) M&I Resource M&I Resource (Base for FS) (Base for OS) 7 Resource details provide in section “ Ity CIL Project Details”
ITY CIL OPTIMIZATION STUDY ROBUST PROJECT ECONOMICS IRR of +20% even at $1,000/oz NPV 5% / IRR Cumulative after-tax free cash flow, US$m $1,400m 14-YEAR MINE LIFE 22-MONTH PAYBACK PERIOD $1,400/oz $920m / 50% $1,200m $1,250/oz $710m / 40% $1,000m $800m $600m $1,000/oz $343m / 23% $400m $200m $0m -$200m -$400m Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9 Y10 Y11 Y12 Y13 Y14 Y15 8
ITY CIL OPTIMIZATION STUDY TRANSITIONING OUR IN-HOUSE TEAM FROM HOUNDE TO ITY First gold pour expected by mid 2019 Houndé Houndé Construction oundé, Burkina Faso ITY CIL Ity CIL Construction y (CIL), Côte d'Ivoire KALANA DFS Optimization Construction EXPLORATION GREENFIELD Kalana, Mali Resource Definition Studies Construction 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2017 2018 2019 2020 2021 2022 9
ITY CIL OPTIMIZATION STUDY RCF UPSIZED AND EXTENDED Provides significant headroom to fund growth projects › Increased from $350m to $500m A stronger and enlarged INCREASED bank pool PRINCIPAL AMOUNT › Decreased from LIBOR plus 3.75% to 5.75% to LIBOR plus 2.95% to 3.95% on DECREASED drawn portion INTEREST › Decreased from commitment fees on undrawn portion from 1.31% to 2.01% RATE (depending on the applicable margin) to 1.03% LOWER › Expected to represent savings of approximately $5 million per year MAINTENANCE COSTS › The term of the new RCF is four years, maturing in September 2021, TERM representing an extension of the previous RCF which matures in March 2020 EXTENDED › Upsized RCF is repayable as a single bullet payment on the maturity date, compared to semi-annual reductions/repayments starting September 2018 for the 2015 RCF REPAYMENT › New RCF can be repaid at any time without penalty, and offers Endeavour a corporate style covenant package, which enhances the flexibility to run its business from day-to-day 10
ITY CIL OPTIMIZATION STUDY PROJECT IS FULLY FUNDED Significant headroom provided by cash flow from operations $495m Ity Capex $150m $215m Undrawn $130m RCF Hounde remaining capex Cash (as at June 30, 2017) $85m Liquidity Sources RCF Nzema La Mancha Ity Equipment Sources of Growth FCF before (as at June 30, Upsize Sale Placement Financing Funding Projects Growth Capex 2017) (H2- ’17 to H1 -19) 11
ITY CIL OPTIMIZATION STUDY IMPROVING THE QUALITY OF OUR PORTFOLIO Significant Progress Already Made PORTFOLIO IN 2015 PORTFOLIO IN 2017 AISC, $/oz $1,200 $1,150 AISC, $/oz $1,100 $1,200 $1,050 $1,000 $1,050 Tabakoto Tabakoto Youga Assessment $950 expected by mid-2018 Nzema $900 $850 $850 Agbaou $800 Houndé Kalana Ity HL $650 $750 Potential Karma $700 Agbaou $650 $450 $600 0 5 10 15 20 $550 Ity CIL Mine life, years $500 $450 0 5 10 15 20 Mine life, years Bubble size represents production Côte d’Ivoire Burkina Faso Ghana Mali 12
ITY CIL OPTIMIZATION STUDY ON TRACK TO LOWER GROUP’S AISC TO BELOW $800/OZ Developing projects to improve the portfolio quality STRATEGIC MILESTONES $1,317/oz For 2019 +900koz +900koz 800-900koz + 800koz 800-900koz $1,010/oz $922/oz Annual production $895/oz 584koz <$800/oz 517koz 462koz ≤ 800 $/oz 317koz All-in Sustaining Cost 10+ year 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Mine life Group AISC Houndé, Burkina Faso Ity (Heap Leach), Côte d’Ivoire Youga, Burkina Faso Kalana, Mali Karma, Burkina Faso Tabakoto, Mali Ity (CIL), Côte d’Ivoire Agbaou, Côte d’Ivoire Nzema, Ghana 13
1 1 ITY CIL PROJECT OVERVIEW 2 2 ITY CIL PROJECT DETAILS 3 3 APPENDIX
ITY CIL OPTIMIZATION STUDY SUMMARY OF INDEPENDENT OPTIMISATION STUDY FOR CIL PROJECT KEY CHANGES MADE TO OPTIMIZED STUDY Lead Consultant: › CIL process plant increased from 3Mtpa to 4Mtpa. › Construction of a 26MW full back up power station Contributions of: › Addition of a diverter/flop-gate system to maximize plant utilization › Improved recoveries based on additional metallurgical testwork, namely the Daapleau Primary (fresh) material › Process plant design optimized to maximize replication of Houndé design › Optimized upfront capital cost and sequenced overall build time with a high percentage of “Self - Perform” methodology. › Site layout optimized 15
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