Q4 2018 THE BEL AIR BAUXITE MINE: FROM GRASSROOTS TO PRODUCTION
COMPANY OVERVIEW ALUFER IS ONE OF THE MOST ATTRACTIVE BAUXITE MINING COMPANIES GLOBALLY Commenced production at flagship Bel Air Project • First Ore on Ship – On Time, Under Budget, LTI Free Rare development story: • Alufer discovered the deposit through maiden drilling in 2011 • Completed detailed feasibility studies and extensive social and environmental work • Secured financing in 2016 • Commenced construction in 2017 • Commenced production in Q3 2018 Focused on delivering a long term, sustainable mining operation and creating value for all stakeholders Phase 1: Construction – Complete Phase 2: Ramp up – over the next few months Phase 3: Steady State 2
BEL AIR PROJECT - HIGHLIGHTS Control of own logistics Location advantage > 15 year Life of mine • • Have built a dedicated haul • 15km from the coast 146mt JORC resource • road, export facility, port and Easily accessible from identified - Direct Shipping Ore • berth Ramping up to steady state Conakry by road • • Control full production chain rate of 5.5mtpa Simple operational set up from pit to ship required Responsible, sustainable bauxite High value product Developing a long lasting legacy production • • Using global best practice Well suited to low temp • Over 40 community projects refinery mining methods completed to date • Adopting IFC and Equator • Low reactive silica - notable • Will continue to contribute advantage Principles through Local Development • Low deleterious elements fund 3
CONSTRUCTION FINANCING AND COMMENCEMENT • In December 2016, Alufer successfully secured a $205m financing package from a consortium of international investors • US$80m Senior Debt Facility • Orion Mine Finance • US$125m of Convertible Loan Notes and Equity • Resource Capital Funds • The Africa Finance Corporation • Orion Mine Finance • Six Year Offtake Agreement with Orion Mine Finance • Working with Alufer to market the bauxite product • Construction commenced in January 2017 and the project was officially opened by President Alpha Conde on the 3 rd February 2017. 4
BAUXITE OVERVIEW BAUXITE IS THE PRINCIPAL ORE OF ALUMINIUM • Bauxite is the main commercial mineral from which aluminium oxide is extracted, which in turn is smelted to form aluminium metal: 5t Bauxite Ore 2t Alumina 1t Aluminium Consumers Bauxite Alumina Aluminium and mining refining smelting Fabrication • The aluminium industry is no longer as integrated as it used to be - pricing power is shifting upstream to alumina and bauxite producers • However, aluminium demand drives alumina and bauxite growth - medium to long term demand is still strong • Iron ore and copper usage matured following rapid industrialisation in China and other emerging markets - aluminium is still in its early stages • Demand continues to grow in key sectors including transportation, construction, power, packaging and consumer products 5
PROJECT OVERVIEW - OPERATIONAL SUMMARY SIMPLE LOGISTICS SET-UP: MINING - SHORT HAUL - CAUSEWAY CONVEYORS - TRANSHIPMENT Stage 1: Mining Stage 2: Short Haul Stage 3: Export Facility Stage 4: Shipping • • Automated materials • DSO material is mined Transhipment • Material is then from a minimum of 2 handling set up handled via self- transported via truck • Ore is stockpiled and pits at a time propelled barges and from the pits to the • Open cast, strip handled via conveyor transhipment vessel export facility at the mining with surface over a 1.2km rubble (TSV) coast • miners causeway and loaded Ocean Going Vessels • Low opex, minimal re- • Minimises loss and onto barges loaded 32 km handling, high • Provides access from dilution offshore efficiency • • Enables ongoing shore to suitable water Optimal method for • Alufer have control of rehabilitation during depth for 10,000 DWT bulk export dedicated logistics • LOM barges Significant storage facilities capacity on TSV THE PROCESS HAS BEEN OPTIMISED FOR CAPEX, OPEX AND THE OPERATING ENVIRONMENT 6
MINING OPERATIONS 7
CAUSEWAY, BERTH AND EXPORT FACILITY 8
LOADING THE BARGES AND TRANSHIPPING 9
SOCIAL AND ENVIRONMENTAL ALUFER IS COMMITTED TO PROMOTING & DELIVERING SUSTAINABLE DEVELOPMENT • Ongoing management plans will be in place to ensure compliance with IFC Performance Standards and meet Equator Principles • Ongoing work includes: o Baseline assessments o Integrated terrestrial and marine, social and environmental impact assessments o Social and environmental management plans o A Stakeholder Engagement plan o A detailed Land Access and Resettlement framework and plan o A Critical Habitat review, including Biodiversity action and management plans • The project was awarded the Environmental Certificate of Conformity from the Government of Guinea in June 2013 which has since been renewed annually STAKEHOLDER ENGAGEMENT IS A CORE FOCUS • Throughout the project the team will work with the community to develop local enterprise initiatives and promote local supply 10
SUSTAINABLE INITIATIVES 40 COMMUNITY DEVELOPMENT PROGRAMMES COMPLETED TO DATE THAT WILL HAVE LONG TERM BENEFITS Education: • Building of schoolrooms and teacher accommodation Water: • Installation and repair of wells to ensure potable supply Health • Building of health posts and provision of equipment • Raising awareness and education on malaria, HIV / AIDS, sanitation Local Business • Training, assistance and support of local enterprise (such as local car wash facility) Livelihood • Set up of food cropping projects to provide high value produce (eggplant, cassava, chilli) for the community and site Rehabilitation • Planting of seedlings and creation of nurseries for re-vegetation of the mine and camp site Solar • Generation of power for domestic and public lighting 11
LIVELIHOOD TO OFFSET IMPACTS OF ECONOMIC DISPLACEMENT WE HAVE DEVELOPED A RANGE OF LIVELIHOOD RESTORATION PROJECTS Food cropping projects to provide high value produce (eggplant, chilli) for the community and site • Reinforces social networks, teaches new agricultural techniques and provides extra income • Cooperatives are being rolled out across further local villages A salt culture livelihood restoration project – new methodology taught • Less firewood required; is healthier, safer, reduces deforestation and produces better quality salt • Alufer has also repaired a berm in the mangrove area and constructed a storage room Other livelihood restoration projects are in development, including agricultural projects and the creation of ‘multi-function platforms’ • Use of centralised equipment for processing crops, peanuts for example, for which users pay a small fee 12
STRONG STAKEHOLDER SUPPORT STRONG RELATIONSHIP WITH GOVERNMENT • Alufer has a good working relationship with the Guinean Government • Bel Air was declared a Project of National Interest” (PIN) in December 2014 MINING CONVENTION • Alufer’s Mining Convention signed in February 2016: o The first under the new 2013 Guinean Mining Code and first signed by the new Mines Minister o Ratified by Parliament in June 2016 • Fiscal concessions received to encourage investment and protect sustainability of operation • A tax regime has been developed to promote investment in Guinea and to deliver a fair revenue balance for all stakeholders OFFICIALLY INAUGURATED THE BEL AIR MINE • His Excellency Alpha Conde officially opened the mine in November • Also attended by Minister of Mines, members of Parliament and local authorities who flagged swift progress of the mine and benefits for communities and country 13
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