Published on December 5, 2013
Young-Davidson Mine Update Luc Guimond, General Manager December 5, 2013 www.auricogold.com
FORWARD LOOKING STATEMENTS This presentation contains forward-looking statements and forward-looking information as defined under Canadian and U.S. securities laws. All statements, other than statements of historical fact, are forward-looking statements. The words "expect", "believe", "anticipate", "will", "intend", "estimate", "forecast", "budget" and similar expressions identify forward-looking statements. Forward-looking statements include information as to strategy, plans or future financial or operating performance, such as the Company’s expansion plans, project timelines, production plans, projected cash flows or capital expenditures, cost estimates, projected exploration results, reserve and resource estimates and other statements that express management’s expectations or estimates of future performance. Forward-looking statements are necessarily based upon a number of factors and assumptions that, while considered reasonable by management, are inherently subject to significant uncertainties and contingencies. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements, including: uncertainty of production and cost estimates; fluctuations in the price of gold and foreign exchange rates; the uncertainty of replacing depleted reserves; the risk that the Young-Davidson shaft will not perform as planned; the risk that mining operations do not meet expectations; the risk that projects will not be developed accordingly to budgets or timelines, changes in laws in Canada, Mexico and other jurisdictions in which the Company may carry on business; risks of obtaining necessary licenses, permits or approvals for operations or projects such as Kemess; disputes over title to properties; the speculative nature of mineral exploration and development; risks related to aboriginal title claims; compliance risks with respect to current and future environmental regulations; disruptions affecting operations; opportunities that may be pursued by the Company; employee relations; availability and costs of mining inputs and labor; the ability to secure capital to execute business plans; volatility of the Company’s share price; continuation of the dividend and dividend reinvestment plan; the effect of future financings; litigation; risk of loss due to sabotage and civil disturbances; the values of assets and liabilities based on projected future cash flows; risks arising from derivative instruments or the absence of hedging; adequacy of internal control over financial reporting; changes in credit rating; and the impact of inflation. Actual results and developments are likely to differ, and may differ materially, from those expressed or implied by the forward-looking statements contained herein. Such statements are based on a number of assumptions which may prove to be incorrect, including assumptions about: business and economic conditions; commodity prices and the price of key inputs such as labour, fuel and electricity; credit market conditions and conditions in financial markets generally; revenue and cash flow estimates, production levels, development schedules and the associated costs; ability to procure equipment and supplies and on a timely basis; the timing of the receipt of permits and other approvals for projects and operations; the ability to attract and retain skilled employees and contractors for the operations; the accuracy of reserve and resource estimates; the impact of changes in currency exchange rates on costs and results; interest rates; taxation; and ongoing relations with employees and business partners. The Company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events or otherwise, except as required by applicable law. Cautionary Note to U.S. Investors Concerning Measured, Indicated and Inferred Resources This presentation uses the terms "measured," "indicated" and "inferred” resources. We advise investors that while those terms are recognized and required by Canadian regulations, the United States Securities and Exchange Commission does not recognize them. “Inferred” resources” have a great amount of uncertainty as to their existence and as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred resource will ever be upgraded to a higher category. Under Canadian rules, estimates of inferred mineral resources may not form the basis of feasibility or other economic studies. United States investors are cautioned not to assume that all or any part of measured or indicated mineral resources will ever be converted into mineral reserves. United States investors are also cautioned not to assume that all or any part of an inferred mineral resource exists, or is economically or legally mineable. 2
Overview • • Low cost producer and strong production growth profile Long mine life: Opportunity to expand as reserves increase Located in a stable jurisdiction, close to major centres Historic Production from U/G Mines of Timmins & Kirkland Lake(1) 20 15 Ounces (Millions) • Active 10 5 Historical Production • • YD P&P YD M&I Hoyle Pond Macassa 1933-99 + 2002-13 Pamour Young-Davidson Coniarium Paymaster Upper Canada 1938-71 Preston Sylvanite 1927-61 Hallnor Aunor Teck Hughes 1917-68 Wright Hargreaves 1921-65 Lakeshore Mine K.L. 1918-65 Commercial production declared September 1st, 2012 Kerr Addison 1938-96 • McIntyre 1912-88 First gold pour on April 30th, 2012 Dome 1910-2013 • Hollinger 1910-68 0 YD Inferred Underground production commenced Oct/12;Declared commercial production Oct. 31/13 • Historic production from underground gold mines in Timmins and Kirkland Lake (~108 M Oz.) Solid safety record • Five mines with greater than 5 million ounces production, Young-Davidson is likely to be the sixth (1) Refer to endnote #1. 3
Rich Tradition – Mine History • Site of two former producers • 20+ years in operation • • +1,200 tpd average production rate Early pioneers of bulk mining • +1 million tonne stopes underground Young-Davidson Mine (YD) • Mined ~9 million tonnes and produced 970,000 ounces • Average realized grade of 3.37 g/tonne • Profitable operations at realized grades • Supported dividend payments Matachewan Consolidated Mine (MCM) Period Mine Tonnes 1934 to 1957 YD 5,653,000 3.21 585,000 1934 to 1954 MCM 3,205,000 3.66 378,000 1981 to 1982 MCM 96,400 2.36 7,300 8,954,400 3.37 970,300 Total Grade (g/t) Produced (Oz) 4
Responsible Mining Fostering positive relationships with all stakeholders • Strong First Nations support • Partnerships with local communities • Hiring and training locally • • 96% of mine workforce from local regions Supporting local suppliers • 47% of mine spending on local suppliers 5
Underground Mine Plan Ramp Portal 10350L MCM Historic Mine Workings Open Pit Highly Productive Mining Methods YD Historic Mine Workings Transverse long hole stoping NG Shaft MCM Shaft • • 9890L • YD West Zone 9590L For wider zones (12-40m) 30m sub levels Longitudinal retreat • For areas < 12m widths 9400L • 8900L 3.8M reserve ounces with exploration upside • Mining recovery ~ 92% • 9200L Pastefill Dilution ~10% • Underground reserve grade 2.82 g/t 6
Open Pit Overview • 315m wide x 800m long and 140m deep • Life of Mine production: 2.25 years • 7.5Mt of ore @ 1.36 g/t Au • Mill Feed 4.2Mt @ 1.78 g/t • Low grade stockpile 3.3Mt @ 0.82 g/t • Strip Ratio 2.5:1 • 8m benches • Cat 777 Trucks • 992 Loaders 7
Underground Mining Rates Underground Mine Ramp-up (tpd) Underground Mine Productivity (tpd) (Year-End Productivity) 2,600 8,000 Target 2,400 Commercial Production Actual 2,200 2,000 7,000 6,000 1,800 5,000 1,600 1,400 4,000 1,200 1,000 3,000 800 2,000 600 400 1,000 200 0 0 Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec 2012A 2013E 2014E • 2017E Target of 2,000tpd by end of 2013 • 2016E Commercial underground production declared October 31, 2013 • 2015E Currently mining in the Upper Boundary Zone (“UBZ”) • • • 60,000 to 80,000 tonne stopes Mining 30,000 to 40,000 tonne panels Overall average ore thickness (current reserves) is 20 metres • Highly productive bulk mining methodologies • Highly mechanized with low manning requirements 8
Process Plant Performance YTD Crusher 9,000 Mill Tonnes Processed (tonnes per day) Target 8,000 Actual 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec 9
Shaft System Productivities Upper mine represents 8 years of production • Supports increased underground mining rates • Improved productivity vs. ramp haulage • Optimizes cycle time • Enhanced cost efficiencies • Reduces mobile equipment requirements • Improves ventilation • ⅔ of 2014 mine plan is currently accessed • Capacity of 8,000tpd 10
Northgate Production Shaft Work Accessing mine via shaft system Reaming of NG shaft • 1st leg reaming completed (440m) • Ground support completed • 2nd leg reaming completed (890m) • 3rd leg (610m) • Planned end of 2016 LEGEND Raise Bore Leg #1 Raise Bore Leg #2 Raise Bore Leg #3 11
Solid Production Growth Stable and Growing Production Profile(3) Gold Ounces Produced 35,000 30,000 25,000 20,000 15,000 10,000 5,000 Q3 12 Q4 12 Q1 13 • Q3 13 Q4 13E Solid production growth quarter over quarter • Q2 13 Cash costs in-line with target levels (3) Refer to endnote #3. 12
Endnotes 1. Data provided by the Timmins Resident Geologist Program Ontario Geological Survey for the Ministry of Northern Development & Mines (2006). 2. Reserves and resources for Young-Davidson and El Chanate mines, Kemess Underground Project, and Orion represent gold grade as per technical reports and Company disclosure. For more information regarding AuRico Gold’s Mineral Reserves and Resources as at December 31, 2012 and the Kemess Feasibility Study, please refer to the press release dated March 25, 2013 titled AuRico Reports 2012 Reserve & Resource Update and Kemess Feasibility Study Results, available on the Company website at www.auricogold.com. Measured and indicated resources excludes inferred resources. 3. Production figures include gold ounces only. Production at the Young-Davidson mine includes pre-production ounces, which include ounces produced prior to the declaration of commercial production on September 1, 2012, as well as all ounces produced from the underground mine. 4. All-in sustaining costs are defined as cash costs, sustaining capital, corporate general and administrative expense, reclamation, care and maintenance expense, and exploration expenditures. Prior to commissioning the underground mine at Young-Davidson, all-in cash costs are calculated on ounces produced from the open pit only. All underground costs are capitalized, and any revenue related to underground ounces sold is credited against capital expenditures. 13
Crusher Station 9530 L Soledad Property – Kern County, California 15
Conveyor Level 9500 L Soledad Property – Kern County, California 16
Reserves and Resources(2) Total Proven and Probable Reserves Tonnes (000's) Gold (g/t) Gold Oz. (000's) Young-Davidson - Surface 6,425 1.31 271 Young-Davidson - Underground 39,037 2.82 3,534 Total Young-Davidson 45,462 2.60 3,804 Total Measured and Indicated Resources Tonnes (000's) Gold (g/t) Gold Oz. (000's) Young-Davidson - Surface 291 1.70 16 Young-Davidson - Underground 9,531 2.74 839 Total Young-Davidson 9,821 2.71 855 Inferred Resources Tonnes (000's) Gold (g/t) Gold Oz. (000's) Young-Davidson - Surface 0.99 1 Young-Davidson - Underground 13,983 2.80 1,259 Total Young-Davidson (2) Refer to endnote 2. 31 14,014 2.80 1,260 17
Notes to Reserves and Resources Notes: • Mineral Reserves and Resources have been stated as at December 31, 2012. • Mineral Resources are in addition to Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability when calculated using Mineral Reserve assumptions. Reserves have been reported in accordance with NI 43-101, as required by Canadian securities regulatory authorities. In addition, while the terms “Measured”, “Indicated and “Inferred” Mineral Resources are required pursuant to NI 43-101, the SEC does not recognize such terms. Canadian standards differ significantly from the requirements of the SEC, and mineral resource information contained herein is not comparable to similar information regarding mineral reserves disclosed in accordance with the requirements of the SEC. Investors should understand that “Inferred” Mineral Resources have a great amount of uncertainty as to their existence and great uncertainty as to their economic and legal feasibility. In addition, investors are cautioned not to assume that any part or all of AuRico’s Mineral Resources constitute or will be converted into Reserves. • Following the completion of a joint venture agreement, Minera Frisco has a 50% interest in the Orion Project. • Mineral resource tonnage and contained metal have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding. The following metal prices were used for the calculation of Reserves and Resources: Reserves Resources USD Au $/oz Ag $/oz Cu $/lb Au $/oz Ag $/oz Cu $/lb El Chanate $1,400 - - $1,600 - - Young-Davidson $1,400 - - $1,600 - - Kemess Underground $1,300 $23.00 $3.00 - - - Orion $13.00 NSR $850 $13.00 - Reserves and Resources were prepared under the supervision of the following Qualified Persons: Resources Reserves El Chanate Jeffrey Volk, CPG, FAusIMM, Director Reserves and Resources, AuRico Gold Inc. Chris Sharpe, P.Eng, Manager Mining, AuRico Gold Inc. Young-Davidson - Open Pit Jeffrey Volk, CPG, FAusIMM, Director Reserves and Resources, AuRico Gold Inc. Chris Sharpe, P.Eng, Manager Mining, AuRico Gold Inc. Young-Davidson - Underground Jeffrey Volk, CPG, FAusIMM, Director Reserves and Resources, AuRico Gold Inc. Chris Bostwick, FAusIMM, SVP Technical Services, AuRico Gold Inc. Kemess Underground Jeffrey Volk, CPG, FAusIMM, Director Reserves and Resources, AuRico Gold Inc. Chris Bostwick, FAusIMM, SVP Technical Services, AuRico Gold Inc. Orion Jeffrey Volk, CPG, FAusIMM, Director Reserves and Resources, AuRico Gold Inc. 18
All-in Sustaining Cash Cost Allocation All-in Sustaining Cash Costs 2013 All-in Sustaining Cash Costs $1,100-$1,200 per ounce(4) Corporate G&A Exploration • Provides increased transparency • More representative of actual cost of production • Removes influence of accounting treatments • Can be reconciled to FCF Sustaining Cost Allocation Materials/Mtc 9% Consumables 19% Cash Costs Diesel 9% Labour 57% (Includes contract labour) Power 6% (4) Refer to endnote #4. 19
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