Junior Miners: The Debt Sentence?

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Junior MinersThe Debt Sentence?
Dr Tim Williams Director Global Mining Metals,
Transaction Advisory Services, Ernst Young
LLP 44 (0)20 7951 2922twilliams_at_uk.ey.com
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Ernst Young in the mining industry

• A global leader in assurance, tax, transaction
  and advisory services
• Globally we work for 25 of the top 30 mining and
  metals companies
• We lead the way in emerging markets, and have
  advised on key flotations in the sector,
  including Xstrata plc Hochschild Mining Ltd
  Kazakhmys plc Gem Diamonds Ltd Ferrexpo Ltd
  Fresnillo plc Ruuki Group plc and on Rio
  Tinto/BHP and Xstrata/Anglo American proposals
• We have advised on many transactions in the
  sector, including two of the largest deals in
  recent years Falconbridge by Xstrata and Inco
  by Vale
• We are recognised as leading advisors in key
  financial centres
• We lead the UK mining new listings 9 of the last
  12
• We work for all of the FTSE 100 mining and metals
  companies

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Dont be short-termist
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Copper, what recessions?
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Aluminium, the young metal solid electricity
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Aluminium stock shock
Source LME, Thompson Datastream
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Mining surviving
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YoY movement in net debt 1980 to 2009
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Mining eye looking good
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Miners have been leading AIM in 2010
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Mining returning to importance on AIM
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Ins and outs of the AIM miners
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AIM mining funds raised and all AIM funding
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Gold remains the target
Source Ernst Young
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New mining listings on AIM this year

• Scotgold gold Scotland 0.7m
• Bellzone iron ore Guinea 34m
• Kibo gold Tanzania 0m
• Metminco Cu, Au, Mo, Zn Peru, Chile 9.3m
• Ncondezi Coal coal Mozambique 36m
• Central Asia Metals Cu, Au, Mo Kazakhstan,
• Mongolia 38m

Source press reports
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AIM mining consolidators M

• Rusina Mining and European Nickel
• Western Coal and Energybuild
• Braemore Resources and Jubilee Platinum
• Hidefield Gold and Minera IRL
• Ridge Mining and Aquarius Platinum
• Cambrian Mining and Western Coal Corp
• Mano River Resources and African Aura

Source press reports
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AIM miners as targets, last 18 months A

• Afnat Resources by Axmin
• Kiwara by First Quantum
• Mowdow Mines by Franco Nevada
• CAMEC by ENRC
• Moto Goldmines by Randgold Resources
• Glencar Mining by Gold Fields
• Minerva Resources by Dwyka Resources
• Cambrian Mining by Western Coal
• Oriel Resources Mechel

Source press reports
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Lets be partners

• Jubilee Platinum and
• Sylvania Resources PGMs joint venture
• Mariana Resources and
• Cliffs Natural Resources exploration
  partnership
• Allied Gold IFC
• Nyota Minerals IFC
• Petra Diamonds IFC
• Herencia Resources Nyrstar
• Serabi Mining Eldorado Gold
• Goldstone Resources Bendigo Resources
• Triple Plate Junction Newcrest Mining joint
  venture
• Karelian Diamonds Rio Tinto exploration
  partnership
• European Nickel Hunter Dickinson

Source press reports
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China!

• African Minerals Tonkolili iron ore in Sierra
  Leone China Railway Materials Commercial Corp
• African Minerals Shandong Iron Steel
• Oxus Golds Amantaytau Goldfields in Uzbekistan
  Chinese financiers
• European Nickels Caldag nickel project Jiangxi
  Rare Earths and Rare Metals Tungsten Group
• Toledo Minings nickel in Philippines Jinchuan
  Group
• Chromex Minings lumpy chrome (offtake) Suzhou
  Kaiyuan Chemical
• Bellzone Minings Kalia iron ore in Guinea -
  China International Fund
• Kryso Resources Pakrut gold in Tajikistan
  China Nonferrous Metals
• Sirius Minerals - potash - Sino-Agri Mining

Source press reports
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Bubble bath? Double bubble trouble?
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Our views and opinionswww.ey.com/miningandmetals
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www.ey.com/miningandmetals
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Thank you
Michael D Lynch-Bell EMEIA Leader Mining Metals
Ernst Young LLP 44 (0)20 7951
3064mlynchbell_at_uk.ey.com
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Disclaimer

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