TZMI CONGRESS November 2013
Disclaimer Forward-Looking Information This document may contain forward-looking statements. These forward-looking statements are made as of the date of this document and Sierra Rutile Limited (the Company ) does not intend, and does not assume any obligation, to update these forward-looking statements, whether as a result of new information, future events or otherwise, except as required under applicable securities legislation. Forward-looking statements relate to future events or future performance and reflect Company management s expectations or beliefs regarding future events and future performance and include, but are not limited to, statements with respect to the estimation of mineral reserves and resources, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, success of mining operations, environmental risks, unanticipated reclamation expenses, title disputes or claims and limitations on insurance coverage. In certain cases, 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 statements that certain actions, events or results may, could, would, might or will be taken, occur or be achieved or the negative of these terms or comparable terminology. By their very nature forward-looking statements involve known and unknown risks, uncertainties, assumptions and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward looking statements. Such factors include, among others, risks related to actual results of current exploration activities; changes in project parameters as plans continue to be refined; future prices of mineral resources; possible variations in ore reserves, grade or recovery rates; 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; as well as those factors detailed from time to time in the Company's interim and annual reports. These risks, uncertainties, assumptions and other factors could adversely affect the outcome and financial effects of the plans and events described herein. 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 as 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 should not place undue reliance on forward- looking statements.
Company Highlights Illustrated ability to execute the business plan as stated World s best asset for premium rutile product Existing production base and installed infrastructure minimizes risk Near-term production growth ready to be delivered Continual focus on capital efficiency and cost reduction Preferred location within TiO 2 feedstock sector Contributing to a better Sierra Leone 3
Illustrated Ability to Execute TZMI 2011 What we said: TZMI 2013 What we ve done since 2011: Capital continues to be invested in optimizing existing operations Overall process recovery increased by over 30% Lanti Dry mining operation due to commence at a total project cost of $20 million Project completed on budget and ahead of schedule Near-term expansion opportunities to grow rutile production by 90% within 2 years Production rate increased by 91% Commissioning Feasibility Study for the construction of a second large dredge Completed Feasibility Study for a lowercapex, faster-implementation, lower-risk Gangama Dry Mining project Management continues to deliver on the business plan 4
World s Best Asset for Premium Rutile Product Large size, high-quality deposit The world s largest primary rutile mine JORC resources in excess 840m tonnes at 1% rutile Currently producing at a rate of 129,000 tpa of rutile Additional ilmenite and zircon by-credits Resources to support a mine life of over 65 years Produces a premium product within the rutile market Resource Base Category Tonnes Grade (%) Contained Tonnes (kt) Millions Rutile Ilmenite Zircon Rutile Ilmenite Zircon Measured 43 0.82 0.48 0.10 354 207 44 Indicated 634 1.03 0.66 0.15 6,532 4,166 945 Total 677 1.02 0.65 0.15 6,886 4,372 989 Inferred 164 0.96 - - 1,575 - - Grand Total 841 1.01 0.52 0.12 8,461 4,372 989 Note: 0% cut-off Overview of Deposits Taninahun Boka Nyandehun Grade: 1.93% Immense resource base provides a long production life with operational flexibility Goap Sembehun Kamatpo Kibi Dodo Benduma Komende Sembehun Grade: 1.08% Rutile: 3.7Mt Gbeni Grade: 1.21% Rutile: 758kt Lanti Grade: 1.14% Rutile: 984kt Gangama Grade: 1.44% Rutile: 685kt 0 10km Gambia Grade: 1.03% Area 1 SRL plant Jagbahun Mosavi Grade: 1.29% 5
Indexed Process Recovery (Rolling 3-month average; Feb 2011 = 100%) 2Q10 3Q10 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13F Trailing 12 months production (rutile '000 tonnes) Strong and Growing Production Base An integrated multi-mine operation Lanti Dredge: dredge and processing plant capable of mining and treating 1,000tph Lanti Dry Mining: truck and shovel mining operation feeding a 500tph processing plant Strong production growth Smooth integration of dredge and dry mining Accelerated access to new ore bodies (e.g. Gbeni) Strong Rutile Production Growth 130 120 110 100 90 80 70 60 50 40 Process Recovery Improvement 150% 140% Steady operational improvement Operational efficiencies continue to be realized Management focus on near-term, quick win production and recovery improvements Industry leading LTIFR of 0.03 per 200,000 work hours a reduction of 93% since 2011 130% 120% 110% 100% 90% 80% Source: Sierra Rutile A well-established operation with strong year-on-year production growth 6
Installed Infrastructure Supports Expansion Republic of Guinea Falaba Gberia Timbako Koinadugu Mambolo Bumbuna Pepel Jagbwema Koindu Freetown Masiaka Waterloo Rotifunk Buedu Kenema Serabu Gbangbatok Daru Matru Joru Liberia Concentrator plant to process the dry mined ore into a heavy mineral concentration Mineral Separation Plant separates the heavy mineral concentrate into its components rutile and by-products ilmenite and zircon Shipping fleet comprising two push boats and 1,000 2,000 tonne barges used to transport product to deep water buoys for loading on to international vessels Atlantic Ocean Rotifunk Gbangbatok Serabu Conventional earth moving equipment, mines 500 tonnes of ore per hour Trucking operation to transport heavy mineral concentrate to the Mineral Separation Plant and finished product to the Port Port capable of loading over 500,000 tonnes of product per year Matru JORC Compliant Resource of over 840 million tonnes with an average rutile grade of 1.01% SRL Reconnaissance Licence Areas SRL Mineral Lease Boundary Bucket ladder Dredge designed to dig at a rate of 1,000 tonnes per hour Wetplant to process the Dredge feed into a heavy mineral concentrate Silos and domes capable of storing 32,000 tonnes of product Infrastructure designed to support rutile production of more than 200,000 tonnes per year 7
Near-Term Production Growth: Ready to be Delivered Gangama Dry Mining Project Operationally identical to the Lanti Dry Mining project Capital reduced with little risk of capital over-runs Value-optimisation study reduced Gangama capital budget by 21% from US$103 million 2 to US$81 million 1 77% of capital cost is fixed Power, water, roads and port capacity are already in place Gangama Dry Mining Capital Costs Earthworks & Infrastructure 10% Mobile Equipment 23% Other 12% Process Plant (LSTK) 54% 77% of capital costs are fixed very little risk of cost inflation Gangama Dry Mining (Gangama deposit only) +20 year life from mining unit Gangama Dry Mining unit will mine nearby deposits once the Gangama deposit is depleted 1 Feasibility study estimate 2 Pre-feasibility study estimate Average annual production rate (ore mined) Average annual rutile production Project life (Gangama deposit life) Up-front capital expenditure Construction period Exceptional project economics with 15+ addition years from the mining unit 7.4mtpa 93,100 tpa 6 years $81mm 12 months 8
Capital Cost (US$ millions) Maintaining Cost Discipline Tightly managed operating costs Implementing cost saving initiatives following a bottom-up review Continually reinforcing a culture of cost efficiency Efficient capital allocation Lanti Dry Mining project was completed on budget and ahead of schedule Gangama Dry Mining project capex reduction by over 21% Additional $23 million capital savings to be realized through dry mining, rather than dredging, the Gbeni deposit Expatriate Headcount 90 80 70 60 50 40 30 20 10 0 2009 2010 2011 2012 2013 2014 Gangama Dry Mining Project Capital Cost $140 $120 $103 $100 $85 $80 $60 $40 $20 Expatriate headcount declining as operational improvements have been completed 21% cost reduction $81 Source: Sierra Rutile Sierra Rutile continues to generate shareholder returns by focusing on cost efficiency $0 Original Cost Estimate Value-Optimized Cost Further Cost Reduction 9
A Stable Mining Jurisdiction Investment friendly jurisdiction Stable and investor-friendly country within a sector which is exposed to many higher-risk jurisdictions Pro-mining investment climate attracting African Minerals US$1.8bn iron ore project and London Mining s US$1.0bn iron ore project Sierra Leone has a stable government, welldocumented laws and property rights, and a responsible fiscal regime Long and successful history with Sierra Leone Mine has been in operation since the early 1970s The Company has a positive and long-standing relationship with the Government Strong support from local communities Lanti Dry mining commissioning GUINEA SIERRA LEONE Moyamba Freetown Bo Gbangbatok Momaligi Mines Process plant and tailings Main road LIBERIA Over 40 years, Sierra Rutile has forged strong relationships with Sierra Leone 10
Fish introduced ('000s) A Responsible Steward Environmental management Land rehabilitation program continues Since 2011, 282 hectares of land have been restored Aquaculture project successfully stocking fish in retired dredge ponds Strong, collaborative relationships with the Sierra Leone Environmental Protection Agency and Ministries of Fisheries and Agriculture Tree planting Aquaculture Sustenance Programme 225 Complete by Year End 200 Actual 175 150 125 100 75 50 25 0 2008 2009 2010 2011 2012 2013 Oil palm nursery Source: Sierra Rutile 11
Nurturing Future Talent Preparing Sierra Leoneans to be managers of the future High Potentials program Apprenticeships Sponsorship of a local technical college Sponsorship of local schools Local library A driver for positive change in Sierra Leone Supports local community projects such as schools, wells, bridges, clinics, street lights and other infrastructure Provides a medical facility, treating over 22,000 people a year Child being treated at the Sierra Rutile clinic 12
Contact Details Questions? TZMI CONGRESS November 2013 John Sisay Chief Executive Officer Email: jsisay@sierra-rutile.com Sierra Rutile Limited 30 Siaka Stevens Street 2nd Floor, Access Bank Building Freetown Sierra Leone www.sierra-rutile.com 13