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Transcript of TSX/NYSE Alternext US:NGD
TSX/NYSE Alternext US:NGD
Corporate PresentationFebruary 2009
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Cautionary Statement
All monetary amounts in U.S. dollars unless otherwise stated
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain information contained in this presentation, including any information relating to New Gold’s future financial or operating performance, may be deemed “forward looking”. All statements in this press release, other than statements of historical fact, that address events or developments that New Gold expects to occur, are “forward-looking statements”. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects”, “does not expect”, “plans”, “anticipates”, “does not anticipate”, “believes”, “intends”, “estimates”, “projects”, “potential”, ”scheduled”, “forecast”, “budget” and similar expressions, or that events or conditions “will”, “would”, “may”, “could”, “should” or “might” occur. All such forward-looking statements are subject to important risk factors and uncertainties, many of which are beyond New Gold’s ability to control or predict. Forward-looking statements are necessarily based on estimates and assumptions that are inherently subject to known and unknown risks, uncertainties and other factors that may cause New Gold’s actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. Such factors include, without limitation: the results of the preliminary economic assessment assessing the viability of a new process facility at Amapari; New Gold’s operations are subject to significant capital requirements ; fluctuations in the international currency markets and in the rates of exchange of the currencies of Canada, the United States, Australia, Brazil, Mexico and Chile; price volatility in the spot and forward markets for commodities; impact of any hedging activities, including margin limits and margin calls; discrepancies between actual and estimated production, between actual and estimated reserves and resources and between actual and estimated metallurgical recoveries; changes in national and local government legislation in Canada, the United States, Australia, Brazil, Mexico and Chile or any other country in which New Gold currently or may in the future carry on business; taxation; controls, regulations and political or economic developments in the countries in which New Gold does or may carry on business; the speculative nature of mineral exploration and development, including the risks of obtaining necessary licenses and permits; diminishing quantities or grades of reserves; competition; loss of key employees; additional funding requirements; actual results of current exploration or reclamation activities; changes in project parameters as plans continue to be refined; accidents; labour disputes; defective title to mineral claims or property or contests over claims to mineral properties. In addition, there are risks and hazards associated with the business of mineral exploration, development and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold bullion losses (and the risk of inadequate insurance or inability to obtain insurance, to cover these risks) as well as “Risks and Uncertainties” included in New Gold’s MD&A filed on November 12, 2008 and available at www.sedar.com. Forward-looking statements are not guarantees of future performance, and actual results and future events could materially differ from those anticipated in such statements. All of the forward-looking statements contained in this press release are qualified by these cautionary statements. New Gold expressly disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise, except in accordance with applicable securities laws.CAUTIONARY NOTE TO U.S. READERS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCESInformation concerning the properties and operations of New Gold has been prepared in accordance with Canadian standards under applicable Canadian securities laws, and may not be comparable to similar information for United States companies. The terms “Mineral Resource”, “Measured Mineral Resource”, “Indicated Mineral Resource” and “Inferred Mineral Resource” used in this presentation are Canadian mining terms as defined in accordance with NI 43-101 under guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) Standards on Mineral Resources and Mineral Reserves adopted by the CIM Council on December 11, 2005. While the terms “Mineral Resource”, “Measured Mineral Resource”, “Indicated Mineral Resource” and “Inferred Mineral Resource” are recognized and required by Canadian regulations, they are not defined terms under standards of the United States Securities and Exchange Commission. Under United States standards, mineralization may not be classified as a “reserve” unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve calculation is made. As such, certain information contained in this presentation concerning descriptions of mineralization and resources under Canadian standards is not comparable to similar information made public by United States companies subject to the reporting and disclosure requirements of the United States Securities and Exchange Commission. An “Inferred Mineral Resource” has a great amount of uncertainty as to its existence and as to its economic and legal feasibility. It cannot be assumed that all or any part of an “Inferred Mineral 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. Readers are cautioned not to assume that all or any part of Measured or Indicated Resources will ever be converted into Mineral Reserves. Readers are also cautioned not to assume that all or any part of an “Inferred Mineral Resource” exists, or is economically or legally mineable. In addition, the definitions of “Proven Mineral Reserves” and “Probable Mineral Reserves” under CIM standards differ in certain respects from the standards of the United States Securities and Exchange Commission. CASH COST
“Total cash cost” figures are calculated in accordance with a standard developed by The Gold Institute, which was a worldwide association of suppliers of gold and gold products and included leading North American gold producers. The Gold Institute ceased operations in 2002, but the standard is the accepted standard of reporting cash cost of production in North America. Adoption of the standard is voluntary and the cost measures presented may not be comparable to other similarly titled measures of other companies. New Gold reports total cash cost on a sales basis. Total cash cost includes mine site operating costs such as mining, processing, administration, royalties and production taxes, but is exclusive of amortization, reclamation, capital and exploration costs. Total cash cost is then divided by ounces sold to arrive at the total cash cost of sales. The measure, along with sales, is considered to be a key indicator of a company’s ability to generate operating earnings and cash flow from its mining operations. This data is furnished to provide additional information and is a non-GAAP measure. It should not be considered in isolation as a substitute for measures of performance prepared in accordance with GAAP and is not necessarily indicative of operating costs presented under GAAP.
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Table of Contents
• Overview• Corporate Strategy• Reserves & Resources• Financial Summary • Capital Structure• Stock Chart• Board of Directors & Management• Analyst Coverage• Peer Comparison
• Strategy• Operational Targets• Operations Overview• Internal Growth• External Growth
• Summary
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Overview – Corporate Strategy“A Clear Direction”
A CLEAR DIRECTION
• Vision– Grow production to become a million gold equivalent ounce producer,
with lower than industry average cash cost per ounce by 2012
• Mission– Achieve our vision by:
• Delivering on operational targets (safety, cost, production and environment & social responsibility)
• Maintaining a strong financial position• Growing internally through project development and continuous
improvement at our existing operations; and• Growing externally through continued consolidation of junior
gold producers
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Overview
• Globally diversified intermediate gold producer
• Increasing production and reserves profile
• Cash flow generating operations• Strong reserve position supported by large resource base
• Growth profile with solid development pipeline
• New Afton is scheduled to commence production in the second half of 2012
• El Morro completed feasibility study and entered permitting stage
• Sound platform for profitable growth and increased shareholder returns
• Solid financial management
• Proven board of directors and management with experience financing, developing and operating open pit and underground mines
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OverviewReserves & Resources*
Proven & Probable ReservesMeasured & Indicated
Resources Inferred Resources
PropertyAu
(koz)
Cu (mm lbs) Ag (koz) Au (koz)
Cu (mm lbs) Ag (koz)
Au (koz)
Cu (mm lbs)
Ag (koz)
New Afton1 1,030 960 3,240 1,630 1,480 5,400 225 168 394
Cerro San Pedro1 1,510 - 62,000 2,030 - 75,500 45 - 2,200
El Morro1,2 2,013 1,715 - 2,659 2,019 - 110 142 -
Amapari3 302 - - 745 - - 1,351 - -
Peak3 368 27 - 458 87 - 416 23 -
Total 5 5,225 2,702 65,240 8,2004 3,586 80,900 2,147 333 2,594
* Updated reserves and resources data will be released in Q1 2009.
(1) Measured and indicated resources are inclusive of mineral reserves
(2) The El Morro reserves and resources have been calculated at 30% of the total reserves and resources to reflect New Gold’s 30% interest in the project
(3) Measured and indicated resources are exclusive of mineral reserves
(4) The total measured and indicated gold resources are reported inclusive of proven & probable gold reserves and are as of most recent 43-101 Technical Report(s). This total will differ from the above line items because the measured and indicated resources for Peak and Amapari are presented exclusive of proven and probable reserves
(5) Numbers may not add due to rounding
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OverviewFinancial Summary
Cash Balance As at September 30, 2008 $251 million
2008 Revenue As at September 30, 2008 $159 million
Long Term Investments (ABCP)1
As at September 30, 2008 $87.7 million
Debt Senior Secured Notes
Exp: June 2017Annual Interest Rate: 10%
CAD$187 million
Convertible Debenture
Exp: June 2014Annual Interest Rate: 5%
CAD$55 million
1 On January 16, 2009 the Ontario Superior Court approved the restructuring of the Third Party Asset Back Commercial Paper (“ABCP”) market, which had been frozen since August 2007. On January 21, 2009 the Pan-Canadian Investors Committee for Third Party Structured ABCP announced that the restructuring Plan has now been fully implemented. Under the agreement New Gold will receive new notes with a par value of CAD $168.9 million, the majority of which will mature in 2017. On closing of the restructuring, New Gold will also receive approximately CAD $5.8 million representing its share of interest earned on its ABCP from August 2007 net of restructuring costs.
2 On January 9, 2009, New Gold reduced its debt position by CAD $50 million, through the buy back of a portion of its Senior Secured Notes for consideration of $30 million, and reduced interest payments by $5 million per year.
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OverviewCapital Structure
Shares Issued & Outstanding 212,840,746Stock Options 8,989,888Warrants 60,136,161Insider Ownership 15%
Major Shareholders
Seymour Schulich 12%Highfields Capital 7.5%Goldcorp Inc. 7%U.S. Global Investors 7%Tocqueville Asset Management 4%
Toronto Stock Exchange (NGD:TSX) New York Stock Exchange (NGD:NYSE Alternext US)Cusip No. 644535 10 6 U.S. 20F Registration under Section 12(b) of the 1934ISIN CA644 535 10 6 8 Act, CIK# 0000800166 SEDAR Profile 00004818
as at December 31, 2008
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OverviewOne Year Stock Chart
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Current Price: $3.0852 Week High/Low: Low High TSX $0.94 $9.75 NYSE Alternext US $0.74 $10.00Average Daily Volume (TSX: 3 m) 1,649,890
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Organizational StructureBoard of Directors
Robert Gallagher Chief Executive Officer &
Director
Mr. Gallagher has worked in the mining industry for over 30 years and has spent 15 years with Placer Dome and the last 7 years with Newmont Mining Corporation, most recently as Vice President Operations, Asia Pacific. Mr. Gallagher brings a wealth of experience in the mining industry.
Craig Nelsen Chairman
Mr. Nelsen was previously the Chairman and a Director of Metallica Resources Inc. He is also the President, CEO, and Director of Avanti Mining Corporation. He previously served as Chief Executive Officer of that company from 1994 to 1999. Mr. Nelsen also served as the Executive Vice-President, Exploration, for Gold Fields Limited, one of the world's largest gold mining companies.
Pierre Lassonde Director
Mr. Lassonde is currently the Chairman of Franco Nevada Corporation. He formerly served as President of Newmont from 2002 to 2006 and resigned as a director and Vice-Chairman of Newmont effective as of November 30, 2007. Previously Mr. Lassonde served as a director and President (1982 to 2002) and Co-Chief Executive Officer (1999 to 2002) of the former Franco-Nevada.
Clifford DavisDirector
Mr. Davis has more than 40 years of international experience in the operation and development of both underground and open pit gold and base metal mines. His career has given him extremely valuable exposure to mining operations in locations throughout North America, South America, Europe and Africa. Mr. Davis is a graduate in mining engineering from the Royal School of Mines in London, England.
Paul Sweeney Director
Mr. Sweeney has more than 30 years experience in the mining industry in senior financial roles. He is currently the Vice President, Corporate Development of Plutonic Power Corporation and previously was the Vice President and Chief Financial Officer for Canico Resource Corp.
Ian TelferDirector
Mr. Telfer is Chairman of Goldcorp and previously served as President and Chief Executive Officer of Goldcorp from February 2005 until its merger with Glamis Gold Ltd. in November 2006. Mr. Telfer was previously Chairman and Chief Executive Officer of Wheaton River since September 2001 and has over 25 years of experience in the precious metals business.
James EsteyDirector
Mr. Estey is the recently retired Chairman of UBS Securities Canada Inc. and has more than 30 years of experience in the financial markets. In 1994, Mr. Estey became the head of the Canadian Equities business and in 2002 he was appointed President and CEO of UBS Securities Canada. He serves on the boards of Calvalley Petroleum, New Gold Inc., Pure Trading, Range Royalty and the Estey Centre for Law and Economics in International Trade.
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Organizational StructureManagement Team
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Robert Gallagher President and CEO
Mr. Gallagher has worked in the mining industry for over 30 years and has spent 15 years with Placer Dome and the last 7 years with Newmont Mining Corporation, most recently as Vice President Operations, Asia Pacific. Mr. Gallagher brings a wealth of experience in the mining industry.
Basil HuxhamExecutive VP and CFO
Mr. Huxham was formerly the Executive Vice President and Chief Financial officer of Peak Gold Ltd. Prior to that he was the Corporate Controller of Duke Energy's Canadian operations, where he led the integration of the Canadian and US corporate financial accounting and reporting functions after Duke Energy acquired Westcoast Energy in 2001. Mr. Huxham also previously held various finance roles at the Canadian Pacific Ltd. group. Mr. Huxham is a Chartered Accountant.
James (Jim) CurrieVP Operations
Mr. Currie is a mining engineer with over 28 years of experience in the mining industry, having worked on projects in North and South America, Asia and Africa. Mr. Currie was previously the Vice President Operations for Miramar Mining Corp. in Vancouver and was responsible for the development of Miramar’s 10 million ounce gold resource at Hope Bay in the Canadian Arctic. Prior to that, Mr. Currie held the position of General Manager of Mauritanian Copper Mines SA.
Arthur Graham VP Corporate Development
Mr. Graham is a mining engineer with over 20 years of mining industry experience. Previously he was a Director in the Energy and Commodities division of BNP Paribas' New York office with responsibility for the assessment and monitoring of mining projects and companies in transactions throughout the Americas. Mr. Graham also held similar positions with Deutsche Bank, Bankers Trust and Scotiabank.
John MarshallVP Human Resources
Mr. Marshall has over 20 years experience in human resources spanning the energy, semiconductor and banking industries. He was previously the Director of Worldwide HR Operations for PMC-Sierra Inc. where he managed human resources operations for employees in over 10 countries. Prior to PMC-Sierra, Mr. Marshall held various human resources roles at Duke Energy, Westcoast Energy and NatWest Group plc.
Mélanie HennesseyVP Investor Relations
Mrs. Hennessey was formerly the Vice President Investor Relations for Peak Gold Ltd. Previously she was the Director of Investor Relations for Goldcorp Inc. She has extensive M&A experience, having been part of 8 transactions in the past three years. Mrs. Hennessey has a Masters of Business Administration from the University of Ottawa.
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OverviewAnalyst Coverage
Company Name
GMP Securities LP Craig WestJennings Capital Inc Stuart McDougallMacquarie Capital George AlbinoParadigm Capital Don MacLeanRBC Capital Markets Michael CurranTD Newcrest Steven GreenWellington West Capital Markets Steven Parsons
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OverviewPeer Comparison
2009Production(000’s)
Market CapUS $ mm
P/NAV CFPS EVUS $ mm
EV/2009 ProductionUS $
Western Goldfields Inc.
146 $252 0.5x $0.29 $302 $2.06
Minefinders Corp. 182 $294 0.5x $0.97 $388 $2.13Jaguar Mining 169 $348 1.3x $0.64 $405 $2.40New Gold Inc 212 $526 1.0x $0.21 $498 $2.35Aurizon Mines Ltd. 153 $537 1.6x $0.37 $520 $3.40
Alamos Gold Inc. 151 $628 1.4x $0.56 $535 $3.54Gammon Gold Inc. 292 $841 1.2x $0.65 $875 $3.00Red Back Mining Inc. 376 $1,301 1.7x $0.70 $1,110 $2.95Eldorado Gold Corp. 340 $3,132 2.0x $0.32 $3,011 $8.86
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Source: Macquarie Research, Canaccord Capital, BMO Capital Markets, RBC Capital Markets
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OverviewPeer Comparison
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As of close February 11, 2009*
Share Price YTD % Change
Volume Market Cap C$ mm
Western Goldfields 2.29 16.84 1,703,555 313Golden Star 1.96 58.06 795,887 462New Gold Inc 3.08 74.01 2,107,310 656Aurizon Mines 4.50 12.78 875,375 666Gammon Gold Inc. 8.80 30.37 610,771 1,056Centerra Gold Inc. 4.80 8.11 712,189 1,038Eldorado Gold Corp. 10.56 9.43 3,599,672 3,867IAMGOLD Corp. 9.86 29.74 4,666,267 2,915*Source: Thomson Reuters February 11, 2009
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Corporate StrategyDelivery on Operational Targets - Production
OPERATIONS 20072008
Guidance 20082009
Forecast Gold (thousand ounces) 239.7 250 272 190-210 Copper (million pounds) 7.49 9.4 8.25 13-15 Silver (million ounces) 0.4 1.1 1.1 1.1-1.3 Total Cash Costs (US$/oz)3 n/a $ 500-520 $ 549 $ 465-485Peak Mines Gold (thousand ounces) 116.5 100.5 90-100 Copper (million pounds) 7.49 8.25 13-15 Total Cash Costs (US$/oz) $ 243 $ 489 $ 370-390Amapari Gold (thousand ounces) 96.4 87 10-12 Total Cash Costs (US$/oz) $ 515 $ 748 $ 515-535Cerro San Pedro2
Gold (thousand ounces) 26.8 84.6 90-100 Silver (million ounces) 0.4 1.1 1.1-1.3 Total Cash Costs (US$/oz) n/a $ 438 $ 550-5701 Amapari was placed on temporary care and maintenance on January 2, 2009. Production in 2009 will be limited to leaching of gold from previously stacked ore.2 Cash Costs for 2007 have not been presented as they are not representative of the current operations of Cerro San Pedro as 2007 was a start-up year.3 Total cash cost net of by-product credit were be adversely impacted for 2008 with the decrease in prices for copper and silver
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(1) Measured and indicated resources are inclusive of mineral reserves(2) Measured and indicated resources are exclusive of mineral reserves(3) The El Morro Project has been calculated at 30% of the total reserves and resources to reflect New Gold’s 30% interest in the project
Amapari²:
745,000 oz Au M&I Resources Peak²:
458,000 oz Au M&I Resources
El Morro (Attributable)1,3:
2,659,000 oz Au M&I Resources
Cerro San Pedro¹:
2,030,000 oz Au M&I Resources
New Afton¹:
1,630,000 oz Au M&I Resources
• Complementary portfolio leveraged to continued global growth• Approximately 8.2 million oz Au of measured and indicated gold resources(1)
Corporate StrategyAsset Review
Development Projects
Producing Mines
Care and Maintenance
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Corporate StrategyAsset Review
Producing Mines
Annual Production2007 2008 2009 F
Gold (k oz) 116.5 100.5 90-100Copper (m lbs) 7.49 8.25 13-15
PEAK MINESQuick FactsLocation AustraliaOwnership 100%
Reserves 1Gold (k oz) 368Copper (m lbs) 27.2
Resources2Gold (k oz) 458Copper (m lbs) 86.6
Mine type UndergroundProduction start-up 1992Cash cost / Oz (est. 2009) $ 370-390
1 Mineral reserve estimates for the Peak Mines were calculated using a gold price of $450 per ounce and a copper price of $1.25 per pound. The cut-off net smelter return value used for the Mineral Reserve estimates for the Peak Mines was $100 per tonne.
2 Measured & indicated resources, exclusive of mineral reserves. Mineral reserves and resources have been reported as of December 31, 2006 in accordance with CIM Standards or the JORC Code.
3 For the period ending September 30, 2008
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900m 3100m 1800m 800m 1900m
Perseverance Zone A
Peak
New Occidental
Chesney
New Cobar
Perseverance Zone D
1818
LOM Production Sources
Corporate StrategyAsset Review – Peak Mines
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Corporate StrategyAsset Review – Peak Mines
-2,500
-2,000
-1,500
-1,000
-500
0
500
1,000
1,500
2,000
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
Gold (k oz)
Resources(Exclusive ofReserves)
Reserves
CumulativeOz produced
There are currently more gold ounces in Resources than when the mine commenced production in 1992. Peak Mines achieved a milestone in 2008, producing its two millionth ounce of gold since commissioning the mine.
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Corporate StrategyAsset Review
Producing MinesQuick Facts
Location MexicoOwnership 100%
Reserves1Gold (m oz) 1.5Silver (m oz) 62
Resources1,2Gold (m oz) 2.03Silver (m oz) 75.5
Mine type Open PitProduction start-up 2007Cash cost / Oz (est.2009) $ 550-570
CERRO SAN PEDRO
Annual Production
2007 2008 2009 F
Gold (k oz) 26.8 84.6 90-100
Silver (m oz) 0.4 1.1 1.1-1.3
1 Mineral reserves and resources were estimated using a gold price of $475/oz Au and $8.00/oz Ag reported as of January 1, 2007 and March 31, 2007, respectively in accordance with CIM Standards of the JORC Code.
2 Mineral resources have been estimated at a cut-off grade of 0.20 g/t gold. Measured & indicated resources, inclusive of proven and probable reserves.
3 For the period ending September 30, 2008
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1500m
1000
0N
1050
0N
1100
0N
Kh
Kg
Kg
Kg
Kh
Kb
1700m
1900m
2100m
PorphyryOxide Ore
PorphyryOx./Silf.
Faults
MineralizedFaults
PorphyrySulfide
Ls. Oxide Ore
CarbonaceousBegoñia Ls.
B. Mn Ox. Ore
Massive Sulf.
ALTERATION-MINERALIZATION SECTION B-B’
Corporate StrategyAsset Review – Cerro San Pedro
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Corporate StrategyInternal Growth
Development MinesQuick Facts
Location CanadaOwnership 100%
Reserves1
Gold (m oz) 1.03Silver (m oz) 3.24Copper (m lbs) 960
Resources2
Gold (m oz) 1.63Silver (m oz) 5.4Copper (m lbs) 1,480
Mine type Underground
Production start-up Middle of 2012
Estimated mine life 12 Years1 Mineral Reserves estimate for the New Afton project were calculated using a gold
price of $475 per ounce and a copper price of $1.45 per pound. Cut-off at $15 per tonne of ore. Mineral reserves and resources have been reported as of September 21, 2006 in accordance with CIM Standards or the JORC Code
2 Measured & indicated resources, inclusive of proven and probable reserves.
NEW AFTON
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New Afton Block Cave Model
Corporate StrategyInternal Growth – New Afton
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Development MinesQuick Facts
Location Chile
Ownership 30% New Gold/70% Xstrata Plc.
Reserves1Gold (m oz) 2.01
Copper (m lbs) 1,714.5
Resources1,2Gold (m oz) 2.66
Copper (m lbs) 2,018.7
Mine type Open Pit
Status Permitting Stage (12-18 months)
1 For the Calculation of estimated total reserves and resources, the El Morro Project has been calculated at 30% of the total reserves and resources, to reflect New Gold’s 30% interest in the El Morro Project.Mineral reserves have been estimated at prices of $1.25/lb copper, $500/oz gold and are reported at a 0.3% copper equivalent cut-off. Mineral reserves and resources have been reported as of March 31, 2008 in accordance with CIM Standards or the JORC Code.
2 Measured & indicated resources are inclusive of proven and probably reserves.
EL MORRO
Corporate StrategyInternal Growth
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New Gold will continue to be a compelling investment:
• Cash generating assets with growth potential, all located in mining friendly jurisdictions
• Solid financial position
• Internal growth through project development and continuous improvement at our existing operations
• External growth through mergers and acquisitions
• Undervalued in comparison to our peers
Summary
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Contact Information
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Investor RelationsMélanie HennesseyVice President Investor RelationsDirect: +1 (604) 696-4100 Toll-free: +1 (888) 315-9715Email: [email protected]
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AppendixReserves & Resources
Additional Notes on all Mineral Reserves:• All Mineral Reserves have been calculated in accordance with the CIM Standards or the JORC Code. The JORC Code has been
accepted for current disclosure rules in Canada under NI 43-101. The Mineral Reserves have been reported as of the following dates:
– Amapari Mine – September 30, 2007– Peak Mines – December 31, 2006– New Afton Project – September 21, 2006– Cerro San Pedro Mine – January 1, 2007– El Morro – March 31, 2008
• The qualified person(s) (as defined under NI 43-101) or competent person(s) (as defined under the JORC Code for the Mineral Reserves estimates are as follows:
– Amapari Mine – Carlos Guzmán, Ing. Civil de Minas, AusIMM, NCL Brasil Ltda– Peak Mines – Geoffrey N. Challiner, B.Sc. (Eng.), C.Eng., Independent Mining Engineer, Mine and Quarry Engineering
Services, Inc.– New Afton Project – Mike Thomas, MAusIMM (CP), AMC Consultants Pty Ltd.– Cerro San Pedro Mine – William L. Rose, WLR Consulting, Inc.– El Morro Project – Barton G. Stone, P.G., and Richard J. Lambert, P.E., Pincock, Allen & Holt
• Mineral Reserve estimates for the Amapari Mine were calculated using a gold price of $575 per ounce. Based on a cut-off grade of 1.1 grams per tonne.
• Mineral Reserve estimates for the Peak Mines were calculated using a gold price of $450 per ounce and a copper price of $1.25 per pound. The cut-off net smelter return value used for the Mineral Reserve estimates for the Peak Mines was A $100 per tonne.
• Mineral Reserves estimate for the New Afton project were calculated using a gold price of $475 per ounce and a copper price of $1.45 per pound. Cut-off at $15 per tonne of ore.
• Mineral Reserve estimates for the Cerro San Pedro Mine were calculated using a $475 per ounce gold price and a $8.00 per ounce silver price.
• Reported at 100%, however, New Gold’s interest is only 30%. Mineral Reserve estimates for the El Morro Project are calculated on a copper equivalent cut-off basis: Eq Cu = Cu (%) + 0.592 x Au (g/t), where Cu (%) represents the average copper grade, Au (g/t) represents the average gold grade and 0.592 represents a constant based on a copper price of $1.25 per pound, a gold price of $500 per ounce and average metal recoveries for the deposit.
• For the calculation of estimated total reserves, the reserve estimates for the EL Morro Project have been calculated at 30% of the total reserves, to reflect New Gold’s 30% interest in the El Morro Project.
• Numbers may not add up due to rounding.
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AppendixReserves & Resources
Additional Notes on all Mineral Resources:• All Mineral Resources have been calculated in accordance with the CIM Standards or the JORC Code. The JORC Code has
been accepted for current disclosure rules in Canada under NI 43-101. The Mineral Resources have been reported as of the following dates:
– Amapari Mine – September 30, 2007– Peak Mines – December 31, 2006– New Afton Project – September 21, 2006– Cerro San Pedro Mine – March 31, 2007– El Morro – March 31, 2008
• The qualified person(s) (as defined under NI 43-101) or competent person(s) (as defined under the JORC Code) for the Mineral Resource estimates are as follows:
– Amapari Mine – Emmanuel Henry, Member of the AusIMM (CP), AMEC International (Chile) S.A.– Peak Mines – Neil Inwood, MAusIMM, Senior Consultant, Resources, RSG Global Consulting Pty Ltd.– New Afton Project – David Rennie, Scott Wilson Roscoe Postle Associates Inc.– Cerro San Pedro Mine – William L. Rose, WLR Consulting, Inc.– El Morro Project – Barton G. Stone, P.G., and Richard J. Lambert, P.E., Pincock, Allen & Holt
• Mineral Resource estimates for the Amapari Mine were calculated using a gold price of $600 per ounce, based on a cut-off grade of 0.5 grams per tonne for the open pit and 2.1 grams per tonne for the underground mineralization.
• Mineral Resource estimates for the Peak Mine were calculated using a gold price of $525 per ounce and a copper price of $1.50 per pound.
• Mineral Resources for the New Afton Project were estimated by applying a cut-off of $10 per tonne of ore, which was derived using a gold price of $450 per ounce, a silver price of $5.25 per ounce and a copper price of $1.20 per pound.
• Mineral Resources for the Cerro San Pedro Mine have been estimated at a cut-off grade of 0.20 grams per tonne of gold using a gold price of $475/oz. Silver-to-gold ratio is estimated at 60:1.
• Reported at 100%, however, New Gold’s interest is only 30%. Mineral Resource estimates for the El Morro Project are calculated on a copper equivalent cut-off basis: Eq Cu = Cu (%) + 0.592 x Au (g/t), where Cu (%) represents the average copper grade, Au (g/t) represents the average gold grade and 0.592 represents a constant based on a copper price of $1.25 per pound, a gold price of $500 per ounce and average metal recoveries for the deposit. Inferred Mineral Resources are defined on the basis of drill sample density and include Inferred Mineral Resources occurring within and outside a simulated pit shell based on a copper price of $1.25 per pound and a gold price of $500 per ounce.
• Mineral Resources are not known with the same degree of certainty as Mineral Reserves and do not have demonstrated economic viability.
• Numbers may not add up due to rounding.
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