Edition 2, 2014

State of the Market: Mining and Finance Report

Expert review of all aspects of the industry, recent performance and quarterly outlook

Special reports in this edition Mining above 60ºN Cash Costs for Base Metals Mining Regional Activity Contents

Hinde Sight 03 Market for Mining 04 Exploration 07 Assay Share-Price Alert 11 Metals Production Outlook 12 Mergers and Acquisitions 16 Mining Finance 18 Special Reports: Mining above 60ºN 20 Cash Costs for Base Metals Mining 39 Regional Activity 41

STATE OF THE MARKET: MINING AND FINANCE REPORT Report is published by CONTRIBUTORS PRODUCTION SNL Metals & Mining Åsa Borssén Roxanne Daniel Rovino Chaudhary Contact Masuma Farooki SNL Metals & Mining Chris Hinde Narelle Gardiner 7 Birchin Lane Director, Reports Chris Hinde London, EC3V 9BW Email: [email protected] Glen Jones Tel: +44 (0)20 7398 1825 Viktoriya Larsson Website: www.SNL.com/Metals Michelle Mowdy Janaka Ratanayake Marketing Manager Email: [email protected]

This report is supplied on a confidential basis for the subscriber's use only. The contents must not be disclosed to third parties and it must not be copied in whole or in part without the prior written permission of SNL Metals & Mining. Photocopying and electronic forwarding is prohibited. Copyright 2014 SNL Metals & Mining.

Edition 2, 2014 www.SNL.com/Metals 02 Hinde Sight Funding remains a problem for the mining industry, especially for explorers

There is a rush of companies debuting on the world’s trading house, for US$3.5 billion. Deutsche Bank, stock exchanges. By the end of March, global initial Morgan Stanley, UBS and Royal Bank of Scotland are public offerings already exceeded US$40 billion, all scaling back their presence in commodities, and which is twice the level of the first quarter last year. Barclays recently confirmed plans to pull out of Thompson Reuters reports that European IPOs have commodity trading. tripled so far this year. The combination of investment banks falling out This IPO revival in the general market is a welcome of love with commodities, and IPOs not serving the sign of increased risk-taking and of financial markets smaller companies, is worrying for junior exploration again functioning efficiently after almost seven years and mining companies. This is reflected in the of crisis. However, as the Financial Times warned, lacklustre US$7.0 billion raised in the March most of this activity is from bigger companies, bankers quarter, with only US$1.6 billion of this earmarked and financiers, rather than from the smaller companies for explorers. that will provide the economic growth of the future. As we explain on p7 and p18, the data for the A broader worry is that the IPO market does not December quarter has been updated to reflect late serve the smallest companies. While volumes are near reporting (data for the State of the Market reports is record highs, the number of IPOs is on a long-term collected in the middle of the month following a downward trend, which means that the average calendar quarter). Even on a like-for-like basis, ie offering size is rising. taking the apparent December quarter funding when Meanwhile, investment banks’ malaise about the the previous SOTM was published at the end of mining sector is worsening amid rising political and January (US$6.2 billion, cf the restated US$9.8 regulatory pressure on the financial community to billion), there has been no real improvement in the retreat to their core businesses. In the US, the Federal amount raised by mining companies. Reserve has questioned whether banks should be The latest available data suggests that the allowed to handle physical commodities. In Europe, industry’s cash holdings at the end of December Basel III requires banks to maintain bigger capital (this information is always a quarter in arrears) was cushions, which can act as a drag on profit in volatile over US$108 billion. This compares favourably with markets, such as commodities. the US$66 billion reported in the previous SOTM The single greatest driver, however, is probably the report for the September quarter (but is down on the low, and stable, prices for many commodities. The revised total of almost US$112 billion). Coalition consultancy estimates that the revenues of The industry’s lacklustre funding position, and dull the top-ten banks in commodities fell from US$14.1 metals prices, are illustrated by the continued decline billion in 2008 to US$4.5 billion last year. in exploration drilling and new resources-reserves, as The trickle of financial houses leaving the sector has reported on p7-10. The global economy might have become a flood. JPMorgan Chase is selling its physical turned the financial corner but this is not yet true for commodities business to Mercuria, the Geneva-based the mining sector.

GOLD PRICES (US$/oz) COPPER PRICES (US$/t)

1,700 8,500 1,600 8,000 1,500 7,500 1,400 7,000 1,300 6,500 1,200 6,000 JanFeb MarApr MayJun JulAug SepOct NovDec JanFeb Mar JanFeb MarApr MayJun JulAug SepOct NovDec JanFeb Mar 2013 2014 2013 2014

IRON-ORE PRICES* (US$/t) COAL PRICES* (US$/t)

170 * 62% Fe, Fines, CFR Tianjin 105 * Australian thermal coal, 160 100 (12,000btu/lb, under 1% sulphur, 14% ash, 150 95 FOB Newcastle/Port Kembla) 140 90 130 85 120 80 110 75 100 70 JanFeb MarApr MayJun JulAug SepOct NovDec JanFeb Mar JanFeb MarApr MayJun JulAug SepOct NovDec JanFeb Mar 2013 2014 20132014

Edition 2, 2014 www.SNL.com/Metals 03 Market for Mining Metals markets remain dull, but stable, in the face of a sluggish world economy

The International Monetary Fund predicted recently It seems likely that the biggest downside risk for that the cost of borrowing in the global economy is growth will come from property, and analysts warn that likely to remain low long after the recovery gathers the fate of China’s overheated real estate market is pace. Research by the IMF showed that there were absolutely critical to the health of the overall economy. “no compelling reasons to expect real interest rates Real estate construction directly accounted for 16% will quickly return to the average level of 2% observed of GDP in 2013, according to estimates from Nomura. during the mid-2000s”. At that level, China is approaching a dependence on The forecast that money will remain cheap should property last seen in Ireland and Spain before the encourage borrowers, including governments, to bursting of their financial bubbles. increase their levels of debt, and boost business and The Financial Times noted that many of the infrastructure development. This is encouraging for industries already suffering from severe overcapacity longer-term metals consumption but the short-term in China, such as steel, cement and glass, are heavily outlook for the mining industry is gloomy. indebted and reliant on continued rapid growth in Metals price forecasts remain centred on the property construction for their survival. Chinese economy. Unfortunately, data for March Land sales and property-related taxes accounted showed that first quarter growth declined, although for 38% of total government revenue in 2013, the rate was slightly ahead of expectations. Year-on- and heavily indebted local governments have year GDP growth in China eased from 7.7% in the used highly priced land as collateral for the vast December quarter last year to 7.4% in the quarter majority of their loans. A property crash would just ended. not only lead to collapsing growth in the world’s In a recent Market Report, independent analyst Ted second-largest economy, and largest commodity Arnold noted that the country’s quarter-on-quarter consumer, but would also have a huge impact on growth was only 1.4%, the slowest level since the first Chinese households, which have an estimated quarter two years ago. However, March industrial two-thirds of their assets tied up in real estate. production growth improved from 8.6% year-on-year Nevertheless, there is widespread expectation to 8.8% (although 9.0% had been expected). that Chinese growth will pick up during the The Financial Times reported in April that the main current quarter thanks to the recovery in exports, reason for the Chinese slowdown during the first accelerated investment approvals and improved quarter was a slump in fixed asset investment, which fund disbursements. This has already led to has been the biggest driver of the Chinese economy. a rebound in infrastructure investment. In the first three months of the year, investment grew at the slowest pace since late 2002. However, Premier OTHER ECONOMIES Li Keqiang reiterated that his government will not US monetary policy remains ‘accommodative’ but is resort to short-term stimulus measures in the face becoming less so. This trend is buoyed by economic of what he described as temporary fluctuations data for March that has indicated a moderate rebound in growth. from the weather-impacted data in January and The relative slide was attributed largely to declining February. Nevertheless, growth in the first quarter was real estate investment, and this situation is certain to weak, and GDP seems likely to have grown by only get worse in the coming months as new housing floor about 1% (the country’s preliminary first quarter GDP space under construction contracted 27% in the estimate is scheduled to be released on April 30). first quarter. Second-quarter GDP growth estimates in the US

FIVE-YEAR PRICES

Left scale: Coal (US$/t) Iron ore (62% Fe, Fines, CFR Tianjin; US$/t) Left scale: Nickel (US$/t) Right scale: Copper (US$/t) Right scale: Gold (US$/oz) Aluminium (US$/t) Zinc (US$/t) 210 10,750 30,000 3,800 190 9,750 25,000 170 8,750 150 7,750 20,000 2,800

130 6,750 15,000 110 5,750 10,000 1,800 90 4,750 70 3,750 5,000

50 2,750 0 800 2010 2011 2012 2013 2010 2011 2012 2013

Edition 2, 2014 www.SNL.com/Metals 04 Market for Mining continued

range up to 3.6%, and the chair of the Federal Goldman Sachs notes that China has up to US$160 Reserve, Janet Yellen, said in mid-April that the billion of loans that use commodities as collateral but, economy was making “very meaningful progress”, for the moment, the weak copper price, the growing adding it was “quite plausible” that the country would mined supply and insipid demand are at the forefront be back to near full employment by the end of 2016. of miners’ concerns. In one of her first big speeches as Fed chair, Ms Yellen Sentiment is turning increasingly bullish on cleared up market confusion caused by her March aluminium. Good technical support exists at around press conference, when she appeared to suggest that US$1,820/t (basis three months), and a number of interest rates could rise as early as Spring 2015. funds are reported to be looking to establish long Instead, she made clear that the timing of a first Fed positions when those levels are reached. rate rise depended entirely on progress in raising The aluminium market is very liquid, and the employment and inflation. fundamentals are beginning to improve on the back of Analysts agree that the US Central Bank will production cutbacks and rising demand. An increasing probably only start raising benchmark interest rates, number of analysts are talking about a modest supply which it has kept near zero since December 2008, deficit market this year, with the hope of breaching the when it is satisfied with the health of the national overhead resistance around US$1,900/t. labour market. The Fed is expected to conclude its Nickel continues to be the star of the metals monthly bond-buying programme later this year, and markets, and the metal hit a 14-month high of most economists expect the first interest rate hike US$18,000/t in mid-April. The nickel price has risen will be in the second half of 2015. 29% so far this year thanks to the Indonesian ore Ms Yellen noted that the recovery had continued export ban, which came into force on January 12. from 2010 to 2012, despite shocks from the Eurozone On the basis of fundamentals, there should be a and fiscal tightening in the US but only, she said, massive nickel deficit starting from the end of this because the Fed was willing to provide extra stimulus year. By 2016, analysts expect LME and producer via asset purchases. She argued that was still the nickel inventories to be lower than in 2006/07, when case, saying that the Federal Open Market Committee nickel prices were regularly trading above “stands ready to adjust the pace of purchases as US$20,000/t. warranted should the outlook change materially”. Zinc continues to be a steady market, with more In the Eurozone, the European Central Bank has and more traders looking at US$2,150/t (basis three so far resisted measures to increase monetary months) as the next upside target. Good support exists accommodation but is reported to be working on at around US$2,000/t, and the technical funds ways to accomplish effective financial easing. The continue to look for dips on which to establish fresh ECB is aware that a further rise in the Euro will be long positions. counterproductive to European growth but its mandate is to preserve the value of the Euro and the bank will GOLD LOOKS WEAK not want unduly to undermine Europe’s currency. The fraught situation in the Ukraine has had little In Australia, JP Morgan chief economist Stephen effect on the gold price, which seems to be locked Walters says that falling business investment will be a within a tight range around US$1,340/oz (spot significant drag on the country’s economic growth. He London). There is good support existing at noted “mining companies continue to scale back their US$1,280/ oz, with de mand in Asia remaining price spending intentions, albeit more quickly than we had sensitive, but gold prices are widely expected to keep anticipated, while those outside the mining sector are falling through 2015. As evidence, analysts note a treading water, at best”. normalisation of US monetary policy, and a trend by investors into higher yielding assets. BASE METALS SCENE The GFMS team at Thomson Reuters reported Commodity markets can be categorised as dull, and recently that physical demand, which hit record levels many higher-cost mines are coming under pressure. last year after prices plummeted in the second quarter, In copper, an Australian bank recently concluded that is expected to remain firm. Nevertheless, this will not around 10% of Chinese mine production would be be enough to offset a continued decline in Western unprofitable at prices of under US$6,800/t. However, investment. GFMS expects prices to average the same research note argued that the “incoming US$1,225/oz this year, down from an average of surplus supports our view that any gains would be US$1,410/oz in 2013 (the first year in which prices capped at close to US$7,000/t”. had declined in over a decade). Funds and futures traders are reported to be GFMS’s head of research, Rhona O’Connell, warned unexcited by the prospect of sluggish copper price that the gold price may fall as low as US$1,100 in movements for the remainder of the year. Most see 2014 if gold is hit by further bouts of liquidation. Ms better opportunities in other metals, particularly nickel O’Connell said “We have had a gold market that was and tin, and Mr Arnold reports that many planned to characterised from 2009 to 2012 by heavy investment ‘short’ or reduce their activity in copper this year. due to financial uncertainty. That has now turned

Edition 2, 2014 www.SNL.com/Metals 05 Market for Mining continued

GOLD DRILLING V GOLD PRICES factor driving gold higher in the wake of the financial crisis, weighing on interest rates (the opportunity cost 600 1,900 of holding the metal) while stoking fears of inflation. GFMS reported that 880t of gold were liquidated from Exchange Traded Funds last year, against inflows of 279t in 2012. This helped offset a rise in physical 400 1,600 Price (US$/oz) gold demand to a record 4,957t. Bar investment jumped by one-third to an all-time high of 1,377t last year, while jewellery buying rose 18% to a six-year 200 1,300 peak of 2,361t. Demand was particularly strong in China, which Drilling (Number of prospects) Prospects reporting drilling overtook India to become the top consumer of the Gold price metal last year. Its gold-jewellery fabrication demand 0 1,000 1357911 13579111357911 13 surged 40% to a record 871.9t. The supply of scrap 2011 2012 2013 gold fell 22% last year, meanwhile, as lower prices made selling gold less attractive to consumers. around, and we are in a period where professional Buying of gold by central banks fell 25% to 409t. investors have better places to put their money as far Factoring in liquidation from ETFs and a rise in as rates of return are concerned, and they are not as mine production to a record 3,022t, the gold market concerned about risk.” recorded a net surplus of 277t, GFMS said. Small “It’s likely that, financial tensions aside, if you look deficits are likely to be seen in the physical market in at the next two to three years, you could be going into 2014 and 2015, Ms O’Connell said, but a continued a different kind of mindset where we get back to drift lower in ETF holdings, reflecting a lack of interest looking at gold as a commodity, in the sense that it from professional investors, will put the market more will move into a deficit which will pull prices higher. or less in balance. But that will take a few years.” GFMS concluded that the gold price will “continue Gold prices fell 28% last year as investors sold out to decline broadly during 2015. It won’t be until of investment products, such as physically backed you get to 2016 that you will find incredibly strong exchange-traded funds, on expectations that the physical demand, if East Asia keeps growing the Federal Reserve would roll back its extraordinary way it is, results in the kind of deficit that will make stimulus measures. Those measures had been a key a difference to price.”

EXTRACT THE TRUE COSTS FOR A GIVEN MINE. Eliminate manual compiling, improve efficiency and reduce costs with our powerful interactive platform. With SNL Metals & Mining, the most comprehensive data on every mine, project and company is at your fingertips. Drill down to key metrics and operating data with one click. SNL Metals & Mining gives you accurate, verifiable data down to the most granular level. Project data is linked to corporate profiles with more than 100 financial items. Know more in less time. Build actionable reports quickly. Contact us for a demo.

Request a demo at SNLMetals.com Edition 2, 2014 www.SNL.com/Metals 06 Exploration Hot Spots International exploration for metals falls to yet another all-time low

Global economies are recovering but the improvement three months to end-March, compared with 168 in the is not yet reflected in metals prices or the minerals December quarter and 200 prospects a year ago. The exploration scene. As the graph on p8 illustrates, shortfall was spread fairly equally, with most of the drilling activity fell again in the three months to activity remaining in Australasia and North America. end-March. Based on the number of prospects reporting drilling RESOURCES UNCOVERED results in the quarter just ended (856), exploration is The continued decline in drilling activity is reflected at only 56% of the year-ago level (1,517), which was in the announcement of new mineral resources and itself just 62% of the number of prospects reporting ore reserves (shown in the tables on p9 as contained drilling in the first quarter of 2012 (2,465). metal). Within this extremely low total, gold prospects Comparison is complicated, however, because of accounted for over 50% of the drilling announcements delays in reporting resources and reserves, particularly in the March quarter (432 prospects). This at year end. The data for the December quarter has composition has varied within a narrow 45-53% range been restated to reflect announcements pertaining each quarter for the past few years. to that period since the previous issue of SOTM went The overall trend remains downward but there are to press. monthly spikes. As the graph on p6 illustrates, gold Particularly large increases are apparent in the companies appear to time their drilling press releases figures for gold resources and reserves. For example, according to market conditions (represented here by gold resources reported for Canada in the December the gold price). It is also apparent that the majority of quarter were given in SOTM, Edition 1, as under 5Moz drilling announcements are released during the first but have been revised here to almost 16Moz (the gold month of every quarter (see graph p8). reserves were little changed). The original figure for This first-month spike is particularly apparent for gold new gold resources in North and Central America companies. For the March quarter, almost 47% of the during the December quarter (as reported by mid- gold-drilling press releases were made during January. January) was 14Moz. This has now been revised to This was a similar proportion to the year-ago experience 78Moz after incorporating late reports. but much higher than the share of under 38% for Similarly, in the SOTM report published at the January announcements in the first quarter of 2012. In end of January, there were under 4Moz of new gold the four quarters of 2013, the percentage of gold- reserves announced in Africa for the December drilling announcements made during the first month of quarter. These have now been revised to almost each period ranged from 39% to over 48%, with an 12Moz. average of almost 44%. The average in 2012 was in For new copper reserves, the total for South line with chronological expectations at barely 38%. America was originally reported as under 1Mt for These cumulative numbers for each quarter (taken the December quarter but now stands at almost 9Mt. from the monthly figures shown in the graph on p8) Such significant revisions are unusual but it is might include multiple reports of drilling from the likely, of course, that the resource-reserve totals same prospect. The quarterly commodity totals (shown for the March quarter will be somewhat higher in in the tables on p8) exclude these multiple reports. subsequent issues of SOTM. By comparing the On a monthly basis, there was a spike in January available data at equivalent times (ie examining press (396 prospects, as discussed above) but drilling releases made up to two weeks after the end of each announcements in February and March totalled only quarter), it is clear that new resources of gold and 232 and 228, respectively. silver have fallen again, while resources of copper Reports of gold drilling actually increased on a and zinc are higher than was apparent at the quarter-on-quarter basis (378 prospects, compared with equivalent time three months ago. In the reserves 354 in the December quarter) but the activity is still category, there were falls for gold, silver and zinc, but sharply lower than the year-ago figure of 696 prospects. higher totals for copper, despite the decline in drilling Geographically, the gold-drilling improvement for that metal. (although it is from an extremely low base) was felt Total gold resources announced in the March quarter everywhere, apart from North America and Europe. amounted to 30.7Moz, compared with the original Companies listed on the Australian Stock Exchange 35.6Moz during the December quarter (ignoring the showed a particularly improvement (rising to 140 significantly higher revised numbers for that period). prospects from only 108 in the previous quarter). Gold reserves fell from an unrevised 15.7Moz in the Companies with their primary listing on the Toronto December quarter to only 3.1Moz. Stock Exchange and TSX-Venture still account for the Taking the unrevised numbers for the December majority of the gold-drilling reports (193 prospects in quarter, resources and reserves of copper for the the March quarter) but activity was lower than during March quarter were both higher; the former rising to the previous quarter (207 prospects). 14.1Mt from 5.3Mt, and the latter to 2.6Mt from an Reports of copper drilling fell to 128 prospects in the unrevised 1.3Mt in the December quarter.

Edition 2, 2014 www.SNL.com/Metals 07 Exploration Hot Spots continued

QUARTERLY DRILLING REPORTS (INDIVIDUAL PROSPECTS) Mar Q Dec Q Mar Q Mar Q Dec Q Mar Q Mar Q Dec Q Mar Q COPPER 2014 2013 2013 GOLD 2014 2013 2013 LEAD 2014 2013 2013 Canada 23 30 36 Canada 90 103 141 Canada 5 8 9 Australia 45 53 55 Australia 80 70 137 Australia 9 4 13 USA 3 8 11 USA 25 28 50 USA 1 Mexico 8 1 6 Mexico 23 19 27 Mexico 2 5 6 Brazil 2 4 4 Brazil 6 6 23 Brazil

N&C America 34 40 55 N&C America 138 152 231 N&C America 7 13 16 S. America 19 21 30 S. America 44 37 106 S. America 6 4 Europe 6 19 16 Europe 16 24 33 Europe 1 3 Africa 11 22 16 Africa 51 48 121 Africa 2 1 Asia 13 13 28 Asia 49 21 67 Asia 11 6 7 Australasia 45 53 55 Australasia 80 72 138 Australasia 9 4 13

TSX/TSX-V* 53 71 84 TSX/TSX-V* 193 207 357 TSX/TSX-V* 16 21 24 ASX* 71 89 99 ASX* 140 108 231 ASX* 12 9 15 London* 4 7 3 London* 34 29 49 London* 1 1

TOTAL 128 168 200 TOTAL 378 354 696 TOTAL 29 31 43 * Primary listing of issuing company * Primary listing of issuing company * Primary listing of issuing company

GLOBAL DRILLING ACTIVITY Mar Q Dec Q Mar Q SILVER 2014 2013 2013 COPPER GOLD SILVER ZINC/LEAD OTHER Canada 10 20 21 Australia 16 16 18 1,200 USA 3 18 Mexico 23 22 38 d le

il 1,000 Brazil 1

s Dr N&C America 33 45 77

pect 800 S. America 17 21 42

Pros Europe 1 2

ct 600

in Africa 4 2 4 st Asia 22 9 19 400 Australasia 16 16 18 er of Di

mb 200 TSX/TSX-V* 49 62 96 Nu ASX* 36 26 35 0 London* 6 4 13 425 6 7 8 9 10 1112 1 3 4 5 6 7 8 9 10 1112 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 2011 2012 2013 2014 TOTAL 92 94 162 * Primary listing of issuing company ACTIVITY MAP (March Quarter; 2014) Mar Q Dec Q Mar Q ZINC 2014 2013 2013 Canada 10 11 15 Australia 10 7 18 USA 2 4 Mexico 5 5 8 Brazil

N&C America 15 18 27 S. America 2 7 6 Europe 2 2 4 Africa 2 2 1 Asia 4 5 6 Australasia 10 7 18

TSX/TSX-V* 20 28 34 ASX* 14 12 20 London* 1 1

Operational Development Exploration TOTAL 35 41 62 * Primary listing of issuing company

Edition 2, 2014 www.SNL.com/Metals 08 Exploration Results Summary of the best assay results announced during the past quarter, and new resources/reserves

The best assays (in terms of grade x intersection) further excellent results at its high-sulphide epithermal announced during the three months to end-March are Cukaru Peki deposit in eastern Serbia. Hole FMTC shown on p10. Note that this ranking does not take 1338 on the joint-venture project with Freeport- into account important factors such as the depth of McMoRan Exploration Corp returned 4.81% Cu the intersection or the project location. (and 2.88g/t Au) over 206m at 554m. The top-ranked copper assay for the March quarter The third best copper assay of the quarter was in came from Newcrest Mining Ltd at its 50%-owned Ecuador at the Alpha deposit of SolGold plc. The Wafi-Golpu project in Papua New Guinea. Hole WR499 company announced the discovery of 0.61% Cu over intersected an average of 1.44% Cu (and 1.28g/t Au) 1,346m from only 24m. over 943m at a depth of 966m. Excellent drill intersections continue to be reported In second place this time (it was ranked first in the at the Duckhead gold project in Brazil. The project December quarter), Reservoir Minerals Inc reported makes top billing this time after being ranked second

QUARTERLY REVIEW OF RESOURCES / RESERVES ANNOUNCEMENTS GOLD RESOURCES (‘000oz; contained metal) GOLD RESERVES (‘000oz; contained metal) Mar Q 2014 Dec Q 2013 Mar Q 2013 Mar Q 2014 Dec Q 2013 Mar Q 2013 Canada 14,970 15,706 10,443 Canada 11,359 476 Australia 881 10,605 12,679 Australia 681 4,296 2,929 USA 1,631 38,009 4,221 USA 3,745 Mexico 309 20,181 5,787 Mexico 1,641 19,933 Brazil 638 11,585 1,321 Brazil 5,434 236 N&C America 16,909 77,936 21,370 N&C America 16,746 20,409 S. America 4,703 21,488 10,725 S. America 546 9,688 773 Europe 1,732 10,849 14,114 Europe 1,078 292 2,538 Africa 5,015 23,010 20,860 Africa 247 11,991 1,580 Asia 1,485 8,829 17,090 Asia 553 4,980 1,898 Australasia 881 10,977 12,721 Australasia 681 4,296 2,929 TOTAL 30,725 153,090 96,880 TOTAL 3,105 47,993 30,127 COPPER RESOURCES (‘000t; contained metal) COPPER RESERVES (‘000t; contained metal) Mar Q 2014 Dec Q 2013 Mar Q 2013 Mar Q 2014 Dec Q 2013 Mar Q 2013 Canada 3,972 2,284 834 Canada 220 Australia 23 4,228 2,771 Australia 700 879 USA 3,352 13,600 2,786 USA 1,808 682 1,104 Mexico 1,403 9 Mexico 1,391 297 Brazil 741 94 Brazil 1,201 N&C America 7,324 17,493 3,928 N&C America 1,808 2,293 1,401 S. America 6,724 11,212 3,800 S. America 433 8,675 189 Europe 3,078 35 Europe 213 25 Africa 75 3,912 3,634 Africa 145 1,916 Asia 23 1,220 8,902 Asia 183 34 Australasia 4,228 2,771 Australasia 700 879 TOTAL 14,146 41,142 23,068 TOTAL 2,599 13,791 2,503 SILVER RESOURCES (‘000oz; contained metal) SILVER RESERVES (‘000oz; contained metal) Mar Q 2014 Dec Q 2013 Mar Q 2013 Mar Q 2014 Dec Q 2013 Mar Q 2013 Canada 60,991 136,343 32,325 Canada 60,826 3,999 Australia 170,733 15,164 Australia 13,818 9,700 USA 4,720 157,492 32,335 USA 194,470 Mexico 18,240 389,311 350,902 Mexico 39,363 533,087 Brazil 6,595 222 Brazil N&C America 83,950 687,455 415,562 N&C America 294,659 537,087 S. America 9,184 120,026 44,526 S. America 53,581 232,930 30,839 Europe 14,351 59,883 56,214 Europe 9,043 47,397 20,219 Africa 3,394 19,039 1,647 Africa 2,644 Asia 3,041 183,395 18,342 Asia 27,825 5,385 Australasia 170,733 15,164 Australasia 13,818 9,700 TOTAL 113,921 1,240,530 551,455 TOTAL 62,624 619,272 603,230 ZINC RESOURCES (‘000t; contained metal) ZINC RESERVES (‘000t; contained metal) Mar Q 2014 Dec Q 2013 Mar Q 2013 Mar Q 2014 Dec Q 2013 Mar Q 2013 Canada 395 703 532 Canada 397 Australia 577 Australia 298 USA 171 6 USA 1,064 Mexico 1,770 903 Mexico 155 1,898 Brazil Brazil N&C America 395 2,733 1,440 N&C America 397 1,219 1,898 S. America 1,459 140 S. America 73 122 Europe 17 625 18 Europe 4 608 Africa 94 139 57 Africa 286 89 Asia 556 1,018 Asia 21 519 Australasia 577 Australasia 298 TOTAL 506 5,511 3,250 TOTAL 402 2,206 2,926

Edition 2, 2014 www.SNL.com/Metals 09 Exploration Results continued

in gold assays during the December quarter. Beadell depth of 92m, 20m below the existing Amun workings. Resources Ltd reported 143g/t Au over 29m from The top-ranked zinc assay (see table below) was at 73m in an infill hole on the Main lode. The deposit the Halls Peak property owned by Precious Metal is relatively small but Beadell believes there is more Resources Ltd. In the first of a planned six holes at gold to be found in the area. the former Gibsons mine near Armidale in Australia, In mid-February, Eagle Hill Exploration Corp reported DDH HP026 returned 7.2% Zn (plus 1.1% Cu, 2.3% 416g/t Au over 7.8m at a depth of 226m at the Windfall Pb and 58g/t Ag) over 48.0m from surface. Lake property in Canada. The intersection extends the The best silver assay announced during the March high-grade mineralisation along strike and at depth. quarter was reported by Fortuna Silver Mines Inc At the end of January, Centamin plc announced a following step-out drilling late in 2013 on the Trinidad 162g/t Au assay over 10.0m at its Sukari gold mine in North discovery, which is contiguous with the San Jose Egypt. The drilling is part of the company’s Stage 4 mine in Oaxaca, Mexico. A 6.3m intersection (true underground expansion to lift total production to over width 3.7m) averaged 3,511g/t Ag (plus 15g/t Au) 450,000oz/y. The latest intersection is located at a from a depth of 419m.

TOP-RANKED ASSAYS (MARCH QUARTER; GRADE X INTERSECTION) COPPER COMPANY PROJECT HOLE GRADE (%) INTERSECTION (m) DEPTH (m) PROJECT LOCATION 1 Newcrest Mining Ltd Golpu WR499 1.44 943.0 966 60km SW Lae (PNG) 2 Reservoir Minerals Inc Cukaru Peki FMTC 1338 4.81 205.6 554 6km SE Bor (Serbia) 3 SolGold plc Alpala CSD-13-005 0.61 1,346.0 24 49km NNW Ibarra (Ecuador) 4 Seabridge Gold Inc Iron Cap IC-13-052 0.29 857.4 180 69km NNW Stewart (Canada) 5 NovaGold Resources Inc Galore Creek (Legacy) GC13-0895 1.50 135.3 304 165km SSW Dease Lake (Canada) 6 Great Western Exploration Ltd Spasskaya SPD0012 2.52 78.0 0 60km E Karagandy (Kazakhstan) 7 NGEx Resources Inc Josemaria JMDH80 0.44 434.1 144 115km E Vallenar (Argentina) 8 OZ Minerals Ltd Carrapateena (Khamsin) DD13KMS014 0.34 557.0 1,036 65km E Woomera (Australia) 9 Avanco Resources Ltd Antas North APBD-080 6.80 27.0 158 122km SW Maraba (Brazil) 10 CuDeco Ltd Rocklands (Las Minerale) LMRC266 1.49 121.0 12 15km WNW Cloncurry (Australia) GOLD COMPANY PROJECT HOLE GRADE (g/t) INTERSECTION (m) DEPTH (m) PROJECT LOCATION 1 Beadell Resources Ltd Duckhead (Main lode) FVM382 143.0 29.0 73 125km NW Macapa (Brazil) 2 Eagle Hill Exploration Corp Windfall Lake EAG-13-527 416.0 7.8 226 130km SW Chibougamau (Canada) 3 Centamin plc Sukari UGRSD0041 162.0 10.0 92 200km ENE Aswan (Egypt) 4 Newcrest Mining Ltd Golpu WR499 1.3 943.0 996 60km SW Lae (PNG) 5 Crocodile Gold Corp Phoenix UDH0755 122.0 6.8 214 Near Fosterville (Australia) 6 SolGold plc Alpala CSD-13-005 0.5 1346.0 24 49km NNW Ibarra (Ecuador) 7 Northern Star Resources Ltd Paulsens (Voyager 2) PDU2839 73.2 8.9 54 Pannawonica 106km S (Australia) 8 Gold Road Resources Ltd Yamarna (Gruyere) 14GYDD0008 1.2 560.2 16 135km ENE Laverton (Australia) 9 Barkerville Gold Mines Ltd Cow Mountain CM11-102 293.0 2.2 77 60km E Quesnel (Canada) 10 Probe Mines Ltd Borden Lake (HG Zone) BL14-573 16.3 39.0 458 155km WSW Timmins (Canada) LEAD COMPANY PROJECT HOLE GRADE (%) INTERSECTION (m) DEPTH (m) PROJECT LOCATION 1 KGL Resources Ltd Marshall-Reward KJCD048 19.60 18.0 287 270km ENE Alice Springs (Australia) 2 North River Resources plc Namib (Kempe) NLDDK011 10.50 23.3 2 30km ENE Swakopmund (Namibia) 3 Robust Resources Ltd Romang Island (Perak) LWD403 1.57 144.8 57 223km NE Dili (Indonesia) 4 New Pacific Metals Corp RZY ZK2402 4.13 35.3 26 155km WNW Yushu (China) 5 Red Metal Ltd Maronan MRN13002 6.62 17.5 513 155km ESE Mt Isa (Australia) 6 Levon Resources Ltd Cordero C13-257 0.41 276.0 46 37km NNE Hidalgo del Parral (Mexico) 7 Precious Metal Resources Ltd Halls Peak (Gibsons) DDH HP 026 2.30 48.0 0 45km SE Armidale (Australia) 8 Investigator Resources Ltd Paris (Paris North) PPRC101 2.45 39.0 21 150km WNW Whyalla (Australia) 9 Centerra Gold Inc Altan Tsagaan Ovoo #4 ATO-182ADD 0.65 79.5 187 135km ESE Choybalsan (Mongolia) 10 Trevali Mining Corp Stratmat ST-754 7.57 6.5 409 47km SW Bathurst (Canada) SILVER COMPANY PROJECT HOLE GRADE (g/t) INTERSECTION (m) DEPTH (m) PROJECT LOCATION 1 Fortuna Silver Mines Inc San Jose (Trinidad North) SJOM-335 3,511 6.3 419 40km S Oaxaca (Mexico) 2 KGL Resources Ltd Marshall-Reward KJCD048 732 18.0 287 270km ENE Alice Springs (Australia) 3 Mandalay Resources Corp Yasna DLV13-086 497 26.4 529 110km S Coihaique (Chile) 4 New Pacific Metals Corp RZY ZK2402 343 35.3 26 155km WNW Yushu (China) 5 Musgrave Minerals Ltd Menninnie Dam (Frakes) MDAC375 990 10.0 43 115km WNW Whyalla (Australia) 6 Terramin Australia Ltd Menninnie Dam (Frakes) MDAC375 990 10.0 43 115km WNW Whyalla (Australia) 7 Almaden Minerals Ltd Tuligtic-Ixtaca (Main) TU-13-378 74 124.5 21 70km NNE Puebla (Mexico) 8 Paramount Gold and Silver Corp San Miguel (Don Ese) DS-13-039 2,295 4.0 368 75km NE Alamos (Mexico) 9 Mandalay Resources Corp Fabiola DLV13-086 854 9.1 484 110km S Cohaique (Chile) 10 IMPACT Silver Corp San Juan (Noche Buena) Z13-76 994 5.9 52 100km SW México City (Mexico) ZINC COMPANY PROJECT HOLE GRADE (%) INTERSECTION (m) DEPTH (m) PROJECT LOCATION 1 Precious Metal Resources Ltd Halls Peak (Gibsons) DDH HP 026 7.20 48.0 0 45km SE Armidale (Australia) 2 Robust Resources Ltd Romang Island (Perak) LWD403 2.04 144.8 57 223km NE Dili (Indonesia) 3 Red Pine Exploration Inc Cayenne/Chili CC13-01 9.36 27.5 11 95km SW Timmins (Canada) 4 North River Resources plc Namib (Kempe) NLDDK011 10.00 23.3 2 30km ENE Swakopmund (Namibia) 5 Tinka Resources Ltd Ayawilca A14-18 5.93 36.0 372 60km SSW Huánuco (Peru) 6 Trevali Mining Corp Stratmat ST-751 7.42 26.8 431 47km SW Bathurst (Canada) 7 Levon Resources Ltd Cordero C13-257 0.64 276.0 46 37km NNE Hidalgo (Mexico) 8 New Pacific Metals Corp RZY ZK2402 4.66 35.3 26 155km WNW Yushu (China) 9 Independence Group NL Bentley (Flying Spur) 13BUDD143 9.70 16.4 503 51km NNW Leonora (Australia) 10 Beaufield Resources Inc Tortigny TO-13-02 8.37 16.0 223 95km NNW Chibougamau (Canada)

Edition 2, 2014 www.SNL.com/Metals 10 Assay Share-Price Alert Better-than-expected assay results can have a remarkable short-term impact on equity values

The top twenty short-term share-price performances share price tripled to 30c/share, and has since risen (following assay results) during the March quarter to over 40c. are ranked below (as measured by the share price The share price of Perth-based Parmelia Resources 20 days after the relevant press release). Note that Ltd more than doubled to over 3c/share in the first this simplistic ranking takes no account of underlying half of February after it announced the results of market conditions (including metals prices) or Phase 1 drilling at the Mushroom Reef prospect on alternative impacts on the company valuation. its Darvii Naruu project in Govi Altai province, western The table below shows a greater range in share-price Mongolia. The share price has subsequently retreated movements for the top 20 performances (gains of to its original valuation. 16-200%) than were reported during the December The Parmelia example illustrates the problematic quarter (20-117%). Three companies saw share price nature of ranking changes at low share valuations. improvements of over 100% in the specified periods, Another example is the 10c/share price appreciation compared with only one during the December quarter. in the second half of January by ASX-listed Hammer Transition Metals Corp is a multi-metal exploration Metals Ltd (formerly Midas Resources Ltd) following company that focuses on the discovery of ore deposits the announcement of high-grade copper intersections in Canada using, it says, the “project-generator (including 14m at 2.62% Cu) at the Overlander North business model”. This involves focusing exclusively and South projects at Mount Isa in Queensland. This on the discovery stage of the mining cycle, and, once 100% equity appreciation has occurred numerous an interesting prospect has been identified, bringing times over the past year, and the company is currently in a partner that earns an interest in the property by trading in the middle of this range, at 15c/share. funding advanced exploration. A 70% equity appreciation (to 51c/share) was In late January, the company announced recorded by ASX-listed Lamboo Resources Ltd during intersections (including 20m at 3.2g/t combined the first half of March following the announcement PGMs) on its Sunday Lake equal joint venture with of “significant flake graphite assays” at its Geumam Impala Platinum Holdings Ltd in Thunder Bay, project in South Korea. The share price has continued Ontario. Over the subsequent 20 days the company’s to rise, and was recently trading above 80c.

IMPACT OF DRILLING RESULTS ON SHARE PRICES (March Quarter) SHARE PRICE (US$) COMPANY NAME PROPERTY PRESS RELEASE FROM TO# GAIN (%) Transition Metals Corp Sunday Lake Jan 27 0.100 0.300 200.0 Parmelia Resources Ltd Darvii Naruu Jan 28 0.015 0.032 113.3 Hammer Metals Ltd Overlander Jan 17 0.100 0.200 100.0 Lamboo Resources Ltd Geumam Feb 27 0.300 0.510 70.0 Carlisle Goldfields Ltd Farley Lake Jan 20 0.045 0.075 66.7 Erin Resources Ltd Lingokoto Jan 28 0.008 0.012 50.0 IMX Resources Ltd Nachingwea Feb 24 0.040 0.060 50.0 Resource & Investment NL Peak Hill Jan 9 0.050 0.075 50.0 Columbus Gold Corp Montagne d'Or Feb 26 0.425 0.600 41.2 WCP Resources Ltd Al Hariqah Jan 23 0.030 0.042 40.0 Celsius Coal Ltd Kokkia Jan 22 0.010 0.014 40.0 Musgrave Minerals Ltd Menninnie Dam Jan 28 0.068 0.090 32.4 West African Resources Ltd Tanlouka Feb 7 0.100 0.130 30.0 Desert Mines and Metals Ltd Daehwa Feb 3 0.016 0.020 25.0 East Africa Resources Ltd Mkuju South Feb 7 0.008 0.010 25.0 Investigator Resources Ltd Peterlumbo Jan 29 0.045 0.055 22.2 Estrella Resources Ltd Altair Mar 18 0.120 0.145 20.8 Graphite One Resources Inc Graphite Creek Jan 8 0.120 0.145 20.8 Bauxite Resources Ltd Athena/Dionysus Jan 16 0.115 0.135 17.4 Metals of Africa Ltd Rio Mazoe Feb 2 0.070 0.081 15.7 # Share price movement 20 days after the first assay announcement

Edition 2, 2014 www.SNL.com/Metals 11 Metals Production Outlook Early announcements signal a significant decline in copper and gold production during the quarter to end-March

By the end of April, production announcements had Like the gold mines, the total production from been made by 144 gold, copper and iron ore mines early-reporting copper mines had increased each for the quarter to end-March. The equivalent number quarter last year (starting with only 1.05Mt in the of early reports for the December quarter was only March quarter). 115 mines. The iron-ore scene during the March quarter was If these early announcements turn out to be different. Total production by the 30 iron-ore mines representative of all producers for the quarter then that had reported production statistics by the end of there has been a significant reduction in copper and April was 165.6Mt for the March quarter; down only gold production, with iron ore output only slightly 1.12Mt (0.7%) on the December quarter figures from lower. the same mines. The individual performances from all On May 1, as we went to Press, production reports of these early-reporting iron-ore mines are shown in had been received for 55 identifiable gold mines, the table on p15. compared with 49 early-reporting mines in the State of the Market (SOTM) report for the December quarter. NOTABLE CHANGES These gold mines, which are all listed in the table on Amongst the 55 gold mines for which March quarter p13, reported a combined 6.76Moz in the March production is already available, only 16 operations quarter, compared with 7.94Moz for the three months (29%) reported higher output. Lower production was to end-December (a decline of almost 15%). This reported at all but three of the 12 gold mines in reverses the steadily increasing gold production from Australasia (see table p13), all but two of the eight in early-reporting mines during 2013. South America, and all 11 of the early-reporting gold The overall production picture is similar for the mines in Europe saw lower production in the most copper miners. Early production reports have been recent quarter. The production picture was more received from 59 mines (45 copper mines had mixed in Africa. reported in time for the last SOTM report). Overall The greatest physical increases in quarter-on-quarter production from those operations that have already gold production were reported at Thompson Creek announced their March quarter results amounts to Metals Co’s Mt Milligan mine, Newmont Mining Corp’s 1.35Mt, which is 180,000t (12%) less than the 51.4%-owned Yanacocha mine and four of Barrick registered output from these same mines during the Gold Corp’s operations. quarter to end-December. The ramp-up at the Mt Milligan mine continues to progress, with mine pit grades as expected, metal recoveries in the mill currently above expectations and OUTPUT ALERT mill throughput steadily improving. Thompson Creek The tables on the following pages list only those expects mill throughput to achieve 75-85% of design mines that have already announced their production capacity by end-2014. results for the March quarter. This early data for Between them, Barrick’s operations at Goldstrike, the three commodities covered in this production Bald Mountain, Golden Sunlight and Veladero outlook (gold, copper and iron ore) enables increased quarter-on-quarter gold production by a prompt estimate of the trend for the quarter. 56,000oz. This positive contribution was more than However, details of total production, and offset, however, by reductions in production of confirmation of trends, will only be known at 25,000oz at the company’s Ruby Hill mine, of a much later date. 14,000oz at Pierina and of 61,000oz at Lagunas Norte. The 31% shortfall at the latter operation

+ =

Edition 2, 2014 www.SNL.com/Metals 12 Metals Production Outlook continued

EARLY PRODUCTION ANNOUNCEMENTS: GOLD (oz) Company Announcement Q4 2013 Q1 2014 Rise/Fall Change (%) AFRICA North Mara African Barrick Gold plc 60,358 68,639 8,281 14 Bonikro Newcrest Mining Ltd 22,657 29,694 7,037 31 Golden Pride Resolute Mining Ltd 20,585 792 -19,793 -96 Driefontein Sibanye Gold Ltd 162,200 130,900 -31,300 -19 Ahafo Newmont Mining Corp 162,000 105,000 -57,000 -35 AUSTRALASIA Nullagine Millennium Minerals Ltd 14,067 18,762 4,695 33 DeGrussa Sandfire Resources NL 5,957 10,035 4,078 68 Rosemont Regis Resources Ltd 8,259 10,736 2,477 30 Broula King Resource Base Ltd 2,736 1,707 -1,029 -38 South Kalgoorlie Metals X Ltd 8,844 3,208 -5,636 -64 Rosebery MMG Ltd 9,916 2,939 -6,977 -70 Mt Rawdon Evolution Mining Ltd 27,710 18,033 -9,677 -35 Garden Well Regis Resources Ltd 37,206 27,006 -10,200 -27 Plutonic Northern Star Resources Ltd 28,000 7,000 -21,000 -75 Kanowna Northern Star Resources Ltd 60,000 39,000 -21,000 -35 Macraes OceanaGold Corp 68,419 40,668 -27,751 -41 Telfer Newcrest Mining Ltd 156,789 127,489 -29,300 -19 EUROPE (Inc Russia) Solcocon Auriant Mining AB 1,125 311 -814 -72 Asacha Trans-Siberian Gold plc 8,414 6,057 -2,357 -28 Svartliden Dragon Mining Ltd 9,467 7,094 -2,373 -25 Tardan Auriant Mining AB 6,173 2,379 -3,794 -61 Malomir Petropavlovsk plc 45,300 30,500 -14,800 -33 Pokrovskiy Rudnik Petropavlovsk plc 30,800 14,200 -16,600 -54 Titimukhta Polyus Gold International Ltd 37,100 17,200 -19,900 -54 Olimpiada Polyus Gold International Ltd 197,300 167,000 -30,300 -15 Blagodatnoye Polyus Gold International Ltd 111,300 80,600 -30,700 -28 Pioneer Petropavlovsk plc 111,500 65,400 -46,100 -41 Lenzoloto Polyus Gold International Ltd 51,400 500 -50,900 -99 NORTH AMERICA Mt Milligan Royal Gold Inc 18,446 39,200 20,754 113 Goldstrike Barrick Gold Corp 242,000 262,000 20,000 8 Bald Mountain Barrick Gold Corp 14,000 24,000 10,000 71 Golden Sunlight Barrick Gold Corp 20,000 30,000 10,000 50 Bachelor Lake Metanor Resources Inc 16,833 25,282 8,449 50 Round Mountain Kinross Gold Corp 78,000 86,000 8,000 10 La Herradura Fresnillo plc 20,664 28,309 7,645 37 Holt St Andrew Goldfields Ltd 13,579 17,497 3,918 29 Mishi Wesdome Gold Mines Ltd 221 1,000 779 352 Pine Cove Anaconda Mining Inc 3,852 2,832 -1,020 -26 Elder Abcourt Mines Inc 3,684 1,436 -2,248 -61 Hislop St Andrew Goldfields Ltd 5,068 1,710 -3,358 -66 Minto Silver Wheaton Corp 9,126 5,128 -3,998 -44 Palmarejo/Gudalupe Franco-Nevada Corp 35,486 25,216 -10,270 -29 Kensington Coeur Mining Inc 37,404 25,428 -11,976 -32 Ruby Hill Barrick Gold Corp 35,000 10,000 -25,000 -71 Nevada Newmont Mining Corp 535,000 377,000 -158,000 -30 SOUTH AMERICA Yanacocha Newmont Mining Corp 185,000 208,000 23,000 12 Veladero Barrick Gold Corp 142,000 158,000 16,000 11 Torrecillas Minera Gold Ltd 1,023 394 -629 -61 Fazenda Brasileiro Yamana Gold Inc 18,270 12,693 -5,577 -31 Chapada Yamana Gold Inc 28,223 20,455 -7,768 -28 Pierina Barrick Gold Corp 16,000 2,000 -14,000 -88 Tucano Beadell Resources Ltd 60,823 32,507 -28,316 -47 Lagunas Norte Barrick Gold Corp 195,000 134,000 -61,000 -31 SOUTH EAST ASIA Ban Houayxai PanAust Ltd 32,933 23,356 -9,577 -29 Grasberg Freeport-McMoRan Copper & Gold Inc 502,000 209,000 -293,000 -58

Edition 2, 2014 www.SNL.com/Metals 13 Metals Production Outlook continued

reflected lower grades, as anticipated in the mine As in the previous SOTM reports, only the copper plan, and the company forecast production this year mines where significant* changes have been reported at 0.57-0.61Moz. are tabulated below (amounting to 20 mines in the The two largest falls in quarter-on-quarter gold latest quarter). production came at Newmont’s Nevada operations, *Defined as the six mines with the greatest increase and at Freeport-McMoRan Copper & Gold Inc’s in tonnage, the six with the greatest reduction in Grasberg operation in Indonesia. tonnage, and any operations where there has been PT Freeport Indonesia (PT-FI) resumed open-pit a quarter-on-quarter change of more than 25%. mining at its Grasberg operations in mid-2013 in a Of the 20 copper mines that reported these phased approach. However, in January this year the ‘significant’ production changes in the March quarter, government published regulations regarding the export 12 reported higher production. However, these of minerals. As a result of the delay in obtaining positive changes in tonnage were not as significant as approvals for 2014 exports, PT-FI implemented the negative changes in production. Also, most of the changes to its operations to align its concentrate operations that are not tabulated reported a decline in production with PT Smelting’s operating plans. copper production. During the March quarter, PT-FI’s milling rate averaged Apart from Grasberg, see above, the most significant only 118,000t/day, which is approximately half of individual reductions in quarter-on-quarter copper normal rates. As a result, the mine’s copper production production were reported at Glencore Xstrata plc’s (table below) also suffered, down 55% to 65,000t. Collahuasi and Antamina mines in Chile and Peru, Newmont’s Nevada operations produced only respectively, and BHP Billiton Ltd’s Escondida mine 377,000oz of gold in the March quarter, compared in Chile. All reported reductions in excess of 20,000t. with 535,000oz in the December quarter. Collahuasi’s production increased due to continuing Significant changes were also reported at Newmont’s higher grades and recovery from the SAG Mill 3 Ahafo mine (output down 35% to 105,000oz) and at shutdown in the first quarter last year. Higher Polyus Gold International Ltd’s Lenzoloto mine. The grades reflect the current phase of mining and the latter is a seasonal producer, with output of 51,400oz accelerated ore extraction to maximise productivity. in the December quarter but only 500oz in the March Lower grades are expected later in the year, however, quarter, and even this gold represents a carry-over as ore supply increases from the next phase. of gold-in-progress from sands washed in the Despite the first quarter shortfall, full-year copper December quarter. production at Antamina is expected to be broadly

EARLY PRODUCTION ANNOUNCEMENTS: COPPER (t) Company Announcement Q4 2013 Q1 2014 Rise/Fall Change (%) AFRICA Kipoi Central Tiger Resources Ltd 8,527 6,157 -2,370 -28 ASIA Surda India Resources Ltd 473 997 524 111 Gedabek Anglo Asian Mining plc 71 141 70 99 Damajianshan Brockman Mining Ltd 304 55 -249 -82 AUSTRALASIA DeGrussa Sandfire Resources NL 15,492 18,098 2,606 17 Golden Grove MMG Ltd 6,891 8,834 1,943 28 Kanmantoo Hillgrove Resources Ltd 4,306 5,838 1,532 36 Savannah Panoramic Resources Ltd 1,186 1,525 339 29 Mt Carlton Evolution Mining Ltd 83 364 281 339 NORTH AMERICA Bingham Canyon Rio Tinto Ltd 64,500 69,200 4,700 7 Sierrita Freeport-McMoRan Copper & Gold Inc 18,500 22,500 4,000 22 Pinto Valley Capstone Mining Corp 14,856 17,322 2,466 17 SOUTH AMERICA Cerro Colorado BHP Billiton Ltd 19,400 22,000 2,600 13 El Abra Freeport-McMoRan Copper & Gold Inc 40,000 42,000 2,000 5 Zaldivar Barrick Gold Corporation 32,500 24,000 -8,500 -26 Alumbrera Glencore Xstrata plc 34,900 26,000 -8,900 -26 Escondida BHP Billiton Ltd 291,900 271,300 -20,600 -7 Collahuasi Glencore Xstrata plc 141,700 118,900 -22,800 -16 Antamina Glencore Xstrata plc 125,600 98,000 -27,600 -22 SOUTH EAST ASIA Grasberg Freeport-McMoRan Copper & Gold Inc 144,000 65,500 -78,500 -55

Edition 2, 2014 www.SNL.com/Metals 14 Metals Production Outlook continued

unchanged from the 2013 financial year, given a Australasia, and 13 reported higher output (11 of decline in copper ore grades in the second half of these mines being in Australasia and two in Africa). the year, consistent with the mine plan. There were particularly notable changes in Escondida also remains on track to produce 1.1Mt production at six operations in Australia. Three mines of copper in the 2014 financial year before increasing reported much larger iron-ore output in the March to a planned 1.3Mt in the 2015 financial year. quarter (Chichester Range, Mt Newman and Hope Supporting this target, the company reported a 28% Downs), and three much lower output (Rio Tinto’s increase in the resource at Escondida compared with West Angelas and Hamersley mines, and BHPB’s the mid-2013 estimate. Yandi operation). All three copper mines in North America to have Fortescue Metals Group Ltd’s Chichester Range so far reported their production for the March quarter operation in the Pilbara was the stand out performer, achieved significant increases in output. Rio Tinto lifting iron-ore production 15% (4.1Mt) to 30.8Mt. Ltd’s Bingham Canyon lifted output 7% (4,700t) Fortescue also celebrated completion of its group to 69,200t, Freeport-McMoRan reported a 22% expansion to 155Mt/y with the official opening of improvement (4,000t) to 22,500t at its Sierrita mine, the Kings Valley project at the Solomon Hub. All and Capstone Mining Corp improved output 17% components of the port, rail and the Chichester (2,466t) to 17,322t at the Pinto Valley operation. and Solomon Hub expansions are now fully Amongst the 30 iron-ore mines for which March- operational, with significant construction and quarter production is already available, 24 are in major contracts complete.

EARLY PRODUCTION ANNOUNCEMENTS: IRON ORE (t) Company Announcement Q3 2013 Q4 2013 Rise/Fall Change (%) AFRICA Sishen Kumba Iron Ore Ltd 8,395,000 8,658,000 263,000 3 Thabazimbi Kumba Iron Ore Ltd 151,000 157,000 6,000 4 Kolomela Kumba Iron Ore Ltd 2,740,000 2,513,000 -227,000 -8 AUSTRALASIA Chichester Range Fortescue Metals Group Ltd 26,700,000 30,800,000 4,100,000 15 Mt Newman BHP Billiton Ltd 16,689,000 18,287,000 1,598,000 10 Hope Downs Hancock Prospecting Pty Ltd 9,112,000 9,559,000 447,000 5 Roper Bar Western Desert Resources Ltd 62,000 295,000 233,000 376 Wodgina Atlas Iron Ltd 1,197,000 1,397,000 200,000 17 Tallering Peak Mount Gibson Iron Ltd 571,000 659,000 88,000 15 Extension Hill Mount Gibson Iron Ltd 573,000 654,000 81,000 14 Karara Gindalbie Metals Ltd 829,000 901,000 72,000 9 Koolyanobbing Cliffs Natural Resources Inc 2,723,000 2,790,000 67,000 2 Nelson Bay River Shree Minerals Ltd 45,000 83,000 38,000 84 Kara Tasmania Mines Ltd 46,415 55,151 8,736 19 Abydos Atlas Iron Ltd 687,000 684,000 -3,000 0 Eastern Range Rio Tinto Ltd 2,513,000 2,447,000 -66,000 -3 Pardoo Atlas Iron Ltd 293,000 202,000 -91,000 -31 Spinifex Ridge Moly Mines Ltd 422,000 321,000 -101,000 -24 Area C BHP Billiton Ltd 13,392,000 13,273,000 -119,000 -1 Goldsworthy BHP Billiton Ltd 504,000 242,000 -262,000 -52 Mt Dove Atlas Iron Ltd 599,000 323,000 -276,000 -46 Karara (DSO) Gindalbie Metals Ltd 756,000 367,000 -389,000 -51 Koolan Island Mount Gibson Iron Ltd 915,000 468,000 -447,000 -49 Pannawonica Rio Tinto Ltd 8,661,000 8,168,000 -493,000 -6 West Angelas Rio Tinto Ltd 7,635,000 6,564,000 -1,071,000 -14 Yandi BHP Billiton Ltd 20,159,000 18,379,000 -1,780,000 -9 Hamersley Rio Tinto Ltd 35,868,000 33,898,000 -1,970,000 -5 EUROPE Dannemora Dannemora Mineral AB 315,000 294,000 -21,000 -7 NORTH AMERICA Carol Lake Rio Tinto Ltd 3,953,000 3,005,000 -948,000 -24 SOUTH AMERICA Ponte Verde South American Ferro Metals Ltd 251,000 193,000 -58,000 -23

Edition 2, 2014 www.SNL.com/Metals 15 Mergers and Acquisitions There has been a sharp increase in M&A activity, led by deals involving copper and gold

The total value of mergers and acquisitions (M&A) US$6.60 billion (56%) share of the total was during the first three months of 2014 (as announced dominated in the March quarter by the outline US$5 by mid-April) rose almost 66% to US$11.87 billion, billion agreement between Glencore and China compared with the revised December quarter figure of Minmetals for the latter to acquire Las Bambas in US$7.17 billion. This brought the total for the past Peru. This deal contributed to a ten-fold increase four quarters to US$38.09 billion, and, as the graph between the December and March quarters in M&A below illustrates, confirms a healthy upward trend in activity involving copper assets. the total value of deals since the middle of 2013. Gold deals accounted for US$3.27 billion (almost The number of deals announced, however, slipped to 28% of the total) in the March quarter. This was a 62 during the March quarter, compared with 76 in the three-fold increase from the gold deals worth US$1.09 December quarter. Over 56% of these deals were for billion in the December quarter. gold assets, with copper deals accounting for a further The gold M&A activity in the quarter just ended 23% of the total number. included the contested US$2.5 billion bid for Osisko By value, the lion’s share of M&A activity announced Mining Corp. Two major gold deals that were first so far in 2014 has been for copper assets. Copper’s announced in December were finalised during the

MINING DEALS (March Q 2014) Value Deals MINING DEAL VALUES (March Q 2014) (US$ million) (Number) Gold Copper Chrome Iron Ore Other By Acquirer Country: China 5,286.7 4 Canada 3,170.6 20 UK 1,332.5 2 14% Australia 147.4 14 28% USA 123.8 5 Other 1,807.4 17

By Target Commodity: Copper 6,601.3 14 Gold 3,271.1 35 Chrome 1,610.0 1 Iron Ore 66.8 2 Other 319.2 10 56% TOTAL 11,868.4 62 Note: Mining deals exclude energy minerals and construction materials

COPPER, GOLD AND IRON ORE TRANSACTIONS MINING M&A (Past Four Quarters) BY VALUE (US$ million) Number of transactions (right-hand scale) 7,000 Copper 16,000 80 6,000 Gold 14,000 70 Iron Ore ) 5,000 12,000 60 lli on mi 10,000 50

4,000 S$ (U

s 8,000 40 3,000 al

of de 6,000 30 e

2,000 lu

Va 4,000 20

1,000 2,000 10

0 0 0 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2013 Q3 2013 Q4 2013 Q1 2014

Edition 2, 2014 www.SNL.com/Metals 16 Mergers and Acquisitions Continued

LARGEST MINING DEALS (March Q 2014) Main Share Value Object Buyer's Announced Status Object Metal (%) (US$ million) Country Buyer Country Seller Seller's Country Feb Pending Las Bambas Copper 100 5,000.0 Peru China Minmetals Corp China Glencore Xstrata plc Switzerland Jan Pending Osisko Mining Gold 100 2,445.0 Canada Contested Canada n/a Feb Failed AMCOL International Corp Chrome 100 1,610.0 USA Imerys SA France n/a Jan Completed Turquoise Hill Resources Copper, Gold 0 1,222.5 Canada Rio Tinto plc UK n/a Feb Failed Augusta Resource Copper 84 326.0 Canada Hudbay Minerals Inc Canada n/a Feb Pending Marigold Mine Gold 100 275.0 USA Silver Standard Resources Inc Canada Goldcorp, Barrick Gold Canada Jan Pending Langer Heinrich Mine Uranium 25 190.0 Namibia China National Nuclear Corp China Paladin Energy Australia Feb Pending Anglogold Namibia Gold 100 110.0 Namibia QKR Corporation UK Anglogold Ashanti South Africa

its companies contributing deals worth a total of DEAL VALUE BY BUYER’S COUNTRY (March Q 2014) US$3.17 billion (27% of the total). The two largest deals announced during the March Australia Canada USA China UK Other quarter (see table) were for Las Bambas and for Osisko, as mentioned above. However, the mooted deal between Imerys SA and AMCOL, valued at US$1.6 billion, did not go through, and the parties decided 1% to end the sale agreement. 15% As the table at the bottom of p16 demonstrates, the 27% improvement in overall M&A activity has come from a sharp increase in deals involving copper and gold. The value of deals involving these two metals, plus the 11% third major metal, iron ore, rose four fold between the December and March quarters, reaching some US$9.9 billion (83% of the total), compared with only US$2.1 1% billion (29% of the total) in the three months to end-December 2013. Much of the balance of M&A activity during the December quarter was taken up by three large deals. In the aluminium sector, Vale SA sold its 22% Norsk 45% Hydro stake in a deal valued at US$1.82 billion. In phosphate, Mosaic Co paid US$1.40 billion for assets held by CF Industries. In the diamond sector, shares in Alrosa worth US$1.30 billion (16% of the company) were March quarter; Asanko Gold’s US$180 million sold in a Russian public offering. The federal acquisition of PMI Gold, and Primero Mining’s government sold a 7% stake, and now owns 43.9%, US$210 million takeover of Brigus Gold. with the Yakutia government also selling 7% Iron ore M&A activity slumped from the seven deals (diluted its holding to 25%). The company itself worth (a revised) US$406.8 million in the December sold Treasury shares representing a 2% stake. quarter, to just two deals worth US$66.8 million in the Notwithstanding the continued shortage of finance March quarter. (see p18), acquisition activity looks set to remain In terms of the location of the acquiring companies, strong in the current quarter. However, until funding China again dominated, accounting for 45% (US$5.29 improves for small and medium-sized companies, billion) of the US$11.87 billion M&A total in the much of this likely to take the form of joint ventures March quarter. Canada ranked second, with and earn-in arrangements.

Edition 2, 2014 www.SNL.com/Metals 17 Mining Finance Funding for the mining sector remained lacklustre in the first quarter of 2014

The increased level of merger and acquisition (M&A) billion). However, this overall figure disguises the activity in the March quarter, as reported on the fact that almost all of this cash is held by the large preceding pages, was achieved in conditions of tight companies/producers. finance. Total funds raised by the mining sector in the Exploration companies had cash holdings of only three months to end-March fell below US$7.0 billion US$7.5 billion at end-December. The overlapping from a restated US$9.8 billion in the quarter to group of 2,890 listed companies on the SNL database end-December. with a market capitalisation of under US$100 million This apparent quarter-on-quarter decline of 29% (at the end of December) had combined cash holdings might not be as worrying as it appears. The March- of only US$6.5 billion at the end of December. This quarter figure is based on the financing as reported equates to an average of under US$2.3 million, by the middle of April, and the final number will representing 19% of this group’s average market inevitably be higher (the December quarter figure, for capitalisation at that time. example, was revised up from the US$6.2 billion Liquidity in the industry is not helped by depressed reported by the middle of January). metals prices, and mining companies have been As in previous quarters, there was a sharp difference struggling to generate profits. For example, Barrick between the amounts raised by explorers and by Gold reported a loss of US$10 billion for 2013, producers. Funds raised by the latter companies fell Newcrest and Vale reported losses in excess of US$5.5 31% to under US$5.4 billion from almost US$7.8 billion, and Kinross Gold and Goldcorp reported losses billion. However, this absolute amount still compares of around US$3 billion for 2013. very favourably with the US$1.6 billion raised by exploration companies (US$2.0 billion in the PROPERTY PRICING December quarter). Barely US$1.1 billion was raised The SNL database distinguishes between ‘corporate’ during the quarter just ended by companies with a and single-property transactions, with the former market capitalisation of under US$100 million. incorporating multiple-property deals and the The shortfall in funding was felt most severely by acquisition of a company and its assets. The table companies whose primary listing is on the Toronto on p19 represents data where the resource/reserve Stock Exchange (TSX), with funding down from information is available, and the amount paid for US$4.4 billion in the December quarter to US$1.6 these in-ground assets can be segregated from the billion in the March quarter. Companies listed on the associated infrastructure. Australian Stock Exchange (ASX) saw funding drop The table on p16 consolidates all transactions into 26% to US$1.2 billion. overall expenditure, separated into commodity Cash holdings (assessed one quarter in arrears) categories. This amount will always be significantly were down slightly overall at the end of December higher than the property-only values. (US$108.1 billion) in comparison with the end- Accordingly, the pricing data in the table below September assessment (a reassessed US$111.8 excludes the amount paid for any infrastructure, and

FUNDS RAISED Funds Raised (US$ million) Cash Holdings (US$ million)* Q1 2014 Q4 2013 Q1 2013 Q4 2013 Q3 2013 Q4 2012 Company Size (US$ million) <10 196 620 748 2,005 2,412 1,993 10-49 524 588 714 2,589 3,060 4,123 50-100 348 512 686 1,925 2,081 2,014 >100 5,912 8,045 4,404 101,550 104,287 38,286 Primary Exchange TSX 1,585 4,400 1,628 24,516 25,309 30,288 ASX 1,221 1,640 1,666 29,851 29,935 6,192 London 393 433 637 9,691 9,994 1,925 Other 3,782 3,292 2,621 44,011 46,602 8,010 Company Type Explorer 1,621 1,985 1,912 7,520 8,030 9,948 Producer 5,361 7,781 4,641 100,549 103,811 36,468 TOTAL RAISED / CASH 6,980 9,765 6,552 108,069 111,841 46,416 * One quarter lag in information

Edition 2, 2014 www.SNL.com/Metals 18 Mining Finance continued

also any transactions where the property-only price INDUSTRY VALUATION can not be identified. The data also excludes multi- There has been little change over the past three project and multi-deposit (‘corporate’) transactions. months in terms of the industry’s capital structure. Applying these rules, the overall price paid for This remains sharply divided between big and stand-alone gold properties during the March quarter small companies, and between the related was only US$145 million, compared with US$541 categories of producers and explorers. million during the previous quarter. This corresponds According to SNL’s database, the 1,957 with US$19/oz of resources in the ground. companies with a market value of less than The total sales value of identifiable gold properties US$10 million (representing almost 57% of the increased in Asia and Australasia in the March quarter, listed mining companies) had a combined market compared with the December quarter, but the values fell capitalisation at the end of March of under US$6 elsewhere. The gold-sales value in North America halved billion (an average of just US$3.0 million). In to US$68 million, with an even more dramatic decline in contrast, the 575 listed companies on the database Africa, and no identifiable gold values being identifiable (17% of the total number) that have a market in either Europe or South America. (Note that this does value in excess of US$100 million accounted for a not mean that there were no gold-asset transactions in combined market capitalisation of over US$1,808 these two continents, only that the individual gold billion (an average market value of US$3.1 billion). resources could not be isolated and valued.) The asset valuations of these identifiable gold INTERNATIONAL MINING MARKET transactions varied from barely US$15/oz for the African deals to almost US$185/oz in Asia. End-Quarter Average Company Size Number Market Cap Market Cap Identifiable copper-asset transactions were lower in (US$ million) Companies (US$ million) (US$ million) the quarter just ended, falling 20% to US$80 million, <10 1,957 5,795 3.0 most of which came in North and Central America, with no resource values being identifiable in South 10-49 720 16,640 23.1 America, The average value of the resources that could 50-100 198 14,213 71.8 be isolated from infrastructure etc was US$33/t. >100 575 1,808,236 3,144.8 TOTAL 3,450 1,844,884 534.7

PROPERTY PRICING (March Quarter)* GOLD COPPER Sales Price Total Sales Value** Sales Price Total Sales Value** (US$/oz resources) (US$ million) (US$/t resources) (US$ million) Q1 Q4 Q1 Q1 Q4 Q1 Q1 Q4 Q1 Q1 Q4 Q1 2014 2013 2013 2014 2013 2013 2014 2013 2013 2014 2013 2013 Canada 9.3 8.6 24.7 11.1 20.5 12.6 178.3 24.9 20.5 5.0 Australia 9.4 7.2 15.8 23.3 11.5 15.0 79.8 10.3 USA 18.8 2.4 27.0 48.4 0.6 25.2 51.9 2.2 28.0 1.2 Argentina 4.6 5.5 Peru 220.1 142.0 N&C America 40.9 24.5 51.8 68.3 140.9 37.8 236.6 24.9 2.2 59.2 5.0 1.2 S. America 220.1 54.5 142.0 4.8 8.2 8.6 Europe 15.6 0.0 10.9 0.0 188.8 20.6 Africa 15.2 79.3 5.6 206.2 Asia 184.8 12.6 44.4 29.5 6.5 78.2 Australasia 94.2 7.2 15.8 27.0 11.5 15.0 79.8 10.3 TOTAL 19.1 17.9 19.2 145.3 541.1 57.6 32.6 7.1 2.2 79.8 102.2 1.2 * Geographical breakdown of properties sold (evaluated in terms of the total amount, and per unit of metal in the ground) **Data excludes infrastructure

Edition 2, 2014 www.SNL.com/Metals 19 Special Report: Mining above 60ºN The area above 60°N contains some of the most prospective terrain for mining but is underexplored

Over 18% of the Earth’s land area lies above a latitude (Chukota, Yakutia, Krasnoyarsk, Taymyr and Murmansk). of 60° north, and this extensive region includes some Historic northern operations include the Canadian of the planet’s most attractive geology for mineralisation. mines of Polaris and Lupin in Nunavut, both of which Although the circumference of the world at this are now closed. Polaris (Cominco’s zinc operation on latitude is only half that of the equator, the area to the Little Cornwallis Island) was some 1,000km north of north encompasses all of Finland, Greenland and the Arctic Circle at 75.4ºN (there is an unrelated Iceland, most of Sweden, Norway and Alaska, and vast Polaris project at 56.5ºN in British Columbia). The areas of northern Russia. It also includes a tiny part Lupin mine was actually just short of the Arctic proper, of the UK, as the Shetland Islands, to the north of at ‘only’ 65.8ºN. Scotland, lie mainly above 60°N. The world’s most northerly mines are three coal In Canada, the 60th ‘parallel’ constitutes the operations at 77.9-78.2ºN in Spitsbergen on Norway’s mainland boundary between the northern provinces Svalbard Islands (see p22). The most northerly of Yukon, Northwest Territories and Nunavut, and the exploration projects are Canada Coal Inc’s exploration southerly provinces of British Columbia, Alberta, at 79.9ºN in Nunavut, and base metals exploration by Saskatchewan and Manitoba. (It should be noted that Ironbark Zinc Ltd and Avannaa Resources Ltd at parts of Nunavut – the islands of Hudson Bay and 80.2-83.0ºN in Greenland’s far north. James Bay – are located south of 60°N, and parts SNL’s mining database lists over 100 companies of Quebec and of Newfoundland and Labrador are working in the Arctic, operating 55 mines/plants and located to the north.) 329 exploration/development projects, see summary Some important cities lie on, or near, a latitude of table below. Russia accounts for almost two-thirds 60°N (note that each degree of latitude equates to of the Arctic mines/plants, with none in Canada 111km). These cities include Anchorage (61.2°N, despite the country contributing 27% of the world’s 149.9°W) in North America, St Petersburg (59.9°N, documented Arctic exploration projects. There are no 30.3°E) in Russia, and Helsinki (60.2°N, 25.0°E), Arctic mines in Greenland, and there are neither mines Stockholm (59.3°N, 18.1°E) and Oslo (59.9°N, nor projects in Iceland above 66.5°N. 10.8°E) in Finland, Sweden and Norway, respectively. Mining to the north of this latitude is not without its ARCTIC MINING difficulties. At 60°N the North Pole is only 3,300km away (half the distance of the equator), and the sun is Country Mines/Plants Projects* above the horizon for less than six hours at the Winter Greenland 0 31 solstice (although it is above the horizon for nearly 19 Canada 0 89 hours at the Summer solstice). USA (Alaska) 3 23 Being at the edge of the Northern Temperate Zone, Russia 33 67 which extends from the Tropic of Cancer (23.5°N), mining becomes progressively more difficult to the Finland 3 36 north. In particular, there are environmental and Sweden 7 58 operating issues related to working in the Arctic. Norway 9 25 TOTAL 55 329 ARCTIC MINING *Includes categories not included in the tables on p25-36 The Arctic comprises the region above the Arctic Circle, which is the southernmost latitude in the northern hemisphere at which the sun can remain ARCTIC CIRCLE (66.5°N) continuously above (or below) the horizon for 24 hours (at the solstices in June and December, respectively). The Arctic Circle is not a fixed latitude but is currently 66° 33′N (ie 66.5°N), which is some 720km north of the 60th parallel. The Arctic Circle passes through eight countries (in order, westward from Greenwich in the UK): Iceland (where it passes through the small offshore island of Grímsey), Denmark (Greenland), Canada, the US (Alaska), Russia, Finland, Sweden and Norway. The area north of the Arctic Circle extends for some 20 million km2 (representing about 6% of the Earth’s surface). This area incorporates northern Alaska and northern Canada (Nunavut and the Northwest Territories), most of Greenland, the northern parts of Norway, Sweden and Finland, and northern Russia

Edition 2, 2014 www.SNL.com/Metals 20 Special Report: Mining above 60ºN continued

ARCTIC OPERATIONS Name Latitude Country Province Owner Commodities Location Most Northerly Advanced-Exploration Projects Nunavut 79.9 Canada Nunavut Canada Coal Inc Coal Quaanaaq, 430km NW Havik 76.3 Greenland Qaasuitsup Red Rock Resources plc Gold, Iron ore, Magnetite Qaanaaq, 133km SSE Ladderbjerg 73.5 Greenland NE National Park Unspecified Company Copper, Lead Kulusuk, 1050km NE Syradasaiskaya 73.0 Russia Krasnoyarsk MMC Norilsk Nickel OJSC Coal Coking Noril'sk, 460km NNW Rubjerg Knude 72.6 Greenland NE National Park Unspecified Company Copper Kulusuk, 940km NE Ukkusissat 71.1 Greenland Qaasuitsup Angel Mining plc (Administration) Zinc Nuuk, 770km N Repparfjord 70.4 Norway Finnmark Metallica Mining ASA Copper Hammerfest, 30km SE Tomtor 70.0 Russia Yakutia (Sakha) Unspecified Co Niobium, Rare earth Yakutsk, 1,050km NW Qeqertaa 69.6 Greenland Qaasuitsup Avannaa Resources Ltd Diamond Illulissat, 50km NE Grundtjern 69.6 Norway Finnmark Northern Iron Ltd Iron ore, Magnetite Kirkenes, 10km S Sostervann 69.6 Norway Finnmark Northern Iron Ltd Iron ore, Magnetite Kirkenes, 10km S Tverrdalen 69.6 Norway Finnmark Northern Iron Ltd Iron ore, Magnetite Kirkenes, 11km S Bjornfell 69.6 Norway Finnmark Northern Iron Ltd Iron ore, Magnetite Kirkenes, 12km S Oskarsmalm 69.6 Norway Finnmark Northern Iron Ltd Iron ore, Magnetite Kirkenes, 14km S Jerntoppen 69.6 Norway Finnmark Northern Iron Ltd Iron ore, Magnetite Kirkenes, 14km S Severnij 69.6 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Gold, Nickel, PGMs Noril'sk, 38km NNE Glubokij 69.6 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Gold, Nickel, PGMs Noril'sk, 32km NNE Tuktu 69.0 Canada Nunavut Advanced Explorations Inc Copper, Magnetite Raw, Silver Baker Lake, 770km NE Jennestad 68.8 Norway Nordland Nordic Graphite Ltd Graphite Harstad, 45km W Yugo-Vostochnaya 68.6 Russia Murmansk MMC Norilsk Nickel OJSC Ilmenite, Titanium, Vanadium Murmansk, 109km NW Arctic Pre-feasibility/Scoping Studies Ymer 73.3 Greenland NE National Park NunaMinerals AS Antimony, Gold, Tungsten Ymer Island Karrat 71.7 Greenland Qaasuitsup Avannaa Resources Ltd Rare earths, Yttrium Nuugaatsiaq, 20km E Nussir 70.5 Norway Finnmark Nussir ASA Copper, Gold, PGMs Tromsø, 210km ENE Ulveryggen 70.5 Norway Finnmark Nussir ASA Copper Hammerfest, 32km SE Bidjovagge 69.3 Norway Finnmark Arctic Gold AB Copper, Gold Kautokeino, 40km NW Skaergaard 68.2 Greenland Sermersooq Platina Resources Ltd Gold, Palladium, Platinum, PGMs Reyjkavik, 630km NW Lik 68.2 Alaska Alaska Zazu Metals Corp Lead, Silver, Zinc Fairbanks, 775 km NW Doris North 68.1 Canada Nunavut TMAC Resources Inc Gold Cambridge Bay, 120km SSW Madrid 68.1 Canada Nunavut TMAC Resources Inc Gold Bathurst Inlet, 148Km NNE Hope Bay 68.1 Canada Nunavut TMAC Resources Inc Gold Cambridge Bay, 130km SSW Viscaria 67.9 Sweden Norrbotten Avalon Minerals Ltd Copper, Gold, Iron ore, Magnetite Kiruna, 5km W Sokli 67.8 Finland Lappi Laani (Lapland) Yara International ASA Apatite, Phosphate Kovdor, 50km NW Discovery Zone 67.8 Sweden Norrbotten Hannans Reward Ltd Copper, Gold, Magnetite Kiruna, 8km SSW Tributary Zone 67.8 Sweden Norrbotten Hannans Reward Ltd Magnetite Kiruna, 8km SSW Rakkuri 67.8 Sweden Norrbotten Hannans Reward Ltd Copper, Gold, Iron ore, Magnetite Kiruna, 10km S Boston 67.7 Canada Nunavut TMAC Resources Inc Gold Bathurst Inlet, 115km NE Nunasvaara 67.7 Sweden Norrbotten Talga Resources Ltd Graphite Kiruna, 50km ESE Mertainen 67.7 Sweden Norrbotten LKAB Iron ore, Magnetite Kiruna, 30km ESE Vuruchuaivench 67.5 Russia Murmansk MMC Norilsk Nickel OJSC Copper, Gold, Nickel, PGMs Monchegorsk, 80km SE Workman's Bench 67.5 Alaska Alaska Silverado Gold Mines Ltd Antimony, Gold Wiseman, 7km NW High Lake 67.4 Canada Nunavut MMG Ltd Base metals, Copper, Gold Bathurst Inlet, 136km WNW Upper Kobuk 67.2 Alaska Alaska NovaCopper Inc Copper, Gold, Lead, Silver, Zinc College, 460km NW Arctic 67.2 Alaska Alaska NovaCopper Inc Copper, Gold, Lead, Silver, Zinc Fairbanks, 460km NW Usinsk 3 67.1 Russia Komi Novolipetsk Steel OJSC Coal, Coal Vorkuta Ulu 66.9 Canada Nunavut Elgin Mining Inc Gold Cambridge Bay, 340km SW Three Bluffs 66.6 Canada Nunavut North Country Gold Corp Diamonds, Gold, Silver Baker Lake, 330km NE Committee Bay 66.6 Canada Nunavut North Country Gold Corp Diamonds, Emerald, Gold, Silver Baker Lake, 290km NNE White Mountain 66.5 Greenland Qeqqata Hudson Resources Inc Alumina, Anorthosite Saqqarliit, 39km SSE Sarfartoq 66.5 Greenland Qeqqata Hudson Resources Inc Cerium, Diamond, Rare earths Nuuk, 250km N

Edition 2, 2014 www.SNL.com/Metals 21 Special Report: Mining above 60ºN continued

ARCTIC OPERATIONS Name Latitude Country Province Owner Commodities Location Arctic Feasibility Studies Citronen Fjord 83.0 Greenland NE National Park Ironbark Zinc Ltd Lead, Zinc North Pole, 775km S Malmbjerg 71.8 Greenland Sermersooq KGHM Polska Miedz SA Molybdenum Scoresbysund, 200km NW Mary River 71.3 Canada Nunavut Baffinland Iron Mines Corp Iron ore Pond Inlet, 157km SSE Souker 69.4 Russia Murmansk Kola Mining Corp Copper, Nickel Nikel', 12km ENE Maslovskoye 69.2 Russia Taymyr MMC Norilsk Nickel OJSC Cobalt, Copper, Gold, PGMs Noril'sk, 14km SSW Pellapakh 68.5 Russia Murmansk Grangesberg Iron Ore plc Copper, Molybdenum Kola Penninsula Roche Bay 68.4 Canada Nunavut Advanced Explorations Inc Copper, Iron ore, Magnetite Baker Lake, 740km NE Kuervitikko 67.6 Finland Lappi Laani (Lapland) Northland Resources SA Copper, Gold, Iron ore, Magnetite Kittila, 40km WSW Hannukainen 67.6 Finland Lappi Laani (Lapland) Northland Resources SA Copper, Gold, Iron ore, Magnetite Kittila, 41km WSW Fedorova 67.5 Russia Murmansk Barrick Gold Corp Copper, Gold, Nickel, PGMs Apatity, 90km E Pellivuoma 67.4 Sweden Norrbotten Northland Resources SA Copper, Gold, Iron ore, Magnetite Pajala, 25km NW Stora Sahavaara 67.4 Sweden Norrbotten Northland Resources SA Copper, Iron ore, Magnetite Pajala, 19 km NNW Novogodnee Monto 66.8 Russia Yamalo-Nenets Petropavlovsk plc Gold, Iron ore

Under Construction Lunckefjell 78.0 Norway Spitsbergen Store Norske AS Coal Longyearbyen, 35km SE Black Angel 71.7 Greenland Qaasuitsup Angel Mining plc (Administration) Lead, Silver, Zinc Nuuk, 770km N Skalisty 69.6 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 33km NNE Kekura Centre 67.0 Russia Chukotka (Chukot) Bazovye Metally CJSC Gold Aliskerovo, 92km SSW

Operating Store Norske 78.2 Norway Spitsbergen Store Norske AS Coal Longyearbyen Gruve No7 78.1 Norway Spitsbergen Store Norske AS Coal Longyearbyen, 16km SE Svea Nord 77.9 Norway Spitsbergen Store Norske AS Coal Longyearbyen, 40km SE Almazy Anabara 71.0 Russia Yakutia (Sakha) Alrosa OJSC Diamonds Noril'sk, 990km ENE Elkem Tana Quarry 70.5 Norway Finnmark Elkem Tana AS Quartz Nikel', 135km NNW Sydvaranger 69.7 Norway Finnmark Northern Iron Ltd Magnetite Kirkenes, 10km S Bjornevatn 69.7 Norway Finnmark Northern Iron Ltd Iron ore, Magnetite Kirkenes, 8km S Fisketind Ost 69.6 Norway Finnmark Northern Iron Ltd Iron ore, Magnetite Kirkenes, 13km S Kjellmannsasen 69.6 Norway Finnmark Northern Iron Ltd Iron ore, Magnetite Kirkenes, 15km S Oktyabrsky 69.6 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 28km N Taimyrsky 69.6 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 29km NNE Komsomolsky 69.5 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 26km NNE Talnakh Concentrator 69.5 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Nickel Noril'sk, 24km N Mayak 69.5 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 23km NNE Pechenga 69.4 Russia Murmansk MMC Norilsk Nickel OJSC Copper, Gold, Ilmenite, PGMs Murmansk, 110km NW Kaula-Kotselvaara 69.4 Russia Murmansk MMC Norilsk Nickel OJSC Copper, Gold, Nickel, PGMs Nikel, 3km SE Severny-Gluboky 69.4 Russia Murmansk MMC Norilsk Nickel OJSC Copper, Gold, Nickel, PGMs Nikel, 22km E Nadezhda Smelter 69.3 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Nickel Noril'sk, 9km W Norilsk Concentrator 69.3 Russia Taymyr MMC Norilsk Nickel OJSC Nickel Noril'sk, 1km S Taimyr Peninsula 69.3 Russia Taymyr MMC Norilsk Nickel OJSC Cobalt, Copper, Gold, PGMs Norilsk Medvezhy Ruchey 69.3 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 4km SSW Zapolyarny 69.3 Russia Taymyr MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 5km SW Mayskoye 69.0 Russia Chukotka (Chukot) Polymetal International plc Gold, Silver Komsomol'skiy, 54km E Franzefoss 68.4 Norway Nordland Franzefoss Miljokalk AS Limestone Narvik, 20km W Olenogorsky 68.2 Russia Murmansk Olkon JSC Iron ore, Magnetite Raw Olenegorsk

Edition 2, 2014 www.SNL.com/Metals 22 Special Report: Mining above 60ºN continued

ARCTIC OPERATIONS Name Latitude Country Province Owner Commodities Location Operating (continued) Olkon 68.2 Russia Murmansk Olkon JSC Iron ore, Magnetite Raw Olenegorsk Red Dog 68.1 Alaska Alaska Teck Resources Ltd Germanium, Lead, Silver, Zinc Fairbanks, 760km WNW Kittila 67.9 Finland Agnico-Eagle Mines Ltd Gold Kittila, 40km NE Monchegorsk Refinery 67.9 Russia Murmansk MMC Norilsk Nickel OJSC Cobalt, Copper, Nickel Monchegorsk Lovozersky 67.9 Russia Murmansk Lovozersky GOK Beryllium, Cerium, Rare earth Apatity, 65km NE Kiruna 67.8 Sweden Norrbotten LKAB Iron ore, Magnetite Kiruna, 3km SW Kevitsa 67.7 Finland First Quantum Minerals Ltd Cobalt, Copper, Gold, PGMs Kemijärvi, 110km N Oleniy Ruchey 67.7 Russia Murmansk Acron JSC Apatite, Nepheline Syenite Kirovsk, 25km ENE Kirovsky 67.7 Russia Murmansk Apatit OJSC Bauxite, Nepheline Syenite Kirovsk, 6km NE Apatit 67.7 Russia Murmansk Apatit OJSC Bauxite, Nepheline Syenite Kirovsk Gruvberget 67.7 Sweden Norrbotten LKAB Magnetite Svappavaara, near Pahtavaara 67.6 Finland Lappland Goldminers (Administration) Gold Sodankylä, 25km NNW Rasvumchorr 67.6 Russia Murmansk Apatit OJSC Bauxite, Nepheline Syenite Kirovsk, 7km NE Vostochny 67.6 Russia Murmansk Apatit OJSC Bauxite, Nepheline Syenite Kirovsk, 20km ENE ANBP-3 Concentrator 67.6 Russia Murmansk Apatit OJSC Phosphate Kirovsk Central 67.6 Russia Murmansk Apatit OJSC Bauxite, Nepheline Syenite Kirovsk, 8km ENE Dvoinoye 67.6 Russia Chukotka (Chukot) Kinross Gold Corp Gold, Silver Aliskerovo, 76km ESE ANBP-2 Concentrator 67.6 Russia Murmansk Apatit OJSC Phosphate Apatity Kovdorsky 67.6 Russia Murmansk EuroChem Mineral Co Apatite, Iron ore, Magnetite Kovdor Svappavaara 67.6 Sweden Norrbotten LKAB Iron ore, Magnetite Kiruna, 40km SE Little Squaw Creek 67.6 Alaska Alaska Goldrich NyacAU Placer LLC Gold College, 290km N Vorkutaugol 67.5 Russia Komi Vorkutaugol JSC Coal Vorkuta Nolan Creek 67.5 Alaska Alaska Silverado Gold Mines Ltd Antimony, Gold Wiseman, 7km N Tapulivuoma 67.4 Sweden Norrbotten Northland Resources SA Iron ore, Magnetite Pajala, 25km NNW Kaunisvaara 67.4 Sweden Norrbotten Northland Resources SA Copper, Gold, Iron ore, Magnetite Pajala, 20km NNW Kandalaksha Smelter 67.2 Russia Murmansk UC RUSAL plc Aluminium Kandalaksha Malmberget 67.2 Sweden LKAB Iron ore, Magnetite Malmberget Aitik 67.1 Sweden Norrbotten Boliden AB Copper, Gold, Molybdenum Gallivare, 15km ESE Kupol 66.8 Russia Chukotka (Chukot) Kinross Gold Corp Gold, Silver Aliskerovo, 140km SE Sentachan 66.5 Russia Yakutia (Sakha) GeoProMining Ltd Antimony Yakutsk, 600km NE

MINING PROJECTS ABOVE 60°N Status Iceland Greenland Canada Alaska Russia Finland Sweden Norway TOTAL Grass Roots 24 539 42 9 33 35 10 692 Exploration 10 315 47 9 28 34 4 447 Adv Exploration 9 112 21 21 57 59 12 291 Pre-Feas/Scoping 7 33 9 8 14 14 6 91 Feasibility Studies 7 32 2 7 7 7 62 Construction 1 1 7 1 8 1 1 20 Operating 3 1 13 6 70 20 16 16 145 Rehabilitation 1 1 TOTAL 4 59 1,052 128 132 160 165 49 1,749

Active Companies 3 18 281 67 36 42 42 21 478* *Some companies are active in more than one country

Edition 2, 2014 www.SNL.com/Metals 23 Special Report: Mining above 60ºN continued

LATITUDE BANDS Russia has an impressive 33 mines/plants in the According to the SNL database, there are 1,749 Arctic (one of which, the Almazy diamond mine, is exploration and mining projects above 60°N (see table above 70°N). The country has 69 operations between p23), with 60% of these being in Canada. This total the 60th and 70th parallels, with the northerly mines excludes operations under care and maintenance (five) including MMC Norilsk Nickel OJSC’s various copper- and projects whose status is unknown (12) or from nickel operations in Taymyr (clustered around 69.6°N) which no information has been received for five years. and its copper-gold-nickel operations in Murmansk. It is highly likely that there is an under- All 20 of Finland’s operations above 60°N are south representation of Russian projects because of the of 70°N. The country has three operations in the difficulty in capturing early-stage information. The Arctic; Agnico-Eagle Mines Ltd’s Kittila gold operation database reports that half of the 145 mines/plants (67.9°N), First Quantum Minerals Ltd’s Kevitsa operating above 60°N are in Russia but that the cobalt-copper operation (67.7°N) and the Pahtavaara country has just a similar number of exploration gold mine (67.6°N) owned by Lappland Goldminers. projects. In contrast, Canada has only 13 mines/plants A similar grouping is true of Sweden’s 16 mines but over 1,000 exploration projects. above the 60th parallel, all being south of 70°N, with There are no mines in the world north of the 80th seven operations in the Arctic. Those above 66.5°N parallel, and only three projects — all of which are include LKAB’s four magnetite/iron-ore mines at in Greenland. As noted above, Ironbark Zink is Kiruna (67.8°N), Gruvberget (67.7°N), Svappavaara conducting a feasibility study for a lead-zinc mine at (67.6°N) and Malmberget (67.2°N). Also in the far Citronen Fjord (83.0°N), just 775km from the North north of the country are Northland Resources SA’s Pole. Some 270km to the south, exploration is being Tapulivuoma iron-ore mine and Kaunisvaara multi- conducted for base metals in Washington Land metal mine, and Boliden AB’s Aitik copper-silver mine. (80.2-80.5°N) by Ironbark and by Avannaa Resources. Norway has seven operations between 60°N and the There is also relatively little work underway between Arctic Circle, with nine mines above 66.5°N. Four of the 70th and 80th parallels: the latter are above 70°N; these are three coal mines in Spitsbergen, on the island of Svalbard, at 77.9- MINING ACTIVITY 70-80°N* 78.2°N, and the Elkem Tana quartz quarry at 70.5°N Exp/Dev Mining in the country’s Finnmark province. Other northerly Greenland 16 0 operations in Finnmark include four mines owned by Canada 20 0 Northern Iron Ltd at around 69.6°N. Russia 2 1 Norway 6 4 CORPORATE ACTIVITY Total 44 5 The SNL database records 478 companies as being * No activity in Iceland, Alaska, Finland or Sweden active north of the 60th parallel, with 281 of these having projects in Canada (see table, p23). Relatively The mines in this latitude band comprise Alrosa’s few of these companies are active in more than one Almazy diamond mine in Russia (71.0°N), and four in country, with only 26 companies being engaged in two Norway. The latter are Elkem Tana AS’s quartz quarry countries and just three companies (Agnico-Eagle in Finnmark (70.5°N), and three coal mines operated Mines, Boliden and Kinross Gold) registering work in Spitsbergen by Store Norske AS at 77.9-78.2°N. above 60°N in three countries. Not surprisingly, it is the area between the 60th and Although there is a surprising lack of geographical 70th parallels that accounts for the great majority of diversity amongst the northern explorers, many the whole region’s mining activity (see tables p25-36). companies have numerous projects within their target There are three operations above 60°N in Iceland country. Amongst the most notable in this regard but they are all aluminium smelters (owned by Alcoa is Strategic Metals Ltd, which has 110 Canadian Ltd, Century Aluminium Co and Rio Tinto Ltd) at projects recorded in the SNL database. 64.0-65.0°N. In Greenland, the only mine above 60°N The search in Greenland is led by Nuna Minerals AS, is the Nalunaq gold mine (at 60.4°N). with 12 projects, in Finland by Altona Minerals Ltd There are 13 operations in Canada above 60°N, all (23 projects), and in Norway by Northern Iron Ltd (10) in the band below 70°N. These are led by Agnico- and Drake Resources Ltd (7). Eagle Mines Ltd’s Meadowbank gold mine in Nunavut There are a number of competing multiple explorers (at 65.0°N) and Dominion Diamond Corp’s Ekati mine in Alaska, Russia and Sweden. The latter country in the Northwest Territories (64.7°N). includes Hannans Record Ltd (21), Talga Resources Alaska boasts six operations above 60°N, including Ltd (17), Continental Precious Minerals Inc (10), three in the Arctic; Teck Resources Ltd’s Red Dog Botnig Exploration Holdings AB (9) and Boliden AB (7). multi-metal mine at 68.1°N, Goldrich Mining Co’s Companies active in Alaska include North Fork Resources Little Squaw Creek gold mine at 67.6°N (operated by Ltd (10 projects), Kiska Metals Corp (8) and GoldRich NyacAu Placer LLC) and Silverado Gold Mines Ltd’s Mining Co (8). The most prominent in Russia are Norilsk Nolan Creek mine at 67.5°N. Nickel (24), Alrosa (22) and Polymetal International plc (21).

Edition 2, 2014 www.SNL.com/Metals 24 Special Report: Mining above 60ºN continued

USA (ALASKA) Name Latitude Owner Commodities Location Adv. Exploration Tobin Creek 67.5 Goldrich NyacAU Placer LLC Gold Fairbanks, 300km NNW Big Creek 67.5 Goldrich NyacAU Placer LLC Gold Fairbanks, 300km NNW Hammond 67.5 Silverado Gold Mines Ltd Gold Fairbanks, 320km N Sun 67.1 Andover Mining Corp Copper, Gold, Lead, Silver, Zinc Fairbanks, 425km NW Bornite 67.1 NovaCopper Inc Cobalt, Copper Fairbanks, 480km NW Bluff 64.6 Bering Straits Native Corp Gold Nome, 80km E Illinois Creek 64.3 Plan B Minerals Corp Copper, Gold, Lead, Silver, Zinc Anchorage, 540km NW Lost South (LMS) 64.2 Corvus Gold Inc Gold, Silver Delta Junction, 20km NNE Taurus 63.6 Senator Minerals Inc Copper, Gold, Molybdenum Delta Junction, 220km E Stellar 63.3 Millrock Resources Inc Copper, Gold Anchorage, 280km NE MAN Alaska 63.2 Pure Nickel Inc Copper, Gold, Nickel, PGMs Delta Junction, 90km SSW Delta 63.2 Agnico-Eagle Mines Ltd Copper, Gold, Lead, Silver, Zinc Delta Junction, 120km SE Golden Zone 63.2 Alix Resources Corp Copper, Gold, Silver Fairbanks, 200km SSW Rainbow Hill 63.2 CanAlaska Uranium Ltd Gold Delta Junction, 130km SW Caribou Dome 63.1 C-D Development Corp Copper Anchorage, 255km NE Vinasale Block 62.8 Freegold Ventures Ltd Gold Anchorage, 340km WNW Whistler 62.0 Kiska Metals Corp Copper, Gold, Silver Anchorage, 165km WNW Fish Creek 61.7 WestMountain Gold Inc Gold, Silver Anchorage, 220km WNW Jonesville 61.7 Black Range Minerals Ltd Coal Thermal Anchorage, 75km NE Shotgun 60.4 TNR Gold Corp Gold Anchorage, 450km W

Pre-feasibility/Scoping Lik 68.2 Zazu Metals Corp Lead, Silver, Zinc Fairbanks, 775 km NW Workman's Bench 67.5 Silverado Gold Mines Ltd Antimony, Gold Wiseman, 7km NW Upper Kobuk 67.2 NovaCopper Inc Copper, Gold, Lead, Silver, Zinc College, 460km NW Arctic 67.2 NovaCopper Inc Copper, Gold, Lead, Silver, Zinc Fairbanks, 460km NW Golden Summit 65.1 Freegold Ventures Ltd Gold, Silver, Tungsten Fairbanks, 30km NNE Gil 65.0 Kinross Gold Corp Gold Fairbanks, 38km NE Graphite Creek 65.0 Graphite One Resources Inc Graphite Nome, 60km N Nome 64.6 NovaGold Resources Inc Gold, Gravel Nome, 5km N

Feasibility Study Livengood 65.5 International Tower Hill Mines Ltd Gold Fairbanks, 80km NNW Donlin 62.1 Donlin Gold LLC Gold Anchorage, 450km WNW

Construction Terra 61.8 WestMountain Gold Inc Gold, Silver Anchorage, 210km WNW

Operating Red Dog 68.1 Teck Resources Ltd Germanium, Lead, Silver, Zinc Fairbanks, 760km WNW Little Squaw Creek 67.6 Goldrich NyacAU Placer LLC Gold College, 290km N Nolan Creek 67.5 Silverado Gold Mines Ltd Antimony, Gold Wiseman, 7km N Fort Knox 65.0 Kinross Gold Corp Gold Fairbanks, 24Km NE Pogo 64.5 Sumitomo Metal Mining Co Gold Fairbanks, 140km ESE Usibelli 64.0 Usibelli Coal Mine Inc Coal Fairbanks, 115km SSW

Edition 2, 2014 www.SNL.com/Metals 25 Special Report: Mining above 60ºN continued

CANADA Name Province Latitude Owner Commodities Location Adv. Exploration* Nunavut Nunavut , Ellesmere Island 79.9 Canada Coal Inc Coal Quaanaaq, 430km NW Tuktu Nunavut 69.0 Advanced Explorations Inc Copper, Magnetite Raw, Silver Baker Lake, 770km NE Arcadia Nunavut 67.7 Canada Carbon Inc Gold Bathurst Inlet, 173Km NW Copper River Nunavut 67.4 GPM Metals Inc Copper, Diamonds, Nickel, PGMs Kugluktuk, 73m SW Mountain Lake Nunavut 67.3 Canterra Minerals Corp Uranium Cambridge Bay, 520km WSW Turner Lake Nunavut 67.2 Bama Gold Corp Copper, Gold, Nickel, PGMs Bathurst Inlet, 56km NW Pistol Lake Nunavut 67.1 Leeward Capital Corp Gold Bathurst Inlet, 39km NW Qilalugaq Nunavut 66.6 North Arrow Minerals Inc Diamonds Rankin Inlet, 510km NNE Glacier Lake Northwest Territories 66.1 Alberta Star Development Corp Copper, Gold, Nickel, Silver Port Radium, 0.5km SE Hood Nunavut 66.1 MMG Ltd Copper, Silver, Zinc Yellowknife, 400km N Jericho Nunavut 66.0 Shear Diamonds Ltd Diamonds Yellowknife, 420km NE Contact Lake Northwest Territories 66.0 Alberta Star Development Corp Copper, Gold, Lead, Moly Port Radium, 15km SE Jericho Regional Nunavut 65.9 Shear Diamonds Ltd Diamonds Yellowknife, 420km N Lupin Nunavut 65.8 Elgin Mining Inc Gold Yellowknife, 390km NNE Yava Nunavut 65.6 Savant Explorations Ltd Copper, Gold, Lead, Silver, Zinc Yellowknife, 470km NE Crest Yukon Territory 65.3 Chevron Corp Iron ore Whitehorse, 520km NNE Iron Creek Yukon Territory 65.3 Chevron Corp Iron ore Whitehorse, 520km NNE Blue Caribou Nunavut 65.2 Mega Precious Metals Inc Copper, Gold, Molybdenum, Silver Yellowknife, 500km NE Gayna River Northwest Territories 65.0 Eagle Plains Resources Ltd Gallium, Lead, Silver, Zinc Keno Hill, 240km ENE Hart River Yukon Territory 64.6 Panarc Resources Ltd Copper, Gold, Lead, Silver, Zinc Keno Hill, 110km NW Sissons Schultz Nunavut 64.6 AREVA SA Uranium Iqaluit Goz Creek Yukon Territory 64.4 Tarsis Resources Ltd Germanium, Lead, Silver, Zinc Mayo, 180km NE Blende Yukon Territory 64.4 Blind Creek Resources Ltd Lead, Silver, Zinc Dawson City, 233km ENE Colomac Northwest Territories 64.4 Nighthawk Gold Corp Gold, Silver Yellowknife, 210km N Andrew Lake Nunavut 64.3 AREVA SA Uranium Hamlet WO Block Northwest Territories 64.3 Peregrine Diamonds Ltd Diamonds Yellowknife, 300km NE Cass Northwest Territories 64.3 Pine Cliff Energy Ltd Gold Yellowknife, 200km N Indin Lake Northwest Territories 64.3 Nighthawk Gold Corp Gold Yellowknife, 210km NW Chidliak Nunavut 64.3 Peregrine Diamonds Ltd Diamonds Iqaluit, 118km NE Tiger Yukon Territory 64.2 ATAC Resources Ltd Gold Whitehorse, 390km NNE Rackla Yukon Territory 64.2 ATAC Resources Ltd Gold, Indium, Lead, Silver Keno Hill, 45km NE Damoti Lake Northwest Territories 64.2 Nighthawk Gold Corp Gold Yellowknife, 194km NNW Brewery Creek Yukon Territory 64.1 Americas Bullion Royalty Corp Gold Dawson City, 55km E Walsh Lake Northwest Territories 64.0 Seabridge Gold Inc Gold Yellowknife, 230km NE Hopeful Yukon Territory 64.0 Other Parties/Vendors Silver Dawson City, 110km E Hopeful Yukon Territory 64.0 18526 Yukon Inc Silver, Tin Keno Hill, 100km W Red Mountain 2 Yukon Territory 64.0 AM Gold Inc Gold Mayo, 60km NW Keno Yukon Territory 63.9 Independence Gold Corp Copper, Gold, Lead, Silver, Zinc Keno Hill, 3km NW Red Mountain Yukon Territory 63.9 AM Gold Inc Gold Whitehorse, 360km N Keno Hill Yukon Territory 63.9 Alexco Resource Corp Gold, Lead, Silver, Zinc Keno Hill, 19km W Elsa Tailings Yukon Territory 63.9 Alexco Resource Corp Gold, Lead, Silver, Zinc Whitehorse, 360km NNW Bermingham Yukon Territory 63.9 Alexco Resource Corp Gold, Lead, Silver, Zinc Whitehorse, 350km N Lone Star Yukon Territory 63.9 Klondike Gold Corp Gold Dawson, 19km SE Sue-Dianne Northwest Territories 63.8 Fortune Minerals Ltd Copper, Gold, Silver Yellowknife, 190km NW * Only the advanced exploration projects above 63.6°N are listed; others available on request.

Edition 2, 2014 www.SNL.com/Metals 26 Special Report: Mining above 60ºN continued

CANADA Name Province Latitude Owner Commodities Location Pre-feasibility/Scoping Doris North Nunavut 68.1 TMAC Resources Inc Gold Cambridge Bay, 120km SSW Madrid Nunavut 68.1 TMAC Resources Inc Gold Bathurst Inlet, 148Km NNE Hope Bay Nunavut 68.1 TMAC Resources Inc Gold Cambridge Bay, 130km SSW Boston Nunavut 67.7 TMAC Resources Inc Gold Bathurst Inlet, 115km NE High Lake Nunavut 67.4 MMG Ltd Base metals, Copper, Gold Bathurst Inlet, 136km WNW Ulu Nunavut 66.9 Elgin Mining Inc Gold Cambridge Bay, 340km SW Three Bluffs Nunavut 66.6 North Country Gold Corp Diamonds, Gold, Silver Baker Lake, 330km NE Committee Bay Nunavut 66.6 North Country Gold Corp Diamonds, Emerald, Gold, Silver Baker Lake, 290km NNE George Lake Nunavut 65.9 Sabina Gold & Silver Corp Gold Bathurst Inlet, 100km SSE Hackett River Nunavut 65.9 Glencore Xstrata plc Copper, Gold, Lead, Silver, Zinc Bathurst Inlet, 110km S Back River Nunavut 65.9 Sabina Gold & Silver Corp Base metal, Gold Bathurst Inlet, 112km SSE Goose Lake Nunavut 65.6 Sabina Gold & Silver Corp Gold Bathurst Inlet, 74km SE Kiggavik-Sissons Nunavut 64.5 AREVA SA Uranium Baker Lake, 80km WNW Sissons Nunavut 64.3 AREVA SA Uranium Baker Lake, 80km WNW Courageous Lake Northwest Territories 64.1 Seabridge Gold Inc Gold Yellowknife, 240km NE FAT Northwest Territories 64.1 Seabridge Gold Inc Gold Yellowknife, 240km NE Wolf Yukon Territory 64.0 Victoria Gold Corp Tungsten Mayo, 48km NNE Dublin Gulch Yukon Territory 64.0 Victoria Gold Corp Antimony, Gold, Silver, Tungsten Keno Hill, 30km WNW Marg Yukon Territory 64.0 Redtail Metals Corp Copper, Gold, Lead, Silver, Zinc Keno Hill, 35km E Lucky Queen Yukon Territory 63.9 Alexco Resource Corp Gold, Lead, Silver, Zinc Keno Hill, 3km W Onek Yukon Territory 63.9 Alexco Resource Corp Gold, Lead, Silver, Zinc Keno Hill, 5km SW Flame and Moth Yukon Territory 63.9 Alexco Resource Corp Gold, Lead, Silver, Zinc Keno Hill, 8km SW Tom & Jason Yukon Territory 63.1 HudBay Minerals Inc Lead, Silver, Zinc Whitehorse, 367km NE Wrigley Northwest Territories 63.1 Mackenzie Mountain Metals Inc Lead, Silver, Zinc Wrigley, 12km W Meliadine Nunavut 63.0 Agnico-Eagle Mines Ltd Gold Rankin Inlet, 25 km NNW Ferguson Lake Nunavut 62.9 Unspecified Company Cobalt, Copper, Nickel, PGMs Kivalliq region Nucleus Yukon Territory 62.3 Northern Freegold Resources Ltd Copper, Gold, Silver Whitehorse, 217km NW Revenue Yukon Territory 62.3 Northern Freegold Resources Ltd Copper, Gold, Molybdenum, Silver Whitehorse, 220km NNW Freegold Mountain Yukon Territory 62.3 Northern Freegold Resources Ltd Copper, Gold, Lead, Moly Keno Hill, 200km SSW Wellgreen Yukon Territory 61.5 Wellgreen Platinum Ltd Cobalt, Copper, Gold, PGMs Whitehorse, 250km WNW Pine Point Cluster Northwest Territories 60.8 Tamerlane Ventures Inc Lead, Zinc Hay River, 72km E Northern Dancer Yukon Territory 60.0 Largo Resources Ltd Molybdenum, Tungsten Whitehorse, 210km SE

Feasibility Study Mary River Nunavut 71.3 Baffinland Iron Mines Corp Iron ore Pond Inlet, 157km SSE Roche Bay Nunavut 68.4 Advanced Explorations Inc Copper, Iron ore, Magnetite Baker Lake, 740km NE Izok Corridor Nunavut 65.6 MMG Ltd Copper, Gold, Lead, Silver, Zinc Yellowknife, 360km NNE Izok Lake Nunavut 65.6 MMG Ltd Copper, Lead, Silver, Zinc Yellowknife, 360km NNE Eagle Yukon Territory 64.0 Victoria Gold Corp Gold Keno Hill, 30km WNW NICO Northwest Territories 63.5 Fortune Minerals Ltd Bismuth, Cobalt, Copper, Gold Yellowknife, 172km NW Gahcho Kue (AK) Northwest Territories 63.4 De Beers SA Diamonds Yellowknife, 280km ENE MacTung Yukon Territory 63.3 North American Tungsten Corp Ltd Ammonium Sulphate, Copper, Gold Keno Hill, 260km ESE Nicholas Lake Northwest Territories 63.2 Tyhee Gold Corp Gold, Tungsten Yellowknife, 90km NNE Yellowknife Northwest Territories 63.2 Tyhee Gold Corp Gold, Silver, Tungsten Yellowknife, 80km NNE Ormsby Northwest Territories 63.2 Tyhee Gold Corp Gold Yellowknife, 80km NNE Goodwin Lake Northwest Territories 63.1 Tyhee Gold Corp Gold, Silver Yellowknife, 65km NNE

Edition 2, 2014 www.SNL.com/Metals 27 Special Report: Mining above 60ºN continued

CANADA Name Province Latitude Owner Commodities Location Feasibility Study (continued) Clan Lake Northwest Territories 62.9 Tyhee Gold Corp Gold Yellowknife, 50km N Yukon Yukon Territory 62.9 Overland Resources Ltd Lead, Zinc Whitehorse, 280km NNE Darcy Yukon Territory 62.9 Overland Resources Ltd Zinc Ross River, 105km N Andrew Yukon Territory 62.9 Overland Resources Ltd Germanium, Lead, Silver, Zinc Ross River, 89km NNW Darin Yukon Territory 62.9 Overland Resources Ltd Lead, Zinc Ross River, 100km N Casino Yukon Territory 62.7 Western Copper and Gold Corp Copper, Gold, Molybdenum, Silver Keno Hill, 220km SW Selwyn Yukon Territory 62.6 Yunnan Chihong Zinc & Germanium Co Lead, Zinc Whitehorse, 364km NE Howards Pass Yukon Territory 62.6 Yunnan Chihong Zinc & Germanium Co Lead, Zinc Tungsten, 85km NW ANNIV Central Yukon Territory 62.6 Yunnan Chihong Zinc & Germanium Co Lead, Zinc Whitehorse, 360km NE ANNIV East Yukon Territory 62.5 Yunnan Chihong Zinc & Germanium Co Lead, Zinc Whitehorse, 360km NE Don HC Yukon Territory 62.5 Yunnan Chihong Zinc & Germanium Co Lead, Zinc Whitehorse, 365km NE Brodel Yukon Territory 62.5 Yunnan Chihong Zinc & Germanium Co Lead, Zinc Whitehorse, 365km NE XY Central Yukon Territory 62.5 Yunnan Chihong Zinc & Germanium Co Lead, Zinc Whitehorse, 370km NE Carmacks Yukon Territory 62.3 Copper North Mining Corp Copper, Gold, Silver Keno Hill, 190km SSW Nechalacho Northwest Territories 62.1 Avalon Rare Metals Inc Beryllium, Cerium, Rare earth Yellowknife, 100 km ESE Prairie Creek Northwest Territories 61.6 Canadian Zinc Corp Copper, Lead, Silver, Zinc Dease Lake, 450km NE Mequillon Quebec 61.5 Jilin Jien Nickel Industry Co Cobalt, Copper, Gold, PGMs Kangiqsujuaq, 95km W Division Mountain Yukon Territory 61.3 Pitchblack Resources Ltd Coal Coking Whitehorse, 85 km NW Pine Point N204 Northwest Territories 60.9 Tamerlane Ventures Inc Lead, Zinc Yellowknife, 170km SSE

Construction Indian River Yukon Territory 63.7 Klondike Star Mineral Corp Gold Dawson, 30km SE Mesamax Quebec 61.6 Jilin Jien Nickel Industry Co Cobalt, Copper, Gold, PGMs Kangiqsujuaq, 68km W Expo Quebec 61.6 Jilin Jien Nickel Industry Co Cobalt, Copper, Gold, PGMs Kangiqsujuaq, 80km W Expo Ungava Quebec 61.5 Canadian Royalties Inc Cobalt, Copper, Gold, PGMs Schefferville, 840km NNW Ivakkak Quebec 61.4 Jilin Jien Nickel Industry Co Cobalt, Copper, Gold, PGMs Kangiqsujuaq, 90km W Pine Point Northwest Territories 60.9 Tamerlane Ventures Inc Lead, Zinc Yellowknife, 180km S Pine Point R190 Northwest Territories 60.7 Tamerlane Ventures Inc Lead, Zinc Yellowknife, 200km SSW

Operating Meadowbank Nunavut 65.0 Agnico-Eagle Mines Ltd Gold, Silver Baker Lake, 77km N Ekati Northwest Territories 64.7 Dominion Diamond Corp Diamonds Yellowknife, 310km NE Diavik Northwest Territories 64.5 Diavik Diamond Mines Inc Diamonds Yellowknife, 300km NE Bellekeno Yukon Territory 63.9 Alexco Resource Corp Silver Whitehorse, 353km N Eastern Keno Hill Yukon Territory 63.9 Alexco Resource Corp Gold, Lead, Silver, Zinc Keno Hill, 6km SW Snap Lake Northwest Territories 63.6 De Beers SA Diamonds Yellowknife, 220km NE Minto Yukon Territory 62.6 Capstone Mining Corp Copper, Gold, Silver Minto, 20km W Cantung Northwest Territories 62.0 North American Tungsten Corp Ltd Copper, Tungsten, Zinc Whitehorse, 385km ENE Raglan Operation Quebec 61.7 Glencore Xstrata plc Cobalt, Copper, Nickel, PGMs Salluit, 117km SE Raglan Zone 3 Quebec 61.7 Glencore Xstrata plc Cobalt, Copper, Nickel Salluit, 115km SE Katinniq Quebec 61.7 Glencore Xstrata plc Cobalt, Copper, Nickel Montreal, 1,800km N Raglan Zone 2 Quebec 61.7 Glencore Xstrata plc Cobalt, Copper, Nickel Salluit, 120km SE Wolverine Yukon Territory 61.4 Yukon Zinc Corp Copper, Gold, Lead, Silver, Zinc Whitehorse, 275km ENE

Edition 2, 2014 www.SNL.com/Metals 28 Special Report: Mining above 60ºN continued

FINLAND Name State/Province Latitude Operator/Significant Owner Commodities Location Adv. Exploration* Iso-Kuotko Lappi Laani (Lapland) 68.0 Agnico-Eagle Mines Ltd Gold Rovaniemi, 175km NNW Hanhimaa Lappi Laani (Lapland) 67.9 Agnico-Eagle Mines Ltd Copper, Gold, Lead, Silver, Zinc Kittila, 31km NNE Lomalampi Lappi Laani (Lapland) 67.9 Government of Finland Cobalt, Copper, Gold, Nickel, PGMs Sodankyla, 70km NE Kettukuusikko Lappi Laani (Lapland) 67.8 Taranis Resources Inc Gold Kittila, 17km NE Riikonkoski Lappi Laani (Lapland) 67.7 Taranis Resources Inc Copper, Gold Kittila, 10km NE Kuusamo North Oulun Laani 66.3 Dragon Mining Ltd Cobalt, Copper, Gold, Rare earth Kuusamo, 35km N Kivimaa Lansi-Suomen Laani 66.2 Endomines AB Copper, Gold Rovaniemi, 50km SW Kuusamo South Oulun Laani 66.2 Dragon Mining Ltd Cobalt, Gold Kuusamo, 25km NNW Kuusamo 66.1 Belvedere Resources Ltd Cobalt, Copper, Gold, Uranium Ruka, 11km W Kaukua Oulun Laani 65.9 Finore Mining Inc Copper, Gold, Nickel, PGMs Kemijärvi, 90km SSE Lantinen Koillismaa Oulun Laani 65.9 Finore Mining Inc Cobalt, Copper, Gold, Nickel, PGMs Kemijärvi, 90km SSE Haukiaho 65.9 Finore Mining Inc Copper, Gold, Nickel, PGMs Oulu, 150km NE Oijarvi Lappi Laani (Lapland) 65.7 Agnico-Eagle Mines Ltd Gold, Silver Kemi, 60km E Tormua Oulun Laani 65.3 Nordic Mines AB Gold Taivalkoski, 70km ESE Kuhmo 65.2 Altona Mining Ltd Cobalt, Copper, Nickel, PGMs Oulu, 170km E Nuottijarvi Oulun Laani 64.4 Elite Vantage Development Uranium Kajaani, 40km NE Kiimala Oulun Laani 64.1 Aquila Resources Inc Copper, Gold Oulu, 100km SSW Angesneva Oulun Laani 64.1 Aquila Resources Inc Gold Oulu, 100km S Koski Oulun Laani 64.1 Vuorokas Oy Iron ore, Magnetite, Titanium Kajaani, 22km SW Otanmaki Oulun Laani 64.1 Vuorokas Oy Magnetite, Titanium, Vanadium Kajaani, 30km WSW Vuorokas Oulun Laani 64.1 Vuorokas Oy Iron ore, Magnetite, Titanium Kajaani, 32km WSW Vesipera Oulun Laani 64.1 Aquila Resources Inc Gold Raahe, 65km Sof Hirsikangas 64.1 Belvedere Resources Ltd Gold Kokkola,40km NE Koivusaarenneva Lansi-Suomen Laani 63.9 Unspecified Company or Entity Ilmenite, Iron ore, Magnetite, Titanium Kokkola, 15km ENE Outovesi 63.7 Keliber Oy Lithium, Spodumene Kokkola, 35km ESE Syvajarvi 63.7 Keliber Oy Lithium, Spodumene, Tantalite Kokkola, 35km ESE Rautavaara Ita-Suomen Laani 63.4 FinnAust Mining plc Cobalt, Copper, Nickel Siilinjärvi, 50km NE Hosko Ita-Suomen Laani 63.1 Endomines AB Gold Ilomantsi, 48km NNE Kokka Ita-Suomen Laani 63.0 Altona Mining Ltd Cobalt, Copper, Nickel Outokumpu, 28km NNW Karelian Line Ita-Suomen Laani 63.0 Endomines AB Gold Ilomantsi, 40km NE Kaavi-Kuopio 2 Ita-Suomen Laani 62.9 Sunrise Resources plc Diamonds Kuopio, 20km ENE Saramaki 62.9 Altona Mining Ltd Cobalt, Copper, Nickel, Zinc Kylylahti, 15km NW Muurinsuo Ita-Suomen Laani 62.8 Endomines AB Gold Ilomantsi, 24km ENE Korvilansuo Ita-Suomen Laani 62.8 Endomines AB Gold Ilomantsi, 40km NE Perttilahti Ita-Suomen Laani 62.8 Altona Mining Ltd Cobalt, Copper, Nickel, Zinc Joensuu, 38km NW Kuittila Ita-Suomen Laani 62.8 Endomines AB Gold Ilomantsi, 15km ENE Vuonos Ita-Suomen Laani 62.8 Altona Mining Ltd Cobalt, Copper, Zinc Joensuu, 35km WNW Outokumpu 2 Ita-Suomen Laani 62.7 Altona Mining Ltd Cobalt, Copper, Nickel, Zinc Outokumpu Riihilahti Ita-Suomen Laani 62.7 Altona Mining Ltd Cobalt, Copper, Nickel Joensuu, 55km WNW Hautalampi Ita-Suomen Laani 62.7 Altona Mining Ltd Cobalt, Copper, Nickel, Zinc Joensuu, 40km WNW Sikakangas Etela-Suomen Laani 62.7 Government of Finland Gold Seinajoki, 10km S FinnAust Regional Oulun Laani 62.7 FinnAust Mining plc Cobalt, Copper, Nickel, Zinc Joensuu, 50km W Valkeisenranta Ita-Suomen Laani 62.6 Altona Mining Ltd Cobalt, Copper, Nickel Varkaus, 30km NNW Sarkalahti Ita-Suomen Laani 62.5 Altona Mining Ltd Copper, Nickel Varkaus, 20km N * Only the advanced exploration projects above 62.4°N are listed; others available on request.

Edition 2, 2014 www.SNL.com/Metals 29 Special Report: Mining above 60ºN continued

FINLAND Name State/Province Latitude Operator/Significant Owner Commodities Location Pre-feasibility/Scoping Sokli Lappi Laani (Lapland) 67.8 Yara International ASA Apatite, Phosphate Kovdor, 50km NW Arctic 66.2 Gold Fields Ltd Copper, Gold, Nickel, PGMs Rovaniemi, 45km SE Suhanko 66.1 Gold Fields Ltd Copper, Gold, Nickel, PGMs Rovaniemi, 43km SSE Vaara 65.3 Altona Mining Ltd Cobalt, Copper, Nickel, PGMs Suomussalmi, 29km NNE Peura-Aho 65.2 Altona Mining Ltd Cobalt, Copper, Nickel, PGMs Suomussalmi, 29km NNE Sika-aho 65.2 Altona Mining Ltd Copper, Nickel Suomussalmi, 29km NNE Hietaharju Oulun Laani 65.1 Altona Mining Ltd Cobalt, Copper, Nickel, PGMs Suomussalmi, 30km NNE Arola Oulun Laani 64.4 Altona Mining Ltd Nickel Kajaani, 69km ENE Kopsa Oulun Laani 63.8 Belvedere Resources Ltd Copper, Gold, Silver Haapajärvi, 5 km WNW Lantta 63.6 Keliber Oy Beryl, Lithium, Spodumene, Tantalite Kokkola, 55km ESE Keliber 63.6 Keliber Oy Lithium, Spodumene, Tantalite Kokkola, 55km ESE Kalvia Lansi-Suomen Laani 63.6 Cove Resources Ltd (In Administration) Ilmenite, Magnetite Raw Kokkola, 60km ESE Kaire Lansi-Suomen Laani 63.6 Cove Resources Ltd (In Administration) Ilmenite, Magnetite Raw Kokkola, 60km ESE Haveri Lansi-Suomen Laani 61.7 Unspecified Company Copper, Gold Tampere, 36km NW

Feasibility Study Kuervitikko Lappi Laani (Lapland) 67.6 Northland Resources SA Copper, Gold, Iron ore, Magnetite Kittila, 40km WSW Hannukainen Lappi Laani (Lapland) 67.6 Northland Resources SA Copper, Gold, Iron ore, Magnetite Kittila, 41km WSW Mustavaara Lappi Laani (Lapland) 65.8 Mustavaaran Kaivos Oy Iron ore, Magnetite, Titanium Rovaniemi, 130km SE Otanmaki Oulun Laani 64.1 Vuorokas Oy Iron ore, Magnetite, Titanium Kajaani, 32km WSW Koivu Lansi-Suomen Laani 63.6 Cove Resources Ltd (In Administration) Ilmenite, Magnetite Raw Kokkola, 60km ESE Lahtojoki Ita-Suomen Laani 63.0 Kimberley Diamonds Ltd Diamonds Kuopio, 47km WNW Ramepuro Ita-Suomen Laani 62.9 Endomines AB Gold Ilomantsi, 30km NE

Construction Taivaljarvi 63.9 Sotkamo Silver AB Copper, Gold, Lead, Zinc Kuhmo, 30km SW

Operating Kittila 67.9 Agnico-Eagle Mines Ltd Gold Kittila, 40km NE Kevitsa 67.7 First Quantum Minerals Ltd Cobalt, Copper, Gold, Nickel, PGMs Kemijärvi, 110km N Pahtavaara 67.6 Lappland Goldminers (Administration) Gold Sodankylä, 25km NNW Kemi Lappi Laani (Lapland) 65.8 Outokumpu Oyj Chromite Kemi, 7km ENE Tornio Smelter Lappi Laani (Lapland) 65.8 Outokumpu Oyj Ferrochrome Tornio Laiva Oulun Laani 64.5 Nordic Mines AB Gold Raahe, 15km SSE Talvivaara Oulun Laani 64.0 Talvivaara Mining Co (Administration) Cobalt, Copper, Uranium, Zinc Kajaani, 30km SSE Kokkola Smelter Lansi-Suomen Laani 63.9 Boliden AB Cadmium, Zinc Kokkola, 4km NW Kokkola Refinery Lansi-Suomen Laani 63.9 Freeport-McMoRan Copper & Gold Inc Cobalt Kokkola, 5km W Pyhasalmi Oulun Laani 63.7 First Quantum Minerals Ltd Copper, Gold, Silver, Sulphur, Zinc Iisalmi, 55km W Siilinjarvi Lansi-Suomen Laani 63.1 Yara International ASA Apatite, Phosphate Siilinjärvi, 5km NNE Pampalo Ita-Suomen Laani 63.0 Endomines AB Gold Lieksa, 70km ESE Luikonlahti Plant Ita-Suomen Laani 62.9 Altona Mining Ltd Copper, Gold, Nickel Outokumpu, 27km NNW Kylylahti 62.9 Altona Mining Ltd Cobalt, Copper, Gold, Nickel, Zinc Outokumpu, 25km NE Outokumpu Ita-Suomen Laani 62.7 Altona Mining Ltd Cobalt, Copper, Gold, Nickel, Zinc Outokumpu Orivesi Lansi-Suomen Laani 61.7 Dragon Mining Ltd Gold Tampere, 26km NE Vammala Lansi-Suomen Laani 61.3 Dragon Mining Ltd Gold Tampere,50km SW Harjavalta Refinery Lansi-Suomen Laani 61.3 Boliden AB Copper, Gold, Nickel, Silver Pori, 26km SE Harjavalta Refinery Lansi-Suomen Laani 61.3 MMC Norilsk Nickel OJSC Nickel Pori, 26km SE Jokisivu Lansi-Suomen Laani 61.1 Dragon Mining Ltd Gold Rauma, 55km E

Edition 2, 2014 www.SNL.com/Metals 30 Special Report: Mining above 60ºN continued

GREENLAND Name Province Latitude Owner Commodities Location Adv. Exploration Havik Qaasuitsup 76.3 Red Rock Resources plc Gold, Iron ore, Magnetite Qaanaaq, 133km SSE Ladderbjerg NE National Park 73.5 Unspecified Company Copper, Lead Kulusuk, 1050km NE Rubjerg Knude NE National Park 72.6 Unspecified Company Copper Kulusuk, 940km NE Ukkusissat Qaasuitsup 71.1 Angel Mining plc (Administration) Zinc Nuuk, 770km N Qeqertaa Qaasuitsup 69.6 Avannaa Resources Ltd Diamond Illulissat, 50km NE Storoe Sermersooq 64.4 NunaMinerals AS Gold Nuuk, 40km NE Aries Kujalleq 61.2 Ram Resources Ltd Niobium, Rare earths, Tantalum, Zircon Qassiarsuk, 30km E Motzfeldt Kujalleq 61.2 Ram Resources Ltd Niobium, Rare earths, Tantalum, Uranium Qassiarsuk, 17km NE Isortoq Kujalleq 61.0 West Melville Metals Inc Iron ore, Magnetite, Titanium Nuuk, 420km SE

Pre-feasibility/Scoping Ymer NE National Park 73.3 NunaMinerals AS Antimony, Gold, Tungsten Ymer Island Karrat Qaasuitsup 71.7 Avannaa Resources Ltd Rare earths, Yttrium Nuugaatsiaq, 20km E Skaergaard Sermersooq 68.2 Platina Resources Ltd Gold, Palladium, Platinum, PGMs Reyjkavik, 630km NW White Mountain Qeqqata 66.5 Hudson Resources Inc Alumina, Anorthosite Saqqarliit, 39km SSE Sarfartoq Qeqqata 66.5 Hudson Resources Inc Cerium, Diamond, Rare earths Nuuk, 250km N Aappaluttoq Sermersooq 63.0 True North Gems Inc Ruby, Sapphire Nuuk, 145km SSE Fiskenaesset Sermersooq 63.0 True North Gems Inc Ruby, Sapphire Nuuk, 160km S

Feasibility Study Citronen Fjord NE National Park 83.0 Ironbark Zinc Ltd Lead, Zinc North Pole, 775km S Malmbjerg Sermersooq 71.8 KGHM Polska Miedz SA Molybdenum Scoresbysund, 200km NW Isua Sermersooq 65.2 London Mining plc Magnetite Nuuk, 140km NE Kvanefjeld Kujalleq 61.0 Greenland Minerals and Energy Rare earth, Uranium, Yttrium, Zinc Nuuk, 465km SE Zone 3 Kujalleq 61.0 Greenland Minerals and Energy Rare earth, Uranium, Yttrium, Zinc Nuuk, 465km SE Sorensen Kujalleq 60.9 Greenland Minerals and Energy Cerium, Dysprosium, Rare earths Nuuk, 465km SE Tanbreez Kujalleq 60.9 Tanbreez Mining Greenland AS Feldspar, Niobium, Rare earths Nuuk, 470km SE

Construction Black Angel Qaasuitsup 71.7 Angel Mining plc (Administration) Lead, Silver, Zinc Nuuk, 770km N

Operating Nalunaq Kujalleq 60.4 Angel Mining plc (Administration) Gold Nanortalik, 33km NE

ICELAND Name Province Latitude Owner Commodities Location Construction Helguvik Aluminium Smelter 64.0 Century Aluminum Co Aluminium Reykjavik, 35km WSW

Operating Fjardaal Aluminium Smelter 65.0 Alcoa Inc Aluminium Reykjavik, 385km ENE Nordural Aluminium Smelter Grundartangi 64.4 Century Aluminum Co Aluminium Reykjavík, 25km NNE Reykjavik Aluminium Smelter 64.0 Rio Tinto Ltd Aluminium Reykjavik, 11km SW

Edition 2, 2014 www.SNL.com/Metals 31 Special Report: Mining above 60ºN continued

NORWAY Name Province Latitude Owner Commodities Location Adv. Exploration Repparfjord Finnmark 70.4 Metallica Mining ASA Copper Hammerfest, 30km SE Grundtjern Finnmark 69.6 Northern Iron Ltd Iron ore, Magnetite Kirkenes, 10km S Sostervann Finnmark 69.6 Northern Iron Ltd Iron ore, Magnetite Kirkenes, 10km S Tverrdalen Finnmark 69.6 Northern Iron Ltd Iron ore, Magnetite Kirkenes, 11km S Bjornfell Finnmark 69.6 Northern Iron Ltd Iron ore, Magnetite Kirkenes, 12km S Oskarsmalm Finnmark 69.6 Northern Iron Ltd Iron ore, Magnetite Kirkenes, 14km S Jerntoppen Finnmark 69.6 Northern Iron Ltd Iron ore, Magnetite Kirkenes, 14km S Jennestad Nordland 68.8 Nordic Graphite Ltd Graphite Harstad, 45km W Joma Tailings Nord-Trondelag 64.9 CRD Holdings AB Copper, Gold, Iron ore, Silver Trondheim, 230km NE Espedalen Oppland 61.4 Drake Resources Ltd Cobalt, Copper, Nickel Lillehammer, 55km NW Dalen Oppland 61.4 Drake Resources Ltd Cobalt, Copper, Nickel Lillehammer, 58km NW Stormyra Oppland 61.3 Drake Resources Ltd Cobalt, Copper, Nickel Lillehammer, 58km NW

Pre-feasibility/Scoping Nussir Finnmark 70.5 Nussir ASA Copper, Gold, PGMs Tromsø, 210km ENE Ulveryggen Finnmark 70.5 Nussir ASA Copper Hammerfest, 32km SE Bidjovagge Finnmark 69.3 Arctic Gold AB Copper, Gold Kautokeino, 40km NW Engebo Sogn og Fjordane 61.5 Nordic Mining ASA Garnet, Rutile Bergen, 120km N Hurdal Akershus 60.5 Intex Resources ASA Molybdenum Oslo, 60km NNE Nesodden Hordaland 60.1 Nordic Mining ASA Quartz Bergen, 50km SE

Construction Lunckefjell Spitsbergen, Svalbad 78.0 Store Norske AS Coal Longyearbyen, 35km SE

Operating Store Norske Spitsbergen, Svalbad 78.2 Store Norske AS Coal Longyearbyen Gruve No7 Spitsbergen, Svalbad 78.1 Store Norske AS Coal Longyearbyen, 16km SE Svea Nord Spitsbergen, Svalbad 77.9 Store Norske AS Coal Longyearbyen, 40km SE Elkem Tana Quarry Finnmark 70.5 Elkem Tana AS Quartz Nikel', 135km NNW Sydvaranger Finnmark 69.7 Northern Iron Ltd Magnetite Kirkenes, 10km S Bjornevatn Finnmark 69.7 Northern Iron Ltd Iron ore, Magnetite Kirkenes, 8km S Fisketind Ost Finnmark 69.6 Northern Iron Ltd Iron ore, Magnetite Kirkenes, 13km S Kjellmannsasen Finnmark 69.6 Northern Iron Ltd Iron ore, Magnetite Kirkenes, 15km S Franzefoss Nordland 68.4 Franzefoss Miljokalk AS Limestone Narvik, 20km W Kvannevann Nordland 66.4 Rana Gruber AS Iron ore, Magnetite Kvannevann Mosjoen Smelter Nordland 65.9 Alcoa Inc Aluminium Mo I Rana, 100km SW Sunndal Smelter Oppland 62.4 Norsk Hydro ASA Aluminium Molde, 90km E Ardal Smelter Sogn og Fjordane 61.6 Norsk Hydro ASA Aluminium Bergen, 200km NE Hoyanger Smelter Sogn og Fjordane 61.2 Norsk Hydro ASA Aluminium Bergen, 100km NNE Gudvangen Sogn og Fjordane 60.9 Nordic Mining ASA Aluminous Clay, Anorthosite Bergen, 95km NE Odda Smelter Hordaland 60.1 Boliden AB Aluminium, Zinc Odda , 3km NNW o9f

Edition 2, 2014 www.SNL.com/Metals 32 Special Report: Mining above 60ºN continued

RUSSIA Name Province Latitude Owner Commodities Location Pre-feasibility/Scoping Vuruchuaivench Murmansk 67.5 MMC Norilsk Nickel OJSC Copper, Gold, Nickel, PGMs Monchegorsk, 80km SE Usinsk 3 Komi 67.1 Novolipetsk Steel OJSC Coal, Coal Vorkuta Mangazeisky Yakutia (Sakha) 65.7 Silver Bear Resources Inc Copper, Gold, Lead, Silver, Zinc Yakutsk, 390km N Oroch Magadan 63.7 Polymetal International plc Gold, Silver Magadan, 950km NE Amaam North Chukotka (Chukot) 63.0 Tigers Realm Coal Ltd Coal Anadyr, 200km SSE Solur-Vostochnaya Yakutia (Sakha) 62.7 Alrosa OJSC Diamonds Mirnyy, 25km NW Amaam Chukotka (Chukot) 62.7 Tigers Realm Coal Ltd Coal, Coal Coking Anadyr, 240km SSE Nezhdaninskoye Yakutia (Sakha) 62.5 Polyus Gold International Ltd Gold, Silver Yakutsk, 450km E

Feasibility Study Souker Murmansk 69.4 Kola Mining Corp Copper, Nickel Nikel', 12km ENE Maslovskoye Taymyr 69.2 MMC Norilsk Nickel OJSC Cobalt, Copper, Gold, Nickel, PGMs Noril'sk, 14km SSW Pellapakh Murmansk 68.5 Grangesberg Iron Ore plc Copper, Molybdenum Kola Penninsula Fedorova Murmansk 67.5 Barrick Gold Corp Copper, Gold, Nickel, PGMs Apatity, 90km E Novogodnee Monto Yamalo-Nenets 66.8 Petropavlovsk plc Gold, Iron ore Salekhard, 25km N Prognoz Magadan 63.7 Polymetal International plc Gold, Silver Magadan, 950km NE Perevalnoye Magadan 62.7 Polymetal International plc Copper, Lead, Silver, Zinc Omsukchan, 25km WNW

Construction Skalisty Taymyr 69.6 MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 33km NNE Kekura Centre Chukotka (Chukot) 67.0 Bazovye Metally CJSC Gold Aliskerovo, 92km SSW Grib Arkhangel 65.5 Lukoil OAO Diamonds Arkhangel, 120km NNE Karpinskogo-1 Arkhangel 65.3 Alrosa OJSC Diamonds Arkhangel'sk, 90km NNE Botubinskaya Yakutia (Sakha) 65.0 Alrosa OJSC Diamonds Nyurba, 200km NNW Nachalnoye-2 Magadan 62.6 Polymetal International plc Silver Omsukchan, 25km WNW Natalka Magadan 61.6 Polyus Gold International Ltd Gold Magadan, 280km NW Ametistovoe Kamchatka 61.5 Renova Group Gold Tilichiki, 125km NW

Operating Almazy Anabara Division Yakutia (Sakha) 71.0 Alrosa OJSC Diamonds Noril'sk, 990km ENE Oktyabrsky Taymyr 69.6 MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 28km N Taimyrsky Taymyr 69.6 MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 29km NNE Komsomolsky Taymyr 69.5 MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 26km NNE Talnakh Concentrator Taymyr 69.5 MMC Norilsk Nickel OJSC Copper, Nickel Noril'sk, 24km N Mayak Taymyr 69.5 MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 23km NNE Kola Peninsula (Pechenga) Murmansk 69.4 MMC Norilsk Nickel OJSC Copper, Gold, Ilmenite, Nickel, PGMs Murmansk, 110km NW Kaula-Kotselvaara Murmansk 69.4 MMC Norilsk Nickel OJSC Copper, Gold, Nickel, PGMs Nikel, 3km SE Severny-Gluboky Murmansk 69.4 MMC Norilsk Nickel OJSC Copper, Gold, Nickel, PGMs Nikel, 22km E Nadezhda Smelter Taymyr 69.3 MMC Norilsk Nickel OJSC Copper, Nickel Noril'sk, 9km W Norilsk Concentrator Taymyr 69.3 MMC Norilsk Nickel OJSC Nickel Noril'sk, 1km S Taimyr Peninsula (Polar) Taymyr 69.3 MMC Norilsk Nickel OJSC Cobalt, Copper, Gold, Indium, PGMs Norilsk Medvezhy Ruchey Taymyr 69.3 MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 4km SSW Zapolyarny Taymyr 69.3 MMC Norilsk Nickel OJSC Copper, Nickel, PGMs Noril'sk, 5km SW Mayskoye Chukotka (Chukot) 69.0 Polymetal International plc Gold, Silver Komsomol'skiy, 54km E Olenogorsky Murmansk 68.2 Olkon JSC Iron ore, Magnetite Raw Olenegorsk Olkon Murmansk 68.2 Olkon JSC Iron ore, Magnetite Raw Olenegorsk Monchegorsk Refinery Murmansk 67.9 MMC Norilsk Nickel OJSC Cobalt, Copper, Nickel Monchegorsk Lovozersky Murmansk 67.9 Lovozersky GOK Beryllium, Cerium, Rare earth Apatity, 65km NE Oleniy Ruchey Murmansk 67.7 Acron JSC Apatite, Nepheline Syenite Kirovsk, 25km ENE Kirovsky Murmansk 67.7 Apatit OJSC Bauxite, Nepheline Syenite, Phosphate Kirovsk, 6km NE

Edition 2, 2014 www.SNL.com/Metals 33 Special Report: Mining above 60ºN continued

RUSSIA Name Province Latitude Owner Commodities Location Operating (continued) Apatit Murmansk 67.7 Apatit OJSC Bauxite, Nepheline Syenite, Phosphate Kirovsk Rasvumchorr Murmansk 67.6 Apatit OJSC Bauxite, Nepheline Syenite, Phosphate Kirovsk, 7km NE Vostochny Murmansk 67.6 Apatit OJSC Bauxite, Nepheline Syenite, Phosphate Kirovsk, 20km ENE ANBP-3 Concentrator Murmansk 67.6 Apatit OJSC Phosphate Kirovsk Central Murmansk 67.6 Apatit OJSC Bauxite, Nepheline Syenite, Phosphate Kirovsk, 8km ENE Dvoinoye Chukotka (Chukot) 67.6 Kinross Gold Corp Gold, Silver Aliskerovo, 76km ESE ANBP-2 Concentrator Murmansk 67.6 Apatit OJSC Phosphate Apatity Kovdorsky Murmansk 67.6 EuroChem Mineral Co Apatite, Iron ore, Magnetite, Phosphate Kovdor Vorkutaugol Komi 67.5 Vorkutaugol JSC Coal Vorkuta Kandalaksha Smelter Murmansk 67.2 UC RUSAL plc Aluminium Kandalaksha Kupol Chukotka (Chukot) 66.8 Kinross Gold Corp Gold, Silver Aliskerovo, 140km SE Sentachan Yakutia (Sakha) 66.5 GeoProMining Ltd Antimony Yakutsk, 600km NE Udachny Division Yakutia (Sakha) 66.4 Alrosa OJSC Diamonds Udachnyy, 19km WSW Udachny Yakutia (Sakha) 66.4 Alrosa OJSC Diamonds Udachnyy, 19km WSW Zarnitsa Yakutia (Sakha) 66.4 Alrosa OJSC Diamonds Udachny, 18km E Komsomolskaya Yakutia (Sakha) 66.0 Alrosa OJSC Diamonds Aykhal, 10km NE Jubilee Yakutia (Sakha) 66.0 Alrosa OJSC Diamonds Aykhal, 12km NW Aikhal Yakutia (Sakha) 65.9 Alrosa OJSC Diamonds Aykhal, 1km S Aikhal Division Yakutia (Sakha) 65.9 Alrosa OJSC Diamonds Aykhal, 1km S Arkhangelskaya Arkhangel 65.3 Alrosa OJSC Diamonds Archangel, 86km NNE Lomonosov Division Arkhangel 65.3 Alrosa OJSC Diamonds Arkhangel'sk, 85km NNE Nyurba Division Yakutia (Sakha) 65.0 Alrosa OJSC Diamonds Nyurba, 200km NNW Nyurbinskaya Yakutia (Sakha) 65.0 Alrosa OJSC Diamonds Nyurba, 200km NNW Nyurba (Placer) Yakutia (Sakha) 65.0 Alrosa OJSC Diamonds Nyurba, 200km NNW Timan Komi 64.8 UC RUSAL plc Aggregate, Bauxite Ukhta, 155km NNE Karelsky Okatysh Karelia 64.7 Karelsky Okatysh JSC Magnetite Raw Kostomuksha, 7km W Sarylakh-Surma Yakutia (Sakha) 64.4 GeoProMining Ltd Antimony, Gold Ust-Nera, 75km SW North Onega Arkhangel 64.0 UC RUSAL plc Bauxite Arkhangel Badran Yakutia (Sakha) 64.0 Zapadnaya Gold Mining Ltd Gold Ust-Nera, 90km SW Birkachan Magadan 63.9 Polymetal International plc Gold, Silver Magadan, 950km NE Nadvoitsy Smelter Karelia 63.9 UC RUSAL plc Aluminium Segezha, 16km N Kubaka Magadan 63.7 Polymetal International plc Gold, Silver Magadan, 950km NE Tsokol Magadan 63.7 Polymetal International plc Gold, Silver Magadan, 950km NE Arylakh Magadan 63.2 Polymetal International plc Gold, Silver Sinegor'ye, 260km ENE Lunnoye Magadan 63.1 Polymetal International plc Gold, Silver Omsukchan, 134km from Berelekh Magadan 62.8 Susumanzoloto OJSC Gold Susuman, 3km NW Dukat Magadan 62.6 Polymetal International plc Gold, Silver Omsukchan, 25km WNW Dalniy Magadan 62.5 Polymetal International plc Gold, Silver Karazhal, 26km WSW Mirny Division Yakutia (Sakha) 62.5 Alrosa OJSC Diamonds Mirnyy, 8km ESE Mir Yakutia (Sakha) 62.5 Alrosa OJSC Diamonds Mirnyy, 8km ESE Sopka Kvartsevaya Magadan 62.5 Polymetal International plc Gold, Silver Karazhal Mirny Alluvial Yakutia (Sakha) 62.5 Alrosa OJSC Diamonds Mirnyy, 25km ESE International Yakutia (Sakha) 62.5 Alrosa OJSC Diamonds Mirny, 15km SW Goltsovoye Magadan 61.0 Polymetal International plc Lead, Silver, Zinc Magadan, 575km NE Shemurskoye Sverdlovsk 60.6 Ural Mining and Metallurgical Co Copper, Gold, Silver, Zinc Ivdel', 35km WSW North Urals Sverdlovsk 60.2 UC RUSAL plc Bauxite Severouralsk, 4km N Blagodatnoye Krasnoyarsk 60.1 Polyus Gold International Ltd Gold Vangash, 37km WNW Khakanja Khabarovsk 60.0 Polymetal International plc Gold, Silver Okhotsk, 92km NW Khakanja Khabarovsk 60.0 Polymetal International plc Gold, Silver Okhotsk, 90km NW

Edition 2, 2014 www.SNL.com/Metals 34 Special Report: Mining above 60ºN continued

SWEDEN Name Province Latitude Owner Commodities Location Adv. Exploration* Sautusvaara Norrbotten 67.9 Hannans Reward Ltd Iron ore, Magnetite Kiruna, 25km E Vieto Norrbotten 67.8 Hannans Reward Ltd Copper, Iron ore, Magnetite Kiruna, 20km W Laukujarvi Norrbotten 67.8 Hannans Reward Ltd Copper, Iron ore, Magnetite Kiruna, 30km W Sorvivuoma Norrbotten 67.8 Talga Resources Ltd Copper, Gold, Iron ore, Magnetite Kiruna, 41km E Puoltsa Norrbotten 67.8 Hannans Reward Ltd Iron ore, Magnetite Kiruna, 15km WSW Vathanvaara Norrbotten 67.8 Talga Resources Ltd Copper, Gold, Iron ore, Magnetite Kiruna, 41km ESE Ekstromsberg Norrbotten 67.8 Hannans Reward Ltd Iron ore, Magnetite Kiruna, 30km WSW Pahtohavare Norrbotten 67.8 Hannans Reward Ltd Copper, Gold Kiruna, 9km SW Norrbotten Norrbotten 67.8 Elgin Resources Inc Copper, Gold, Iron ore, Magnetite Kiruna Mining District Manty Vathanvaara Norrbotten 67.8 Talga Resources Ltd Copper, Gold, Iron ore, Magnetite Kiruna, 42km ESE Vittangi Norrbotten 67.8 Talga Resources Ltd Copper, Gold, Graphite, Iron ore Kiruna, 50km ESE Kuusi Nunasvaara Norrbotten 67.7 Talga Resources Ltd Copper, Gold, Iron ore, Magnetite Kiruna, 50km ESE Harrejaure Norrbotten 67.7 Hannans Reward Ltd Iron ore, Magnetite Kiruna, 32km SW Renhagen Norrbotten 67.7 Hannans Reward Ltd Iron ore, Magnetite Kiruna, 32km SW Kiruna Norrbotten 67.7 Hannans Reward Ltd Copper, Gold, Iron ore, Magnetite Kiruna, 40km WSW Tjarrojakka Norrbotten 67.7 Hannans Reward Ltd Copper, Iron ore, Magnetite Kiruna, 49km WSW Pattok Norrbotten 67.7 Hannans Reward Ltd Iron ore, Magnetite Kiruna, 50km WSW Jankka Norrbotten 67.7 Talga Resources Ltd Copper, Gold, Iron ore, Magnetite Kiruna, 48km ESE Kiruna South Norrbotten 67.6 Antofagasta plc Copper, Gold Kiruna, 25km SSE Masugnsbyn Norrbotten 67.5 Talga Resources Ltd Iron ore, Magnetite Kiruna, 85km SE Akosjegge Norrbotten 66.9 Hannans Reward Ltd Iron ore, Magnetite Gallivare, 56km SW Purnu Norrbotten 66.9 Botnia Exploration Holding AB Copper, Gold Gällivare, 40km SE Kallak North Norrbotten 66.8 Jokkmokk Iron Mines AB Iron ore, Magnetite Malmberget, 78km SW Kallak Norrbotten 66.8 Jokkmokk Iron Mines AB Iron ore, Magnetite Malmberget, 78km SW Munka Norrbotten 66.6 Beowulf Mining plc Molybdenum Kiruna, 185km SSW Raitajarvi Norrbotten 66.5 Talga Resources Ltd Graphite Boden, 95km NE Skuppesavon Norrbotten 66.4 Continental Precious Minerals Inc Uranium Gällivare, 135km WSW Pleutajokk Norrbotten 66.3 Continental Precious Minerals Inc Uranium Mo i Rana, 150km E Ballek Norrbotten 66.1 Beowulf Mining plc Copper, Gold, Silver, Uranium Gällivare, 155km SW Lulepotten Norrbotten 66.1 Beowulf Mining plc Copper, Gold, Silver Arjeplog, 13km E Kvarnan Norrbotten 66.0 Continental Precious Minerals Inc Uranium Boden, 55km WNW Laver Norrbotten 65.8 Boliden AB Copper, Gold, Molybdenum, Silver Boden, 67km W Svartliden Norrbotten 65.3 Norrliden Mining AB Copper, Gold, Silver, Zinc Skellefteå, 95km NW stone Norrbotten 65.3 Norrliden Mining AB Copper, Gold, Lead, Silver, Zinc Arvidsjaur, 37km SSE Sellmansberget Vasterbotten 65.2 Botnia Exploration Holding AB Tungsten Skellefteå, 180km WNW Eva Vasterbotten 65.2 Norrliden Mining AB Copper, Gold, Lead, Silver, Zinc Skellefteå, 90km WNW Gubbtrask Vasterbotten 65.1 Lappland Goldminers (Administration) Gold, Lead, Silver, Zinc Skellefteå, 160km WNW Nyborg Vasterbotten 65.1 Terraco Gold Corp Copper, Silver, Zinc Skellefteå, 115km WNW Stekenjokk Vasterbotten 65.1 Vilhelmina Mineral AB Copper, Gold, Lead, Silver, Zinc Mo i Rana, 135km S Norra Vasterbotten 65.1 Orex Minerals Inc Copper, Gold, Silver, Zinc Skellefteå, 165km WNW Barsele Vasterbotten 65.0 Orex Minerals Inc Gold Skellefteå, 165km WNW Barsele Vasterbotten 65.0 Orex Minerals Inc Copper, Gold, Silver, Zinc Skellefteå, 165km WNW Langdal Vasterbotten 64.8 Wiking Mineral AB Copper, Gold, Lead, Silver, Zinc Skellefteå, 35km WNW Jormlien Trondelag 64.7 Botnia Exploration Holding AB Copper, Zinc Trondheim, 220km NE * Only the advanced exploration projects above 64.5°N are listed; others available on request.

Edition 2, 2014 www.SNL.com/Metals 35 Special Report: Mining above 60ºN continued

SWEDEN Name Province Latitude Owner Commodities Location Pre-feasibility/Scoping Viscaria Norrbotten 67.9 Avalon Minerals Ltd Copper, Gold, Iron ore, Magnetite Kiruna, 5km W Discovery Zone Norrbotten 67.8 Hannans Reward Ltd Copper, Gold, Magnetite Kiruna, 8km SSW Tributary Zone Norrbotten 67.8 Hannans Reward Ltd Magnetite Kiruna, 8km SSW Rakkuri Norrbotten 67.8 Hannans Reward Ltd Copper, Gold, Iron ore, Magnetite Kiruna, 10km S Nunasvaara Norrbotten 67.7 Talga Resources Ltd Graphite Kiruna, 50km ESE Mertainen Norrbotten 67.7 LKAB Iron ore, Magnetite Kiruna, 30km ESE Ronnbacken Vasterbotten 65.5 Nickel Mountain Group AB Cobalt, Nickel, PGMs Storuman, 90km NW Storuman Vasterbotten 65.3 Tertiary Minerals plc Fluorite Storuman, 30km NW Vargbacken Vasterbotten 65.1 Botnia Exploration Holding AB Gold Skellefteå, 130km WNW Norra Norrliden Vasterbotten 65.0 Elgin Mining Inc Copper, Gold, Lead, Silver, Zinc Skellefteå, 70km WNW Haggan Jamtland 63.1 Aura Energy Ltd Molybdenum, Nickel, Uranium Ostersund, 21km SW Viken Jamtland 63.0 Continental Precious Minerals Inc Copper, Molybdenum, Nickel Ostersund, 23km SW Woxna Gavleborg 61.5 Flinders Resources Ltd Graphite, Lead Bollnäs, 50km WNW Vindfall-Sortarnan Gavleborg 60.6 Wiking Mineral AB Copper, Lead, Silver, Zinc Sandviken, 8km ESE

Feasibility Study Pellivuoma Norrbotten 67.4 Northland Resources SA Copper, Gold, Iron ore, Magnetite Pajala, 25km NW Stora Sahavaara Norrbotten 67.4 Northland Resources SA Copper, Iron ore, Magnetite Pajala, 19 km NNW Faboliden Vasterbotten 64.6 Lappland Goldminers (Administration) Gold, Silver Lycksele, 35km W Haksberg Dalarnas 60.2 Nordic Iron Ore AB Iron ore, Magnetite Ludvika, 5km N Ludvika Dalarnas 60.1 Nordic Iron Ore AB Iron ore, Magnetite Ludvika, 8km WSW Blotberget Dalarnas 60.1 Nordic Iron Ore AB Iron ore, Magnetite Ludvika, 7km WSW Grangesberg-Risberg Dalarnas 60.1 Grangesberg Iron AB Iron ore, Magnetite Grangesberg

Operating Kiruna Norrbotten 67.8 LKAB Iron ore, Magnetite Kiruna, 3km SW Gruvberget Norrbotten 67.7 LKAB Magnetite Svappavaara, near Svappavaara Norrbotten 67.6 LKAB Iron ore, Magnetite Kiruna, 40km SE Tapulivuoma Norrbotten 67.4 Northland Resources SA Iron ore, Magnetite Pajala, 25km NNW Kaunisvaara Norrbotten 67.4 Northland Resources SA Copper, Gold, Iron ore, Magnetite Pajala, 20km NNW Malmberget 67.2 LKAB Iron ore, Magnetite Malmberget Aitik Norrbotten 67.1 Boliden AB Copper, Gold, Molybdenum, Silver Gallivare, 15km ESE Bjorkdal Vasterbotten 64.9 Elgin Mining Inc Gold Skellefteå, 25km NW Kankberg Tellurium Vasterbotten 64.9 Boliden AB Gold, Silver, Tellurium Skelleftea, 35 km WNW Boliden Vasterbotten 64.9 Boliden AB Copper, Gold, Lead, Tellurium Skelleftea, 30km WNW Svartliden Vasterbotten 64.8 Dragon Mining Ltd Gold Umea, 160km NW Ronnskar Refinery Vasterbotten 64.7 Boliden AB Copper, Gold, Lead, Selenium Skelleftehamn, 3km SE Kubikenborg Smelter Vasternorrland 62.4 UC RUSAL plc Aluminium Sundsvall, 3km SE Kringel Gavleborg 61.4 Flinders Resources Ltd Graphite Bollnäs, 40km W Garpenberg Dalarnas 60.3 Boliden AB Copper, Gold, Lead, Silver, Zinc Hedemora, 12km ENE Dannemora Uppsala 60.2 Dannemora Mineral AB Iron ore, Magnetite, Manganese Uppsala, 40km NE

Edition 2, 2014 www.SNL.com/Metals 36 Special Report: Mining above 60ºN continued

COMPANIES ACTIVE ABOVE 60°N (RED INDICATES ACTIVITY IN MORE THAN ONE COUNTRY) 0890763 BC Ltd Banyan Gold Corp Dawson Gold Corp Hannans Reward Ltd 18526 Yukon Inc Barrick Gold Corp De Beers SA Hawkeye Gold & Diamond Inc 19651 Yukon Inc Bathurst Inlet Developments (1984) Ltd Denali Resources Ltd HFX Holding Corp 21st North Bazovye Metally CJSC Diadem Resources Ltd Highland Gold Mining Ltd 37999 Yukon Inc BCGold Corp Diavik Diamond Mines Inc Hodges Resources Ltd 4763 NWT Ltd Bearing Resources Ltd Dominion Diamond Corp Hornby Bay Mineral Exploration Ltd 524520 BC Ltd Beaufield Resources Inc Donlin Gold LLC HudBay Minerals Inc 644981 BC Ltd Belvedere Resources Ltd Dragon Mining Ltd Hudson Resources Inc 7606 Yukon Ltd Benz Capital Corp Drake Resources Ltd Hunter Bay Minerals plc 877384 Alberta Ltd Beowulf Mining plc Eagle Plains Resources Ltd Hunter Exploration Group 953725 NWT Ltd Bering Straits Native Corp E-Energy Ventures Inc Independence Gold Corp Aben Resources Ltd Bitterroot Resources Ltd Elgin Mining Inc Inform Resources Corp Acme Resources Inc Black Range Minerals Ltd Elgin Resources Inc Interior Alsaka Mining LLC Acron JSC Black Sea Metals Inc Elite Vantage Development International Gold Resources Inc Adamera Minerals Corp Blind Creek Resources Ltd Elkem Tana AS International Lithium Corp Advanced Explorations Inc Bluenose Gold Corp EMC Metals Corp International Samuel Exploration Corp Agnico-Eagle Mines Ltd Bluestone Resources Inc Endomines AB International Tower Hill Mines Ltd Akkerman Exploration BV Boliden AB Endurance Gold Corp Intex Resources ASA Alaska Gold Corp Boss Resources Ltd Equitas Resources Corp Ironbark Zinc Ltd Alberta Star Development Corp Boxxer Gold Corp Erex International Ltd Jien International Investment Ltd Alcoa Inc Brandenburg Energy Corp Ethos Gold Corp Jilin Jien Nickel Industry Co Alexco Resource Corp Bristol Bay Native Corp Eurasia Mining plc Jokkmokk Iron Mines AB Alix Resources Corp Brookemont Capital Inc Eurasian Minerals Inc Jome Naeringspark All Star Minerals plc Bullmoose Mines Ltd EuroChem Mineral Co Juuan Dolomiittikalkki Oy Almaden Minerals Ltd Burnstone Ventures Inc Expedition Mining Inc Kaiyue International Inc Alrosa OJSC Cache Exploration Inc Exploratus Ltd Kalac Holdings Ltd Altona Mining Ltd Calista Corp FinnAust Mining plc Kaminak Gold Corp AM Gold Inc Cameco Corp Finore Mining Inc Kapuskasing Gold Corp Americas Bullion Royalty Corp Canada Carbon Inc Fire River Gold Corp Karelian Diamond Resources plc Anconia Resources Corp Canada Coal Inc Firesteel Resources Inc Karelsky Okatysh JSC Andesite Capital LLC Canadian Dehua International Mines First Point Minerals Corp Kaska Minerals Corp Andover Mining Corp Inc First Quantum Minerals Ltd Keliber Oy Angel Mining (in administration) Canadian Natural Resources Ltd Flinders Resources Ltd Kennady Diamonds Inc Anglo Alaska Gold Corp Canadian Royalties Inc Fortune Minerals Ltd Kennecott Exploration Co Anglo American plc Canadian Zinc Corp Forum Uranium Corp Kestrel Gold Inc Anglo Canadian Mining Corp CanAlaska Uranium Ltd Franzefoss Miljokalk AS Kettle River Resources Ltd Ansell Capital Corp Canterra Minerals Corp Freegold Ventures Ltd KGHM Polska Miedz SA Anthill Resources Ltd Cantex Mine Development Corp Freeport-McMoRan Copper & Gold Inc Khalkos Exploration Inc Antofagasta plc Capstone Mining Corp Full Metal Minerals Ltd Killdeer Minerals Inc Apatit OJSC Cariboo Rose Resources Ltd Full Metal Zinc Ltd Kimberley Diamonds Ltd Aquila Resources Inc Carlin Gold Corp G & S Trading Inc King Terrence Ernest Arctic Gold AB Cathro Resources Corp GCO Minerals Co Kinross Gold Corp Arctic Star Exploration Corp C-D Development Corp GDK Baimskaya LLC Kiska Metals Corp Arcturus Ventures Inc Central Resources Corp Geoforum Scandinavia AB Kivalliq Energy Corp Arcus Development Group Inc Century Aluminum Co GeoProMining Ltd KJ Gold Canada Ltd AREVA SA Chevron Corp Georgetown Corp Klondike Gold Corp Argentum CJSC Clear Creek Resources Ltd GGL Resources Corp Klondike Silver Corp Argonaut Gold Inc CMC Metals Ltd Glencore Xstrata plc Klondike Star Mineral Corp Argus Metals Corp Coastal Gold Corp Gold Fields Ltd Kobex Minerals Inc Arkticheskiye Geolog' Raboty Colorado Resources Ltd Gold World Resources Inc Kola Mining Corp Arrowstar Resources Ltd Commander Resources Ltd Goldbank Mining Corp Kopparberg Mineral AB Ashburton Ventures Inc Comstock Metals Ltd Goldbar Resources Inc Lakeland Resources Inc ATAC Resources Ltd Conroy Gold and Natural Resources plc GoldON Resources Ltd Lappland Goldminers (Administration) Aura Energy Ltd Constantine Metal Resources Ltd GoldRich Mining Co Largo Resources Ltd Aura Silver Resources Inc Continental Precious Minerals Inc Goldrich NyacAU Placer LLC Leeward Capital Corp Aurchem Exploration Ltd Copper North Mining Corp Goldspike Explorations Inc Les Ressources Tectonic Inc Aurchem Ltd Corvus Gold Inc Goldstrike Resources Ltd Liberty Gold Corp Aurion Resources Ltd Cove Resources Ltd (In Administration) Gorilla Minerals Corp Liberty Star Uranium & Metals Corp Avalon Minerals Ltd Coventry Resources Inc GPM Metals Inc Linc Energy Ltd Avalon Rare Metals Inc CRD Holdings AB Grangesberg Iron AB Linux Gold Corp Avannaa Resources Ltd Cullen Resources Ltd Grangesberg Iron Ore plc LKAB Avaron Mining Corp Curlew Lake Resources Inc Graphite One Resources Inc Lobo del Norte Exploration Inc Azimut Exploration Inc CW Properties LLC Great Bear Resources Ltd Logan Resources Ltd Azteca Gold Corp Dalradian Resources Inc Greatland Exploration Ltd London Mining plc Baffinland Iron Mines Corp Dannemora Mineral AB Greenland Minerals and Energy Lornex Capital Inc Bama Gold Corp Darnley Bay Resources Ltd GV Gold OJSC Lovozersky GOK

Edition 2, 2014 www.SNL.com/Metals 37 Special Report: Mining above 60ºN continued

COMPANIES LIST (CONTINUED) Lukoil OAO NovaGold Resources Inc Rio Tinto Ltd Thompson Creek Metals Co Luxwing Holdings Ltd Novolipetsk Steel OJSC Rockhaven Resources Ltd Thunderstruck Resources Ltd Mackenzie Mountain Metals Inc NunaMinerals AS Rosander Mining Co Tigers Realm Coal Ltd Magnus Minerals Ltd Nunavik Nickel Mines Ltd Ross River Minerals Inc Tiktaliik Gold Corp Mangazeya Mining Ltd Nunavut Tunngavik Inc Royal Pretoria Gold Ltd Tintina Mines Ltd Manson Creek Resources Ltd Nussir ASA Ryan Gold Corp TM Resources AB Mawson Resources Ltd Nycon Resources Inc Ryanwood Exploration Inc TMAC Resources Inc McEwen Mining Inc Nyrstar NV Sabina Gold & Silver Corp TNR Gold Corp Mega Precious Metals Inc Oceanic Iron Ore Corp Sanatana Resources Inc Trans Atlantic Metals AG Melkior Resources Inc O'Connor Lake Mines Ltd Savant Explorations Ltd Transition Metals Corp Metallica Mining ASA Olivut Resources Ltd Scavo Resources Corp Troymet Exploration Corp Metals Creek Resources Corp Olkon JSC Scout Exploration Inc True North Gems Inc Millrock Resources Inc Opawica Explorations Inc Seabridge Gold Inc True North Nickel Inc Mindat Research Ore Exploration AB Senator Minerals Inc Tushtena Resources Inc Mineral Exploration Network Ltd Orex Minerals Inc Shear Diamonds Ltd Twyford Ventures Inc Miranda Gold Corp Osisko Mining Corp Shoshoni Gold Ltd Tyhee Gold Corp MMC Norilsk Nickel OJSC Outokumpu Oyj Sienna Resources Inc UC RUSAL plc MMG Ltd Overland Resources Ltd Silver Bear Resources Inc Ucore Rare Metals Inc Monster Mining Corp Ovoca Gold plc Silver Predator Corp Ultra Resources Corp Mountain Island Exploration Ltd Pacific Bay Minerals Ltd Silver Pursuit Resources Ltd Ural Mining and Metallurgical Co MPH Ventures Corp Pacific North West Capital Corp Silver Range Resources Ltd Uravan Minerals Inc Mustavaaran Kaivos Oy Pacific Ridge Exploration Ltd Silver Standard Resources Inc Ur-Energy Inc NA Potash Developments Inc Panarc Resources Ltd Silverado Gold Mines Ltd URU Metals Ltd Naughty Blair Lawrence Panoramic Resources Ltd Slave Lake Diamond Corp Usibelli Coal Mine Inc Network Exploration Ltd Pasinex Resources Ltd Snowfield Development Corp Veris Gold Corp New Dimension Resources Ltd Peregrine Diamonds Ltd Solid Resources Ltd Victoria Gold Corp New Nadina Explorations Ltd Perlis Enterprise Inc Solomon Resources Ltd Viking Gold Exploration Inc New Pacific Metals Corp Petropavlovsk plc Sotkamo Silver AB Vilhelmina Mineral AB Newera Resources Ltd Pine Cliff Energy Ltd Stakeholder Gold Corp Virginia Mines Inc Newmont Mining Corp Pitchblack Resources Ltd Status LLC Vorkutaugol JSC NexGen Energy Ltd Plan B Minerals Corp Stina Resources Ltd Voyager Gold Corp Nickel Mountain Group AB Platina Resources Ltd Store Norske Spitsbergen AS Vuorokas Oy Nighthawk Gold Corp Platinum Group Metals Ltd Stornoway Diamond Corp War Eagle Mining Company Inc Nordic Graphite Ltd Playfair Mining Ltd Strategic Metals Ltd Wellgreen Platinum Ltd Nordic Iron Ore AB Polymetal International plc Strongbow Exploration Inc West Melville Metals Inc Nordic Mines AB Polyus Gold International Ltd Stroshein Robert Western Copper and Gold Corp Nordic Mining ASA Precipitate Gold Corp Sumitomo Metal Mining Co Western Troy Capital Resources Inc Norrliden Mining AB Promithian Global Ventures Inc Sunrise Resources plc WestMountain Gold Inc Norsk Hydro ASA Prospector Resources Corp Susumanzoloto OJSC Whetstone Minerals Ltd Nortec Minerals Corp Prosperity Goldfields Corp Taku Gold Corp White Pine Resources Inc North American Nickel Inc Pure Energy Minerals Ltd Talga Resources Ltd Wiking Mineral AB North American Tungsten Corp Ltd Pure Nickel Inc Talmora Diamond Inc Wildwood Exploration Inc North Arrow Minerals Inc Pure Nickel Inc Talvivaara Mining Co (Administration) Wolverine Minerals Corp North Country Gold Corp Rackla Metals Inc Tamerlane Ventures Inc WPC Resources Inc North Fork Resources Pty Ltd Ram Resources Ltd Tanbreez Mining Greenland AS XinXing Ductile Iron Pipes Co North Sur Resources Inc Rana Gruber AS Tanqueray Resources Ltd Yankee Hat Minerals Ltd Northern Dynasty Minerals Ltd Range Minerals Corp Taranis Resources Inc Yara International ASA Northern Freegold Resources Ltd Rare Earth Minerals plc Tarsis Resources Ltd YES Exploration Syndicate Inc Northern Iron Ltd Redtail Metals Corp Tasman Metals Ltd Yukon Zinc Corp Northern Shield Resources Inc Regent Ventures Ltd Teck Resources Ltd Yunnan Chihong Zinc & Germanium Co Northern Tiger Resources Inc Renaissance Minerals Ltd Terraco Gold Corp Zapadnaya Gold Mining Ltd Northland Resources SA Renova Group TerraX Minerals Inc Zazu Metals Corp Northquest Ltd Resolve Ventures Inc Tertiary Minerals plc Zinccorp Resources Inc Norton Gold Fields Ltd Rhyolite Resources Ltd Teryl Resources Corp

Edition 2, 2014 www.SNL.com/Metals 38 Special Report: Cash Costs for Base Metals Mining With base metals prices falling, the industry has responded with a reduction in cash operating costs

Cash costs for the major base metals declined in costs. Other onsite costs (which include machinery, 2013 from an apparent cyclical peak in 2012. For spares, explosives and tyres) increased quite rapidly copper operations, onsite mining and milling cash until the credit crunch of 2008, as did acid prices. costs fell 3.1% to an average of US$33.5/t of ore Costs in terms of metal produced are more ambiguous mined and milled. Zinc operations saw average mine because the effects of offsite smelting, refining costs and mill costs fall 1.6% to US$60.4/t. Lead costs and product shipping costs have to be taken into fell 0.4% to US$65.8/t, while nickel cash costs were account, plus changes in metal prices and the effects down 2.5% to US$117.5/t of ore mined and milled. of by-product credits. Even for mines producing only one product, cost movements will not necessarily ONSITE MINE & MILL CASH COSTS (US$/t Ore) change with underlying onsite production costs, since 2013 2012 Change (%) changes in grades can push costs in either direction, Copper 33.53 34.61 -3.1 even before considering changes in offsite costs. Zinc 60.42 61.38 -1.6 ‘Normal’ costing is used to compare cash costs Lead 65.77 66.00 -0.4 across single and multi-product mines. In this method, mine and mill costs are assigned pro-rata to Nickel 117.50 120.55 -2.5 each mine product according to its value to the mine COPPER CASH COSTS (2013) owner. This means that each metal bears its pro-rata Cost (US c/lb) Share (%) share of onsite mine and mill costs, plus the cost of treatment, refining and shipping for that metal. Labour 40.9 24.2 As a result of incorporating the value of metal in the Energy 28.4 16.8 cost calculation, the apparent cost of metal will depend Reagents 16.9 10.0 on the price of each mine product. This explains why the Other onsite 55.6 33.0 pro-rata cost of producing copper from multi-product Offsite 26.9 15.9 mines in recent years has increased along with the Total 168.8 100.0 copper price, however increased precious metals prices have had the opposite effect on copper costs. This Note: Copper cost is pro-rata across all mine products, no credits confuses the cash cost picture. 'Offsite' comprises treatment, refining and shipping. Taking pro-rata cash costs for the major base metals This reduction in cash costs is largely attributable to in 2013, copper metal costs fell only 1.0% to 168.8c/ lower diesel prices and a fall in the cost of electricity. lb, even though copper mine and mill costs were down These reductions more than offset a relatively modest 3.1% in terms of the copper ore. This is explained by increase in labour costs in most producer countries. the increase in treatment and refining costs for These changes are consistent with a decline in copper, and the relative increase in the pro-rata weight producer country exchange rates against the US for copper at multi-product mines. (Note that while dollar, with the only significant exceptions being LME copper prices were down 7.3% last year, copper's Mexico, Sweden and the Eurozone. For copper main co-products, gold and silver, saw even bigger operations, lower acid prices resulted in a significant price falls in 2013, which means that copper's share fall in SX-EW costs. The table above shows the in mine costs actually increased.) average cost composition for copper mines in 2013. This pro-rata costing effect was even more pronounced with zinc and lead, where metal costs COPPER COST CHANGES 2000-2013 (c/lb Cu) rose 3.0% for zinc metal (to 61.9c/lb) and 6.1% for lead (to 63.3c/lb), despite modest reductions in onsite 180 mine and mill costs for the ore. Reductions in Offsite 160 Other Onsite treatment costs for these two metals were offset by 140 Reagents increases in pro-rata costs because lead prices 120 Energy actually rose by 4.0% last year, and the 1.9% fall in Labour 100 zinc prices was significantly less than the falls in 80 copper, silver and gold prices. 60 PRO RATA CASH COSTS (USc/lb) 40 2013 2012 Change (%) 20 0 Copper 168.8 170.4 -1.0 2000 2002 2004 2006 2008 2010 2012 Zinc 61.9 60.1 3.0 Lead 63.3 59.7 6.1 The chart above illustrates the movement in five Nickel 569.3 641.9 -11.3 cost drivers since 2000. Offsite costs, such as smelting and refining, have remained relatively stable The price of nickel fell by almost as much as gold compared with the onsite costs of energy and labour last year (down 14.3% on the LME). As a result,

Edition 2, 2014 www.SNL.com/Metals 39 Special Report: Cash Costs for Base Metals Mining continued

nickel costs fell 11.3% in 2013 (to 569c/lb) despite supported base-metals miners in recent years. onsite mine and mill costs falling only 2.5%. Nickel costs fell last year as the metal gets far less Costs are normally presented after taking into account benefit from by-product ‘crediting’; nickel laterites by-product credits. This approach raises more have only minor credits available from cobalt, and over interpretational problems because adding back all 22% of nickel production in the Minecost sample is available credits will result in many mines having ferronickel, which earns no credits at all. Nevertheless, negative costs. Nevertheless, this 100% crediting since the price of all the principal nickel by-product assumption is becoming more common, so this metals (copper, cobalt and PGMs) fell last year, lower method is applied below (all mine costs are allocated credits for the metal reinforced the underlying to the metal of interest, and then 100% of the value downward trend in onsite nickel mine and mill costs. of all co-product and by-product metal is deducted). During the early years of the decade, such For cash costs in 2013, a ‘crediting’ calculation ‘crediting’ reduced net copper cash costs by around leaves averages of 122.6c/lb for copper, -11.9c/lb for 50% of the total. When the gold price increased zinc, -85.8c/lb for lead and 413c/lb for nickel. These significantly in the middle of the last decade, the figures compare with cash costs in 2012 (after 100% value of credits increased so much that copper net co- and by-product crediting) of 107.9c/lb for copper, costs were zero, or negative, by 2007. -31.8c/lb zinc, -145c/lb lead and 463.1c/lb nickel. This trend was reversed in 2008, and by 2013 the benefit of by-product credits to copper production had CASH COSTS AFTER 100% CREDITS (USc/lb) more or less returned to the levels seen ten years ago. 2013 2012 Change (%) The way prices are looking in 2014, this trend can be Copper 122.6 107.9 13.6 expected to hold steady. Zinc -11.9 -31.8 62.7 Lead -85.8 -145.8 41.2 The data in this Special Report was provided by Nickel 413.0 463.1 -10.8 minecost.com, which maintains detailed engineering-based financial models for over 300 These credit-included cash costs increased last year mines, which produce at least 85% of western for copper, zinc and lead because of the significant world base-metals production. decline in silver and gold prices, which have

CASH COST DATA IS ALSO AVAILABLE FOR GOLD MINES ON SNL (2013, US$/oz)

Edition 2, 2014 www.SNL.com/Metals 40 Special Report: Regional Activity Although Asia dominates metals production, Latin America remains an important target for mine development

Only 95 new projects, with a total anticipated capital recently. This reflects declining investment appetite expenditure of US$38 billion, were registered last year and increasing corporate financial problems. The in the development-pipeline database of Stockholm- concern is that this decline at the early stage of based Raw Materials Group (RMG, part of SNL Metals project development might mean that there will not & Mining). This amount contrasts with the 113 be enough projects to satisfy metals demand in a projects, valued at US$47 billion, recorded in 2012, few years. and the peak year of 2010 when 167 projects worth The expenditure on projects at the construction US$115 billion were recorded. stage fell 17% in 2013 to below US$68 billion (from By the end of last year, RMG’s database contained almost US$82 billion in 2012) at an average cost of 1,307 projects where a development investment has US$787 million. This is 15% lower than the average been published. The database contains a further cost in 2012, and is close to the US$645 million 3,400 projects where news has been received during average of 2011. Behind these numbers are several the past eight years but for which no investment high-cost projects that are being put on hold or went estimates have been made (most of these are at the into production. conceptual stage). The ‘committed’ projects have total committed capital expenditure of almost US$791 REGIONAL CONTRIBUTIONS billion (see table, p42), which compares with the Latin America maintained its top position in 2013 in 1,282 development projects in 2012 that had an terms of the number of projects and the capital investment total of under US$735 billion. expenditure commitments for the 1,307 development These recorded development projects are fairly projects with capex estimations. The region also evenly distributed around the world but almost half continues to contribute a significant share of the of the total capex commitment comes from projects world’s metals production (see tables, p44). located in the Americas. The RMG database contains Although lower than the peak of 32% achieved in project details from the largest 700 mining companies 2010, Latin America had a 29% share of committed but these companies only account for a combined development capital expenditure last year. In absolute 40% of the world’s mined metal, by value. Much of terms, development capex in Latin America has risen the remaining output comes from countries where from the US$210 billion earmarked in 2012 to transparency, especially with regard to investment US$229 billion committed in 2013. plans, is low. As a result, the project data reported The SNL database records 293 committed here for Asia is almost certainly an underestimate. development projects in Latin America at an average Because of the financial crisis and depressed metals project investment of US$780 million. This is the prices, the mining industry’s investment in new highest average of all regions (it contrasts with an projects has declined in recent years. Nevertheless, average of only US$572 million in Australasia), and is a the committed capital expenditure in the development result of the large number of very large projects in the pipeline has continued to grow. One reason for this continent (in 2013 there were 62 projects in Latin is the tendency for the expected development America with capital expenditure of more than expenditure to rise as projects move up the US$1 billion). development pipeline, for example from feasibility Committed development projects in North America to the construction phase. accounted for 20% of the total projected capex last Many of the industry’s largest gold and copper year, with Australasia contributing 15% of the total. projects reported higher-than-expected capex last year. Africa and Europe are both close to Australasia in For example, during 2013 the 13 largest copper activity (14% and 13%, respectively), while Asia has projects (individual capex of over US$4 billion) dropped below 10% for the first time in five years. increased their capex expectations by a total of US$19 Project investment in North America (recorded in the billion (54% above the level of 2012). The 11 leading database as the US and Canada, with Mexico being gold projects (those having individual capex included under Latin America) has risen to 20% from expectations of over US$2 billion) reported a US$7 a 15% contribution in 2010. In absolute terms, the billion increase in capex during 2013 (an increase continent accounted for US$161 billion in 2013, of 60%). some US$15 billion higher than registered in 2012, As reported in the previous edition of State of and a significant growth compared with the total of the Market, the number and value of projects at the US$77 billion in 2009. feasibility stage have increased strongly over the past On a national basis, Canada has taken over as two years, accounting for 24% of the total projects the leading location for development projects, and over 30% of the total development investment outperforming Australia in 2013 with committed capex (see chart p42). This trend was to be expected given of US$117 billion (a growth of 12%). The main reason the high numbers of new projects announced in 2010 behind Australia’s decline to second place is the and 2011. falling price of iron ore. This metal is very important to On the other hand, the number of projects at the the Australian mining sector but Canada has a much conceptual and pre-feasibility stages has decreased wider mix of projects, including gold and base metal

Edition 2, 2014 www.SNL.com/Metals 41 Special Report: Regional Activity continued

DEVELOPMENTS: COMMITTED CAPITAL EXPENDITURE projects that are among the world’s largest developments (US$ billion) 2009 2010 2011 2012 2013 (including five iron-ore projects, two copper projects and 12 gold projects in the top-20 rankings of Conceptual 83 147 172 110 130 each commodity). Prefeasibility 92 129 167 159 158 Australasia’s development investment fell almost Feasibility 135 103 113 204 241 US$5 billion to barely US$116 billion in 2013, Construction 50 57 66 82 68 reducing the region’s share of the world total to 15%, compared with 16% in 2012. Within this amount, Operating, exp/plans 73 93 125 147 160 Australia’s share of mining investment declined 5%. Susp, restart/constr 25 27 27 21 22 However, although Australia fell from top place in Closed, reopen/plans 6 6 6 12 13 terms of the value of its overall investments, it remains the leading country in terms of the number of projects Total 465 562 675 735 791 in the pipeline. Iron-ore projects continue to dominate the country’s development programme, accounting for PROJECT CAPEX (US$ billion) nine of the top 30 iron-ore projects worldwide, with total investment of US$33 billion. 254 30 Africa’s share of total investment remained at 14% in 2013, but the total amount committed increased 204 25 to over US$110 billion, with an average capex of US$549 million. The SNL database registers 26 154 20 projects in the region with a capex commitment of greater than US$1 billion in 2013, compared with 104 15 23 projects in 2012. These are mostly iron-ore projects, led by Rio Tinto’s Simandou project in Guinea with an estimated capex of US$10 billion. 54 10 Europe (including all of Russia in terms of the database records) showed a positive trend between 4 5 2012 and 2013, with its share of the total 2009 2010 2011 2012 2013 development capex increasing from 10% to 13%. Conceptual Prefeasibility Feasibility Much of this European improvement was attributed to a jump of 53% in Russian total investment Construction Operating, exp/plans commitments, which reached US$74 billion in 2013. Right-hand scale: The main reason for the increased Russian Susp, restart/constr Closed, reopen/plans investment is the announcement of three high-cost projects last year. These comprise the Oroyek poly- metallic deposit, with a preliminary development cost PROJECT (Numbers) of US$5 billion (this was announced by the Russian 400 160 government but has not yet been put up for auction); the Elanskoye nickel deposit, owned by Norilsk Nickel, 140 which has around US$3.3 billion in capital expenditure; 350 120 and Intergeo’s US$2.3 billion Kingashsky nickel- copper-PGM project. Most of the projects in Russia are 100 300 financed by local investors, and the share of funding 80 from abroad is minimal. 250 60 DEVELOPMENT PROJECTS (Committed) 40 200 Capex (US$ billion) 2009 % 2010 % 2011 % 2012 % 2013 % 20 Africa 68 15 79 14 99 15 106 14 110 14 150 0 Asia 65 14 73 13 73 11 75 10 71 9 2009 2010 2011 2012 2013 Europe 50 11 62 11 75 11 77 10 103 13 Conceptual Prefeasibility Feasibility Operating, exp/plans Latin America 134 29 180 32 192 28 210 29 229 29 Right-hand scale: North America 77 17 86 15 124 18 146 20 161 20 Construction Susp, restart/constr Australasia 71 15 81 14 113 17 121 16 116 15 Closed, reopen/plans Total Capex 465 562 675 735 791

Edition 2, 2014 www.SNL.com/Metals 42 Special Report: Regional Activity continued

DEVELOPMENT REGION: CAPEX (US$ million) Asia reached an investment peak in 2009 (14% of the world total) and its world share has been falling for the past four years (accounting for only 9% in 2013). The region has a total of 209 development projects in 2013 the SNL database, 22 of which have a capex of more than US$1 billion, led by the disputed Tampkana copper project in the Philippines (US$5.2 billion). The region’s project-investment average is the lowest of all 2012 regions at US$342 million, which is less than half the average in Latin America. The data reported for Asia is far less certain than elsewhere, and the investment figure for China is most 2011 certainly an underestimate. Many of the projects are run by state-owned companies and details are sparse. However, Chinese projects are mostly small, with an average project cost of just US$193 million. 2010 PRODUCTION TRENDS The production tables on p44 show mined output for five metals, separated over the past four years into 2009 six regions. The world production of zinc was little changed last year at 13.6Mt but the output of gold (2,950Moz), 0 50,000 100,000 150,000 200,000 250,000 copper (17.9Mt), lead (5.3Mt) and nickel (1.85Mt) were all 5.4-6.5% higher than in 2012. Indeed, with the exception of copper in 2011, the DEVELOPMENT REGION: PROJECTS (Number) output of gold, copper, zinc, lead and nickel has risen Australasia North America Latin America each year for the past three years. Last year’s production, compared with world output in 2010, was Europe Asia Africa higher by almost 16% for gold, 11% for copper, 10% 2013 for zinc, 26% for lead and 22% for nickel. Led by Chinese output, Asia dominates this burgeoning global production, being the leading continent in 2013 for gold (26% of the world output), 2012 zinc (48%), lead (60%) and nickel (40%). The continent also produced over 20% of the world’s copper, where it is in second place to Latin America (which accounts for 45% of the global total). 2011 Since 2010, Asia’s zinc production has risen by over 21%, its gold production by almost 15% and its copper production by 14%. The latter three year average incorporates year-on-year increases of 9.5% 2010 and 7.1% in the past two years, after a decline in output during 2011. Even greater three-year increases have been achieved for lead (up almost 52%) and nickel (over 62%).

2009

0 100 200 300 400

Australasia North America Latin America Europe Asia Africa

Edition 2, 2014 www.SNL.com/Metals 43 Special Report: Regional Activity continued

PERCENTAGE PRODUCTION CHANGES REGIONAL METALS PRODUCTION GOLD Left scale: Africa Asia Australasia Europe North America Latin America Region 2011 vs 2010 (%) 2012 vs 2011 (%) 2013 vs 2012 (%) Right scale: Total Africa 5.7 -2.2 2.0 GOLD (Moz) Asia 5.5 3.1 5.5 800 3,100 Europe -4.9 6.9 16.2 650 2,950 Latin America 4.1 0.5 2.0 500 2,800 North America 3.5 -1.0 3.7 350 2,650 Australasia -3.0 -2.0 3.4 200 2,500 Total 2.7 6.9 5.4 2010 2011 2012 2013

COPPER COPPER (‘000t) 10,000 18,000 Region 2011 vs 2010 (%) 2012 vs 2011 (%) 2013 vs 2012 (%)

Africa 6.8 6.8 24.9 7,750 17,500 Asia -3.0 9.5 7.1 Europe 1.7 3.6 1.8 5,500 17,000 Latin America -0.6 4.1 6.6 3,250 16,500 North America 4.3 2.6 5.9 Australasia 5.6 -4.2 3.1 1,000 16,000 2010 2011 2012 2013 Total -0.8 4.8 6.5

ZINC ZINC (‘000t) 7,000 14,000 Region 2011 vs 2010 (%) 2012 vs 2011 (%) 2013 vs 2012 (%) Africa -5.0 4.0 7.0 5,275 13,500 Asia 11.3 12.9 -3.7 Europe 4.0 -2.1 -1.7 3,550 13,000 Latin America -6.0 0.6 2.4 1,825 12,500 North America -1.3 -0.1 -14.0

Australasia 2.0 1.3 -5.2 100 12,000 Total 4.4 5.1 0.0 2010 2011 2012 2013

LEAD LEAD (‘000t) Region 2011 vs 2010 (%) 2012 vs 2011 (%) 2013 vs 2012 (%) 4,050 5,800 Africa 3.1 -9.0 0.0 3,050 5,350 Asia 25.3 11.6 9.0 Europe 13.7 1.6 0.9 2,050 4,900 Latin America -7.9 4.8 8.6 North America -7.5 1.4 -10.6 1,050 4,450 Australasia -5.9 -7.7 9.8 50 4,000 Total 10.6 7.6 6.0 2010 2011 2012 2013

NICKEL NICKEL (‘000t) 800 1,900 Region 2011 vs 2010 (%) 2012 vs 2011 (%) 2013 vs 2012 (%) Africa 0.1 5.3 21.5 600 1,800 Asia 37.6 6.9 10.2 Europe 4.6 -2.4 -5.6 400 1,700 Latin America 31.4 30.0 -4.7 200 1,600 North America 38.6 -6.9 10.0

Australasia 14.3 10.2 1.9 0 1,500 Total 6.5 8.4 5.8 2010 2011 2012 2013

Edition 2, 2014 www.SNL.com/Metals 44 Special Report: Regional Activity DIG DEEPER WITH OUR continued INSTANT PROJECT PROFILES. How long does it take you to compile an in-depth project profile now? With SNL Metals & Mining you’ll do it in seconds. Use our menus to customize “Project Briefing Books” with drill results, maps of all surrounding claims, financings, reserves and resources details, operational data and more. Create accurate analytical reports with verifiable data.

Our project data is linked to company profiles including detailed corporate financials you won’t find anywhere else. SNL Metals & Mining takes you to greater depth, faster. It’s the ultimate resource. See a demo today. SNLMetals.com +1 (866) 296-3743 (US & Canada) +44 20 7398 0873 (Europe, Middle East & Africa) +852 5808 1882 (Asia-Pacific) EXTRACT ACTIONABLE INTELLIGENCE

Edition 2, 2014 www.SNL.com/Metals 45 About SNL Metals & Mining

The single-source solution for global mining intelligence

Now part of SNL Metals & Mining, IntierraRMG is the industry’s single- source solution for global mining intelligence. SNL’s acquisition of IntierraRMG reaffirms each company’s commitment to providing the global mining industry with the greatest breadth, depth and quality of information.

In addition to the comprehensive product offering IntierraRMG clients already receive, SNL Metals & Mining will ultimately provide insightful, sector-focused news, more in-depth company financials, extensive exploration budget analysis, Excel templates embedded in a comprehensive Excel add-in and 24/7 customer support.

For a demonstration on SNL Metals & Mining services, please contact us on [email protected]

Edition 2, 2014 www.SNL.com/Metals 46