Survey 2010 Philip Klapwijk Executive Chairman, GFMS Ltd.

Denver Gold Group –European Gold Forum 2010 Zurich April Zurich 15, 15th April 2010 2010

GFMS gratefully acknowledge the generous support from the following comp anies for this year’s Gold Survey and its two Updates

Commerzbank Global www.pamp.com Precious Metals Tanaka Precious Metals Group Valcambi sa

World Gold Council Dubai Multi Commodities Barrick Gold Corporation JPMorgan Chase Bank Centre

www.IBKCapital.com ScotiaMocatta www.standardbank.com www.newmont.com

www.nyse.com/nyseliffeus Johnson Matthey www.ljgold.com www.commodities.sgcib.com

Kinross Gold Corporation www.natexiscm.com www.randrefinery.com INTL Commodities, INC. The GFMS Group’s Unique Research Capabiliti es & P rogramme

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Also, weekly, monthly, quarterly & bi-annual reports plus forecasts and a wide range of consultancy services across all the precious and base metals & steel.

For more information visit: www.gfms .co .uk or email: [email protected] Presentation Outline

• GldPiGold Prices

• SlSupply

• Demand

• Outlook US Dollar Gold Price Weekly Averages 1300 DOLLAR 2008 2009 Q1 2010

Average 871.96 972.35 1,109.12

1100 Intra-Year 2.7% 24.4% -0.5%

Year-on-Year 25.4% 11.5% 22.1%

zz 900

US$/oz US$/o 700

500 2626--weekweek moving average

300 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10

Source: GFMS; Thomson Reuters Euro Gold Price Weekly Averages 850 EURO 2008 2009 Q1 2010 Euro/oz Average 593.09 696.94 802.51

IntraIntra--YearYear 6.9% 21.5% 6.1%

650 YearYear--onon--YearYear 17.0% 17.5% 15.0% uro/oz EE 450 2626--weekweek moving average

250 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10

Source: GFMS; Thomson Reuters Gold Prices in Different Currencies Indexed Daily Series 140 US$/oz ) 00 130

120 Rupee 10g/g 2009=10 Euro/kg 110 4th Jan (( 100 Index 90 Rand/kg

80 Jan-09 Mar-09 May-09 Jul-09 Sep-09 Nov-09 Jan-10 Mar-10

Source: GFMS; Thomson Reuters Real and Nominal Gold Prices (($preal US$ price in constant 2009 terms) 1800 1980 average: $1,600 New record nominal 1500 annual average reached in 2009, but in real terms today’s prices are still well 1200 short of historical peaks. z oo

900 Real Price US$/

600

300 Nominal Price

0

Source: GFMS, Thomson Reuters Suppl y GFMS’ Mine Supply Database

• Over 100 companies analysed on a quarterly basis – production/costs/corporate activity • Over 300 mines recorded on an annual basis – production/costs/reserves/grade • Over 320 projects –projected production profile, startstart--upup date, capex, reserves, resources • Informal mine production measured on a countrycountry--byby-- country basis • Costs measured at 70% of Western World gold production • BottomBottom--upup cost analysis methodology to assess $/tonne mining, ore processing and on -site administration costs , plus benchmarking of fuel, power, labour productivity and other key inputs • Glbllobal anal ysis and df forecasting of mine suppl y, b reakd own of industry cost structures and trends, benchmarking Gold Mine Production

Latin America Other 2009 up 163t North America China 3000 South Africa Australia or 6.8% yoy

2500

2000 nes

nn 1500 to 1000

500

0 1981 1985 1989 1993 1997 2001 2005 2009

Source: GFMS (Gold Survey 2010) Mine Production: Winners and Losers (Figures represent year-on-year chihange, i.e. 2009 less 2008)

70 Indonesia 60 50 40 China 30 nnes

oo RiRussia Argentina t 20 Ghana 10 0 -10 Mongolia -20 SthSouth UitdUnited Africa States Source: GFMS (Gold Survey 2010) Major Western World Mines' Cash Costs (in money-of-the-day terms)

800

700 Australia 600

500 South Africa

S$/oz North UU 400 America Other 300 Latin America 200

100 Q1-05 Q1-06 Q1-07 Q1-08 Q1-09

Source: GFMS (Gold Survey 2010) YearYear--onon--YearYear Changes to Cash Costs

540 +3 +5 +5 +6 520 --44 +12

S$/oz) --1212

UU 500 +10 +21

Costs ( 480 hh --3333

460 464 478 otal Cas 2009 vs 2008 TT

440

Source: GFMS (Gold Survey 2010) Mine Production

 163 tonneincrease equal to 6.8% y-y-oo--yy in 2009; the first annual increase for three years.  Strong growth from a suite of new projects and operating mines. Major country gains in Indonesia, China, Russia, Argg,entina, Brazil and Mexico.  All regions posted growth, except for North America. Two largest falls at the mine level were seen in the United States.  US dollar denominated total cash costs increased by an average 3%, or $14/oz, to $478/oz in 2009.  GFMS’ propr ietary ‘All-I’CIn’ Costs measure i ncreased db39% by 3.9% to $717/oz. AboveAbove--GroundGround Stocks of Gold, end-end-20092009 Gold is not “consumed” like most commodities; stocks can be available at the right price… Above-ground Stocks, end 2009 = 166,000t

Jewellery 52%

Lost & Unaccounted Official Holdings 2% 16%

Other Fabrication 12%

Private Investment 18%

Source: GFMS (Gold Survey 2010) Supply from Scrap, Hedging & Official Sales

Net Official Sector Sales Flat trend since 2000? Hedging Supply 2000 Scrap 1800 1600 Secular increase in supply 19871987--9999 1400 1200 1000 onnes

TT 800 600 400 200 0 1980 1984 1988 1992 1996 2000 2004 2008

Source: GFMS Change in Supply from AboveAbove--GroundGround Stocks 2009 compared to 2008

400

300

200

100

tonnes 0

-100

-200

-300 Official Sector Scrap

Source: GFMS (Gold Survey 2010) Regional Changes in Scrap Supply 2009 compared to 2008

80

70

60

50

40 tonnes 30

20

10

0 Middle East Asia Other Indian Europe North Latin East SC America America

Source: GFMS (Gold Survey 2010) Jewellery Fabrication & Scrap Supply

1700

1500 Jewellery Fabrication 1300

1100

900 Tonnes 700

500

300 SSlScrap Supply

100 04. H1 05. H1 06. H1 07. H1 08. H1 09. H1

Source: GFMS (Gold Survey 2010) AboveAbove--GroundGround Jewellery Stocks by Region, end-2009

Indian Sub- Continent 16%

North America Europe 17% 20%

Other 9%

East Asia Middle East 25% 12%

Source: GFMS (Gold Survey 2010) CBGA and Other Gold Sales

Other 700 CBGA 600 500 400 300 tonnes 200 100 0 -100 2000 2002 2004 2006 2008

“CBGA” refers to signatories to the Central Bank Gold Agreement “Other” refers to all other countries

Source: GFMS (Gold Survey 2010) Demand World Gold Fabrication

4500 Developing Countries 2009 down 472t 4000 Industrialised Countries or 16% yoy 3500 3000 2500

tonnes 2000 1500 1000 500 0 1980 1984 1988 1992 1996 2000 2004 2008

Source: GFMS (Gold Survey 2010) Jewellery Fabrication: Winners and Losers (Figures represent year-on-year change, i.e. 2009 less 2008)

0

Latin America -50 North Other East America Asia Indian

nnes -100 Europe S-C oo t

-150

-200 Middle East

Source: GFMS (Gold Survey 2010) Fabrication Demand in 2009

 A sharp decline in jewellery demand was the principal driver of the 16% or 472t fall in fabrication demand to 2,417 t.

 Full year jewellery fabrication dropped by 20% or 434 tonnes,,ggp with higher gold prices and the economic downturn the primary reasons for the fall.

 Other fabrication fell by just 5.4% y-o-y to 658 tonnes in 2009. However, with all coins excluded, the drop reaches 15%. • Electronics demand dropped by 16%, largely due to the economic crisis, particularly in the first half. GFMS’ Hedging Analysis

• GFMS enter all hedging transactions into our hedging database and the Brady Trinity system.

• Trades are input on a quarterly basis by company , instrument, year of expiry and currency.

• Using detailed market data, accurate deltas and other sensitivities are calculated.

• Comppggrehensive global hedge book analy ypsis is published once per quarter by GFMS, in association with Société Générale. Net Market Impact of Producer Hedging

150 Supply 50

-50

tonnes -150

-250 Demand

-350

1 .Q1 .Q1 .Q1 .Q1 .Q1 .Q1 .Q .Q1 .Q1 .Q1 2 3 00 01 0 0 04 05 06 07 08 09

Source: GFMS (Gold Survey 2010) Total Accelerated Supply from Producer Hedging*

4

rr Outstanding hedge book just 3 236 tonnes at end-end-20092009 end-yea

2 tonnes, ))

1 (1000s

0 1995 1997 1999 2001 2003 2005 2007 2009 * outstanding forward sales, loans and net delta hedge against positions Source: GFMS (Gold Survey 2010) Investment in 2009

• World Investment (which includes the implied figure, bar hoarding and all coins) nearly doubled in 2009 to over 1,900 tonnes and reached an approximate value of $60 billion.

• The first few months of 2009 saw a record level of investment demand. Fears about financial stability and economic depression triggered a wave of safe haven buying, particularly in the forms of gold ETFs and physical bullion products. • After a summer lull, investor activity, especially in the OTC and futures markets, picked up strongly from September onwards, ppyrimarily driven by a weaker dollar ,gpp, higher price expectations and growing concerns regarding future trends in inflation. This surge in investment demand drove prices above $1,200, before a loss of momentum and some profit taking brought about a price correction in the final weeks of 2009. World Investment* 2000 70

Value of World 60 IttInvestment 1500 50 U S 40 $ Billion 1000 30 Tonnes s

20 500

10

0 0 2000 2002 2004 2006 2008

*World Investment is the sum of Implied Net ((DisDis)Investment,)Investment, Bar Hoarding and all Coins & Medals. SourceSource:: GFMS (Gold Survey 2010) Gold Exchange Traded Funds

At 31/12/2009, 617t rise 2000 from 31/12/08 Claymore Swiss Gold (SGBS) 1800 ETFS NYSE Dubibai DGX Julius Baer Xetra Gold 1600 ETF Securities Goldist 1400 ZKB Gold iShares COMEX Gold Trust SPDR Gold Trust NewGold Gold Debentures 1200 GBS LSE GBS ASX 1000 Central Gold Trust Central Fund of Canada onnes t 800

600

400

200

0 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Source: Respective issuers Investors’ positions in gold futures in 2009 (nonnon--commercialcommercial & nonnon--reportablereportable positions in Comex & CBOT futures) 350 1250 Average size of net “investor” long. Gold Price 2006 135k contracts

ands) 300 ss 2007 157k contracts 1050 2008 177k contracts 250

2009 219k contracts d ts, thou ollars/ cc 850 200 o (contra z ss 150 650

100 position tt 450

Ne 50

0 250 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Non-commercial & non-reportable net positions in futures taken as proxy for investors’ positions. Source: CFTC European & North American Retail Investment 450

400 Europe 350 North America 300 250 200 tonnes 150 100 50 0 -50 2003 2004 2005 2006 2007 2008 2009

Source: GFMS (Gold Survey 2010) Price Outlook Gold Supply 20082008--2010F2010F Official Sector 5000 Scrap 4500 Mine Production 4000 3500 3000

tonnes 2500 2000 1500 1000 500 0 2008 2009 2010F Source: GFMS Supply in 2010

 Mine Production forecast to increase this year but at a slower pace, just over 2%, compared to the nearly 7% yearyear--onon--yearyear growth seen in 2009.

 Official Sales expected to recover in 2010, mainly driven by 191 tonnes on- on-marketmarket sales by the IMF. Disposals from current CBGA members to be subdued while other countries to be small scale net buyers.

 Scrap forecast to be lower yearyear--onon--yearyear in first half but hig her in secon d ha lf, w it h fu ll year tota l litt le c hange d.

 Overall supply growth in 2010 to slow to perhaps around 5% compare d to 2009’s rap id 8% pace. Gold Demand 20082008--2010F2010F 5,000 PdProducer D e-HdiHedging 4,500 Other Fabrication 4,000 3,500 3,000 World Investment* nes nn

To 2,500 2,000 1,500 1,000

500 • Jewellery - 2008 2009 2010F *World Investment is sum of Implied Net Investment, Bar Hoarding and all Coins & Medals Source: GFMS Demand in 2010

• In spite of a reasonable first quarter, for full year 2010 jewellery demand will recover only modestly, due to higher prices and constrained budgets, especially in light of continued economic weakness in many countries. Concentrated buying expected on price dips .

• Other fabrication set to recover in 2010, due to growth in the electronics sector.

• Prospects for further dede--hedginghedging are limited by the now very low outstanding producer hedgebook.

• Investor interest in gold is expected to remain strong througgypyhout this year and potentially well into 2011. Investment in 2010?

Backdrop for investment in 2010 will remain positive as long as:  Zero to negative real short term interest rates continue in all major currencies.  Concerns over sovereign debt increase and crisis spreads from EtUitdSttEurope to United States.  Inflation expectations grow, especially in the US with its expected $1.6 trillion FY 2010 deficit and probable debt monetization.

 Notwithstanding the above, risk may be growing of shortshort--termterm and temporary sell-off by investors if fears of ‘double-dip’ trigger liquidations across all ‘risky assets’.  LongerLonger--term,term, gold price vulnerability is rising due to investment’s exceptionall y high sh are of d emand and th e i ncreasi ng si ze of investors’ nearnear--marketmarket bullion stocks. World Investment*Investment* & Fabrication (excluding all coins) (1980-2010F) 4000

3500 Fabrication 3000

2500

2000 Tonnes 1500 World Investment 1000

500

0 1980 1984 1988 1992 1996 2000 2004 2008

*World Investment is the the sum of implied investment,investment, babarr hoarding and all coins & medals Source: GFMS Price Outlook

• Investors will remain the principal driver of prices this year, with a breach of $1,300 in the second half still a possibility, although probability has fallen.

• In the short term , prices could retrace from current levels; the mid $1,000s are a possible low over the next three months, with prices in that region most likely to be eventually pushed up again by bargain hunting and stock replenishment.

• Supply expected to rise fairly strongly in 2010, with growth in mine production, and, from a very low base, official sector sales, the latter also expected to be concentrated in the second half. Scrap supply has fallen year-to-date but should recover in the latter part of 2010 basis higher price conditions. These will also mean that there is only a moderate recovery in fabrication demand for the calendar year as a whole.

• Imbalances in the market suggest that at some point the gold price will have to retreat. Nevertheless, this is most unlikely to occur on a secular basis in 2010 and potentially not until well into 2011 given current economic conditions, which in an underlying sense still favour gold investment. GFMS Gold Price Forecast for 2010

1400

1300

1200

rages) 1100

1000

eekly ave 900 ww

800

US$/oz ( 700 Forecast Average: $1, 170 600 Forecast Range: $1,050-$1,300

500 Jan-07 Jan-08 Jan-09 Jan-10 Source: GFMS GFMS Forthcoming Events

• 22 April 2010: Platinum & Palladium Survey 2010

• 27 May 2010: World Silver Survey 2010

• September 2010: Gold Survey 2010 –Update 1 Disclaimer

The information and opinions contained in this presentation have been obtained from sources believed to be reliable, but no representation or warranty, express or implied, is made that such information is accurate or complete and it should not be relied upon as such. This presentation does not purport to make any recommendation or provide investment advice to the effect that anyyg gold related transaction is a ppro priate for all investment objectives, financial situations or particular needs. Prior to making any investment decisions investors should seek advice from their advisers on whether any part of this presentation is appropriate to their specific circumstances. This presentation is not, and should not be construed as, an offer or solicitation to buy or sell gold or any gold related products. Expressions of opinion are those of GFMS Ltd only and are subject to change without notice.