160826 OreCorp Initiation - The Denver Gold Group, Inc. · 2016. 9. 15. · 26 August 2016 We sayWe say Price TargetTarget Strategic Target Strategic Target BUY 0.55 0.901.40 OreCorp

ORECORP LIMITED (ORR)

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1111

ORECORP LIMITED (ORR) INITIATION: All the right ingredients for success

AnalystAnalystAnalystAnalyst

EmailEmailEmailEmail

PhonePhonePhonePhone

DateDateDateDate

Steuart McIntyre

[email protected]

+61 2 8072 2909

26 August 2016

We sayWe sayWe sayWe say PricePricePricePrice TargetTargetTargetTarget Strategic TargetStrategic TargetStrategic TargetStrategic Target

BUY 0.55 0.90 1.40

OreCorp is a gold developer through its flagship Nyanzaga project in Tanzania and is

characterised by its large scale, above average grade deposit (3.3moz @ 3.5g/t) and

its high quality team. OreCorp may earn up to 51% of Nyanzaga, and longer term we

believe it will probably move to 100%, given the project is likely to be non-core to its

much larger JV partner, Acacia Mining. We also see significant regional exploration

potential which we believe could further boost the already robust project economics.

SHARE PRICE CHART

NYANZAGA PRODUCTION & COSTS

COMPANY DATA & RATIOS

Enterprise value $83m

Diluted market cap* $100m

Diluted shares* 182m

Free float 100%

12 month price range $0.05-0.74

GICS sector Materials

Management & associates hold 26%

*Diluted for 8.5m options

IMPLIED RETURN

Implied all-in return 64%

THE RIGHT INGREDIENTS

FOR SUCCESS

In our view OreCorp has all the right

ingredients for success:

• A large scale gold deposit at

above average grade

• In a prolific gold district, with

strong exploration potential

• Based in one of the best

jurisdictions in Africa (Tanzania)

• And most importantly, run by a

high calibre team with strong

African development experience.

SCOPING STUDY

RELEASED THIS MONTH

The Nyanzaga Scoping Study

outlined a 4mtpa project

producing 220ktpa over the first 5

years, at a life of mine All-in

Sustaining Cost of US$798/oz.

Initial capex is expected to be

US$248m +/-35%. We expect

the company to complete a PFS in

Q1 CY17 and a DFS by end CY17

with construction to commence

shortly thereafter.

VALUATION

Using the Scoping Study numbers,

we estimate an NPV for 100% of

Nyanzaga of US$277m using a

US$1,400/oz gold price and 8%

nominal discount rate.

Our 90c Price Target assumes

OreCorp moves to 51% of Nyanzaga

initially and includes a 20% discount

to NPV for development risk.

Our $1.40 Strategic Target assumes

OreCorp moves to 100% of

Nyanzaga longer term, post

completion of the DFS.

$0.00

$0.20

$0.40

$0.60

$0.80

Aug15 Feb16 Aug16

ORR

ASX 200 (relative)

ASX Gold Index (relative)

-

250

500

750

1,000

1,250

-

50

100

150

200

250

FY18 FY19 FY20 FY21 FY22

US$/ozkoz

Nyanzaga (100%) (koz)

All-in Sustaining Cost (US$/oz)


2222

CONTENTS

INVESTMENT SNAPSHOT 3

Macro: Why Gold? 3 Stock Specific: Why OreCorp? 3

COMPANY OVERVIEW 4

THE NYANZAGA GOLD PROJECT, TANZANIA 5

Scoping Study 5 Farm-In Terms 6 Farm-In Flowsheet 7 Resource 8 Mining 9 Processing 10 Infrastructure 11 Permitting 11 Breakdown of Capex & Opex 12 Outstanding Ounces Per Vertical Metre & Upside at Depth 13 Development Timetable 14 Regional Exploration – An Important Part of the Story 14

AKJOUJT SOUTH NI-CU PROJECT, MAURITANIA 15

TANZANIA: A PREFERRED JURISDICTION IN AFRICA 16

INVESTMENT PROPOSITION 17

Valuation Assumptions 17 Valuation Sensitivity 18 Funding Assumptions 18 Peer Comparison 19 Price Target & Rating 20 Strategic Target 20 Near-term Catalysts 20 Key Risks 20 Model Summary: Financials & Valuation (A$m) 21 Model Summary: Operational Inputs & Free Cash Flow (US$m) 22

BOARD & MANAGEMENT 23


3333

INVESTMENT SNAPSHOT

MACRO: WHY GOLD?

We believe gold is in the early stages of a new bull market, driven by:

• I ncreased Increased Increased Increased ggggeopol i t i ca l eopol i t i ca l eopol i t i ca l eopol i t i ca l uuuuncerta inty and ncer ta inty and ncer ta inty and ncer ta inty and wwwweak eak eak eak gggg loba l loba l loba l loba l gggg rowthrowthrowthrowth: On the back of the UK’s

decision to leave the EU in June, we cont inue to see an elevated probabil i ty of further

macro shocks in Europe. In our view, the potent ial for a Donald Trump presidency also

represents a ‘Black Swan’ possibi l ity. Global growth cont inues to be relat ively weak

compared to historic levels and with interest rates at historic lows, most Central Banks

have relat ively l imited opt ions avai lable to st imulate growth.

• Further Fur ther Fur ther Fur ther ccccent ra l ent ra l ent ra l ent ra l bbbbank ank ank ank ssss t imu lust imu lust imu lust imu lus: If the Fed confirms a weak out look for global growth, it has

relat ively l imited opt ions to st imulate growth. It wi l l almost certainly need to slow the rate

hik ing cycle, but may also need to consider further st imulus or quant itat ive easing. In

layman’s terms, this means increasing the money supply.

• Low Low Low Low rrrr ea l ea l ea l ea l iiii n terest nterest nterest nterest rrrr a tes ates ates ates llll i ke ly to ike ly to ike ly to ike ly to ppppers isters isters isters ist : We see an elevated probably that low real interest

rates are more l ikely to persist – a clear posit ive for gold prices and gold equit ies.

STOCK SPECIFIC: WHY ORECORP?

In our view OreCorp has al l the r ight ingredients for success:

• A large sca le go ld depos i t a t above average gradeA large sca le go ld depos i t a t above average gradeA large sca le go ld depos i t a t above average gradeA large sca le go ld depos i t a t above average grade

- Nyanzaga has a resource of 3.3moz @ 3.5g/t – important ly in a single deposit

• Located iLocated iLocated iLocated i n a pro l i f i c go ld d ist r ict wi th st rong exp lorat ion potent ia ln a pro l i f i c go ld d ist r ict wi th st rong exp lorat ion potent ia ln a pro l i f i c go ld d ist r ict wi th st rong exp lorat ion potent ia ln a pro l i f i c go ld d ist r ict wi th st rong exp lorat ion potent ia l

- The Lake Victoria Goldfields in Tanzania is an Archaean Greenstone belt host to a

number of very large gold deposits. Nyanzaga is located:

� ~40km from the 17.3moz Bulyanhulu gold mine (Acacia)

� ~60km from the 21.3moz Geita gold mine (AngloGold Ashanti)

- We see strong potent ial from the Nyanzaga regional explorat ion targets (<10km),

which have potent ial to sweeten the mil l feed and boost project economics:

� Bulu luBu lu luBu lu luBu lu lu : 3m @ 9.1g/t from 27m, 5.7m @ 2.2g/t from 21m

� KasubuyaKasubuyaKasubuyaKasubuya: 5m @ 5.1g/t from 8m, 3m @ 9.2g/t from 9m, 12m @ 3.2g/t from

surface, 4m @ 6.0g/t from 22m, 3m @ 5.8g/t from 25m

� I fugand iI fugand iI fugand iI fugand i : [email protected]/t from 27m, [email protected]/t from 30m, [email protected]/t from 32m

• Based Based Based Based iiii n one of the best ju r i sd ict ions in Af r ica (Tanzan ia )n one of the best ju r i sd ict ions in Af r ica (Tanzan ia )n one of the best ju r i sd ict ions in Af r ica (Tanzan ia )n one of the best ju r i sd ict ions in Af r ica (Tanzan ia )

- According to the Belgian export credit agency, Tanzania is one of the lowest r isk

countr ies in Afr ica and carr ies comparable sovereign r isk to Zambia (see p16)

• AAAA h igh ca l ib re team h igh ca l ib re team h igh ca l ib re team h igh ca l ib re team wi th s t rong A f r ican development exper iencewi th s t rong A f r ican development exper iencewi th s t rong A f r ican development exper iencewi th s t rong A f r ican development exper ience ( fu ll bios p23)

- Cra ig Wi l l i ams (Cha i rman)Cra ig Wi l l i ams (Cha i rman)Cra ig Wi l l i ams (Cha i rman)Cra ig Wi l l i ams (Cha i rman) co-founded Equinox which developed the Lumwana

copper project in Zambia. Equinox was sold to Barrick Gold for ~$7bn.

- Matthew Yates (CEO & MD)Mat thew Yates (CEO & MD)Mat thew Yates (CEO & MD)Mat thew Yates (CEO & MD) formerly the joint MD of Mantra which owned a number

of Afr ican uranium projects. Mantra was ult imately sold to Rosatom Corp for ~$1bn.


4444

COMPANY OVERVIEW

OreCorp Limited is a ~A$100m market cap gold developer through its f lagship Nyanzaga gold

project in northwest Tanzania. Nyanzaga is located ~60km southwest of Mwanza and 40km

northeast of Acacia’s 17.3moz Bulyanhulu gold mine. OreCorp also owns the Akjoujt South nickel-

copper explorat ion project in Mauritania.

OreCorp has a JV on Nyanzaga with Acacia Mining Plc ( formerly Afr ican Barrick) and may earn up

to 51% of the project as detai led in the farm-in terms on p6 of this report.

Acacia is a ~US$3.2bn gold producer l isted on the LSE (ASA) and in our view it is highly l ikely that

a 49% share in a Nyanzaga would be non-core – i.e. i f OreCorp successfu l ly moves to 51% i f OreCorp successfu l ly moves to 51% i f OreCorp successfu l ly moves to 51% i f OreCorp successfu l ly moves to 51% of o f o f o f

Nyanzaga Nyanzaga Nyanzaga Nyanzaga we be l ieve i t i s h igh ly l i ke ly the remain ing 49% wi l l be avai lab le for sa lewe be l ieve i t i s h igh ly l i ke ly the remain ing 49% wi l l be avai lab le for sa lewe be l ieve i t i s h igh ly l i ke ly the remain ing 49% wi l l be avai lab le for sa lewe be l ieve i t i s h igh ly l i ke ly the remain ing 49% wi l l be avai lab le for sa le .

A Scoping Study for Nyanzaga was completed on 10 August 2016 and the company is now

focused on complet ing a PFS in Q1 CY17.

NyanzagaNyanzagaNyanzagaNyanzaga Locat ion in Locat ion in Locat ion in Locat ion in nor thwest nor thwest nor thwest nor thwest Tanzan iaTanzan iaTanzan iaTanzan ia

Source: Company

OreCorp was l isted on the ASX in August 2011 as Si lver Stone Resources (SSZ) and renamed

OreCorp Limited (ORR) in January 2013.

At the end of A t the end of A t the end of A t the end of JuneJuneJuneJune , , , , OreCorpOreCorpOreCorpOreCorp hahahahadddd ~~~~A$A$A$A$17.317.317.317.3m in cash and no debt .m in cash and no debt .m in cash and no debt .m in cash and no debt .

The Lake V ictor ia Goldf ie lds in

Tanzania is a major gold

produc ing dist r ic t.

Histor ic gold product ion f rom

the region is ~20moz

There are a lso >45moz of gold

resources with in 100km of the

Nyanzaga pro ject.


5555

THE NYANZAGA GOLD PROJECT, TANZANIA

SCOPING STUDY

A Scoping Study was completed for Nyanzaga on 10 August 2016 and was managed by

Lycopodium in Perth with a team of well recognised industry experts.

The company’s Scoping Study release provided much more detai l than many ASX l isted companies

do for a Bankable Feasibi l i ty Study, and thus in our view the company’s assumptions are

considerably more transparent than many of their peers. The key outcomes are out l ined below:

Nyanzaga Scop ing StudyNyanzaga Scop ing StudyNyanzaga Scop ing StudyNyanzaga Scop ing Study

CapexCapexCapexCapex US$US$US$US$248248248248mmmm +/+/+/+/ ----35%35%35%35%

Open pit mining Open pit for 5 years

Str ip rat io 2.5:1 l i fe of pit . Ranges from 3:1 to 1.5:1

Underground mining Underground commencing from year 4

Init ial mine l i fe 13 years

Plant size 4mtpa

Head grade 1.9g/t average l i fe of mine, 3.7g/t from UG

Recovery 85%

Product ionProduct ionProduct ionProduct ion 220kozpa f i rs t 5 years , 182kozpa l i fe o f mine220kozpa f i rs t 5 years , 182kozpa l i fe o f mine220kozpa f i rs t 5 years , 182kozpa l i fe o f mine220kozpa f i rs t 5 years , 182kozpa l i fe o f mine

A ISCAISCAISCAISC US$798/oz l i fe o f mineUS$798/oz l i fe o f mineUS$798/oz l i fe o f mineUS$798/oz l i fe o f mine

AIC ( incl UG development) US$874/oz l i fe of mine

Source: Company

The chart below provides a useful overview of the product ion and AISC profi le of Nyanzaga:

Nyanzaga Gold Product ion and AISCNyanzaga Gold Product ion and AISCNyanzaga Gold Product ion and AISCNyanzaga Gold Product ion and AISC

Source: Company

The Scoping Study did not include an NPV or an IRR, however, using the metrics above and a

US$1,400/oz gold price, we have est imated the robust f inancial outcomes below:

RobustRobustRobustRobust F inanc ia l OutcomesFinanc ia l OutcomesFinanc ia l OutcomesFinanc ia l Outcomes

Gold Price US$1,400/oz

NPV (8% nominal, 100% basis) US$277m

Post Tax IRR 25%

Source: B lue Ocean est imates


6666

FARM-IN TERMS

OreCorp is farming into the Nyanzaga project and responsible for management unt i l complet ion of

the DFS (and potent ial ly thereafter). OreCorp may earn up to 51% by:

• Paying US$1m (paid October 2015)

• Sole funding a DFS and regional explorat ion up to US$14m to earn a 25% interest

• On complet ion of DFS:

o I f NPV is <US$200m, or Acacia elects not to retain its part icipat ing interest, then

OreCorp may elect to increase to 51% by making staged payments:

� US$3m on elect ion

� US$2m on commencement of construct ion

� US$10m in the form of a 2% capped net smelter royalty

o I f NPV is >US$200m, Acacia may resume management and retain a 75% interest by

paying OreCorp a mult iple of expenditure (3x to +6x, depending on NPV, based on

the table below)

Appl icable mu l t ip le paid to OreCorp i f Acac ia Appl icable mu l t ip le paid to OreCorp i f Acac ia Appl icable mu l t ip le paid to OreCorp i f Acac ia Appl icable mu l t ip le paid to OreCorp i f Acac ia e lects to e lects to e lects to e lects to reta in 75%reta in 75%reta in 75%reta in 75%

Source: Company re lease 22 September 2015

To simplify the farm in terms for Nyanzaga, we have put together an i l lustrat ive example on the

next page.


7777

FARM-IN FLOWSHEET

While the released farm in terms for Nyanzaga do not specif ical ly st ipulate a gold price or a

discount rate for the calculat ion of NPV, in the i l lustrat ive example below, using the Scoping Study

f igures we assume:

• a gold price of US$1,400/oz

• a nominal discount rate of 8%

• our est imated NPV of US$277m

*Note: Based on A$/US$ of 0.76. Source: B lue Ocean est imates

Interest ingly, while the 51% case yields the higher valuat ion in A$m terms, in the 25% case the

Acacia payment is suff icient ly large to remove the need for OreCorp to raise further equity to fund

its share of in it ial capex.

i.e. Somewhat counterintuit ively the 25% case actual ly leads to a higher valuat ion per share.

Under this “downside scenario” on our gold price and other assumptions our Price Target would

actual ly be a l it t le higher – closer to $1.00.

Where this analysis fal ls down, is that it overlooks the fact that at 51%, OreCorp is l ikely to move

to 100% of the project, and in doing so would increase its market cap, l iquidity and relevance to

investors. Given the high cal ibre team in place, under this scenario we bel ieve it is also l ikely

OreCorp would also begin to trade at a premium to NPV.

OreCorp pays in i t ia l US$1m (pa id) and

so le funds US$14m on DFS & explorat ion

to earn in it ia l 25%

DFS NPV <US$200m

OreCorp pays staged US$15m

to move to 51%

DFS NPV >US$200m

& Acac ia e lects not to reta in

OreCorp pays staged US$15m

to move to 51%

DFS NPV >US$200m

but Acac ia e lects to reta in 75%

Acac ia pays OreCorp a mult ip le

of US$15m based on NPV

The l ike ly scenar io in our v iew

51% of US$277m

less staged US$15m

is US$128m o r ~A$168m*US$128m o r ~A$168m*US$128m o r ~A$168m*US$128m o r ~A$168m*

The downside scenar io:

25% of US$277m

plus 3.5xUS$15m

is US$119m o r ~A$157m*US$119m o r ~A$157m*US$119m o r ~A$157m*US$119m o r ~A$157m*

Does not apply

as our NPV is >US$200m

I f OreCorp successfu l ly moves to 51%,

we be l ieve the remain ing 49% wi l l be

non-core for Acac ia and is h igh ly l ike ly

to be ava i lable for sa le .

i .e . We see a good chance OreCorp

moves to 100% of Nyanzaga


8888

RESOURCE

The Scoping Study ident if ied the opportunity to incorporate lower grade mineral isat ion,

represented by the halo of low grade mineral isat ion in the picture below. This change in approach

resulted in a 19% increase in the resource to 3.3moz, an increase of ~566koz.

Nyanzaga Resource w i th conceptual open pi tNyanzaga Resource w i th conceptual open pi tNyanzaga Resource w i th conceptual open pi tNyanzaga Resource w i th conceptual open pi t

Source: Company

The new mineral resource est imate for Nyanzaga was provided in the Scoping Study release and is

set out below:

Source: Company

The Nyanzaga underground

resource consists of a ser ies of

very la rge pane ls of

minera l isat ion which are l ike ly

to be amenable to bu lk

underground min ing

techniques.

There are 7 h igh grade zones

with impress ive t rue widths of

up to 20m.

The Nyanzaga resource is

we l l understood with 448

holes with in the resource and

83% in M+ I83% in M+ I83% in M+ I83% in M+ I

Th is resource is reported at a

1.5g/t gold cut-of f grade.

At a 2g/t cut-of f the resource

is 2.9moz @ 4.1g/t

At a 1g/t cut-of f the resource

is 4.0moz @ 2.65g/t


9999

MINING

The Scoping Study assumes cont ract min ingcont ract min ingcont ract min ingcont ract min ing for both the open pit and underground mines.

• Open pi tOpen pi tOpen pi tOpen pi t : Runs for 5 years at elevated mining rates. We est imate material movements of up

to ~35-40mtpa in years 2 & 4, based on ore mined of 9.6mt and 12mt respect ively and an

average l i fe of mine str ip of 2.5:1 (ranging from 3:1 to 1.5:1 over the l i fe of the open pit )

o Conventional dri l l , blast, truck and shovel operat ion (250t excavators + 136t trucks)

o Direct feeding ore to the mil l at an average feed grade of 1.8g/t for 5 years

o Stockpil ing low grade ore for processing later. We est imate the average grade of

this stockpiled ore at 0.9g/t over the l i fe of mine. Stockpiled ore represents >70%

of the mil l feed in years 6-11.

• Underground mineUnderground mineUnderground mineUnderground mine: The primary mining method wil l be retreat sub level open stoping with

paste f i l l with panels up to 75m high (made up of 3 sub levels spaced 25m apart)

o Development of the underground mine begins in year 3, with a portal at 160m below

the crest of the open pit. Underground mining costs are est imated at ~US$52/t.

o The f irst underground ore is processed in year 4, ramping up to 1.1mtpa of

underground ore feed at an average LOM grade of 3.7g/t as per the graph below

Ore Movements LOre Movements LOre Movements LOre Movements L i fe o f Minei fe of Minei fe of Minei fe of Mine

Source: Company

An open pi t mine fo l lowed by an Underground mine f rom year 4An open pi t mine fo l lowed by an Underground mine f rom year 4An open pi t mine fo l lowed by an Underground mine f rom year 4An open pi t mine fo l lowed by an Underground mine f rom year 4

Source: Company


1 01 01010

PROCESSING

The planned processing f lowsheet is a convent ional crush, grind, gravity, CIL circuit as set out

below. The grinding circuit wil l include a SAG mil l and pebble crusher and wil l produce a very

standard grind size of 80% passing 106 micron.

It is pleasing to see a pebble crusher included at the early stage level of study – we have seen a

number of mines exclude this important component in the in it ial capex, only for it to be added

short ly after commissioning in the form of addit ional capex to ‘opt imise’ processing performance.

Conceptual F low SheetConceptual F low SheetConceptual F low SheetConceptual F low Sheet

Source: Company

Mi l l Feed by Mi l l Feed by Mi l l Feed by Mi l l Feed by Ore SourceOre SourceOre SourceOre Source and Mater ia l Typeand Mater ia l Typeand Mater ia l Typeand Mater ia l Type

Source: Company


1 11 11111

INFRASTRUCTURE

In this sect ion we brief ly discuss the key infrastructure elements of Nyanzaga. It is worth not ing

that addit ional defin it ion wil l be provided in the PFS, which is due for complet ion in Q1 CY17.

PowerPowerPowerPower: Total project power is est imated at 25MW excluding the UG which is expected to draw a

further 3-4MW from year 4 for vent i lat ion and pumping. The mine wil l be connected to grid power

via the construct ion of 35km transmission l ine using Tanesco (a state ut i l ity) which wil l provide

power to the project at a very competit ive supply cost of US12c/kWhr.

WaterWaterWaterWater : The company plans to use water from Lake Victoria for its processing needs. The lake is

located 7km east of Nyanzaga. The nearby 17.3moz Bulyanhulu mine (Acacia) uses water from

Lake Victoria and the company does not expect water permits to be an issue.

Ta i l i ngsTa i l i ngsTa i l i ngsTa i l i ngs: The budget for tai l ings is US$16m plus an addit ional US$4m p.a. over the l i fe of mine

which is included in the US$7m p.a. in above ground sustaining capital. The company is exploring

the opt ion of using tai l ings as a suitable paste f i l l .

AccessAccessAccessAccess: Site access is good with a well-establ ished regional sealed road network. The init ial

capital est imate includes provision for construct ion of an al l-weather access road.

LabourLabourLabourLabour : Employees wil l be predominately sourced from the local community and elsewhere within

Tanzania, which has two decades of mining experience.

The OreCorp team has highl ighted the importance of strong community engagement during the

other projects they have developed in Afr ica, and plans to repl icate this approach at Nyanzaga.

OreCorp has indicated the local community at Nyanzaga has been very support ive to date.

PERMITTING

Permitt ing in Tanzania is relat ively straight forward compared to other jur isdict ions and at this

stage we don’t expect permitt ing to become a crit ical path item for the project.

Environmental and Social basel ine studies have commenced and the JV recent ly registered an

ESIA applicat ion with the relevant authorit ies in Tanzania. This applicat ion is a precursor to

applying for a special Mining Licence (SML) to cover the project area which the company expects

to lodge during CY17.

An Environmental Cert i f icate is also required as a prerequisite to the grant of the SML.


1 21 21212

BREAKDOWN OF CAPEX & OPEX

The tables below provide a breakdown of the capex and opex for Nyanzaga, to an accuracy of +/-

35%. The init ial capex est imate of US$248m includes 21% contingency or US$43m.

The only capital item which looks a l i tt le low to us is US$65m for a 4mtpa process plant, although

there are signif icant costs included in other categories l ike Infrastructure, Management costs and

Owners costs which many companies would probably include in the Plant cost. In addit ion, there

is signif icant buffer in the US$43m contingency f igure, thus hol ist ical ly we think the capital

est imate appears comparable to other projects.

This assessment is further supported by the capital intensity compared to other projects on p19 of

this report.

Nyanzaga In i t i a l CapexNyanzaga In i t i a l CapexNyanzaga In i t i a l CapexNyanzaga In i t i a l Capex

Source: Company

The opex f igures in the company’s Scoping Study also look defensible to us. The assumed open

pit mining cost of US$3.40/t is comparable to other projects of this scale and in our view should

be achievable, and if anything these costs could even be a l it t le high based on prevai l ing diesel

prices.

Nyanzaga Nyanzaga Nyanzaga Nyanzaga L i fe o f MineL i fe of MineL i fe of MineL i fe of Mine OpexOpexOpexOpex

Source: Company


1 31 31313

OUTSTANDING OUNCES PER VERTICAL METRE & UPSIDE AT DEPTH

One of the most notable features of the Nyanzaga deposit, is its ounces per vert ical metre, shown

below.

Many of the WA-based underground gold miners make good margins out of mines which are only

1,500-2,000 ounces per vert ical metre, compared to Nyanzaga which is much h igher with an

averageaverageaverageaverage o fo fofof 4 ,200 ounces per ver t ica l met re4,200 ounces per ver t ica l met re4,200 ounces per ver t ica l met re4,200 ounces per ver t ica l met re.

The reason this is important for an underground mine is it means the capital cost of the decl ine is

spread over more ounces of product ion – in essence in essence in essence in essence th isth isth isth is means you get more revenue per un i t means you get more revenue per un i t means you get more revenue per un i t means you get more revenue per un i t

cap i ta l out laycap i ta l out laycap i ta l out laycap i ta l out lay… … … … which i s c lear ly which i s c lear ly which i s c lear ly which i s c lear ly an important dr i ver an important dr i ver an important dr i ver an important dr i ver o fofofof re turn on cap i ta lre turn on cap i ta lre turn on cap i ta lre turn on cap i ta l .

Source: Company

The open pi t w i l l be mined

to a depth o f 340mdepth o f 340mdepth o f 340mdepth o f 340m

The current resource

extends to a dep th o f 800mdepth o f 800mdepth o f 800mdepth o f 800m

Ups ide potent ia l a t Ups ide potent ia l a t Ups ide potent ia l a t Ups ide potent ia l a t ddddepthepthepthepth

Interest ing ly , the ounces per

metre on ly fa l ls away at

depth due to lack of dr i l l ing.

The company be l ieves the

minera l isat ion is l ike ly to

extend at depth.

The nearby 17.3moz

Bulyanhulu mine is on ly

~40km from Nyanzaga, and

is min ing at depths ~1,500m

be low sur face and has a

resource down to over

2,000m be low sur face.

Thus, longer term, we see

upside potent ia l at depth for

Nyanzaga, which could

extend mine l i fe and further

improve pro ject economics.


1 41 41414

DEVELOPMENT TIMETABLE

Our forecasts assume the fol lowing development t imetable for Nyanzaga:

• PFS complete in Q1 CY17

• DFS complete by end CY17

• Finance in place by end Q2 CY18 (both debt and equity)

o there is potent ial ly some buffer in this 6-month period, although in our experience

documenting project f inance loan agreements can take up to ~6 months from

complet ion of f inal studies

• 18 month construct ion period from Q3 CY18 to end CY19

• First Product ion in Q1 CY20

REGIONAL EXPLORATION – AN IMPORTANT PART OF THE STORY

In our view the regional explorat ion looks very promising and has potent ia l to add s ign i f i cant potent ia l to add s ign i f i cant potent ia l to add s ign i f i cant potent ia l to add s ign i f i cant

va lue va lue va lue va lue near termnear termnear termnear term. The JV holds 27 l icences and applicat ions covering 271km2 .

Regiona l Explorat ion TargetsRegiona l Explorat ion TargetsRegiona l Explorat ion TargetsRegiona l Explorat ion Targets w i th in 10kmwi th in 10kmwi th in 10kmwi th in 10km o f Nyanzagaof Nyanzagaof Nyanzagaof Nyanzaga

Source: Company. *Note: We assume same US$3.40/t min ing costs and 2.5:1 str ip. 2.9mt @ 2g/t would be a regiona l d iscovery of ~185koz

P rom is ing h i s t o r ic h i t sP rom is ing h i s t o r ic h i t sP rom is ing h i s t o r ic h i t sP rom is ing h i s t o r ic h i t s

Bu lu luBu lu luBu lu luBu lu lu :

3.0m @ 9.1g/t f rom 27m

5.7m @ 2.2g/t f rom 21m

KasubuyaKasubuyaKasubuyaKasubuya :

5m @ 5.1g/t f rom 8m

3m @ 9.2g/t f rom 9m

12m @ 3.2g/t f rom

sur face

4m @ 6.0g/t f rom 22m

3m @ 5.8g/t f rom 25m

I fugand iI fugand iI fugand iI fugand i :

22m @ 3.4g/t f rom 27m

8m @ 3.9g/t f rom 30m

Potent ia l to Po tent ia l to Po tent ia l to Po tent ia l to add add add add s ign i f i cant va lues ign i f i cant va lues ign i f i cant va lues ign i f i cant va lue

G iven lower grade stockpi led ore

(average grade ~0.9g/t ) is expected to

make up >70% of the mi l l feed for the

second ha l f of the mine l i fe, there is

potent ia l for a s ign i f icant improvement

in pro ject economics with regiona l

explorat ion success.

To iTo iTo iTo i l l us t ra tel l us t ra tel l us t ra tel l us t ra te : Replac ing 2.9mt of

0.9g/t ore with 2g/t ore in year 7*:

- increases product ion by ~90koz

- reduces AISC by ~US$100/oz

- increases FCF by ~US$20m


1 51 51515

AKJOUJT SOUTH NI-CU PROJECT, MAURITANIA

OreCorp also has some very interest ing exploration ground in Mauritania and the company bel ieves

it could be on the cusp of a signif icant greenfields discovery.

The company’s maiden dri l l program recent ly intersected nickel-copper mineral isat ion over broad

widths and a meaningful str ike length of ~1km.

Source: Company

Source: Company

Nicke l-copper minera l isat ion

intersected over a 1km

st r ike length… a very

encouraging resu l t for the

f i rst round of dr i l l ing.

Minera l isat ion occurs as a

ser ies of sub-para l le l

gossan/su lph ide zones

indiv idua l ly up to 350m in

st r ike length

Fol low up work is underway.

The company in it ia l ly

encountered anomal ism

dur ing t renching

Minera l ised widths of up to

160m intersected in an

anomaly with a st r ike length

of over 1.6km

The company has a lso

ident i f ied two s ign i f icant

ground magnet ic anomal ies

(M1 & M2) which it expects

to fo l low up soon.


1 61 61616

TANZANIA: A PREFERRED JURISDICTION IN AFRICA

Tanzania is a stable east-Afr ican country which achieved

independence in 1961. It is a president ial const itut ional republic, and

has held democrat ic mult i-party elect ions since 1995. The most

recent elect ion was held in October 2015.

Tanzania has a populat ion of 52 mil l ion (2014) and is one of the

poorest countr ies in the world with a GDP in 2014 of US$44bn.

Tanzania reformed its mining policy in 1998 and has attracted

signif icant capital investment and is the 3rd largest gold producing

country in Afr ica.

Source: Company

SOVEREIGN RISK

The pictures below show a comparison of country r isk according to Delcredere | Ducroire, the

world’s second largest credit insurer. As Belgium’s public credit insurer, it provides cover for

companies and banks against pol it ical and commercial r isks relat ing to internat ional transact ions.

According to Delcredere | Ducroire:

• Tanzania is of comparable r isk to Zambia on most measures, and is one of the more

favourable jur isdict ions in Afr ica

• Mauritania carr ies relat ively higher pol it ical and transfer r isk than both Zambia and Tanzania

Compar ing Sovere ign R isk in A f r icaCompar ing Sovere ign R isk in A f r icaCompar ing Sovere ign R isk in A f r icaCompar ing Sovere ign R isk in A f r ica

Source: De lcredere | Ducroire


1 71 71717

INVESTMENT PROPOSITION

This sect ion provides an in-depth look at our valuat ion assumptions for OreCorp.

VALUATION ASSUMPTIONS

The table below summarises our key valuat ion assumptions based on the Nyanzaga Scoping Study.

Bottom l ine, we endorse the company’s Scoping Study assumptions.

Pro ject Met r icPro ject Met r icPro ject Met r icPro ject Met r ic Scop ing StudyScop ing StudyScop ing StudyScop ing Study

(100% bas is )(100% bas is )(100% bas is )(100% bas is ) CommentaryCommentaryCommentaryCommentary

In it ial Capex US$248m +/-35%, includes US$43m contingency

Plant size 4mtpa

Average head grade 1.9g/t

3.7g/t from underground (post 10% dilut ion)

1.8g/t from open pit direct feed

0.9g/t from stockpile feed (BOEQ est imate)

Recoveries 85%

We see scope for improvement with further met

test ing. Testwork suggests: 92% recovery from

oxides and 86% from sulphides

Average gold product ion 182kozpa 220kozpa for the f irst 5 years

Average Operat ing Costs US$761/oz excludes sustaining capex

Al l- in Sustaining Costs US$804/oz

includes surface sustaining capex of US$7.7mpa

( including US$4m p.a. for tai l ings l i fts)

but excludes UG development capex

US$6/oz higher than the Scoping Study due to higher

royalt ies at higher gold prices

Al l- in Cost US$880/oz

Includes al l sustaining capex

including UG development capex of US$18m in year 3

and US$16/t in UG development capex thereafter

Royalt ies 4.3% 4% Govt royalt ies + 0.3% local Govt levy

Mine Life 13 years

IRR Post Tax 25% including 5% Govt free carry

Discount Rate 8% 8% nominal, 6% real

NPV Post Tax US$277m including 5% Govt free carry

Source: Company data, B lue Ocean Equit ies

Our valuat ion of OreCorp is predominately based on a DCF for Nyanzaga using a US$1,400/oz

gold price and a nominal discount rate of 8%. Our base case assumes Orecorp moves to 51% of

Nyanzaga post complet ion of the DFS, which is due by end CY17.


1 81 81818

VALUATION SENSITIVITY

Based on the valuat ion assumptions out l ined on the previous page, our valuat ion for 100% of

Nyanzaga is US$277m at a gold price of US$1,400/oz and a nominal discount rate of 8%.

The sensit ivity table below provides our est imate of NPV for 100% of Nyanzaga at a range of gold

prices and discount rates:

NPV (US$m, 100%)NPV (US$m, 100%)NPV (US$m, 100%)NPV (US$m, 100%) Gold Pr ice (US$/oz )Gold Pr ice (US$/oz )Gold Pr ice (US$/oz )Gold Pr ice (US$/oz )

1 ,2001,2001,2001,200 1 ,3001,3001,3001,300 1 ,4001,4001,4001,400 1 ,5001,5001,5001,500 1 ,6001,6001,6001,600

D iscountDiscountDiscountDiscount 6% 119 231 343 456 568

RateRateRateRate 8% 80 179 277 375 473

(((( nnnnomina l )omina l )omina l )omina l ) 10% 49 135 222 308 394

12% 23 100 176 252 329


The sensit ivity table below provides our est imate of Post Tax IRR for 100% of Nyanzaga at a range

of gold prices. In our view this analysis demonstrates the economics for Nyanzaga are very robust

in the current gold price environment.

Post Tax IRRPost Tax IRRPost Tax IRRPost Tax IRR Gold Pr ice (US$/oz )Gold Pr ice (US$/oz )Gold Pr ice (US$/oz )Gold Pr ice (US$/oz )

(100%)(100%)(100%)(100%) 1 ,2001,2001,2001,200 1 ,3001,3001,3001,300 1 ,4001,4001,4001,400 1 ,5001,5001,5001,500 1 ,6001,6001,6001,600

12% 19% 25% 31% 36%


FUNDING ASSUMPTIONS

We assume the company develops Nyanzaga using tradit ional project f inance with 60% debt and

40% equity once the DFS is completed in Dec CY17.

Funding UsesFunding UsesFunding UsesFunding Uses US$mUS$mUS$mUS$m Funding SourcesFunding SourcesFunding SourcesFunding Sources US$mUS$mUS$mUS$m

In it ial capex (100%) 248 Debt 60% 168

Working capital 32 Equity 40% 112

Tota lTota lTota lTota l 280280280280 Tota lTota lTota lTota l 280280280280

Source: Company, Blue Ocean Equities

Regardless of the ownership structure for Nyanzaga, it is l ikely the project debt would be arranged

with the JV rather than OreCorp and Acacia separately.

Assuming OreCorp moves to 51% of Nyanzaga, based on our assumed debt/equity spl it , OreCorp

would need to raise its share of equity to fund development, being 51% of US$112m, or ~US$57m.

It is worth not ing OreCorp is current ly well capital ised with A$17.3m in cash.


1 91 91919

PEER COMPARISON

The f irst chart below highl ights that Nyanzaga is a signif icant project in terms of grade and scale

compared to peers. The second chart i l lustrates the project also has a competit ive capital

intensity compared to other gold projects in Afr ica.

A s tandout pro ject on grade and sca le compared to peersA standout pro ject on grade and sca le compared to peersA standout pro ject on grade and sca le compared to peersA standout pro ject on grade and sca le compared to peers

Source: Company, F ivemark Partners

Compet i t ive Cap i ta l Intens i tyCompet i t ive Cap i ta l Intens i tyCompet i t ive Cap i ta l Intens i tyCompet i t ive Cap i ta l Intens i ty (based on init ial capex / oz of product ion)

Source: Company, F ivemark Partners

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2 02 02020

PRICE TARGET & RATING

Our 90c Price Target is for OreCorp based on:

• An NPV for Nyanzaga using US$1,400/oz gold and an 8% nominal discount rate

• A 20% discount to NAV for the development r isks ahead

We rate OreCorp a high convict ion Buy and our 90c Price Target represents an implied return of

>60%.

STRATEGIC TARGET

We derive our longer-term $1.40 Strategic Target for OreCorp based on:

• Removing the 20% discount applied for development r isk

• Assuming the company moves to 100% of Nyanzaga over t ime, which we bel ieve is l ikely

sometime after the complet ion of the DFS at the end of CY17. Our analysis assumes the

company’s acquisit ion of the remaining 49% of Nyanzaga is neither NAV accret ive or

di lut ive.

• Assuming the company begins to trade on a 20-30% premium with NAV, in l ine with

comparable peers. In our view this is defensible given the healthy margins and projected

return on capital as well as the high quality management team.

Our $1.40 Strategic Target represents an implied return of >150%. It is important to note that our

Strategic Target does not account for higher gold prices, which we bel ieve is a very real possibi l i ty.

NEAR-TERM CATALYSTS

There are a number of modest near-term catalysts for OreCorp including:

• Regional explorat ion at Nyanzaga due in the coming months

• Explorat ion in Mauritania due in the coming months

• Nyanzaga resource update due by end CY16

• Nyanzaga PFS in Q1 CY17

• Nyanzaga DFS by end Dec CY17

KEY RISKS

OreCorp is exposed to al l the normal r isks associated with developing and operat ing mining

projects, including funding and construct ion r isk.

Assuming the company makes the transit ion into product ion, the company’s revenues wil l be

derived from the sale of gold. Fluctuat ions in the gold price as well as the Austral ian dollar could

impact the company’s reported cash f low ( in A$), profitabi l i ty and share price.

As OreCorp’s Nyanzaga gold project is based in Tanzania, an investment in OreCorp also carr ies

Tanzanian sovereign r isk.


2 12 12121

MODEL SUMMARY: FINANCIALS & VALUATION (A$M)


Stock Details Enterprise Value $83m

Recommendation: BUY Diluted MCap $100m

Target $0.90 Share Price $0.55 Strategic Target (ST) $1.40 Diluted Shares 182m

NAV $0.91 52 Week High $0.74 Implied Return to ST 155% Free Float 100%

Implied Return 64% 52 Week Low $0.05 Avg Daily Value $0.1m

Macro Assumptions FY17E FY18E FY19E FY20E FY21E Ratio Analysis FY17E FY18E FY19E FY20E FY21E

Gold Price (US$/oz) 1,400 1,400 1,400 1,400 1,400 Diluted Shares m 182 319 325 328 328

Exchange Rate (A$/US$) 0.74 0.72 0.71 0.70 0.70 EPS - Diluted Ac (3.5) (4.3) (1.1) 5.4 10.3

P/E x n.m. n.m. n.m. 10.1x 5.4x

Profit & Loss (A$m) FY17E FY18E FY19E FY20E FY20E CFPS - Diluted Ac (0.9) (0.8) (0.6) 9.1 17.0

Revenue - - - 112 225 P/CF x n.m. n.m. n.m. 6.0x 3.2x

Operating Costs - - - (65) (141) FCF - Diluted Ac (1.1) (0.6) (37.1) (9.3) 17.8

Operating Profit - - - 47 84 P/FCF x n.m. n.m. n.m. n.m. 3.1x

Corporate & Other (2) (2) (2) (3) (4)

Exploration Expense (4) (8) (1) (3) (4) Dividends Ac - - - - -

EBITDA (6) (10) (3) 42 76 Dividend yield % - - - - -

D&A (0) (0) (0) (8) (17) Payout Ratio % - - - - -

EBIT (7) (10) (4) 33 59 Franking % - - - - -

Net Interest Expense 0 0 - (6) (8)

Pre-Tax Profit (6) (10) (4) 28 51 Enterprise Value A$m 93 14 135 175 132

Tax Expense - - - (9) (15) EV/EBITDA x n.m. n.m. (39.7x) 4.2x 1.7x

Minorities (5% Govt) - - - (1) (2) ROE % (46%) (9%) (4%) 15% 22%

Underlying Profit (6) (10) (4) 18 34 ROA % (45%) (9%) (2%) 8% 16%

Signficant Items (post tax) - - - - -

Reported Profit (6) (10) (4) 18 34 Net Debt or (Cash) A$m (7) (86) 35 75 32

Gearing (ND/(ND+E)) % n.m. (586%) 26% 39% 17%

Cash Flow (A$m) FY17E FY18E FY19E FY20E FY21E Gearing (ND/E) % n.m. (85%) 35% 63% 21%

Operating Cashflow (2) (2) (2) 44 79

Tax - - - (9) (15) Gold Reserves & Resources

Net Interest 0 0 - (6) (8) Resource mt g/t moz

Net Operating Cash Flow (2) (2) (2) 30 56 Nyanzaga Measured 2.9 3.77 0.36

Exploration (9) (15) (3) (5) (7) Indicated 21.8 3.45 2.42

Capex - - (119) (66) (6) Inferred 5.1 3.49 0.57

Acquisitions / Disposals - - - - - M+I+I 29.8 3.49 3.34

Other - - - - -

Net Investing Cash Flow (9) (15) (122) (71) (13) Reserve mt g/t moz

Equity Issue - 96 2 1 - Nyanzaga Proved - - -

Borrowing / Repayments - - 114 (19) (38) Probable - - -

Dividends - - - - - P+P - - -

Other - - - - -

Net Financing Cash Flow - 96 117 (18) (38) Earnings Sensitivity FY20E FY21E FY20E FY21E

Change in Cash Position (11) 79 (7) (59) 5 A$m A$m % %

FX Adjustments - - - - - Gold Price US$/oz +10% 7 14 40% 42%

Cash Balance 7 86 79 20 25 FX Translation A$/US$ -10% 2 4 13% 12%

Balance Sheet (A$m) FY17E FY18E FY19E FY20E FY21E Valuation Discount Stake A$m A$/sh

Cash 7 86 79 20 25 Nyanzaga - 51% 212 1.16

Other Current Assets 0 0 0 0 0

PP&E 0 (0) 118 176 165 Nyanzaga (risk-adjusted) 20% 51% 169 0.93

Exploration & Development 5 13 14 17 20 Nyanzaga farm-in payments (33) (0.18)

Other Non Current Assets 2 2 2 2 2 Exploration 50 0.27

Total Assets 14 101 214 215 212 Corporate & Other (37) (0.21)

Debt - - 114 95 57 Debt - -

Other Liabilities 0 0 0 0 0 Cash 17 0.09

Net Assets 14 101 99 120 155 Risk adjusted NAV 166 0.91


2 22 22222

MODEL SUMMARY: OPERATIONAL INPUTS & FREE CASH FLOW (US$M)


Macro Assumptions FY18E FY19E FY20E FY21E FY22E

Gold Price US$/oz 1,400 1,400 1,400 1,400 1,400

Australia Dollar A$/US$ 0.72 0.71 0.70 0.70 0.70

Operational Summary FY18E FY19E FY20E FY21E FY22E FCF Contribution US$m FY18E FY19E FY20E FY21E FY22E

Nyanzaga (100% basis) Nyanzaga (based on OreCorp moving to 51%)

Ore Milled mt - - 2.0 4.2 4.2

Head Grade g/t - - 1.9 1.9 1.8

Recovery % - - 88% 85% 85%

Gold Produced koz - - 110 220 210 Revenue US$m - - 78 157 150

Mining Costs US$/oz - - 508 569 288

Processing Costs US$/oz - - 198 207 217

G&A US$/oz - - 42 44 46

C1 Cash Costs US$/oz - - 747 819 551

Royalties US$/oz - - 60 60 60

Operating Cost US$/oz - - 808 879 611 Operating Costs US$m - - 45 99 66

Sustaining Capex US$/oz - - 70 35 37 Sustaining Capex US$m - - 4 4 4

All-in Sustaining Cost US$/oz - - 878 914 648 All-in Sustaining Cost US$m - - 49 103 69

UG Development US$/oz - - - - 86 UG Development US$m - - - - 9

All-in Cost US$/oz - - 878 914 734 All-in Cost US$m - - 49 103 79

% AIC Margin % - - 37% 35% 48% All-in Margin - - 29 55 71

Initial Capex - 84 42 - -

Farm-in Payments 11 2 4 5 5

Corporate US$m FY18E FY19E FY20E FY21E FY22E

Cash Tax - - 6 11 19

Other Items 1 1 2 3 3

FCF pre Debt Service (12) (88) (25) 36 44

Net Interest (0) - 4 6 3

Debt Drawdown / (Repayment) - 81 (13) (27) (27)

FCF post Debt Service (12) (7) (42) 4 14

New Equity/Dividends US$m FY17E FY18E FY20E FY21E FY22E

Proceeds from Shares/Options 69 2 1 - -

Dividends Paid - - - - -

Change in Cash 57 (5) (41) 4 14

Cash Balance 62 56 14 18 32


2 32 32323

BOARD & MANAGEMENT

Cra ig Wi l l i amsCra ig Wi l l i amsCra ig Wi l l i amsCra ig Wi l l i ams , Cha i rman, Cha i rman, Cha i rman, Cha i rman: Mr Wil l iams is a geologist with over 35 years experience in mineral explorat ion and mine development. He was the President and CEO of Equinox Minerals Limited, which he co-founded in 1993. He was instrumental in the f inancing and development of the major Lumwana Copper mine in Zambia which resulted in Equinox being one of the world’s top 20 copper producers. Fol lowing the ramp up of Lumwana, Equinox embarked on an acquisit ion program that resulted in the takeover of the Citadel Resource Group for $1.2 bi l l ion, target ing development of the Jabal Sayid Mine in Saudi Arabia. Equinox was taken over in mid-2011 by Barrick Gold Corporat ion for $7 bi l l ion, bringing to an end a chal lenging and excit ing 18 year history at Equinox. Mat thew Yates, Mat thew Yates, Mat thew Yates, Mat thew Yates, CEOCEOCEOCEO &&&& MDMDMDMD: Mr Yates is a geologist with over 20 years industry experience, covering most facets of explorat ion from generat ive work to project development. Most recent ly, he was the Joint MD of Mantra Resources Limited and was instrumental in the acquisit ion of a number of uranium projects, including Mkuju River (Tanzania), Kariba (Zambia) and Mavuzi (Mozambique). He has worked in Austral ia and southern, east and west Afr ica, Central Asia and the Gulf Region. Mr Yates has an applied technical background and has held senior posit ions for over f i fteen years, including resident Explorat ion Manager in Tanzania for Tanganyika Gold Limited. A lasta i r Morr i son, NonA lastai r Morr i son, NonA lastai r Morr i son, NonA lastai r Morr i son, Non----Execut i ve Di rectorExecut i ve Di rectorExecut i ve Di rectorExecut i ve Di rector : Mr Morrison is a geologist with more than 20 years experience in mineral explorat ion and investment. From 1996-2003 he worked in Tanzania for East Afr ican Gold Mines Limited at the North Mara Gold Project in Tanzania. He was responsible for the management of exploration, overseeing the del ineat ion of more than 5 mil l ion ounces of resources, including the discovery of the high-grade Gokona gold deposit. In later years, he had addit ional responsibi l it ies for al l in-country development act ivit ies, through feasibil i ty and permitt ing unt i l the commencement of construct ion. Since 2004, he has worked as an investment analyst for a private, resource-oriented investment fund evaluat ing and invest ing in mining projects around the world. Michae l K lessens, NonMichae l K lessens, NonMichae l K lessens, NonMichae l K lessens, Non----Execut i ve Di rectorExecut i ve Di rectorExecut i ve Di rectorExecut i ve Di rector : Mr Klessens is a CPA with over 22 years pract ical f inancial and management experience, part icularly within the resources industry. This experience has involved al l areas of corporate and treasury management, project f inancing, capital raisings, mergers and acquisit ions, dual l ist ings, feasibi l ity studies and establishment of systems and procedures for new mining operat ions. From 2002-2011, Mr Klessens was CFO of Equinox Minerals Limited. Robert R igo, NonRobert R igo, NonRobert R igo, NonRobert R igo, Non ----Execut ive D i rectorExecut ive D i rectorExecut ive D i rectorExecut ive D i rector : An engineer with over 35 years' experience, Mr Rigo has previously held a number of execut ive and senior management posit ions with publicly l isted mining companies. He was Vice President - Project Development at Equinox Minerals Limited (Equinox), where he managed the feasibi l i ty study, related technical studies and engineering design and construct ion contracts for the Lumwana Copper Mine in Zambia. Amongst Mr Rigo's earl ier job roles, he was the Mil l Manager at Boddington Gold Mine, at the t ime Austral ia's largest gold mine. He then became General Manager - Technical Services for Newcrest Mining Ltd, Austral ia's major gold producer. His part icular expert ise l ies in the management of mining operat ions, feasibi l ity studies and construct ion of mining and mineral processing projects. Luke Watson, CFO & Company SecretaryLuke Watson, CFO & Company SecretaryLuke Watson, CFO & Company SecretaryLuke Watson, CFO & Company Secretary : Mr Watson is a Chartered Accountant, Chartered Secretary and a Fel low of FINSIA. He has signif icant corporate experience including mergers & acquisit ions, capital raisings, IPOs and dual l ist ings on the TSX. Since 2005, Mr Watson has held senior corporate and f inance posit ions with a number of Afr ican-focused resources companies, including Mantra Resources Limited (‘Mantra’) and OmegaCorp Limited. Mr Watson was the CFO & Company Secretary of Mantra from its $6 mil l ion IPO in October 2006 unt i l its acquisit ion by ARMZ (JSC Atomredmetzoloto) for approximately $1 bi l l ion in mid-2011.


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CONTACTS ANALYST AUTHORITY

SteuartSteuartSteuartSteuart McIntyreMcIntyreMcIntyreMcIntyre

Senior Resource Analyst

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Executive Director

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Philip PepePhilip PepePhilip PepePhilip Pepe


PPPP +61 2 8072 2921


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PPPP +61 2 8072 2923


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Investment Analyst

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Scott Calcraft Scott Calcraft Scott Calcraft Scott Calcraft


PPPP +61 2 8072 2920


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PPPP +61 2 8072 2929


James McIntoshJames McIntoshJames McIntoshJames McIntosh


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Tim Potts Tim Potts Tim Potts Tim Potts

Institutional/HNW Dealing

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HEAD OFFICE

Blue Ocean Equities Pty. Ltd.Blue Ocean Equities Pty. Ltd.Blue Ocean Equities Pty. Ltd.Blue Ocean Equities Pty. Ltd.

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160826 OreCorp Initiation - The Denver Gold Group, Inc. · 2016. 9. 15. · 26 August 2016 We sayWe say Price TargetTarget Strategic Target Strategic Target BUY 0.55 0.901.40 OreCorp