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Merger of International Goldfields
Ltd and Santa Fe Gold Corporation
Creating a Dynamic Gold-Silver
Producer and Explorer
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Forward Looking Statements
This presentation has been prepared by International Goldfields Limited and Santa Fe Gold Corporation (“The Companies”). The material contained
in this presentation has been prepared for information purposes only, and is not an offer, invitation or recommendation for subscription or purchase
of securities in either of the Companies.
This presentation may contain certain forward-looking statements regarding (i) estimated resources and reserves, (ii) planned production and
operating costs profiles, (iii) planned capital requirements and (iv) plans, strategies and corporate objectives. Such forward-looking statements are
not guarantees of future performance and involve known and unknown risks, uncertainties and other factors, many of which are beyond the control
of the Companies. The forward-looking statements are inherently uncertain and may therefore differ materially from results ultimately achieved.
External and other factors may impact the Companies and affect the forward-looking statements in this release since its preparation. Subject to
applicable law and stock exchange listing rules, the Companies do not intend to publicly update any of the forward-looking statements or any
assumptions.
The information included in this release that relates to Santa Fe Gold resources and historical mining data is based on information compiled by
Douglas F. Irving, who is a professional member of a ‘Recognised Overseas Professional Organisation’ (The Association of Professional Engineers
and Geoscientists of British Columbia) included in a list promulgated by the ASX from time to time. Mr. Irving is employed by Chapman, Wood and
Griswold, Inc. and has worked as a consultant in exploration and mine development for 40 years in precious and base metal exploration. Mr. Irving
has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activity which he is
undertaking to qualify as a Competent Person. Mr. Irving consents to the inclusion in the release of the matters based on his information in the form
and context in which it appears.
The information in this report that relates to exploration results for International Goldfields Ltd is based on information compiled by Mr Travis
Schwertfeger. Mr Schwertfeger is the Chief Executive Officer of International Goldfields Limited. Mr Schwertfeger is a member of The Australian
Institute of Geoscientists and has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to
the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves’. Mr Schwertfeger consents to the inclusion in the report of the matters based on
information in the form and context in which it appears. ns on which any such forward-looking statement is made.
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International Goldfields
• Ownership 93% of Latin Gold
Ltd, a private UK company that
is the 100% owner of 2,976 km2
located in Brazil
– Latin Gold project targeting multi-
million ounce potential, contains
extensive areas of workings in the
Juruena Belt of Brazil
– Not subjected to modern exploration
and vast areas remain untested.
• Ownership 100% of IGS Mali
SARL holding over 1,450km2 in
West Africa
• Plumridge Project, Australia
– Agreements in place for IGS to divest
Australian assets, earning
approximate 25% placement in AAQ
Holding (AAQ.AX)
Santa Fe Gold
• U.S. mining and exploration
company that develops primarily
gold and silver properties.
• Summit Gold-Silver Mine, New
Mexico:
– Commercial production
began 2nd Q 2012
• Lordsburg Mill, New Mexico
– Strategic asset with spare processing
capacity
• Mogollon Gold-Silver project,
New Mexico
– Strategic acquisition with drilled
resources and promising exploration
upside
• Ortiz Gold Project, New Mexico
– Excellent potential for development as
a low cost gold producer
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IGS and Santa Fe to merge
Creating a diversified well-funded and low cost gold-silver explorer and miner
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Merger Highlights
• Proposed merged entity will
have an initial market
capitalisation of approx. A$70
million, at least A$10 million
in cash reserves, low cost
gold and silver production of
28,000opa and operating mill
• Expanded global asset base
with low-cost gold and silver
producing assets and
exploration assets across
major mining districts
• Brings together two highly
experienced and
complementary management
teams with successful record
in exploration and
development
• Improved access to capital
markets
• Merged entity poised for
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Transaction Summary
Structure • IGS and SFEG have entered into a binding Heads of Agreement (HoA) whereby
the entities will merge and SFEG will become a wholly owned Delaware
incorporated subsidiary of IGS
Recommendations • Recommended by the boards of both IGS and SFEG
• Both boards recommend the transaction to shareholders of their respective
companies
Statistics • Pro forma market capitalisation of approx. A$70 million
• Cash reserves of at least A$10 million
• Low cost gold & silver production of 28,000opa (gold equivalent)
• Operating mill
• Near term development assets and portfolio of advanced exploration assets
Conditions • Completion of due diligence by IGS and SFEG
• IGS applying for an ADR listing in the USA and IGS maintaining ASX listing
• Required percentage of IGS and SFEG shareholders approving the merger
• Other customary conditions and regulatory approvals
Merged Company Details • IGS Board of Directors will consist of four directors nominated by SFEG and one
director nominated by IGS
• Will be headquartered in Perth, Western Australia
• Will be listed on the ASX and also traded on a major US exchange or on the
OTC Bulletin Board
Indicative Timetable • Despatch IGS shareholder documentation on 23 October 2012
• Despatch SFEG shareholder documentation on 15 December 2012
• IGS shareholder meeting on 23 November 2012
• SFEG meeting to approve merger by 30 January 2013
• Completion of merger anticipated by 31 January 2013
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Strategic Rationale for the Merger
IGS Latin Gold Project ,
underexplored and Multi Million ounce
potential
+
SFEG’s Summit Gold-Silver Mine, Ortiz Gold Project
and Mogollon Gold-Silver Project
• Combines IGS exploration assets in emerging
global mining districts with SFEG’s portfolio of
low-cost mining and exploration assets in New
Mexico
• Brings together two highly experienced and
complementary management teams with
successful record in exploration and
development
• Low production costs expected to rival major
producers worldwide
• Increases the market relevance and lays the
foundation for a potential material re-rating of
the merged company
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Benefits for Shareholders
Key Benefits for IGS Shareholders • Access to SFEG’s suite of mining and
exploration projects in New Mexico and
cashflow from Summit mine as it ramps up to
full production
• Exposure to Mogollon project - strategic
acquisition with promising exploration upside
and potential to double silver and gold
production at the Lordsburg Mill
• Exposure to historical Ortiz gold project -
excellent potential for development as a low
cost gold producer
• Increased depth of management with strong
mine development and processing
experience added to the team
• Ability to leverage off SFEG’s mining
experience in the development of Latin Gold
project.
• Ability to trade on major US exchange (ADRs)
Key Benefits for SFEG Shareholders • Exposure to Brazilian exploration project –
multi million ounce potential and
underexplored
• Exposure to West African gold sector through
low-cost, early stage exploration assets in
Ivory Coast and Mali
• Reduces debt levels (project finance approx.
$10 million), strengthens balance sheet
• Provides capital for advancement of Mogollon
and Ortiz development projects
• Ability to trade on the ASX and on a major US
exchange (ADRs)
• Global platform for future developments
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Merged Entity - Overview
Status
Projects Exploration Development Production
Summit
Ortiz
Mogollon
Latin Gold
West Africa
Plumridge
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Merged Entity - Overview
Corporate Santa Fe
OTC: SFEG
International
Goldfields
ASX:IGS
Last share price (9 Oct 2012) US34.5c A3.6c
Ordinary shares on issue 117M 572M
Market Capitalisation US$40M A$20.6M
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Enterprise Value Table
Company Ticker Market Cap
($M)
EV
($M)
Reserves /
Resource
(MM oz)
EV/ounc
e
($/oz)
Production
(koz)
Cash
Cost
($/oz)
EPS
($) P/E
IGS /Santa Fe Gold1 IGS - ASX / SFEG-
US 70.00 60.00 1.70 35.29 29.00 364.00 2.4x
ASX
Carrick Gold2 CRK-AX 51.00 48.00 1.20 40.00 (toll treat) NA NA
Doray Minerals3 DRM-AX 69.00 65.00 0.46 140.33 90 (2014) 592.00 NA NA
Ramelius Resources4 RMS-AX 143.00 102.00 2.80 36.43 70.00 931.00 0.12 3.4 X
Focus Minerals FMA-AX 164.00 181.00 4.90 36.94 175.00 1222.00 0.01 3.2X
Saracen Minerals5 SAR-AX 315.00 304.00 5.20 58.46 130.00 898.00 0.07 7.4X
TSX
Allied Nevada ANV-T 2676.00 2401.00 23.40 102.61 204.00 493.00 $1.24 23.86 x
St Andrew Goldfields SAS-T 153.00 135.00 0.70 192.86 95.00 783.00 $0.10 4.15 x
Endeavour Mining EDV-T 509.00 474.00 2.30 206.09 176.00 675.00 $0.31 6.57 x
Rio Alto RIO GA 729.00 598.00 2.60 230.00 180.00 394.00 $0.57 7.38 x
Teranga Gold TGZ-T 560.00 559.00 1.70 328.82 215.00 730.00 ($0.09) -25.97 x
Argonaut AR-T 859.00 824.00 1.20 686.67 88.00 577.00 $0.39 20.65 x
Alamos Gold AGI-T 2314.00 2102.00 2.40 875.83 209.00 374.00 $0.93 20.52 x
Group Average 662.46 604.08 3.89 170.32 120.85 617.92
1 IGS/Santa Fe is based on Summit and Ortiz non-compliant resource and post transaction (assuming min A$5 million raise at completion)
2 Commencing operations, but not yet producing - similar to IGS in that they mine and truck whole ore
3 Andy Well Mine - Developing - not a producer, but low tonnage, high grade underground resource 4 Producer - Wattle Dam / Mt Magnet 5 Producer – Carusoe
Data contained in the above table was taken from publically available information
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Indicative Capital Structure of Merged Entity Post
Transaction Merged Entity
Shares Percentage (%)
Pre-consolidation Post-consolidation 1
Existing IGS Shares on issue 571,520,386 57,152,038 24.38
IGS Shares issued pursuant to
Placement 66,666,667 6,666,667 2.83
Securities issued to SFEG
Shareholders 1,449,469,462 144,946,946 61.57
A$5m Completion Placement
(min) 3 166,666,667 16,666,667 7.08
Securities to be issued to
facilitators and corporate
advisors
100,000,000 10,000,000 4.25
Total 2,354,323,182 235,432,318 100
Notes:
1. Settlement of the Transaction is conditional upon IGS undertaking a consolidation of its issued capital on a one for ten basis.
2. IGS also has the following unlisted options on issue (on a pre-consolidation basis) which have not been included in the above calculations:
(a) 7,250,000 unlisted options (A$0.20; 31 December 2013)
(b) 14,000,000 unlisted options (A$0.08; 31 December 2015)
(c) A further 33,333,333 options (A$0.03; 2 years) will be issued (on a pre-consolidation basis) pursuant to placement terms, subject to
shareholder approval and completion of the Merger
3. It is proposed that a further A$5 million (minimum) will be raised in conjunction with settlement, an issue price of A$0.03 has been assumed
for the above calculations. Settlement is not conditional on completion of this placement
4. SFEG also has 37,648,216 unlisted options, warrants and convertible securities on issue in SFEG which have not been included in the
above calculations. merger agreement will provide for the issuance of “replacement options and warrants” in IGS containing substantially the
same economic terms and provisions as such options, warrants and convertible securities.
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IGS Overview
• Targeting multi million ounce gold discovery(s) in new and emerging
gold provinces in Brazil, West Africa and Australia
• Brazil – Advanced exploration prospect currently drilling, large
landholding with high prospectivity for discovery
• West Africa – Massive landholding with projects located in highly
prospective regions of Mali and Cote d’lvoire
• Australia – Exposure to large land holding in the emerging mineral
province of the Albany-Fraser Belt
• A$10.6 million cash (as at 30 June 2012) to fund aggressive
exploration programs
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Latin Gold Project – New Gold Province
• 93% ownership of Latin Gold Ltd, a
private UK company that is the 100%
owner of 2,976km2 located in the
highly mineralised Alta Floresta
Mineral Province of Juruena Belt
• The state of Mato Grosso is located
in the far west of Brazil and until as
recently as the 1970 - 1980’s was
considered one of Brazil’s remote
frontiers.
• The region has a history of gold
mining dating back to 1718 when
alluvial gold was discovered in
Cuiaba.
• Latin Gold Project is located in an
area of major gold rush with over
5Moz gold extracted by “Garampeiro”
(artisanal) mining in the Alta Floresta
region during the 1980’s.
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Brazil – Regional Prospects
• Aggressive regional scale exploration program
• Definition Drilling planned for Ana and Pe Quente prospects
• ANA Prospect – 2.5 x 4km surface gold anomaly associated with Cu-Mo surface anomaly aureole
– Active artisanal mining on multiple quartz vein hosted structures hosting high grade gold with over 8km of
placer workings draining area.
Best gold diamond drill
intercepts to date:
• 18m at 3.24g/t Au
• ANA006
• 6m at 5.18g/t Au
• ANA007
• 21m at 5.9g/t Au
• ANA008
Best copper drill intercepts to date:
• 4.2m at 0.31% Cu and
• 9m at 0.24% Cu
• ANA006
• 6m at 0.68% Cu
• ANA007
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SFEG Overview Santa Fe is a U.S. mining and exploration company that develops primarily gold and silver properties:
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Summit Gold-Silver Mine,
New Mexico
• Revenue of US$6.4 million
generated in FYE 30 June, 2011
• Revenue of US$11.5 million
generated in FYE 30 June, 2012
• Revenue of US$4.5 - $5 million
generated in 3 months to 30
September, 2012
Lordsburg Mill, New Mexico
• Strategic asset with spare processing
capacity
• Can handle a variety of ore types.
• Centrally located with respect to
historic mining districts and
favourable infrastructure
Mogollon Gold-Silver project,
New Mexico
• Strategic acquisition with drilled
resources and promising exploration
upside
• Potential to double silver and gold
production at the Lordsburg Mill
Ortiz Gold Project, New Mexico
• Historical drilled gold resource of 1.5
million ounces (“non-compliant”)*
• Excellent potential for development
as a low cost gold producer
*IGS does not treat the stated historical estimates as current, and estimates should not be relied upon, however the historical mineral estimations on Ortiz are relevant to IGS in assessing the potential value of the Santa Fe asset portfolio. The historical resource estimate quoted is believed to be reliable, as it was completed by an independent group (Independent Mining Consultants, 2006), reported in categories that relate to JORC resource categories, and results of that resource estimation are comparable to prior in-house estimations completed by a reputable US Mining company (LAC Minerals report, 1990). Santa Fe has commenced work to have all datasets reviewed by a competent person provide a revised JORC compliant resource estimate.
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Santa Fe’s Asset Portfolio
Summit Mine, New Mexico
• Processing commenced in Q2 2010
• Commercial production in Q2 2012
• Production ramp-up underway
• Substantial exploration potential
Lordsburg Mill, New Mexico
• Significant excess capacity
• Increase in throughput expected:
– Ramp-up of ore production from
Summit Mine
– New mine development Mogollon
Project
– Exploration historic Lordsburg
District
– Other ore sources within trucking
distance
Ortiz Gold Project, New Mexico
• Historical drilled gold resource of 1.5 million ounces (“non-compliant”)*
• JORC compliant report underway
• Permitting estimated 2 years
• Production as early as 3 years
Mogollon Project, New Mexico
• Option to acquire Mogollon gold-
silver mining district
• Increase supply of ore to
Lordsburg Mill from Mogollon
property
• Highly prospective exploration
assets
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*IGS does not treat the stated historical estimates as current, and estimates should not be relied upon, however the historical mineral estimations on Ortiz are relevant to IGS in assessing the potential value of the Santa Fe asset portfolio. The historical resource estimate quoted is believed to be reliable, as it was completed by an independent group (Independent Mining Consultants, 2006), reported in categories that relate to JORC resource categories, and results of that resource estimation are comparable to prior in-house estimations completed by a reputable US Mining company (LAC Minerals report, 1990). Santa Fe has commenced work to have all datasets reviewed by a competent person provide a revised JORC compliant resource estimate.
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Summit Mine Summary
Summit Gold-Silver Indicated Resource
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Tons 623,000
Silver Grade 10.780 opt (370g/t) Silver Ounces 7,400,000
Gold Grade 0.143 opt (4.9g/t) Gold Ounces 98,000
Gold Equiv Grade 0.349 opt (11.97g/t) Gold Equiv Ounces1 220,000
Production Ramp-up
• Commercial production commenced Q2 calendar 2012
• Revenues expected to increase as higher grades are reached over
next 18 months
• Lordsburg Mill is producing a marketable, high value Au-Ag
concentrate
• Sales contract with European Smelter: Aurubis AG, Germany
• Sales contracts with Arizona Smelters: Freeport McMoRan; Asarco
• Target production building to 2,400 gold equivalent ounces per month
1Gold equivalency for silver calculated at a 60:1 Ag:Au Ratio
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Summit Mine: Economic Parameters
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In May 2011 an independent Technical Report on the Summit Mine yielded the
following conclusions*:
Capital Cost: US$18.5 million (completed)
Average Cash Cost (5 years): US$364/oz Au Equivalent
Average Operating Cost (5 years): US$84.50/ton
Revenue (5 year average): US$43 million/year
EBITDA (5 year average): US$32 million/year
* Pricing Assumptions:
• Gold: US$1,500/oz
• Silver: US$25/oz
• USD$65 million of tax loss carry-forwards to be applied to Summit
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Strategic Acquisition: Mogollon
Santa Fe has an option to purchase the Mogollon Gold-Silver Project -
payments total US$4.5 million through 2014
Synergies of the acquisition include:
• Mogollon project is within trucking distance (approx. 100 miles) of
Lordsburg Mill, which has spare capacity
• The Mogollon acquisition potentially more than doubles the supply of ore to
the mill
• Production will require development of new underground mine
Mogollon Gold-Silver District, New Mexico:
• Past Production: 15.7 million ounces of silver; 327,000 ounces of gold
• 45 miles of vein length available – only 3 miles developed so far
• Drilling program planned for 2013
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Ortiz Gold Project, New Mexico
Historical Resource Estimate*
• 1.5 million ounce drilled gold resource completed in 2006 by Independent Mining Consultants Inc
• 38.5 - 39.2 million tonnes grading 1.35 -1.37 g/t gold
• US$40mm spent on exploration in the 1980’s – 1990’s
• 120,000 meters of drilling completed
Production Potential
• Historical production in excess of 350,000 ounces of gold
• Future production anticipated as early as 3 years
• Open pit mining at 3mm tons/yr to be processed through crushing, milling and gravity recovery
Litigation settled
• Settlement with Ortiz Mining Inc. confirmed Santa Fe’s exclusive mineral lease rights.
Next Steps
• A JORC compliant technical report with revised resource estimate taking into consideration updated
economic considerations is underway and is expected to be completed before the end of November
2012.
• Permitting: Complete technical work and environmental studies
*IGS does not treat the stated historical estimates as current, and estimates should not be relied upon, however the historical mineral estimations on
Ortiz are relevant to IGS in assessing the potential value of the Santa Fe asset portfolio. The historical resource estimate quoted is believed to be
reliable, as it was completed by an independent group (Independent Mining Consultants, 2006), reported in categories that relate to JORC resource
categories, and results of that resource estimation are comparable to prior in-house estimations completed by a reputable US Mining company (LAC
Minerals report, 1990). Santa Fe has commenced work to have all datasets reviewed by a competent person provide a revised JORC compliant
resource estimate.
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SFEG/IGS Merger Investment Summary
• Santa Fe has successfully made the transition from an exploration to a
producing company
• Profile of increasing cash flow from Summit mine (2012 to 2013)
• Low estimated cost of production from all mines
• Lordsburg Mill is a strategic asset for new ore sources
• Mogollon acquisition builds gold & silver asset base
• Ortiz Gold Project potentially a “company maker”
• Targeting Multi-Million ounce potential on advanced project in Brazil
• Highly Prospective early-stage exploration projects in West Africa feeding
exploration pipeline
• Exposed to potential upside of discovery in emerging Albany-Fraser Belt
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Indicative Timetable
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Event Target Date
Despatch IGS shareholder documentation 23 Oct 2012
Despatch SFEG shareholder documentation 15 Dec 2012
IGS shareholder Meeting 23 Nov 2012
SFEG Meeting to approve Merger 30 Jan 2013
Completion of Merger 31 Jan 2013
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Contacts
Investors:
IGS
Travis Schwertfeger
CEO
International Goldfields Limited
T: +61 8 9221 7729
SFEG
Pierce Carson
CEO & Chairman of Board
Santa Fe Gold Corporation
T: +1 505 255 4852
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Media:
Professional Public Relations
David Tasker
National Director, Investor Relations
T: +61 8 9388 0944/ +61 433 112 936
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