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INVESTOR PRESENTATION

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INVESTOR PRESENTATION Powered By Docstoc
					INVESTOR PRESENTATION
September, 2011




www.lydianinternational.co.uk | TSX:LYD
FORWARD LOOKING STATEMENTS
This presentation contains projections and forward looking information that involve
various risks and uncertainties regarding future events. Such forward-looking information
can include without limitation statements based on current expectations involving a
number of risks and uncertainties and are not guarantees of future performance of the
Company. These risks and uncertainties could cause actual results and the Company’s
plans and objectives to differ materially from those expressed in the forward-looking
information. Actual results and future events could differ materially from anticipated in
such information. These and all subsequent written and oral forward-looking information
are based on estimates and opinions of management on the dates they are made and
expressly qualified in their entirety by this notice.

The Company assumes no obligation to update forward-looking information should
circumstances or management’s estimates or opinions change. This presentation does
not constitute an offer to sell or a solicitation of an offer to buy any securities of the
Company within the United States or otherwise.


                                                                                             2
AMULSAR GOLD DEPOSIT ARMENIA

• Gold production 2014
• 2.5Moz gold resource, open in all directions
• +90% recoveries from metallurgical testing
• Base Case NPV of US$515M and IRR 45%
• Current Mining License over proposed
  starter pit
• Excellent Infrastructure - Highway access,
  electricity, gas and water all within license
• Strong influential shareholders; International
  Finance Corporation (World Bank Group)
  13.2%; EBRD 7.7%



                                                   3
  ARMENIA
• Democratic presidential republic

• Member of WTO

• First Christian country 301AD

• Mineral resources 50% by value
  of exports

• Modern mining law

• 1.5% royalty tax, corporate tax
  20-30% depending on
  profitability


                                     4
MINING INVESTMENT IN ARMENIA

• Cronimet (German Private)
     • Kadjaran Cu-Mo (12.8 Mtpa)
• Geopromining (Russian Private)
     • Zod Au (~30kozpa)
     • Agarak Cu-Mo (5Mt pre-stripping
       2011)
• Dundee Precious Metals (TSX:DPM)
     • Kapan polymetallic (~30koz Au,
       2.9Mlb Cu, 530koz Ag, 19Mlb Zn)




                                         5
    AMULSAR HIGHLIGHTS
•   52,000 meters drilled 2006 – 2010
•   40,000 meters drilling 2011
•   2.5Moz (1.1M Indicated / 1.4M Inferred) gold
    resource, open in all directions
•   Distance from Yerevan - 176kms
•   Very high gold recovery from metallurgical tests
    90% +
•   Established Infrastructure with sealed main road,
    high-tension power lines, gas and water pipe-
    lines
•   PEA results:-
    - Base case NPV US$515 and IRR 45%
    - Sensitivity case (including Erato) NPV US$614
     and IRR 41%




                                                 6
GEOLOGICAL SETTING
• Eocene age High Sulfidation
  Epithermal Gold Deposit
• Entirely oxide
• Ring-fracture and intersecting
  structures
• Dacite Domes
• Dominantly fault controlled with
  some dome-margin control




                                     7
2011 CIM COMPLIANT
RESOURCE ESTIMATE




                     8
RESOURCE AREA AND UPSIDE




                           9
V-HIGH RESOLUTION
     GROUND
  SPECTROMETRY




                    10
      METALLURGY
•   Master composites prepared
    from metallurgical holes drilled
    at Tigranes, Artavasdes and
    Erato

•   Samples leached at the optimal
    crush size of -12mm

•   Leach recoveries of >90%
    obtained after only 47 days

•   Fast leach kinetics with 80% of
    the gold leached in 10 days

•   Low CN consumption of 0.47kg/t


                                  11
    PEA JULY 2011
•   Pit Shell US$1,000; 1.64Moz
    mineable gold; financials
    US$1,200/oz; 5% discount rate;
    85% recovery, ramp-up year 4

•   Capital Cost includes +30%
    contingency and purchase
    Newmonts NSR

•   Consultants:-
    •   K D Engineering
    •   Golder Associates
    •   CSA Global
    •   Wardell Armstrong

•   Resource/financial review update in
    Q4 2011, using a new US$1,200/oz
    Pit Shell

                                          12
    MINE LAYOUT AND
    OPERATING OPTIONS
•    One open-pit for Tigranes and
     Aravasdes. Erato as a separate
     open pit
•    3-stage crushing to -12mm
•    Overland conveyor: from the
     crushing plant to the heap leach
     pad ~4km
•    Heap Leach pad: 75Mt capacity in
     3 phase development
•    ADR Plant: carbon circuit for gold
     and silver adsorption followed by
     elution. Gold will be electrowon
     then smelting to produce dore

                                   13
PERMITTING MILESTONES

•   Second major new mining
    operation to be fully permitted
    in Armenia
•   Current ML (starter pit) status
    change for extraction expected
    end Q3
•   Project fully permitted Q2,
    2012




                                      14
INVESTMENT CATALYSTS
•   Current drilling program 40,000m, ~60%
    released defining exploration upside
•   Updated financials with new US$1,200 pit
    shell and no ramp-up Q3, 2011
•   Permitting milestones
•   Resource update Q4, 2011
•   BFS Q1, 2012
•   Detail Engineering completed study Q4,
    2012
•   Production planned for Q2, 2014




                                        15
REGIONAL EXPLORATION
•   Lydian conducts exploration to
    maintain a continuous pipeline of
    promising grass–roots gold
    projects in the Caucasus region


                                        16
 CAPITAL STRUCTURE
Structure                                                                Major Shareholders & Insiders

Outstanding shares:                                           99.36m     IFC:                             13.16%
Deferred payment shares:                                       1.25m     EBRD:                             7.67%
Warrants and options:                                         12.77m     Directors & Senior Management:    6.59%
Including Directors and Employee
Warrants and Options of 5.41m


Fully diluted outstanding                                                Total Insider Position:          27.45%
shares:                                                       113.38m
Market capital (@ C$ 2.50):                                   C$248m
Cash in Bank (as at 31.08.11):                                C$18.8m*

*Newmont Arrangement: Deferred payments due to
Newmont totalling US$10m in 2 equal instalments - 31/12/11
and on or before 31/12/12. On production : options of - Buy
out interest for US$15.6m, or pay a 3% NSR or pay 20
quarterly payments of US$1m.




                                                                                                             17
MANAGEMENT and DEVELOPMENT TEAM
    Dr Tim Coughlin (Chief Executive Officer)         Mr Nerses Karamanukyan (General Manager
    MSc Exploration and Mining, PhD structural        Caucasus) Previous chairman of the
    geology; 20-yrs international experience,         Management Board of Ardshininvestbank
    Australia, PNG, America’s, Russia, Africa. Held   Armenia, Head of the IFC’s offices in Armenia for
    senior positions with major mining companies,     8 years, Diplomatic Counsellor to the Armenian
    lead country entry-exploration programs in        Embassy in the United Kingdom and Chief of
    Russia, Eastern Europe, Colombia, Ecuador and     Staff for two Armenian Prime Ministers.
    Bolivia.
                                                       Dr Hayk Aloyan (Managing Director Armenia)
    Mr Roderick Corrie (Chief Finance Officer)
                                                       PhD Ore Deposit Geology; 12-yrs experience,
    BA Cambridge, MA (Cantab), Associate
                                                       formerly Deputy Chief of Geological Survey in
    Chartered Institute of Bankers, Member
                                                       Armenian Mining and Metallurgical Institute,
    Securities Institute; Strategic advisor and
                                                       widely published on Armenian metallogenesis,
    financier with a variety of companies.
                                                       specialist in resource estimation.


    Mr Gary Patrick (Development Manager)              Dr Armen Stepanyan (Environmental Officer)
    BSc Metallurgy/Chemistry: 22 years experience      ME Environmental Engineering, PhD
    in mining ranging from operations, to project      (geoecology), MBA (major/finance); 9 years
    management and process design. Specializes in      experience as a researcher, water quality and
    gold and base metals. Has worked in Central        radioecology expert at the National Academy of
    Asia, Former Soviet Union, South America and in    Sciences of Armenia, CRDF, NATO, UNDP,
    Australia.                                         and Armenian Nuclear Regulatory Authority.




                                                                                                       18
BOARD MEMBERS and ADVISORY BOARD
    Mr Gordon Wylie (Non-Executive Chairman)                    Mr Peter Mullens (Non-Executive Director)
    Grad Dip Mining Engineering, Management Diploma             BSc Geology; 21years of extensive mining
    (UNISA); 31-yrs experience, from 1998-2005 as               and exploration industry experience. Successfully
    AngloGold-Ashanti’s Global Exploration Manager.             developed 4 Canadian listed exploration
    Instrumental in developing the company’s                    companies. Strong experience of commercial
    “New Frontiers Strategy” into highly prospective            aspects, ore reserves, financial evaluations, mine
    but poorly prospected higher risk regions such as           planning, JV negotiations, and financing of junior
    DRC, Colombia, China and Laos.                              exploration companies.

                                                                Mr Huw Williams (Non-Executive Director) BA, CFA,
    Mr Marc Henderson (Non-Executive Director)                  FCA, MBA; Over 20 years of emerging
    CFA; More than 20 years experience running                  market investment experience. Works in the
    junior mining companies. CEO of Aquiline                    corporate equity unit for the EBRD. Previously 10
    Resources until sold to Pan American for $625               years in private equity in Africa with Actis and CDC
    million in 2009. Currently CEO of Laramide                  Group plc. Also serves as non-executive director of
    Resources (TSX:LAM).                                        several other EBRD investments.

    Mr. Patrick Gorman (Advisory Board) M.S (Mining),           Miss Liz Wall (Advisory Board) Degrees in Mining
    B.Sc. (Hons) Mining; 35 years technical                     Engineering, Development Studies and Environmental
    and project experience in a wide range of business as a     Management. Focusing on mining projects in developing
    mining engineer. He has managed development                 countries as a social development specialist. Her key
    programmes, conceptual evaluations and studies for          areas cover the provision of expertise and support on
    scoping and definitive feasibility stages. His focus in     environmental management and best practices, social
    technical expertise includes mining engineering, mining     welfare, health, sustainability and compliance to
    contractors, metallurgy, scoping, feasibility studies and   Governmental expectations to World Bank and
    financial modeling.                                         Armenian National standards.


                                                                                                               19
INVESTOR RELATIONS
                                                  Mr Steve Smith (Investor Relations Manager)
Steve Smith                                       FCIB MSI: 30 years experience in international
Lydian International Limited                      offshore banking, majoring in product
                                                  development, marketing and investor relations.
Capstan House, La Route Es Nouaux,              . Has worked in Jersey, Guernsey, IOM,
St. Helier, Jersey JE2 4ZJ                        Switzerland and Poland.



Tel: +44 (0) 1534 747 890                         Miss Donna Pugsley (Investor Relations Officer)
                                                  BA Hons degree in Media Communications and
Fax: +44 (0) 1534 758 708                         Publishing: Over 2 years experience in Trust
                                                  Administration and Public Relations.
Mobile: +44 (0) 7829 848420
E-mail: steve.smith@lydianinternational.co.uk


website: www.lydianinternational.co.uk




                                                                                               20
View North to Erato/North Erato




                                  21
View South to Tigranes and Artavasdes
Tigranes North roads
   view from Erato




                                        22
View South to Arshak from Tigranes




                                     23
Helicopter view of Erato West side




                                     24
Amulsar Camp and Bag Farm




                            25

				
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