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A D I F F E R E N T K I N D O F G O L D C O M P A N Y D I F F E R E N T I S B E T T E R Third Quarter Results 2002 D I F F E R E N T I S B E T T E R Third.

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Presentation on theme: "A D I F F E R E N T K I N D O F G O L D C O M P A N Y D I F F E R E N T I S B E T T E R Third Quarter Results 2002 D I F F E R E N T I S B E T T E R Third."— Presentation transcript:

1 A D I F F E R E N T K I N D O F G O L D C O M P A N Y D I F F E R E N T I S B E T T E R Third Quarter Results 2002 D I F F E R E N T I S B E T T E R Third Quarter Results 2002

2 2 Highlights of the 3 rd Quarter Excellent early drill results at Los Pircos More high-grade gold discovered on the Vista Norte zone at El Penon Another strong operating performance from El Peñón Unhedged gold prices increase by 13% Cash balances of $123 million Feasibility at Esquel continues with results early next year

3 3 Third Quarter 2002 Los Pircos – Positive Drill Results JV with Buenaventura Meridian earning 51% interest by spending $2.7 million By paying BVN an additional $1 million, Meridian can earn 65% Located in northern Peru Nine veins identified on the surface tracing 20km of potential strike length Drilled 2 veins Veta Diana (6 holes) Veta Maribel (1 hole)

4 Los Pircos Location

5 Los Pircos Drilling (Veta Diana) HoleFrom (m) To (m) Intercept* (m) Gold (g/tonne) Silver (g/ton ne) SD-1D97.6 107.3 98.3 110.2 0.7 2.9 2.4 0.3 6.5 3.3 SD-2D64.3 66.9 66.1 70.5 1.8 3.6 38.3 15.8 203 154 SD-3D96.0 109.9 98.7 112.5 2.7 2.6 7.6 80.2 31 3,728 SD-4D2.8 6.8 24.9 28.0 91.2 111.1 3.4 7.0 25.1 28.3 91.8 111.2 0.6 0.2 0.3 0.6 0.1 25.1 32.9 9.4 54.7 8.2 14.2 118 75 15 148 123 44 SD-5D61.1 66.7 76.5 63.7 68.5 76.8 2.6 1.8 0.3 6.2 22.0 28.2 157 317 26 SD-6D35.7 45.5 37.5 46.3 1.8 0.8 68.0 24.9 421 71 * Drilled Width

6 6 Veta Diana Drill-hole Map

7 7 Veta Diana Cross Section

8 8 Third Quarter 2002 Financial Highlights Net income of $9.2 million, or $0.10 per share Exploration costs of $2.5 million expensed Cash balances of $123.4 million Return on sales of 27% for the quarter on average realized gold price of $320 per ounce Debt free and no gold hedge

9 9 EPS Year-Over-Year Cause of Change

10 10 Third Quarter 2002 Start of a new investment period

11 11 Third Quarter 2002 Continued Performance from El Peñón Gold mill head grade 13.8 g/tonne Au recovery of 95% up 1% year over year Ag recovery of 90% up 2% year over year Developed Orito Norte open pit

12 El Peñón – One of the lowest cost mines in the world * El Peñón 3Q Cash Costs ($43/oz) El Peñón 3Q Total Costs ($93/oz) * Gold Fields Mineral Services 2001 cost curve

13 13 Third Quarter 2002 Jerritt Canyon Gold production of 24,322 ounces at a cash cost of $285 per gold ounce for the quarter Cash costs significantly higher as a result of higher mix of stockpile feed as more underground development is completed Expect gold production of 100,000 ounces at $260 per ounce cash cost for 2002 Evaluating options for improving profitability

14 14 Third Quarter 2002 Exploration Program El Peñón High grade mineralization at Vista Norte extended another 150 meters along strike Started underground drilling to the south of Orito Sur with follow-up in the fourth quarter Interesting results from exploration drilling Core area District program

15 15 Vista Norte – Expanded 150m to the north HoleFrom (m) To (m) True Width (m)Gold (g/tonne) Silver (g/tonne) PC264*85871.813.8158 PC265*26292.549.5256 PC28519232.94.8131 PC29522252.69.3121 PC29725271.6258.81,989 PC29835383.316.6103 PC30052576.17.941 PC30249512.47.3161 PC33287880.9101.8265 PC33390921.922.8226 PX08246481.218.386 * Previously reported

16 16 Vista Norte Long Section ?? >10 gm/t and < 20 gm/t >20 gm/t and <50 gm/t >50 gm/t

17 17 Esquel – Action Plan Full feasibility work started in June to completed by year-end Exploration drilling has commenced with three rigs by the end of October Construction in 2003 Production in 2004

18 18 Esquel – exploration commenced Galadriel Ungoliant Elena Sur Elena Norte Julia Antonia Galadriel Sur Football Field Post Mineral Cover 8/01 Resource Areas Open Mineralization / Potential Vein / Structure Ungoliant Drilling (BNC Press Release March 5/02) Drill Intercepts: 9m at 34.3 g/t 8m at 15.8 g/t

19 19 The New Meridian Cash costs (Per oz) Gold production (K ozs) 435 202 1996 2001 2004 700 $83 $239 1996 2001 $95 2004

20 20 Third Quarter 2002 Summary With El Penon and Esquel, we believe we are in two of the better gold districts in Latin America Strong net free cash flow supporting a new period of investment Unhedged for higher gold prices Significant exploration program in 2002 With second round drilling on two new projects An exciting new exploration program at Esquel Brancote merger positions the company To become the fastest growing gold company While remaining one of the lowest cost producers

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