NAUTILUS MINERALS PNG Mining and Petroleum Conference Sydney, December 2012 December 2012 1
Disclaimer and Legal Notice This Presentation may contain forward-looking statements within the meaning of the United States Securities Exchange Act of 1934 and forward-looking information within the meaning of applicable Canadian securities law. Material forward-looking statements and forward-looking information include, but are not limited to statements or information with respect to the Company s ability to locate, mine and transport mineralized material from the seafloor; estimates of future production; the method of transport and amount of mineralized material from the Company s Solwara project; estimates of anticipated costs and expenditures; development and production timelines; the potential commercial extraction of seafloor resources in the CCZ, further development of TOML s CCZ territory and other potential resources in TOML s CCZ territory; the Company s ability to finalise the termination of contracts with suppliers; the Company having sufficient cash to support it moving forward. We have made numerous assumptions about the material forward-looking statements and information contained herein, including those relating to: the future price of copper, gold, silver and zinc; anticipated costs and expenditures; and our ability to achieve our goals. Even though our management believes that the assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that the forward-looking statement or information will prove to be accurate. Accordingly you should not place undue reliance on forward-looking statements or information. Forward-looking statements and information by their nature involve known and unknown risks, uncertainties and other factors which may cause the actual results to differ materially from those described in forward-looking statements or information. "Risk Factors" are presented in the Company's most recent Annual Information Form, available on SEDAR (www.sedar.com). Except as required by law, we undertake no obligation to update forward-looking statements and information as conditions change. No information in this presentation shall constitute an invitation to invest in Nautilus or any entities of the Nautilus Group. Neither Nautilus, nor any entities of the Nautilus Group, nor their respective officers, employees or agents, shall be liable for any loss, damage or expense however caused (including through negligence) which you may directly or indirectly suffer in connection with this presentation including, without limitation, any loss of profit, indirect, incidental or consequential loss. This information is not intended to take the place of professional advice and you should not take action on specific issues in reliance on this information. While efforts are made to keep the information in this presentation accurate and timely, neither Nautilus nor any of the entities of the Nautilus Group guarantee or endorse the content, accuracy or completeness of the information herein. You are referred to the Company's documents filed on SEDAR. All graphics, effects, processes, information and data in this Presentation are owned or used under license by Nautilus. Any reproduction or dissemination, in whole or in part, is strictly prohibited. This presentation does not constitute an offer to sell or a solicitation of an offer to buy Nautilus common shares. In the United Kingdom this presentation is only directed at (i) persons falling within Article 49(2)(a) to (d) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended) and (ii) persons to whom the communication may otherwise lawfully be made (together 'relevant persons'). This presentation must not be acted on or relied upon by any persons who are not relevant persons. Any investment or investment activity to which this presentation relates is available only to relevant persons and will be engaged in only with relevant persons. Information contained herein includes references to the Company s most recent 43-101 Technical Reports as filed on SEDAR. December 2012 2
Talk Outline Who is Nautilus Minerals Deep sea minerals: Opportunity for PNG Project status Our work in PNG Moving forward December 2012 3
Who is Nautilus Minerals? Focus: High grade copper, gold, zinc and silver from the deep sea Exploration in PNG since 1997 World s first SMS Exploration License Nautilus and PNG leading the world in deep sea exploration Major Industry Shareholders 21.0% 11.1% 16.9% 4.5% December 2012 4
Talk Outline Who is Nautilus Minerals Deep sea minerals: Opportunity for PNG Project status Our work in PNG Moving forward December 2012 5
Opportunity for Papua New Guinea Land-based mine Deep sea production High tech, high grade, low volume, low waste, small footprint World s demand for metals continues to rise Land resources are stretched; declining ggrades Every human activity impacts on the environment December 2012 6
Social and Environmental Advantages Average Reserve 7.2 Average Reserve Grade (%) of Land- Grade (%) of Land- Based Copper Based Copper Projects: Projects: Seafloor Massive Sulphide (SMS) deposits HIGH GRADES of copper, gold, zinc & silver Minimal overburden Small physical footprint No land owners to disrupt 0.97 1.0 1.01 0.96 0.71 0.67 0.67 0.62 0.61 1980 1985 1990 1995 2000 2005 2006 2008 2009 Nautilus Indicated Resource Source: Source: Brook Hunt, a Wood Mackenzie Company Nautilus Resource Estimate prepared by Ian Lipton, BSc (Hons), FAusIMM, Principal Geologist, Golder Associates Pty Ltd. Effective Date: 25 Nov 2011. Mineral Resources based on 2.6% Cu eq cut-off grade December 2012 7
Talk Outline Who is Nautilus Minerals Deep sea minerals: Opportunity for PNG Project status Our work in PNG Moving forward December 2012 8
Solwara 1 Project Status Located in the Bismarck Sea, PNG, at 1600m water depth NI 43-101 Resource established Environmental permit granted Dec 2009 Mining lease granted Jan 2011 30 km from nearest coast Small extraction area: 0.11 km 2 December 2012 9
Status of State Equity Option Agreement Without prejudice meetings ongoing Discussions will increase build time and cost Preserving cash Reviewing all aspects of the company December 2012 10
Seafloor Production System Production Support Vessel Operational base. Power supply and dewatering plant Riser and Lifting System Pumps material to the surface Seafloor Production Tools Three remote operated machines, cutting and collecting material December 2012 11
Solwara 1 Project Build 53% complete (end of September) Factory Acceptance Testing completed for subsea pumps Surface pumps p completed Winches and A-Frames advanced Initial cutting trials completed December 2012 12
Seafloor Production Tools Taking Shape Yoke Pilot chair Chasis Caterpillar Chasis tracks December 2012 13
Talk Outline Who is Nautilus Minerals Deep sea minerals: Opportunity for PNG Project status Our work in PNG Moving forward December 2012 14
Nautilus Approach Early, transparent and inclusive stakeholder engagement Inclusive multi-stakeholder workshops to develop ESIA, EIS, EMPs, monitoring programme, etc Communities World-renowned experts in various fields, from anthropologists to deep sea ecologists Government NGOs Ongoing Community Awareness and Consultations Established CARES - 2007 Community Accountable, Responsible Environmentally, Safe www.cares.nautilusminerals.com December 2012 15
Applying the Precautionary Approach Nautilus commitments: Fully enclosed system No hazardous chemicals No tailings discharged d to the sea No blasting Biodegradable fluids/oils to be used in all subsea equipment No extraction impact shallower than 1300 m water depth at Solwara 1 (below where tuna, etc, live) Transparency Freedom to publish Independent monitors and reviewers December 2012 16
Consultation Undertaken since 2007 December 2012 17
Improving Maritime Safety in PNG Exploration data provided to PNG s National Maritime Safety Authority Improves detail and accuracy of navigational charts (improvements to Chart AUS 391 shown) Leads to greater maritime safety December 2012 18
Nautilus-Duke University Opportunity Bursary Nautilus and Duke University (USA) currently have a collaborative scholarship scheme which was initiated in 2007. So far, 4 x PNG Nationals have been awarded a chance to study at Duke University. Learn state-of-the-art techniques under the supervision of world renowned deep sea ecologists. Currently Mr Freddie Alei (New Ireland): - Commenced 6 week courses: - Marine Ecology - Conservation Biology and Policy - Learning state-of-the-art marine science techniques. - Will conduct analyses on Solwara 1 samples December 2012 19
Community Partnerships Port Moresby City Mission i Nautilus committed $US100,000 in funding Donation is being used to improve the quality of life of street children, assisting them to integrate into society Namatanai Community Centre Nautilus donated K100,000 towards the centre Centre is currently a hub for community development initiatives in central New Ireland Province December 2012 20
Commitment to Local Hire and Training Nautilus is committed to: local hire and training programs to encourage skill and capacity building in PNG employing and providing vocational training i for geologists, geophysicists i and environmental scientists Currently ~ 10% of Nautilus workforce is PNG Nationals Nautilus ultimate goal is for 70% of the operation s workforce to be PNG Nationals December 2012 21
Talk Outline Who is Nautilus Minerals Deep sea minerals: Opportunity for PNG Project status Our work in PNG Moving forward December 2012 22
Community development fund Voluntary contribution Aim: contribute to community projects, with a focus on health and education and stimulating small to medium enterprises Independent board will advise Nautilus on the management of the fund Will work with the relevant Provincial i Governments to identify community priorities Will be set up in 2013 (prior to production) December 2012 23
The Way Forward Seafloor Resource Production offers many social and environmental advantages for mineral development Application of the Precautionary Approach Transparency Independent studies Multi-stakeholder t ld approach Finalising discussions with the PNG Government on the State Equity Option Agreement December 2012 24
Mike Johnston CEO and President (Interim) mdj@nautilusminerals.com www.nautilusminerals.com www.cares.nautilusminerals.com December 2012 25