Avocet Mining PLC Prospectus December 2011

c105718pu010 Proof 5: 7.12.11_13:34 B/L Revision:
SUMMARY
This summary should be read as an introduction only to this document and any decision to invest in the
Company should be based on consideration of this document as a whole by the investor and not solely on
this summarised information. Investors should note that if a claim relating to the information contained
in this document is brought by an investor before a court in a member state of the European Economic
Area, the investor bringing the claim might, under the national legislation of that member state, have to
bear the costs of translating the document before legal proceedings are initiated. Civil liability attaches
to those persons who are responsible for this summary, including any translation of this summary, but
only if the summary is misleading, inaccurate or inconsistent when read together with other parts of this
document.
1. Overview
(a) Group Information
Avocet Mining is a West African gold mining and exploration company. The Company currently
operates one gold mine, Inata, in Burkina Faso, and has a pipeline of exploration projects in Burkina
Faso, Guinea and Mali, supported by strong management teams. The Company expects to produce
approximately 160,000 ounces of gold in 2011.
Avocet Mining’s gold mining and exploration operations were historically located in South East Asia.
In June 2009, Avocet Mining acquired Wega Mining and, through it, Inata in Burkina Faso and
exploration assets in Burkina Faso, Guinea and Mali. Following the acquisition of Wega Mining,
Avocet Mining made the decision to divest its South East Asian Assets in order to focus on the
highly prospective gold region of West Africa. At the date of this Prospectus, Avocet Mining holds
an interest in 21 exploration licences in West Africa.
Listed on the OSE and posted for trading on AIM, at the latest practicable date prior to the date of
this Prospectus, Avocet Mining had a market capitalisation of £425 million. Avocet Mining’s recent
exploration focus has been on advancing its understanding of the geology in and around its existing
assets in Burkina Faso, Guinea and Mali.
(b)
(i)
Operations
Exploitation project
Inata, Burkina Faso
Inata is a gold mine located within a highly prospective 1,660 square kilometre land package in the
Bélahouro district of northern Burkina Faso in the western part of the Birimian Belt. Avocet Mining
operates Inata through its 90 per cent owned subsidiary, SMB.
Mining is currently focused on the Inata North, Central and Far South pits, and is undertaken by
conventional open pit methods. Mill throughput of 645,000 tonnes of ore in the first quarter of 2011
represented an average of 318 tonnes of ore per hour. Mill throughput in each of the second and
third quarters of 2011 totalled approximately 585,000 tonnes. In the first quarter of 2011, Inata
produced 47,963 ounces of gold followed by 39,423 ounces of gold in the second quarter of 2011.
The Company produced 33,256 ounces of gold in the third quarter of 2011. In July 2011, Avocet
Mining announced in a strategic update that it had initiated a scoping study regarding increasing
production capacity at Inata to a target of 245,000 ounces per annum during 2013. In October 2011,
as part of its third quarter results, the Company provided an update on the scoping study,
announcing that as well as its stated target of an additional 80,000 ounces per year mentioned above,
the Inata expansion scoping study would also review potential scenarios for larger expansions in gold
production, in order to assess whether an expansion up to 330,000 ounces per year might be
economically viable. The results of the wider scoping study are expected in the first quarter of 2012.
The Inata deposit presently comprises Mineral Resources of 3.36 million ounces and an Ore Reserve
of 1.47 million ounces according to CSA Global and Roscoe Postle and as reported in Part XII
‘‘Mineral Experts’ Report’’. Further details of Inata’s Mineral Resources and Ore Reserves are set out
in Tables 1 and 2 of this Summary. The Company is targeting a further increase of an Ore Reserve
to 1.8 million ounces during the first quarter of 2012.
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