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Marcus Evans Conferences Greenland and Arctic Mineral Exploration and Exploitation Forum 2 nd & 3 rd November 2011

Marcus Evans Conferences Greenland and Arctic Mineral Exploration and Exploitation Forum 2 nd & 3 rd November 2011 The Cumberland Hotel, London, UK. Building a Greenlandic Workforce. Angel Mining: Focussed on Greenland. AIM listed mining company Only company mining in Greenland today

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Marcus Evans Conferences Greenland and Arctic Mineral Exploration and Exploitation Forum 2 nd & 3 rd November 2011

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  1. Nick Hall, CEO Angel Mining plc Marcus Evans Conferences Greenland and Arctic Mineral Exploration and Exploitation Forum 2nd & 3rd November 2011 The Cumberland Hotel, London, UK

  2. Building a Greenlandic Workforce

  3. Angel Mining: Focussed on Greenland • AIM listed mining company • Only company mining in Greenland today • Began building a mining and mineral process team in August 2010 • Prior to August 2010 relied on sub-contractors

  4. Anything you want to do in Greenland is difficult!

  5. Angel Mining: Focused on Greenland • Nalunaq • - High grade gold deposit • - First gold doré produced on 27 May 2011 • - Annual target 24,000 ounces of gold • Black Angel • - a high grade zinc/lead deposit • - First production planned for H2 2013 • - Annual target 30,000 tonnes of Zn 8,000 tonnes of Pb 5

  6. Angel Mining: Location Map Black Angel Nalunaq

  7. NALUNAQ GOLD MINE

  8. First Drop of Production – 29th May

  9. Nalunaq Employees .

  10. Nalunaq Employees .

  11. Government Requirements • Must employ Greenlanders unless the skills do not exist in Greenland • Must not pay less than a Greenlander would earn (to prevent cheap labour) • Must not pay expats more than Greenlanders with same skills • Expats must have a ‘Stay and Work’ permit • Expats must be from the EU or have a Danish visa • (can take 4 months to obtain) 11

  12. Estimate of People Required .

  13. Basic Assumptions • 30 new mines opening in next 5 years • Average camp size of 145 people

  14. Training • Mining school at Sisimuit • Government, schools, SIK, GE, and the emerging mining industry need to make serious training plans • The training project needs funding • There needs to be classroom combined with practical experience • Scholarships at foreign universities and apprenticeships with world class miners

  15. Employment Contract Terms • All site employees are working 6 weeks on site and 3 weeks off • All miners and plant operatives work 7 days per week and a basic 12 hour day • Admin staff work 6 day week, 12 hour days, 7th day is worked if needed • We only pay for days worked on site

  16. Recruitment Experience to Date • Networking has been best source of capable well motivated people • Employment agencies have provided many candidates but we have had a high turnover • We require all employees to have a pre employment medical • Face to face interview is essential

  17. Recruitment Issues • Transport is by air or sea only • Air Greenland has a monopoly of the air • Travel is expensive ($3,000 typical round trip) • Weather and other delays are frequent (worst example – Nalunaq to CPH - 9 days) • Small highly dispersed population • Low indigenous skill base • Poor indigenous work ethic is common • High rates of tax • Free health care

  18. Greenlandic Tax – Expat Employees .

  19. Greenlandic Tax – Resident Employees • Tax rate is 42% to 45% depending on Municipality • 12% of earnings during a calendar year must be paid the following year as holiday pay

  20. Greenlandic Tax - Subcontractors • All subcontractors must be registered • If working in Greenland for more than 30 days in any 12 month period – profits are taxed at 31.8% • Subcontractor’s employees are taxable if they are working in the country for more than 3 months in any 12 month period • Tax treaties exist with Denmark, Iceland, Sweden and Norway • UK authorities do not tax earnings already taxed in Greenland

  21. Greenlandic Tax - Companies • Mining permits are issued for 30 years but only to Greenlandic registered companies • A company may have only one mining permit • There is no Group relief • There are no export duties or royalties • Profits are taxed at 30% p.a. • Dividends are taxed at 7% (it is not an Imputation tax system) • Capital allowances are 30% on reducing balance for operating assets and 5% on buildings

  22. SIK – Labour Union • Largest Union in Greenland • Membership is voluntary • Their main concerns are:- - we should employ and train as many Greenlanders as possible - contributions should be made to the pension scheme run by SIK - comfortable and safe working conditions

  23. Impact Benefit Agreement • Parties - Mining Company - Municipality - Greenland Government (BMP) • Monitoring Plan (annual review) • Areas of Benefit - Employment - Training - Local Suppliers - Taxation - Other

  24. GE – Employers Federation • Like SIK, they are based in Nuuk • They lobby the government on behalf of employers • they provide good networking opportunities • Membership is cheap and I would recommend all companies wanting to operate in Greenland should join

  25. The Challenge that Lies Ahead • Recruiting enough experienced mining professionals • Training Greenlanders in all mining skills and professional disciplines • Competition for the scarce resource of people from:- • - new mining companies • - The Alcan project • Cost Control

  26. 11kg Doré Bar – 15 September

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