corporate overview rbc diamond conference, london may 2008
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3
Company Background Listed on AIM 1998
Management team
– Philip Kenny – CEO
– Tim Wilkes – COO
– Jan Louw – Director of Operations
– 10 diamond geologists on staff
Focused on kimberlite exploration in Botswana
– assembled largest land position in Botswana kimberlite fields
Cash flow from toll treatment JV with De Beers in South Africa
4
Diamond Exploration Worldwide
Source: BHP Billiton
Siberia
Kasai
Kaapvaal
11%
9%
10%
40%
3%
Craton
“Hot spots”
17%
7
Why Botswana?
World’s largest diamond producer
– 30% by value
– geology is favourable for new discoveries
Lowest cost producer
– Climate, infrastructure, politics are favourable
Lowest economic threshold of major kimberlite producing regions
– Northern Canada, Russia ~ $100-120/tonne
– Angola, DRC ~ $25-50/tonne
– Botswana ~ $8-10/tonne
8
Botswana Kimberlite Fields
Orapa 8 out of 75 economic
Orapa Mine ~ $1B revenue p.a., 70% margin
Jwaneng 3 out of 11 economic
Jwaneng Mine ~ $2B revenue p.a., >90% margin
Martin’s Drift 5 out of 7 economic
Mine being developed
Gope 1 out of 9 economic
Gem doing feasibility
Kokong 79 kimberlites
19 with diamonds
Rio Tinto evaluating
Tsabong 83 kimberlites
18 with diamonds
Firestone evaluating
Economic ratio worldwide: 1%
Economic ratio Botswana: 7%
9
Firestone Interests in Botswana
Firestone Licence areas
De Beers JV areas
Tsabong
5,000 sq km
Covers entire kimberlite field
Jwaneng
3,000 sq km surrounding Jwaneng
JV with De Beers over 3,000 sq km; De Beers earning 61% to BFS
Orapa
BK11 advanced evaluation
10,000 sq km surrounding Orapa
JV with De Beers over 5,000 sq km; De Beers earning 61% to BFS
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One of the largest diamondiferous kimberlite fields in the world
83 known kimberlites; 18 diamondiferous
MK1 kimberlite - 180 hectares, diamondiferous
Mir 7ha
~200 cpht $200/t ~100 cpht $100/t
~100 cpht $100/t
~100 cpht $200/t
~40 cpht $14/t
~147 cpht $162/t
MK1 180ha
MK45 25ha
MK38 ~20ha
Udachnaya 20ha
Orapa 111ha
~46 cpht $28/t
Catoca 66ha
Kimberley 4ha
Premier 32ha
Jwaneng 45ha
Tsabong Kimberlite Field
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Tsabong Background
Limited evaluation since first discoveries in the 1980’s
– Evaluation limited by overburden – 20 to 80m
– Microdiamond and geochem techniques in their infancy
– Most kimberlites sampled with 50 kg sample from a single 6” hole
Good diamond potential
– Geochemistry favourable for diamonds
– Similar setting to Jwaneng
– Drilling technology improved significantly
– Diamond prices increased substantially
Economic threshold is modest
– 20 cpht & $120/carat would support a major mine
13
Tsabong Kimberlites
0
5
10
15
20
25
0 10 20 30 40 50 60 70 80 90 100 110 120 130 140 150 160 170 180
Surface Area (Ha)
Nu
mb
er
of k
imb
erl
ites
95%>10Ha
14
Evaluation Programme
Focus on most prospective kimberlites
– Indicator mineral chemistry
– Diamond content
– Size
14 high interest kimberlites selected
– 17 LDD holes planned ~ 6,000 m of 24” LDD drilling ~ 3,500 tonnes of kimberlite sample
– 6,000 metres of core drilling
15
MK1 - Historical Work
Significant microdiamond intersections
0 200 400m
Tuffaceous FaciesKalahari Crater Sedimentary Facies Intrusive facies
A A’
???
16
MK1 – Firestone Work
Tuffaceous FaciesKalahari Crater Sedimentary Facies Intrusive facies
A A’
85-120m 14 diamonds
240-275m 15 diamonds
360-390m 26 diamonds
475-508m 62 diamonds
510m
MK1 – MiDa Results
117 microdiamonds recovered from 561 kgs
Size frequency analysis done by Tinus Oosterveld
– Plotted micro portion
– Extrapolated macro portion
– Requires 200-400 diamonds
– Ideally 20 stones across the middle sieve sizes
Grade of all samples 20cpht
Grade of sample 4 – 119cpht
MK1 KIMBERLITE
0.01
0.10
1.00
10.00
100.00
1000.00
10000.00
100000.00
1000000.00
10000000.00
0.00001 0.00010 0.00100 0.01000 0.10000 1.00000 10.00000
100.00000
Av size, cts/stn
Gra
de
, sp
t u
i
Model 1 Model 2 M3+M4 M5 M TOTAL
20cpht 119cpht
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MK1 - Work Programme
Hole 53A A’
510m
DDHLDDH
Tuffaceous FaciesKalahari Crater Sedimentary Facies Intrusive facies
0 200 400m
4 x 100t LDD holes planned
524m
490m
MiDa samples pending
19
Bulk sampling – LDD Rig
Large diameter drill rig
– 18” & 24” holes
– Drill to 700m
– Allows rapid recovery of bulk sample
20
Bulk sampling – DMS plant
10 tonne per hour, 50-100 tonne per day
No reliance on labs
25-30 bulk samples in 2008
Mobile
MK1 - Preliminary Volume Estimates
Rock type From To Approx Volume Tonnage
(m) (m) Size m3 tonnes
Crater 80 100 154 29,021,218 72,553,045
Crater 100 200 129 131,176,435 327,941,088
Volcaniclastic 200 300 107 109,388,794 273,471,985
Volcaniclastic 300 400 100 89,198,953 222,997,383
Volcaniclastic 400 500 94 71,341,563 178,353,908
Volcaniclastic 500 520 88 12,228,790 30,571,975
Estimated 442,355,753 1,105,889,383
Volcaniclastic kimberlite 705,395,250
22
23
MK1 - conceptual modelling
Base case - @20cpht, $120/ct = $24/tonne revenue
$10/tonne opex
1.1 B tonnes
24Mt per annum
50 year LOM
Start 2014, full tonnage 2015
25
High Interest Kimberlites
KimberliteSurface
Area Macros recovered Micros recovered Comments
MK 1 180 + + Very large size; 13% G10 garnets
MK 31 75 NS + Large size
MK 45 25 NS - 4% G10 garnets; best KIM chemistry
MK 4 20 NS + 10% G10 garnets
MK 42 20 NS +
MK 39 20 NS +
MK 38 20 NS + 24% G10 garnets; best KIM chemistry
MK 7 20 NS - Group 1 eclogitic garnets
MK 34 20 NS +
MK 52 15 NS +
MK 51 10 NS + 17% G10 garnets
MK 82 10 NS - 10% G10 garnets; best KIM chemistry
MK 65 10 NS + Best diamond results
MK 48 10 NS +NS = Not yet sampled
28
# of Holes Tons Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov
BK11 3 600
MK1 4 560
MK31 1 140
MK38 1 140
MK45 1 140
MK50 1 140
MK65 1 140
MK39 1 140
MK42 1 140
MK4 1 140
MK84 1 140
MK51 1 140
MK7 1 140
MK34 1 140
MK48 1 140
? 1 140
? 1 140
? 1 140
? 1 140
? 1 140
25 3,680
Mini Bulk Sampling Programme - 2008
Rig 1
Rig 2
Legend
LD Drilling
Treatment
Results
29
Feasibility
Resource drilling
Mini bulk sampling
Core drill Phase 2
Core drill Phase 1
Tsabong Evaluation Timeline
2007 2008 2009 2010
H2 H1 H2 H1 H2 H1
31
Tsabong Exploration
MK1
MK6
MK4
MK51
MK37
MK1
• >80 geophysical targets to drill.
• 13 kimberlites discovered since Nov 06
• 8,000 metres of drilling planned
32
New discoveries
KimberliteEstimatedSize (Ha)
Depth ofOverburden (m) Kimberlite type
MK71 15 48 Crater/diatreme
MK72 22 91 Crater/diatreme
MK73 18 16 Diatreme/hypabyssal
MK74 8 20 Diatreme/hypabyssal
MK75 28 97 Diatreme
MK76 12 35 Crater
MK77 8 34 Crater
MK78 5 90 Crater/diatreme
MK79 12 133 Crater/diatreme
MK80 18 105 Crater/diatreme
MK81 18 63 Crater
MK82 12 91 Crater
MK83 18 111 Crater
33
Tsabong Exploration Timeline
2006 2007 2008
Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Ranking and evaluation
KIM and Mida analyses
Discovery drilling
Geophysics
KIM and Mida analyses
Discovery drilling
Geophysics Phase 1
Phase 2
36
Botswana projects
92 kimberlites, 23 diamondiferous
Expect more than 100 kimberlites by end 2008
Bulk sample 25-30 kimberlites by end 2008 (3 samples completed)
Botswana economic ratio 7%
Good prospects for significant economic discovery
New projects identified
37
Corporate Information
Shares in issue: 55 million, 63 million fully diluted
– ~45% institutions; ~26% retail; ~29% management
Market cap £106 million
Cash Dec 07 ~ £5 million
Major shareholders
– AXA/Framlington - 10%
– Gartmore - 9%
– JPMorgan - 6%
– Artemis - 6%
38
Summary
Experienced management teamExperienced management team
Cash and cash flowCash and cash flow
Highly prospective kimberlite portfolioHighly prospective kimberlite portfolio
Bulk sampling and exploration news flow in 2008Bulk sampling and exploration news flow in 2008
DisclaimerThe information contained in this presentation ("Presentation") has been prepared by Firestone
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tortuous, statutory or otherwise, in respect of the accuracy or completeness of the Information or for any of the opinions contained herein or for any errors, omissions or misstatements or for any loss, howsoever arising from this Presentation. In communicating this Presentation, the Company does not undertake or agree to any obligation to provide the recipient with access to any additional information or to update this Presentation or to correct any inaccuracies in, or omissions from, this Presentation which may become
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