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Corporate Presentation February 2009. TSX/NYSE Alternext US:NGD. Cautionary Statement. All monetary amounts in U.S. dollars unless otherwise stated CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

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Corporate Presentation

February 2009

TSX/NYSE Alternext US:NGD


Cautionary Statement

All monetary amounts in U.S. dollars unless otherwise stated

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

Certain information contained in this presentation, including any information relating to New Gold’s future financial or operating performance, may be deemed “forward looking”. All statements in this press release, other than statements of historical fact, that address events or developments that New Gold expects to occur, are “forward-looking statements”. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words “expects”, “does not expect”, “plans”, “anticipates”, “does not anticipate”, “believes”, “intends”, “estimates”, “projects”, “potential”, ”scheduled”, “forecast”, “budget” and similar expressions, or that events or conditions “will”, “would”, “may”, “could”, “should” or “might” occur. All such forward-looking statements are subject to important risk factors and uncertainties, many of which are beyond New Gold’s ability to control or predict. Forward-looking statements are necessarily based on estimates and assumptions that are inherently subject to known and unknown risks, uncertainties and other factors that may cause New Gold’s actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward-looking statements. Such factors include, without limitation: the results of the preliminary economic assessment assessing the viability of a new process facility at Amapari; New Gold’s operations are subject to significant capital requirements ; fluctuations in the international currency markets and in the rates of exchange of the currencies of Canada, the United States, Australia, Brazil, Mexico and Chile; price volatility in the spot and forward markets for commodities; impact of any hedging activities, including margin limits and margin calls; discrepancies between actual and estimated production, between actual and estimated reserves and resources and between actual and estimated metallurgical recoveries; changes in national and local government legislation in Canada, the United States, Australia, Brazil, Mexico and Chile or any other country in which New Gold currently or may in the future carry on business; taxation; controls, regulations and political or economic developments in the countries in which New Gold does or may carry on business; the speculative nature of mineral exploration and development, including the risks of obtaining necessary licenses and permits; diminishing quantities or grades of reserves; competition; loss of key employees; additional funding requirements; actual results of current exploration or reclamation activities; changes in project parameters as plans continue to be refined; accidents; labour disputes; defective title to mineral claims or property or contests over claims to mineral properties. In addition, there are risks and hazards associated with the business of mineral exploration, development and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold bullion losses (and the risk of inadequate insurance or inability to obtain insurance, to cover these risks) as well as “Risks and Uncertainties” included in New Gold’s MD&A filed on November 12, 2008 and available at www.sedar.com. Forward-looking statements are not guarantees of future performance, and actual results and future events could materially differ from those anticipated in such statements. All of the forward-looking statements contained in this press release are qualified by these cautionary statements. New Gold expressly disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, events or otherwise, except in accordance with applicable securities laws.

CAUTIONARY NOTE TO U.S. READERS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCES

Information concerning the properties and operations of New Gold has been prepared in accordance with Canadian standards under applicable Canadian securities laws, and may not be comparable to similar information for United States companies. The terms “Mineral Resource”, “Measured Mineral Resource”, “Indicated Mineral Resource” and “Inferred Mineral Resource” used in this presentation are Canadian mining terms as defined in accordance with NI 43-101 under guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) Standards on Mineral Resources and Mineral Reserves adopted by the CIM Council on December 11, 2005. While the terms “Mineral Resource”, “Measured Mineral Resource”, “Indicated Mineral Resource” and “Inferred Mineral Resource” are recognized and required by Canadian regulations, they are not defined terms under standards of the United States Securities and Exchange Commission. Under United States standards, mineralization may not be classified as a “reserve” unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve calculation is made. As such, certain information contained in this presentation concerning descriptions of mineralization and resources under Canadian standards is not comparable to similar information made public by United States companies subject to the reporting and disclosure requirements of the United States Securities and Exchange Commission. An “Inferred Mineral Resource” has a great amount of uncertainty as to its existence and as to its economic and legal feasibility. It cannot be assumed that all or any part of an “Inferred Mineral Resource” will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. Readers are cautioned not to assume that all or any part of Measured or Indicated Resources will ever be converted into Mineral Reserves. Readers are also cautioned not to assume that all or any part of an “Inferred Mineral Resource” exists, or is economically or legally mineable. In addition, the definitions of “Proven Mineral Reserves” and “Probable Mineral Reserves” under CIM standards differ in certain respects from the standards of the United States Securities and Exchange Commission.

CASH COST

“Total cash cost” figures are calculated in accordance with a standard developed by The Gold Institute, which was a worldwide association of suppliers of gold and gold products and included leading North American gold producers. The Gold Institute ceased operations in 2002, but the standard is the accepted standard of reporting cash cost of production in North America. Adoption of the standard is voluntary and the cost measures presented may not be comparable to other similarly titled measures of other companies. New Gold reports total cash cost on a sales basis. Total cash cost includes mine site operating costs such as mining, processing, administration, royalties and production taxes, but is exclusive of amortization, reclamation, capital and exploration costs. Total cash cost is then divided by ounces sold to arrive at the total cash cost of sales. The measure, along with sales, is considered to be a key indicator of a company’s ability to generate operating earnings and cash flow from its mining operations. This data is furnished to provide additional information and is a non-GAAP measure. It should not be considered in isolation as a substitute for measures of performance prepared in accordance with GAAP and is not necessarily indicative of operating costs presented under GAAP.


Table of contents
Table of Contents

  • Overview

    • Corporate Strategy

    • Reserves & Resources

    • Financial Summary

    • Capital Structure

    • Stock Chart

    • Board of Directors & Management

    • Analyst Coverage

    • Peer Comparison

  • Strategy

    • Operational Targets

    • Operations Overview

    • Internal Growth

    • External Growth

  • Summary


Overview corporate strategy a clear direction
Overview – Corporate Strategy“A Clear Direction”

A CLEAR DIRECTION

  • Vision

    • Grow production to become a million gold equivalent ounce producer, with lower than industry average cash cost per ounce by 2012

  • Mission

    • Achieve our vision by:

      • Delivering on operational targets (safety, cost, production and environment & social responsibility)

      • Maintaining a strong financial position

      • Growing internally through project development and continuous improvement at our existing operations; and

      • Growing externally through continued consolidation of junior gold producers


Overview

  • Globally diversified intermediate gold producer

  • Increasing production and reserves profile

    • Cash flow generating operations

    • Strong reserve position supported by large resource base

  • Growth profile with solid development pipeline

    • New Afton is scheduled to commence production in the second half of 2012

    • El Morro completed feasibility study and entered permitting stage

  • Sound platform for profitable growth and increased shareholder returns

    • Solid financial management

    • Proven board of directors and management with experience financing, developing and operating open pit and underground mines


Overview reserves resources
OverviewReserves & Resources*


Overview financial summary
OverviewFinancial Summary

1 On January 16, 2009 the Ontario Superior Court approved the restructuring of the Third Party Asset Back Commercial Paper (“ABCP”) market, which had been frozen since August 2007. On January 21, 2009 the Pan-Canadian Investors Committee for Third Party Structured ABCP announced that the restructuring Plan has now been fully implemented. Under the agreement New Gold will receive new notes with a par value of CAD $168.9 million, the majority of which will mature in 2017. On closing of the restructuring, New Gold will also receive approximately CAD $5.8 million representing its share of interest earned on its ABCP from August 2007 net of restructuring costs.

2 On January 9, 2009, New Gold reduced its debt position by CAD $50 million, through the buy back of a portion of its Senior Secured Notes for consideration of $30 million, and reduced interest payments by $5 million per year.


Overview

Capital Structure

as at December 31, 2008

Toronto Stock Exchange (NGD:TSX) New York Stock Exchange (NGD:NYSE Alternext US)

Cusip No. 644535 10 6 U.S. 20F Registration under Section 12(b) of the 1934

ISIN CA644 535 10 6 8 Act, CIK# 0000800166 SEDAR Profile 00004818

8


Overview one year stock chart
OverviewOne Year Stock Chart

www.moneycentral.msn.com

Current Price: $3.08

52 Week High/Low: Low High

TSX $0.94 $9.75

NYSE Alternext US $0.74 $10.00

Average Daily Volume (TSX: 3 m) 1,649,890


Organizational Structure

Board of Directors


Organizational structure management team
Organizational StructureManagement Team


Overview analyst coverage
OverviewAnalyst Coverage


Overview peer comparison
OverviewPeer Comparison

Source: Macquarie Research, Canaccord Capital, BMO Capital Markets, RBC Capital Markets


Overview peer comparison1
OverviewPeer Comparison

*Source: Thomson Reuters February 11, 2009


Corporate strategy delivery on operational targets production
Corporate StrategyDelivery on Operational Targets - Production


Producing Mines

Development Projects

Corporate Strategy

Asset Review

  • Complementary portfolio leveraged to continued global growth

  • Approximately 8.2 million oz Au of measured and indicated gold resources(1)

New Afton¹:

1,630,000 oz Au M&I Resources

Cerro San Pedro¹:

2,030,000 oz Au M&I Resources

Amapari²:

745,000 oz Au M&I Resources

El Morro (Attributable)1,3:

2,659,000 oz Au M&I Resources

Peak²:

458,000 oz Au M&I Resources

  • Measured and indicated resources are inclusive of mineral reserves

  • Measured and indicated resources are exclusive of mineral reserves

  • The El Morro Project has been calculated at 30% of the total reserves and resources to reflect New Gold’s 30% interest in the project

Care and Maintenance


Corporate strategy asset review
Corporate StrategyAsset Review

Producing Mines

  • Mineral reserve estimates for the Peak Mines were calculated using a gold price of $450 per ounce and a copper price of $1.25 per pound. The cut-off net smelter return value used for the Mineral Reserve estimates for the Peak Mines was $100 per tonne.

  • Measured & indicated resources, exclusive of mineral reserves. Mineral reserves and resources have been reported as of December 31, 2006 in accordance with CIM Standards or the JORC Code.

  • For the period ending September 30, 2008


Corporate StrategyAsset Review – Peak Mines

LOM Production Sources

New Cobar

Peak

Chesney

Perseverance Zone A

Perseverance Zone D

New Occidental

900m

3100m

1800m

800m

1900m

18


Gold (k oz)

2,000

1,500

1,000

Resources

(Exclusive of

500

Reserves)

0

Reserves

-500

Cumulative

-1,000

Oz produced

1992

1997

1999

2000

1993

2002

1994

1995

2003

2004

1991

1996

2005

2006

1998

2001

2007

-1,500

-2,000

-2,500

Corporate StrategyAsset Review – Peak Mines

There are currently more gold ounces in Resources than when the mine commenced production in 1992.  Peak Mines achieved a milestone in 2008, producing its two millionth ounce of gold since commissioning the mine.

19


Corporate strategy asset review1
Corporate StrategyAsset Review

Producing Mines

CERRO SAN PEDRO

  • Mineral reserves and resources were estimated using a gold price of $475/oz Au and $8.00/oz Ag reported as of January 1, 2007 and March 31, 2007, respectively in accordance with CIM Standards of the JORC Code.

  • Mineral resources have been estimated at a cut-off grade of 0.20 g/t gold. Measured & indicated resources, inclusive of proven and probable reserves.

  • For the period ending September 30, 2008

21


Corporate strategy asset review cerro san pedro
Corporate StrategyAsset Review – Cerro San Pedro

Carbonaceous

Begoñia Ls.

2100m

Kb

B. Mn Ox. Ore

Kh

Ls. Oxide Ore

Porphyry

Oxide Ore

Kh

1900m

Kg

Porphyry

Ox./Silf.

Porphyry

Sulfide

Kg

Massive Sulf.

1700m

Faults

Mineralized

Faults

Kg

1500m

10500N

10000N

11000N

ALTERATION-MINERALIZATION SECTION B-B’


Corporate strategy internal growth
Corporate StrategyInternal Growth

Development Mines

NEW AFTON

24


Corporate StrategyInternal Growth – New Afton

New Afton Block Cave Model

25


Development Mines

Corporate StrategyInternal Growth

EL MORRO

27


Summary

  • New Gold will continue to be a compelling investment:

  • Cash generating assets with growth potential, all located in mining friendly jurisdictions

  • Solid financial position

  • Internal growth through project development and continuous improvement at our existing operations

  • External growth through mergers and acquisitions

  • Undervalued in comparison to our peers


Contact information
Contact Information

Investor Relations

Mélanie Hennessey

Vice President Investor Relations

Direct: +1 (604) 696-4100

Toll-free: +1 (888) 315-9715

Email: [email protected]


Appendix reserves resources
AppendixReserves & Resources

Additional Notes on all Mineral Reserves:

  • All Mineral Reserves have been calculated in accordance with the CIM Standards or the JORC Code. The JORC Code has been accepted for current disclosure rules in Canada under NI 43-101. The Mineral Reserves have been reported as of the following dates:

    • Amapari Mine – September 30, 2007

    • Peak Mines – December 31, 2006

    • New Afton Project – September 21, 2006

    • Cerro San Pedro Mine – January 1, 2007

    • El Morro – March 31, 2008

  • The qualified person(s) (as defined under NI 43-101) or competent person(s) (as defined under the JORC Code for the Mineral Reserves estimates are as follows:

    • Amapari Mine – Carlos Guzmán, Ing. Civil de Minas, AusIMM, NCL Brasil Ltda

    • Peak Mines – Geoffrey N. Challiner, B.Sc. (Eng.), C.Eng., Independent Mining Engineer, Mine and Quarry Engineering Services, Inc.

    • New Afton Project – Mike Thomas, MAusIMM (CP), AMC Consultants Pty Ltd.

    • Cerro San Pedro Mine – William L. Rose, WLR Consulting, Inc.

    • El Morro Project – Barton G. Stone, P.G., and Richard J. Lambert, P.E., Pincock, Allen & Holt

  • Mineral Reserve estimates for the Amapari Mine were calculated using a gold price of $575 per ounce. Based on a cut-off grade of 1.1 grams per tonne.

  • Mineral Reserve estimates for the Peak Mines were calculated using a gold price of $450 per ounce and a copper price of $1.25 per pound. The cut-off net smelter return value used for the Mineral Reserve estimates for the Peak Mines was A $100 per tonne.

  • Mineral Reserves estimate for the New Afton project were calculated using a gold price of $475 per ounce and a copper price of $1.45 per pound. Cut-off at $15 per tonne of ore.

  • Mineral Reserve estimates for the Cerro San Pedro Mine were calculated using a $475 per ounce gold price and a $8.00 per ounce silver price.

  • Reported at 100%, however, New Gold’s interest is only 30%. Mineral Reserve estimates for the El Morro Project are calculated on a copper equivalent cut-off basis: Eq Cu = Cu (%) + 0.592 x Au (g/t), where Cu (%) represents the average copper grade, Au (g/t) represents the average gold grade and 0.592 represents a constant based on a copper price of $1.25 per pound, a gold price of $500 per ounce and average metal recoveries for the deposit.

  • For the calculation of estimated total reserves, the reserve estimates for the EL Morro Project have been calculated at 30% of the total reserves, to reflect New Gold’s 30% interest in the El Morro Project.

  • Numbers may not add up due to rounding.


Appendix reserves resources1
AppendixReserves & Resources

Additional Notes on all Mineral Resources:

  • All Mineral Resources have been calculated in accordance with the CIM Standards or the JORC Code. The JORC Code has been accepted for current disclosure rules in Canada under NI 43-101. The Mineral Resources have been reported as of the following dates:

    • Amapari Mine – September 30, 2007

    • Peak Mines – December 31, 2006

    • New Afton Project – September 21, 2006

    • Cerro San Pedro Mine – March 31, 2007

    • El Morro – March 31, 2008

  • The qualified person(s) (as defined under NI 43-101) or competent person(s) (as defined under the JORC Code) for the Mineral Resource estimates are as follows:

    • Amapari Mine – Emmanuel Henry, Member of the AusIMM (CP), AMEC International (Chile) S.A.

    • Peak Mines – Neil Inwood, MAusIMM, Senior Consultant, Resources, RSG Global Consulting Pty Ltd.

    • New Afton Project – David Rennie, Scott Wilson Roscoe Postle Associates Inc.

    • Cerro San Pedro Mine – William L. Rose, WLR Consulting, Inc.

    • El Morro Project – Barton G. Stone, P.G., and Richard J. Lambert, P.E., Pincock, Allen & Holt

  • Mineral Resource estimates for the Amapari Mine were calculated using a gold price of $600 per ounce, based on a cut-off grade of 0.5 grams per tonne for the open pit and 2.1 grams per tonne for the underground mineralization.

  • Mineral Resource estimates for the Peak Mine were calculated using a gold price of $525 per ounce and a copper price of $1.50 per pound.

  • Mineral Resources for the New Afton Project were estimated by applying a cut-off of $10 per tonne of ore, which was derived using a gold price of $450 per ounce, a silver price of $5.25 per ounce and a copper price of $1.20 per pound.

  • Mineral Resources for the Cerro San Pedro Mine have been estimated at a cut-off grade of 0.20 grams per tonne of gold using a gold price of $475/oz. Silver-to-gold ratio is estimated at 60:1.

  • Reported at 100%, however, New Gold’s interest is only 30%. Mineral Resource estimates for the El Morro Project are calculated on a copper equivalent cut-off basis: Eq Cu = Cu (%) + 0.592 x Au (g/t), where Cu (%) represents the average copper grade, Au (g/t) represents the average gold grade and 0.592 represents a constant based on a copper price of $1.25 per pound, a gold price of $500 per ounce and average metal recoveries for the deposit. Inferred Mineral Resources are defined on the basis of drill sample density and include Inferred Mineral Resources occurring within and outside a simulated pit shell based on a copper price of $1.25 per pound and a gold price of $500 per ounce.

  • Mineral Resources are not known with the same degree of certainty as Mineral Reserves and do not have demonstrated economic viability.

  • Numbers may not add up due to rounding.


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