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Advancing African Projects

Advancing African Projects. September 11, 2008. Disclaimer.

yael-fitzgerald
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Advancing African Projects

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  1. Advancing African Projects September 11, 2008

  2. Disclaimer Except for historical information, this presentation contains forward-looking statements, which reflect the Company's current expectation regarding future events. These forward-looking statements involve risks and uncertainties, which may cause actual results to differ materially from those statements. Those risks and uncertainties include, but are not limited to, changing market conditions, and other risks detailed from time-to-time in the Company's ongoing filings. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In light of these risks, uncertainties and assumptions, the forward-looking events in this presentation might not occur.

  3. Hydroelectric Developments (DRC) Forest Products (Eucalyptus) (ROC) Kouilou Potash Project (ROC) Magnesium Alloys (ROC) MagIndustries – AGM 2007

  4. MagIndustries at a Glance • Developing major industrial projects in • Republic of Congo (ROC) • Democratic Republic of Congo (DRC) • Achievements are driving shareholder value • Canadian-based: • TSX-V: MAA, market cap ~C$600M • 4% owned by management, directors • ~75% institutional including Fidelity, Ospraie, Enso, Blakeney, L-R Global

  5. Track Record Demonstrates Competencies Recent Milestones • Secured MagMinerals mining license • Successfully raised capital: US$240M (last 12 months, at the parent and subsidiary level) • Successful forestry operations and chip mill start-up • Advancing decisions with global brand name partners • E+PC; BNP Paribas; Ameropa AG; EIB; IDC • Mitsui; Forestales

  6. TheProjects TheFuture Agenda

  7. Potash forthe world • First new entrant to potash industry • with unmatched competitive advantages The MagIndustries story is about…Exciting Resource Projects in Central Africa Exceptional Returns

  8. 43-101 Measured, Indicated and Inferred Resource Total years of production Planned production (tpy) Phase I (2011) Planned production (tpy) Phase II (2013) Willy Verbrugghe appointed as MagMinerals CEO Capital raised in MagMinerals (pvt.pl.) April 2008 Final SNC Lavalin feasibility report MagMineralsSignificant Progress in Advancing Project 1 Billion tons > 100 600,000 1,200,000 Feb 2008 US$100M May 2008

  9. Kouilou Potash Project Key characteristics of planned mine • 600,000 tonne annual capacity; est. cap cost US$723M • Production costs projected to be in the bottom quartile • Phase II adds 600,000 tonnes; est. cap costs US$500M • First production estimated Q2 2011 • 10% free carried interest granted to ROC Government Marketing • Ameropa AG: marketing partner for 100% of production under “bankable” offtake agreement Next steps • Project financing is well advanced; strong expression of interest from debt providers: Debt and equity financing expected to close Q4 2008 • Construction startup Q3 2008, Commissioning Q4 2010

  10. Proposed plant site Gabon Pointe-Noire ROC BRAZZAVILLE KINSHASA Pointe-Noire DRC Angola Best deepwater port in west-central Africa Kouilou Potash ProjectCompetitive Advantages • Exclusive rights to one of world’s largest carnallite deposits • carnallite  potash • Low cost solution mining + low cost energy  one of lowest cost producers • Location advantage near port (16 km existing rail line) • Shortest Shipping distance to key markets. US$66/tonne delivered cost advantage to Brazil versus Saskatchewan suppliers.

  11. Chips Ahoy! • Sustainable, renewable wood fibre producer • Strong Competitive Advantages The MagIndustries story is about…Exciting Resource Projects in Central Africa Exceptional Returns

  12. Return onInvestment Acquisition Execution MagForestry Proven Business Model in Africa • Two stage acquisition of 100% ownership for cash and shares (US$6M) • Installation of experienced Canadian Forestry Management Personnel • US$10M invested in forestry operations • US$25M invested in chip mill – completing commissioning • 2007 revenues US$9.5M2008 est. revenues US$20M2009 to 2013 est. revenues US$352014 est. revenues US$80M

  13. MagForestryAccomplishments and Outlook Accomplishments • Built the team • Upgraded equipment, increased mechanization • Expanded the tree nursery and planting operations • Built a strong relationship with the community • Chip sales contracts signed • Mitsui shipping contracted • Chip mill now commissioned and in production • Sales (net of shipping) of US$20ME. • Positive cash flow • Increased area under cultivation

  14. MagForestryPointe Noire Chip Mill

  15. MagForestryPointe Noire Chip Mill

  16. MagForestryKissoko Tree Nursery

  17. Power for theCopperbelt • Restoring capacity to one of the world’s lowest cost power producers The MagIndustries story is about…Exciting Resource Projects in Central Africa

  18. INGA Projects: Planned Scope of Work • Phase 1: Emergency work to maintain current output • cost US$25M, work started Q2, 2006 • revenues from sale of 84 MW annually starting Q2 2009 • Subcontractor: Franco Tosi (Italy) • Phase 2: Rehabilitate 4 INGA II turbines • cost US$140M • MagEnergy to market 25% of restored capacity (i.e., 164 MW) • Status: Ratification process continues; timing uncertain

  19. KINSHASA Zongo 2 Busanga Busanga • As DRC’s first Independent Power Producer  secured rights • Busanga is 2nd largest hydro site in DRC after INGA (250 MW potential) • Feasibility study underway • adjacent to Katanga Copperbelt • connected to the South African Power Pool grid • Status: Review of project construction and financing consortium in 2008 Congo River DRC ROC INGAhydroplant 1,100 MW DC line Zambia Angola Copperbelt

  20. Magnesium Automotive Engineers’“Light Metal of Choice” • Key to achieving vehicle mileage targets The MagIndustries story is about…Exciting Resource Projects in Central Africa Exceptional Returns

  21. MagMetals Project Status • Purchase of technology and equipment from Norsk Hydro • Decision to proceed will follow successful startup of MagMinerals potash plant • Construction start potentially in 2011 • First production potentially 2014 Key Characteristics • Planned capacity of 60,000 tonnes per year • Potential to be lowest cost magnesium metal producer in the world: low cost MgCl source; low cost electricity and natural gas

  22. TheProjects TheFuture MagIndustries – Looking Forward

  23. One refurbished turbine running on commercial basis Potash project financedand construction started Chip Mill at full efficiency Update business plan and project timing Key Milestones Next 3-12 Months Will drive shareholder value

  24. MagIndustries 4-6 Years Out • MagMinerals Potash plant Phase I and II in operation – annual revenues on 1.2 million tonnes per year • MagEnergy: most turbines refurbished and operating • MagForestry: annual wood chip sales double from US$35M to US$70M • Construction start for 60,000 tpy magnesium plant • Decision to proceed with greenfield hydro projects • Decision to proceed with MDF (fiberboard) plant

  25. Management Team & Board of Directors William B. Burton, Founder, President &CEO, Director MagIndustries. BSc Honours Economic Geology, 30 years global experience in identifying and developing mineral properties. 12 years with RTZ. Stéphane A. Rigny, Exec. VP & Director MagIndustries, MBA Finance, family history with ROC, 11 years of project and finance experience in francophone Africa, with Rand Merchant Bank (e.g.; $400M project finance in the ROC and the DRC). Bryan Benitz, Chairman and Director since 1999, England. Private investment advisor specializing in financing junior resource companies. Independent Director. Richard Linnell, Director, Johannesburg. Geologist, 35 years African resource industry. Previously Regional Director, African Exploration and Development for Billiton; Director of BHP Billiton (SA) Ltd. Independent Director. Gerard Munera, Director since 2003, United States. Long history in the mining and metals industry as Senior Executive Officer, notably with Union Miniere, Pechiney, RTZ, and Minorco. Independent Director. Mustapha Niasse, Director, Former PM of Senegal, Key negotiator in Sun City Peace Accord which resulted in the power sharing Government for the DRC. Close friend of President Kabila. Independent Director. Gary E German, Director since 2003, Canada. Engineer, extensive experience with Noranda and others developing mining assets globally. Independent Director. Victor Wells, Director, Chairman of the Audit Committee. 30 years financial management with resource companies. Independent Director. Willy Verbrugghe, CEO MagMinerals.35 years experience with major project development and management. Mike Edwards, VP Projects. 35 years experience planning and building major resource projects in Africa. Achim Strauss, VP Engineering & Development. Mechanical engineer, 6 years with Salzgitter Anlagenbau GmbH principally evaluating magnesium projects. Over 11 years of experience in business and project development. Georges Kyriakos, VP Development MagEnergy Inc., Johannesburg, SA. Engineer, Extensive business operating experience in Africa especially in the DRC. Widespread network of political contacts in Central Africa. Dan Orlando, VP MagForestry. Pointe Noire. 25 years experience in management and operations in the Canadian Forestry Industry.

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