TAMPIA GOLD PROJECT FEASIBILITY STUDY

Transcription

1 TAMPIA GOLD PROJECT FEASIBILITY STUDY DEVELOPING A NEW GOLD MINE EXPLORING A POTENTIAL NEW GOLD FIELD ASX:EXU 1

2 TAMPIA GOLD PROJECT Western Australian gold explorer focused on developing the shallow high grade Tampia Gold Project located 240km east of Perth, near Narembeen. Feasibility Study completed May 2018 Targeting December 2018 construction start Excellent potential for multiple deposits in nearby targets Potential new gold district discovered Production targeted for December 2019 Project finance process underway 2

3 COMPANY OVERVIEW $0.18 $ A HIGHLY EXPERIENCED AND SUCCESSFUL EXPLORATION AND MINE DEVELOPMENT TEAM EXU share price $0.14 $0.12 $0.10 $ Volume (m) CHRIS BAKER NON-EXECUTIVE CHAIRMAN Widespread operational and management experience in the Australian and New Zealand resources sector. Current positions include: CEO of Straterra, representing the minerals sector in New Zealand; Chairman of the Coal Association of New Zealand; Chairman of MinEx, the Health and Safety Council of New Zealand. Formerly a non-executive Director and Chairman of the listed Auzex Resources Limited and unlisted Auzex Exploration Limited. JOHN LAWTON MANAGING DIRECTOR AND CEO Over 40 years comprehensive experience in minerals exploration, project development, operations, corporate management and company development, particularly in gold. Co-founded successful gold producer Ross Mining NL in 1987 developing 7 gold mines in 12 years before founding Auzex Resources Ltd in 2003 which successfully identified and developed the Bullabulling Gold project to more than 3.4m ounces of gold. Formerly Managing Director of Auzex Exploration Ltd prior to merging with Explaurum in $0.06 $0.04 $0.02 $- Jun 17 Jul 17 Aug 17 Sep 17 Oct 17 Nov 17 Dec 17 Jan 18 Feb 18 Mar 18 Apr 18 May STEPHEN STROUD NON-EXECUTIVE DIRECTOR Extensive experience across all aspects of corporate finance and equity capital markets including mergers and acquisitions both within Australia and internationally. Stephen is currently Director, Corporate Finance for CCZ Equities where he advises ASX clients on all aspects of capital markets and M&A with particular focus on small-mid cap companies listed on ASX. GREG PARTINGTON GENERAL MANAGER OPERATIONS Over 35 years experience in the exploration industry in Australia, Pacific Islands and Melanesia where he worked as the exploration manager for Northern Gold, General Manager, exploration for Ross Mining NL and Operations Director for Auzex Resources Limited where he has been responsible for the discovery and feasibility studies for the development of more than 10 million ounces of gold for the three companies. He also has 15 years experience in developing earth science GIS databases for use in exploration targeting and resource development. PAUL FREDERIKS CFO AND COMPANY SECRETARY Extensive experience in public company financial and secretarial management over more than 30 years in the Australian resources sector. He has previously held the positions of CFO and Company Secretary of Ross Mining, Geodynamics Ltd, Billabong International Ltd and Discovery Metals Ltd. He also has expertise in ASX listed public company reporting, financial modelling and forecasting, treasury management and hedging, project financing and corporate governance. ASX CODE EXU Shares on Issue 473.7M Unlisted Options 30.3M Performance Rights 19.0M Share price (1 June 2018) $0.09 Market Capitalisation $40M Cash (31 March 2018) $6.0M Enterprise Value $36M Top 20 Shareholders (1 June 2018) 45.09% 3

4 IDEAL PROJECT LOCATION 4

5 FEASIBILITY STUDY HIGHLIGHTS Project confirmed as low cost high margin and financially robust Initial LOM six years with operating costs in the lowest quartile of global gold projects Initial Mine Plan of 534,000oz gold from 8.0 Mt grading 2.07g/t Au with strong potential for resource growth from nearby exploration targets Average LOM gold recovery 92%; free milling with 30-35% gravity gold, 60-70% sulphide associated, 5-10% löllingite associated Mine Plan based on staged development of a single open pit and conventional SAG milling, Gravity, Flotation and UFG, and CIL circuit with 1.5Mtpa throughput Bankable Feasibility Study (BFS) due in October 2018, with construction approval expected December

6 TAMPIA INFRASTRUCTURE Tampia is located 240km from Perth, 14km from Narembeen on rural road network Excellent infrastructure and availability to services All personnel based in Narembeen township Gas power planned on Build-Own-Operate (BOO) basis Ample good quality groundwater available No significant flora and fauna issues due to cultivation landuse All land tenure private and freehold - Native Title extinguished, heritage surveys completed for Feasibility Study 6

7 Parameter Unit Total Gold Produced koz 490 TAMPIA FEASIBILITY STUDY METRICS LOM Gold Price A$/oz 1650 Gross Revenue A$M EBITDA A$M 327 IRR (pre-tax) % 47 NPV 8% (pre-tax) A$M 125 C1 Cash Cost (LOM) A$/oz 886 AISC Cash Cost (LOM) A$/oz 998 Initial Capital Cost A$M 119 Initial Life of Mine Years 5.3 Payback Period Years 1.5 7

8 Feasibility Study completed May 2018 Optimisation review program NEXT STEPS PRODUCTION AND GROWTH Finalise Bankable Feasibility Study October 2018, including project funding, regulatory approvals and contracts Construction start late 2H 2018 Commence production late 2H 2019 Expand resource base from exploration on nearby and regional targets throughout mine development 8

9 POTENTIAL FOR MULTIPLE DEPOSITS 9

10 INITIAL DRILLING GRAVITY TARGET 8 10

11 INVESTMENT HIGHLIGHTS Western Australian gold explorer driven by successful exploration team Shallow, high grade gold deposit outcropping at surface and open at depth Low cost, high margin, low risk gold project with early development target Feasibility Study completed May 2018 Significant immediate resource expansion potential Aggressive exploration program to continue mine development Fully funded Enterprise Value (EV) / Reserve oz Au A$290 approx Late 2019 initial production target 11

12 THANK YOU CONTACT: Managing Director & CEO: JOHN LAWTON 12

13 CAUTIONARY AND FORWARD LOOKING STATEMENTS CAUTIONARY STATEMENTS This Scoping Study is a preliminary technical and economic study of the potential viability of developing an open pit mine and standalone gold processing plant to be constructed onsite at the Tampia Gold Project. The Scoping Study referred to in this announcement is based on lower level technical and preliminary economic assessments, and is insufficient to support estimation of Ore Reserves or to provide assurance of an economic development case at this stage, or to provide certainty that the conclusions of the Scoping Study will be realised. The results should not be considered a profit forecast or production forecast. The Production Target referred to in this presentation is based on 94% Indicated Resources and 6% Inferred Resources for the mine life. The Company has concluded that it has reasonable grounds for disclosing a Production Target that includes a modest amount of Inferred material. However, there is a low level of geological confidence associated with Inferred Mineral Resources and there is no certainty that further exploration work will result in the determination of Measured or Indicated Mineral Resources or that the Production Target or preliminary economic assessment will be realised. The Study is based on the material assumptions described below. These include assumptions about the availability of funding. While the Company considers all the material assumptions to be based on reasonable grounds, there is no certainty that they will prove to be correct or that the range of outcomes indicated by the Study will be achieved. To achieve the potential mine development outcomes indicated in the Study, additional funding will be required. Investors should note that there is no certainty that the Company will be able to raise funding when needed. However, the Company has concluded it has a reasonable basis for providing the forward-looking statements included in this announcement and believes it has reasonable basis to expect it will be able to fund the development of the Tampia Gold Project. To achieve the range of outcomes indicated in the Study, funding in the order of A$100 million, exclusive of working capital, will likely be required. Investors should note that there is no certainty that Explaurum Limited will be able to raise the amount of funding required or when needed. It is also possible that such funding may only be available on terms that dilute or otherwise affect the value of the Company s existing shares. It is also possible that Explaurum could pursue other strategies to provide alternative funding options. Given the uncertainties involved, investors should not make any investment decisions based solely on the results of the Study. FORWARD LOOKING STATEMENTS Some of the statements contained in this report are forward looking statements. Forward looking statements, include, but are not limited to, statements concerning estimates of tonnages, expected costs, statements relating to the continued advancement of Explaurum s projects and other statements that are not historical facts. When used in this report, and on other published information of Explaurum, the words such as aim, could, estimate, expect, intend, may, potential, should and similar expressions are forward looking statements. Although Explaurum believes that its expectations reflected in the forward looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward looking statements. Various factors could cause actual results to differ from these forward looking statements include the potential that Explaurum s project may experience technical, geological, metallurgical and mechanical problems, changes in gold price and other risks not anticipated by Explaurum. Explaurum are pleased to report this summary of the Study in a fair and balanced way and believes that it has a reasonable basis for making the forward looking statements in this announcement, including with respect to any mining of mineralised material, modifying factors, production targets and operating cost estimates. This announcement has been compiled by Explaurum from the information provided by the various contributors to the Study. All financial assumptions and estimates are quoted in Australian Dollars ( A$ or AUD ) only. 13

14 TAMPIA GOLD PROJECT MINERAL RESOURCE CLASSIFICATION Tonnes Average Grade Ounces Inferred Weathered 500, ,000 Fresh 1,500, ,000 Sub-total 2,000, ,000 Indicated Weathered 400, ,000 Fresh 9,400, ,000 Sub-total 9,800, ,000 Total 11,700, ,000 Notes: The Mineral Resource is classified in accordance with JORC, 2012 edition. The effective date of the mineral resource estimate is 5 April The Mineral Resource is contained within M70/816. Estimates are rounded to reflect the level of confidence in these resources. All resources have been rounded to the nearest 0.01 million tonnes. The mineral resource is reported as a recoverable resource at 5 x 5 x 2.5 SMU size, and at 0.45 g/t Au cut-off grade for fresh material and 0.30 g/t Au for weathered material. TAMPIA ORE RESERVE STATEMENT AT 28 APRIL 2018 Reserve Category Tonnes (t) Au (g/t) Au Metal (oz) Probable 7,230, ,000 14

15 TAMPIA GOLD PROJECT MINERAL RESOURCE CLASSIFICATION Tonnes Average Grade Ounces Inferred Weathered 500, ,000 Fresh 1,500, ,000 Sub-total 2,000, ,000 Indicated Weathered 400, ,000 Fresh 9,400, ,000 TAMPIA MINERAL RESOURCE AND ORE RESERVE Sub-total 9,800, ,000 Total 11,700, ,000 Notes: The Mineral Resource is classified in accordance with JORC, 2012 edition. The effective date of the mineral resource estimate is 5 April The Mineral Resource is contained within M70/816. Estimates are rounded to reflect the level of confidence in these resources. All resources have been rounded to the nearest 0.01 million tonnes. The mineral resource is reported as a recoverable resource at 5 x 5 x 2.5 SMU size, and at 0.45 g/t Au cut-off grade for fresh material and 0.30 g/t Au for weathered material. TAMPIA ORE RESERVE STATEMENT AT 28 APRIL 2018 Reserve Category Tonnes (t) Au (g/t) Au Metal (oz) Probable 7,230, ,000 15

16 SUMMARY FEASIBILITY OUTCOMES Parameter Scoping Study November 2017 Feasibility Study May 2018 Mine life (years) LOM ore mined (Mt) LOM waste mined (Mt) LOM strip ratio (Waste:Ore) Indicated Resources (%) Inferred Resources (%) 6 9 Annual ore throughput (Mtpa) Average grade (g/t Au) Metallurgical recovery (LOM Average %) LOM Gold production (koz) Average annual Gold production (kozpa) Average annual Gold production first 2 years (kozpa) Initial capital cost A$M (+/- 15%) 105 (+/-30%) 119 Deferred capital cost A$M - 4 LOM Sustaining capex (A$M) 9 8 WA Govt royalty (%) Other royalty (%) Average C1 cash cost (A$/oz)* Average AISC cash cost (A$/oz)* LOM gold price (A$/oz) 1,650 1,650 Gross revenue (A$M) LOM EBITDA (A$M) Average Annual EBITDA (A$M) Base case pre-tax NPV 8% (A$M) Project IRR (%) pre-tax Initial Payback period pre-tax (years)

17 TAMPIA OPERATING COST SUMMARY (LOM) Cost Centre A$M A$/oz Au % of total cost Mining Processing Refining General & Administration Total Operating Costs TAMPIA MINING COST SUMMARY (LOM) OPERATING COST SUMMARIES Activity A$/t material Mined A$/t ore Mined A$/oz Au Produced % of total Mining Cost Grade Control Drill and Blast Load and Haul Other Mining Management and Staffing Total AVERAGE PROCESS OPERATING COSTS (LOM) Cost Centre A$/t Ore Processed A$/oz Au Produced % of total Processing Cost Power Reagents and Consumables Maintenance Labour ROM Loader and Mobile equipment Other Total

18 APPENDICES FINAL PIT DESIGN TAMPIA PROCESS PLANT AND GENERAL SITE LAYOUT 18

19 TAMPIA PROCESS FLOW SHEET 19

20 AU IN SOIL ANOMALIES OVER GRAVITY TARGETS 20

21 TAMPIA PROJECT GEOLOGY 21

22 TAMPIA ORE BODY SIMPLE AND SHALLOW 22