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Discovery, development and acquisition
21st February2018
(ASX:MCT)
RIUExplorersConferencePresentation
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Metalicityisdevelopingandexploringaworldclasspipelinezincprojects
Primaryassets:
1. HighgradeNapierRangeZincProject:earlycashflowopportunity
2. ProspectiveEmanuelRangeZincProject:elephanthuntingopportunity
3. LargescaleAdmiralBayZincProject:globalJVopportunity
SectorleadingzincpartnersinChinaMinmetals (offtakeandfinancing)andChinaNFC(development,EPCandfinancing)
Secondaryassets:
— prospectivecobalt,lithiumandgraphitetenure
Highimpactdrillingandfeasibilityworkprogramsplannedfor2018
ExperiencedBoardandManagementteamwithsignificantshareholding
Building a high quality zinc portfolio
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Zinc: supply shortage driving prices
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Source:MacquarieResearch,March2016(WoodMac,CRU,LME,ILZSG)Source:MacquarieResearch,March2016(WoodMac,CRU,LME,ILZSG)
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Zinc: macros drivers in good shapeF
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Napier Range zinc project highlights
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Strengthenedzincprojectpipeline- acquisitionofhighgradeNapierRangeZincProjectandEmanuelRangeZincProjectlocatedintheLennardShelf,KimberleyRegion,WA
NapierRange:
— JORC2012InferredMineralResourceEstimate(MRE)of750ktat13.6%ZnEq(5.8%Zn,7.2%Pb and54g/tAg)
— ETRof1-4Mtat10-15%ZnEq1 acrossseveralprospects
— High-grade,near-surfaceandpotentiallylowcapitalproject
— Resourcedrillingandfeasibilityplannedfor2018
MVT-styledeposits:typicallydemonstrateconventionalprocessflowsheetsandhighmetalrecoveries.
1 Notethatthepotentialquantitiesandgradesareconceptualinnature,thattherehasbeeninsufficientexplorationtoestimate MineralResourcesandthatitisuncertainwhetherfurtherexplorationwillresultintheestimationofMineralResources.
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Napier Range – early cash flow opportunity
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High-grade,near-surfaceandpotentiallylowcapitalzincproject
PossiblestarterminetopartfinancedevelopmentofAdmiralBay
PreliminaryeconomicreviewindicatesNapierRangetobeastand-aloneproject
SignificanthighgradeexplorationupsidewithETRover5kmstrikeextent
MultiplesynergisticopportunitieswithAdmiralBay,includinginfrastructure,mineralprocessingequipment,humanresources,financingandofftake
NapierRangeDeposit([email protected]%ZnEq
ExplorationTarget1-4Mt@10-15%ZnEq
HistoriccorestoredattheNapierRangeProject. GossanousdolomiteoutcroppingatNapierRange
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Emanuel Range Zinc Project highlights
7Source:Metalicity
Pillara East
• PoorlytestedareaoftransferfaultboundedbasementhighstrendingNEfromthePillaraMineincludingPD33424mat2.5%Zn&PD1045mat3%Zn
• [email protected]%Zn+PbinLMPD03atLittleMtPierre
• Comprehensivetargetgenerationstudycompletedwithtargetsreadytodrill
KapokNorth
• Anadvancedstage,veryshallow(<60mdeep),and~3.5kmlongtargetdefinedbygossans,geochemistryandIPgeophysicsatGindi GossanforCadjebut stylestratiformmassivesulphides
• Anuntested>5kmlongdolomitefrontidentifiedinrecentASTERgeophysicswithcoincidentZn&Pb anomalism
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100%Metalicityownershipincludingcurrently100%offtake1.
LocatedintheCanningBasinofWesternAustralia,approximately140kmsouthofBroome.
Closeproximitytoexcellentpower,water,roadandportinfrastructuresolutions.
UpdatedInferredMineralResourceEstimate(MRE)of170Mtat7.5%ZnEq2
— In-situcontainedmetalof7.0Mtzinc,4.6Mtleadand137Mozsilver
— DelineatedongrantedMLsandEL
Highgradezoneof20Mtat10%ZnEq(including4.9Mtat12.5%ZnEq).
ScopingStudycompletedbySRKConsulting(July2016)withthefollowingkeyoutcomes:
— Projectdevelopmentdeterminedtobetechnicallyfeasible
— BasecaseOpenStoping miningmethod
— Flatlyingdepositgeometryandrockpropertiespotentiallyfavourableforlongwallmining
— Conventionalflotationprocessingwithexpectedhighmetallurgicalrecoveries
PFSStage-1StudycompletedwithSRKConsulting(September2017)withthefollowingkeyoutcomes:
— HighlycapitalefficientDirectShippingOre(DSO)starterconceptincorporatedintothedevelopmentplan,utilisingoresortingtechnologytoupgradeROMoreto>25%Zn.
— Miningstudiesevaluatedpotentialminingmethodsandtheirgeotechnicalandhydrogeologicalimpacts,withpositiveresultsfromwithinthehighgradezone.
Admiral Bay zinc project highlights
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1 SubjecttoMOUsignedwithChinaMinmetals NonferrousMetalsCo.Ltdfor10%ofAdmiralBayzincandleadconcentrate.SeeMetalicityASXreleaseon17/07/2017.2 SeeMetalicityASXreleaseon4/07/2016;ZnEq =Zn+0.97Pb+0.03Ag(Table1:ZincEquivalenceParameters).
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A well defined high-grade zinc-lead zone
9Source:Metalicity
Higher-gradezoneof20Mtat10% ZnEq,including4.9Mtat12.5%ZnEq.
Higher-gradezonewithinexistingInferredResourceof170Mtat7.5%ZnEq.
Bestintersectionsinclude20mat14.5%ZnEq(including6mat24.3%ZnEq)and14mat17.7%ZnEq(including14mat16.4%Pb).
ThreeZn-richintersections>10% ZnEqallliewithinthiszone.
MultipleZn-richzones>10% ZnEqdefinedastargetsforfuturework.
Drillingisplannedandbudgetedtoconvert12MtofhighgradezonetoIndicatedcategory.
High-gradeIndicatedresourcetargetedtodeliverpaybackontotalpre-productioncapital.
DSO productpotentialfromatotalof3MtofresourceutilisingoresortingtechnologytoupgradeROMoreto>25%Zn.
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Sector leading zinc partners
1.Minmetals isoneofChina’sleadingzincsmeltingcompany’s withannualconsumptioncapacityof1MtpazincconcentrateandiscurrentlycompletingamergerwithChinaMetallurgicalCorporation(MCC).ThecombinedrevenuesofMinmetalsandMCCarereportedtoamounttoapproximatelytwicethatoftheworld’slargestpublicly tradedminingcompany,BHP.1Chinaistheworld’slargestconsumerandprocessorofzincconcentratesintorefinedzinc.Moreinformationcanbefoundat:http://china.org.cn/business/2016-06/03/content_38595154.htm
ChinaMinmetals1 isoneoftheworld’sleadingzincsmeltingcompanies.
— MOUsignedforfuturezincandleadoff-takeandprojectfinancing.
— TheMOUcontemplatesthesupplyofaninitial10%offutureofftakefromAdmiralBayinexchangeformetallurgicaltestwork whichestablishesapathwayforinvestinginMetalicityand/orAdmiralBay.
— Minmetals havecompletedmetallurgicaltestwork onapproximately50kgofexistingcore.
— Minmetals arepreparingareportforMetalicitytoconfirmaninternationalsaleableproduct.
ChinaNFC(“NFC”) isagloballeaderinzincprojectengineering,constructionanddevelopment.
— MOUsignedforthedevelopment,engineeringandfinancingofAdmiralBay.
— ChinaNFCarepreparingareportoutliningtheirproposedEPCMandfinancing.
— ChinaNFCareactivelyinvolvedinsomeoftheworldslargestzincdevelopmentprojects,includingMehediabad,Talla Hamza,Citronen andthe“CityofZinc”(NorthernChina).
— Particularskillinengineeringlargescaleundergroundresourceprojects.
§ Alternatediscussionswithotherglobalbasemetalcompaniesandfinanciersunderway
TheresourcesbullatMinmetals Tower,Beijing,China.
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Battery minerals projects
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TheKyarra CobaltProject- Yerrida Basin
A7km2 prioritytargetareahasbeenidentified- significantsurfacesamplesupto6,400ppmcobalt.
MineralisationmodelanalogoustotheCentralAfricanCopperbelt– prospectiveforcopper-cobaltandnickel-cobaltdeposits.
Recent1,800mRCprogramfrom8holestoatargetdepthof150mcompleted
Drillholesencounteredaconsistentnear-surfacebasemetalenrichmentzone,interpretedtobearegolithenrichmentzone.
8mto12mthick,shallowsouth-dippingzoneofanomalousbasemetal(400–500ppmCuand50–60ppmCo)intersectedinalldrillholes.Valuesrepresentaround4xtheCubackgroundandabout2xtheCobackground.
ThePilbaraLithiumProject
ThePilbaraishosttosomeofthelargesthardrocklithiumdepositsglobally(Pilgangoora andWodgina).
Ourtenementspredominantly:
— Containlithiumbearingpegmatites
— Locatedwithinapegmatitetargetcorridor
— AdjoinexistingworldclassLithiumdeposits
Phase1Drillinghasintersectingverysignificantwidthsoflithiumbearingpegmatites
PendingareviewbyCSAGlobal,Phase2Drillingplannedtovectorinonhighergradezonesofspodumene,petalite,eucryptitebearingpegmatites.
Worldclassinfrastructure&experiencedlocalworkforce/contractingpartnersbasedinPortHedland.
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Company summary
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Exploringanddevelopingaworld-classpipelineofzincprojectsinagenuinelytighteningzincmarket.
LennardShelfprojects
— high-grade,near-surface,near-termdevelopmentandpotentiallylowcapital
SectorleadingpartnersChinaMinmetals andChinaNFC- significantlongterminvestmenttocapturecurrentandfuturehighzincprices,andcreatesustainableshareholdervalue.
Secondarycobaltandlithiumworkprogramsgatheringmomentumwithpotentialspinout.
Multipleshort-termcatalystsforfirsthalfof2018:
— LennardShelfacquisitionfollowedbyaggressiveresourcedrillprograminMarch2018
— AdmiralBayJointVenturediscussionscontinuingthroughoutAsia,Europe&NorthAmerica
— FurtherCobaltexplorationdrillingattheKyarra cobaltdiscoveryin2018
— FurtherLithiumexplorationdrillingatPilgangoora North&Wodgina Southprojectsin2018
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Founders ~15%
ManagementandAssociates ~12%
CITINominees 9%
Appendix1: Corporate snapshot
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Issuedsharecapital(MCT) 563.4mil
Options 150.0 mil
Shareprice(January152018) A4c
Marketcapitalisation(diluted) ~A$28.0mil
Cash(20February2018) ~A$3.5mil
Debt(20February2018) A$0mil
Averagedailytradedvolume 0.70mil
Analystcoverage
Capitalstructure Metalicityshareprice
Majorshareholders
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Appendix 2: Board capability
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CHAIRMANAndrew Daley
• MiningEngineerandInvestmentBanker
• 40yearsexperienceintheresourceandinvestmentbankingindustry
• FoundingDirectorofPanAust,Oxiana andInvestorResourcesLimited(“IRL”)
MANAGING DIRECTORMatthew Gauci
• MBAandMiningExecutive
• 20yearsexperienceintheresourceindustry
• FoundingDirectorofMetalicityLimited
NON-EXECUTIVE DIRECTORMathew Longworth
• GeologistandMiningExecutive
• 30yearsexperienceintheresourcesindustry
• FormerlyManagingDirectorofHeronResourcesLimited
FINANCE DIRECTORJustin Barton
• CFOandCompanyDirector
• 20yearsexperienceintheresourcessector
• FormerlywithErnst&YoungandduallistedPaladinEnergyLimited
COMPANY SECRETARYNeil Hackett
• CompanySecretaryandDirector
• 25yearsexperienceintheresourcesindustry
• FormerlycompanysecretarywithduallistedSundanceResourcesLimited.
BoardandManagement
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DisclaimerandForwardLookingStatements
Thispresentationisnotaprospectusnoranofferofsecuritiesforsubscriptionorsaleinanyjurisdictionnorasecuritiesrecommendation.Theinformationinthispresentationisanoverviewanddoesnotcontainallinformationnecessaryforinvestment decisions.Inmakinginvestmentdecisions,investorsshouldrelyontheirownexaminationofMetalicityLimitedandconsultwiththeirownlegal,tax,businessand/orfinancialadvisersinconnectionwithanyacquisitionofsecurities.TheinformationcontainedinthispresentationhasbeenpreparedingoodfaithbyMetalicityLimited.However,norepresentationorwarranty,expressorimplied,ismadeastothecompletenessoradequacyofanystatements,estimates,opinionsorotherinformationcontainedinthispresentation.Tothemaximumextentpermittedbylaw,MetalicityLimited,itsdirectors,officers,employeesandagentsdisclaimliabilityforanylossordamagewhichmaybesufferedbyanypersonthroughtheuseof,orrelianceon,anythingcontainedinoromittedfromthispresentation.CertaininformationinthispresentationreferstotheintentionsofMetalicityLimited,butthesearenotintendedtobeforecasts,forwardlookingstatements,orstatementsaboutfuturemattersforthepurposesoftheCorporationsAct(Cth,Australia)oranyother applicablelaw.Theoccurrenceofeventsinthefuturearesubjecttorisks,uncertaintiesandotherfactorsthatmaycauseMetalicityLimited’sactualresults,performanceorachievementstodifferfromthosereferredtointhispresentationtooccurascontemplated.Thepresentationcontainsonlyasynopsisofmoredetailedinformationtobepublishedinrelationtothemattersdescribedinthisdocumentandaccordinglyno reliancemaybeplacedforanypurposewhatsoeveronthesufficiencyorcompletenessofsuchinformationandtodosocouldpotentiallyexposeyoutoasignificantriskoflosingallofthepropertyinvestedbyyouorincurringbyyouofadditionalliability.Recipientsofthispresentation shouldconducttheirowninvestigation,evaluationandanalysisofthebusiness,dataandpropertydescribedinthisdocument.Inparticular,anyestimatesorprojectionsoropinions containedhereinnecessarilyinvolvesignificantelementsofsubjectivejudgment,analysisandassumptionsandyoushouldsatisfyyourselfinrelationtosuchmatters.
CompetentPersonStatement- AdmiralBayHighGradeZoneMineralResourceEstimate
TheinformationinthisreportthatrelatestoGeologyandExplorationResultsisbased,andfairlyreflects,informationcompiledbyMrSerik Ursbisinov,whoisaMemberoftheAustralianInstituteofGeoscientists.MrUrsbisinovisemployedbyCSAGlobalPtyLtd,independentresourceindustryconsultants.MrUrsbisinovhassufficientexperiencewhichisrelevanttothestyleofmineralisationandtypeofdepositunderconsiderationandtotheactivitywhichheisundertakingtoqualifyasaCompetentPersonasdefinedinthe2012Editionofthe ‘AustralasianCodeforReportingofExplorationResults,MineralResourcesandOreReserves’.MrUrsbisinovconsentstotheinclusioninthereportofthemattersbasedonhisinformationintheformandcontextinwhichitappears.
CompetentPersonStatement– ExplorationResultsandExplorationTargetRangeforNapierRange
InformationinthisreportthatrelatestoExplorationresultsandExplorationTargetRange(ETR)ontheLennardShelfprojectshasbeenreviewedbyDr. SimonDorling,whoisamemberoftheAustralianInstituteofGeoscientists.Dr. DorlingisaconsultanttoMetalicity Ltd,andhassufficientexperiencerelevanttothestyleofmineralisationandtypeofdepositunderconsiderationandtotheactivitywhichheisundertakingtoqualifyasaCompetentPersonasdefinedbythe2012EditionoftheAustralasianCodeforReportingofExplorationResults,MineralResourcesandOreReserves.Dr. Dorlingconsentstotheinclusionofthedataintheformandcontextinwhichitappears.
CompetentPersonStatement– NapierRangeMineralResourceEstimate
InformationinthisreportthatrelatestotheNapierRangeInferredResourceEstimatehasbeencompiledbyPatrickAdams,FAusIMM,MAIG.MrAdamsisaDirectorofCubeConsulting,andconsultanttoMeridianMineralsPtyLtdwhocommissionedtheresourcereportin2016,andhassufficientexperiencerelevanttothestyleofmineralisationandtypeofdepositunderconsiderationandtotheactivitywhichheisundertakingtoqualifyasaCompetentPersonasdefinedbythe2012EditionoftheAustralasianCodeforReportingofExplorationResults,MineralResourcesandOreReserves.MrAdamsconsentstotheinclusionofthedataintheformandcontextinwhichitappears.
CompetentPersonStatement– Kyarra CobaltExplorationProject
InformationinthisreportthatrelatestoExplorationresultsandExplorationTargetRange(ETR)ontheLennardShelfprojectshasbeenreviewedbyDr. SimonDorling,whoisamemberoftheAustralianInstituteofGeoscientists.Dr. DorlingisaconsultanttoMetalicity Ltd,andhassufficientexperiencerelevanttothestyleofmineralisationandtypeofdepositunderconsiderationandtotheactivitywhichheisundertakingtoqualifyasaCompetentPersonasdefinedbythe2012EditionoftheAustralasianCodeforReportingofExplorationResults,MineralResourcesandOreReserves.Dr. Dorlingconsentstotheinclusionofthedataintheformandcontextinwhichitappears.
CompetentPersonStatement– PilbaraLithiumExplorationProject
TheAustralasianCodeforReportingofExplorationResults,MineralResourcesandOreReserves(the‘JORCCode’)setsoutminimumstandards,recommendationsandguidelinesforPublicReportinginAustralasiaofExplorationResults,MineralResourcesand OreReserves.TheInformationcontainedinthisannouncementhasbeenpresentedinaccordancewiththeJORCCode.InformationinthisreportrelatingtoExplorationresultsisbasedoninformationcompiledbyRalphPorter,aconsultanttotheCompany,whohassufficientexperiencerelevanttothetypeofactivitiesunderconsiderationtoqualifyasaCompetentPersonasdefinedbythe2012EditionoftheAustralasianCodeforreportingofExplorationResults,MineralResourcesandOreReserves.MrPorterisamemberoftheAustralianInstituteofGeoscientists,andconsentstotheinclusionoftheinformationinthisannouncementintheformandcontextinwhichitappears.
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Important noticesF
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Metalicity Limited – poised for growth
SUNRISEATADMIRALBAY
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