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TRANSCRIPT
Cape Alumina Limited
Investor presentation, November 2011
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Disclaimer Statements and material contained in this Presentation, particularly those regarding possible or assumed future
performance, production levels or rates, commodity prices, resources or potential growth of Cape Alumina Limited,
industry growth or other trend projections are, or may be, forward looking statements. Such statements relate to
future events and expectations and, as such, involve known and unknown risks and uncertainties.
Cape Alumina is at an early exploration stage and although reasonable care has been taken to ensure that the facts
stated in this Presentation are accurate and or that the opinions expressed are fair and reasonable, no reliance can
be placed for any purpose whatsoever on the information contained in this document or on its completeness.
Actual results and developments may differ materially from those expressed or implied by these forward looking
statements depending on a variety of factors.
Nothing in this Presentation should be construed as either an offer to sell or a solicitation of an offer to buy or sell
shares in any jurisdiction.
Technical information on any Cape Alumina project in this Presentation had been compiled by Dr Paul Messenger,
Non-Executive Director of Cape Alumina Limited who is a fellow of the Australian Institute of Mining and Metallurgy
(F. AusIMM) and is a competent person and has relevant experience to the mineralisation being reported on to
qualify as a Competent Person as defined by the Australasian Code for Reporting of Minerals Resources and
Reserves. Dr Paul Messenger consents to the inclusion in the presentation of the matters based on the information
in the form and context in which it appears. The resource information in this Presentation has been released to the
Australian Stock Exchange. For
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On 29 November the Company announced a maiden Inferred Resource of 28.3 Million
tonnes (Mt) of in-situ, high-quality, export-grade bauxite at our Bauxite Hills project BH1
area. This is expected to yield 20.3 Mt of beneficiated, dry-product bauxite.
Cape Alumina’s business model is based on the establishment of an independent bauxite supply business to feed the growing market for traded bauxite into China.
Cape Alumina is listed on the Australian Securities Exchange (ASX Code: CBX) with 130 million shares on issue to just over 2,100 shareholders.
Introduction
Our vision - to become one of the largest bauxite producers and traders in the world –
supplying the rapidly growing Asia-Pacific region with high-grade, good-quality bauxite in
accordance with market demands.
Brisbane-based, Cape Alumina controls approximately 1,900 square kilometres of
exploration tenements in world-class western Cape York bauxite province. This is the second largest tenement holding in the region outside the Rio Tinto Alcan mining leases.
Further assay results from the extension drilling undertaken at BH1 and the
exploration of BH2 and BH6 deposits are due to be released in early 2012 and are
expected to significantly increase the project’s resource base.
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Company snapshot ASX Code CBX
Market Cap $23.4m
Shares on Issue 130.0m
Options on Issue 5.4m
Total Shareholders c. 2100
Cash (30 Sept 2011) $1.8m
Top 20 Holdings 93.7%
George Lloyd Chairman
30yrs in the resource industry. Chairman of Pryme Energy Limited, Director of Ausenco Ltd. Adviser to the mining and energy industries in Asia
Graeme Sherlock Managing Director & CEO
Mining Engineer with 20 yrs resource industry experience. Former senior roles with Peabody Energy Aust, Rio Tinto Coal Aust,, Mitsubishi Development after a long career with BHP Billiton
Ronald (Rennie) Fritschy Independent Non-Executive Director
Chancellor CQ University. 30 yrs experience in bauxite and alumna industries. Former MD QAL, Gladstone and Gove Bauxite – alumina
Peter Nicholson Non-Executive Director
Partner in Resource Capital Funds, a mining focussed private equity firm with $2billion in funds. Director of Talison Tantalum Pty Ltd
Mr Liu Jilun Non-Executive Director
MD of Xinfa Group Company Limited, China’s largest independent Alumina-Aluminium company
Valentine Smirnyagin Non-Executive Director
Extensive experience in corporate finance/ strategy for resource and industrial companies. Previous roles include Alcoa Inc, Chromalux Inc and Scania AB
Metallica MineralsLimited
China Xinfa GroupCorporation Ltd
Bondline Limited
Resource Capital Fund IIILIP
Resource Capital Fund IVLP
JP Morgan NomineesAustralia Ltd
Other
16.17%
20.71%
16.49%
13.75%
11.34%
7.89%
13.65%
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Our location and projects F
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Metallica Minerals (20.1%) – One of the most progressive, multi-mineral developers
in Australia’s eastern states. The company has interests in nickel, cobalt, coal,
bauxite, copper, gold and limestone projects.
Our significant shareholders
Resource Capital Funds (25.1%) – A respected resources-focused private equity
firm based in Denver, Colorado, and Perth, Australia. Cape Alumina represents the
funds sole metallurgical bauxite investment.
Xinfa (18.6%) – China’s largest independent alumina-aluminium company with
refining and smelting operations in Shandong, Guangxi and Xinjiang Provinces. It
currently has installed capacity of around 7 million tonnes per annum (Mtpa) of
alumina and over 1.8 million tonnes per annum of primary aluminium.
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General Manager External Affairs, Mr Neville Conway – Mr Conway joined Cape Alumina as the General
Manager, External Affairs and Stakeholder Relations in 2009. Mr Conway is an accomplished senior manager
with extensive stakeholder relations and project management experience. Previous experience includes
working for some of Australia’s largest resource, construction and finance companies as well as an adviser to
Members of the Commonwealth Parliament.
Our management team
Chief Financial Officer and Company Secretary, Mr Scott Waddell – Mr Waddell was appointed Cape
Alumina’s CFO and Company Secretary in Sept 2010. Prior to joining Cape Alumina, he served as Head of
Finance for the Monash Energy project in Victoria’s La Trobe Valley. His resources experience has been
gained over nine years with Anglo Coal and eight years with Rio Tinto Alcan (RTA). He has a deep
understanding of the global bauxite and resources sectors.
MD & Chief Executive Officer, Mr Graeme Sherlock – Mr Sherlock is a qualified mining engineer with more
than 20 years of resource industry experience. With senior business development positions within Peabody
Energy Australia, Rio Tinto Coal Australia and Mitsubishi Development and a long career with BHP Billiton, he
brings a strong record of achievement on several key major resource project developments, mergers,
acquisitions and commercial negotiations across the Australian and international coal industry. A Member of the
Australasian Institute of Mining and Metallurgy, Graeme also has an MBA in Technology and a Postgraduate
Diploma in Management.
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Business Development Consultant, Ms Guoyan Li – Ms Li has been Cape Alumina’s China Business
Development Consultant since 2006. In this time, she has facilitated the development of business ties and
relationships with key Chinese alumina companies. Before moving to Australia, Ms Li spent 15 years at
one of China’s largest copper mining and refinery groups holding key roles including commercial project
manager and foreign affairs co-ordinator along with key roles in the importation of metal process
technology and equipment.
Cape Alumina employs local Aboriginal people in all of our field operations
including exploration, cultural heritage surveys, environmental studies, and
environmental monitoring.
Operations Manager, Mr Ron Tibaldi – Mr Tibaldi joined the Company as Operations Manager in Sept 2007.
He oversees all project exploration activities and manages the Company’s field Health and Safety programs in
Cape York. Before joining Cape Alumina Mr Tibaldi was Mine Production Superintendent at the Gove bauxite
mine and alumina refinery for 32 years. He brings a wealth of experience in all facets of bauxite mining,
rehabilitation and exploration in northern Australia.
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China is the largest alumina producer and
consumer but is short in bauxite, which is
being consumed at an ever increasing rate.
China’s trend towards conventional high
temperature Bayer refineries to utilize bauxite
from Weipa – significant growth next 5 to 10 years.
Western Cape York to become China’s preferred source of bauxite.
Cape Alumina well placed to establish a reliable alternative to the Weipa RTA
operations.
Indonesia to restrict bauxite exports as
government policy and new laws encourage
down-stream processing in Indonesia.
Other, 23%
Brazil, 7%
Jamaica, 7%
Vietnam, 8%Guinea, 28%
Australia, 23%
China, 4%
Share of global bauxite reserves
Asia-Pacific bauxite-alumina trends
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Bauxite prices and Chinese imports are rising
Bauxite prices are increasing based on
the growing Chinese market.
Indonesia has dominated imported
bauxite into China, which is not
sustainable.
Source:
CRU
China are looking for reliable, alternative,
long-term supply.
Source:
CRU
Source:
CRU
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Western Cape York bauxite province Set to become the world’s largest source
of export bauxite.
Estimated to contain over 3 billion tonnes
of bauxite.
Rio Tinto Alcan (RTA) has been the only
Weipa bauxite producer for over 50 years
and remains the only exporter of
Australian bauxite.
RTA plans to increase bauxite production
in Weipa over the next 6 years –
majority of this is expected to go to
Chinese refineries.
Cape Alumina is well placed to provide
an alternative source of bauxite supply to
the bourgeoning Chinese market.
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Cape Alumina is uniquely placed Cape Alumina is the largest exploration
tenement holder in the province with 1,900
km2 under licence with an exploration
target of 300-400 Mt* in-situ bauxite.
Well established with six years on-ground
experience.
Strong partnerships and experience in
cultural heritage and stakeholder
engagement.
Unsurpassed environmental database.
Developed world leading innovative low-
cost mining and continuous rehabilitation
process.
*Note: The resource potential is conceptual in nature and there has been insufficient work completed to
define a mineral resource at this stage. Estimated tonnage range is 300–400 Mt and the estimated
beneficiated grade range is 48–54 per cent Al2O3 and 8-12 per cent SiO2 assuming average 65 per cent recovery. F
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Our bauxite Is located within the world-class western Cape York bauxite province, which is
characterised by high-quality, export-grade bauxite.
Has ready access to ship-borne trade.
Is close to the Asia-Pacific market.
Is well-suited for low and high temperature
alumina refineries.
Is export-grade. Pisolite Hills 134.6Mt in-situ bauxite resource has an average
washed grade of 53.1 per cent Al2O3 and 12.3 per cent SiO2 (7.5 per cent reactive
silica at 150 degrees Celsius).
Inferred Resource of 28.3 Mt of in-situ, high-quality, export-grade bauxite at
Bauxite Hills’ BH1 area. This is expected to yield 20.3 Mt of beneficiated, dry-
product bauxite.
Further assay results from the extension drilling undertaken at BH1 and the
exploration of BH2 and BH6 deposits are due to be released in early 2012 and are
expected to significantly increase the project and Company’s resource base. For
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To date, Cape Alumina has identified seven priority
bauxite exploration areas. The Company has
conducted significant drilling on the Pisolite Hills
and Bauxite Hills deposits.
An advanced exploration and drilling program
commenced in August 2011 at our second major
project site – the Bauxite Hills mine and port
project, which is located approximately 95
kilometres north of Weipa and just five kilometres
south of the Skardon River.
Cape Alumina retains its Pisolite Hills
tenements which contain 134.6 Mt of JORC-
Code-compliant bauxite resources.
Scout exploration programs at our other existing
project areas – Duyfken, Weipa Satellites, and
Vrilya – are planned for 2012.
Exploration program F
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An emerging bauxite project that incorporates seven
bauxitic plateaux - BH1 through to BH7.
The bauxite in the project area is proving to be high-
quality and export-grade . The bauxite at BH1
appears to include bauxite zones suitable for both
high and low temperature refineries.
Cape Alumina has lodged four Mining Lease
Applications (MLAs) over the area.
Skardon River is a tidal estuary less than 10 miles
long with existing port and disturbed land.
Pisolite Hills experience means we can expedite the
permitting process.
Local environment comprises predominantly open
eucalyptus woodland plateaux and estuarine
waterways. There are no known fresh water springs
in the vicinity of the bauxite target areas.
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Bauxite Hills – an emerging export project F
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Recently completed 2,569-hole, 7,000-metre drilling program revealed the
presence of near-surface, pisolitic bauxite rich units with average
thicknesses of 2.4 metres at BH1 and 1.8 metres at BH2 and BH6.
The BH1 deposit has an extremely low strip ratio, with an average
overburden of 0.4 metres. A summary of the drilling results as at October
2011 is provided in Table 1 (right).
Exploration results reveal an Inferred Resource of 28.3 Million tonnes (Mt)
of in-situ, high-quality, export-grade bauxite at Bauxite Hills’ BH1 area.
This is expected to yield 20.3 Mt of beneficiated, dry-product bauxite.
Further assay results from the extension drilling undertaken at BH1 and
the exploration of BH2 and BH6 deposits are due to be released in early
2012 and are expected to significantly increase the project’s resource
base.*
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Bauxite Hills – drilling program update
*The potential quantity and grade of the deposits at BH2, BH3, BH4, BH5, BH6 and BH7 are
still conceptual in nature. There is insufficient information at this time to define a mineral
resource and there is no certainty that further exploration will result in the determination of a
mineral resource in these areas. The beneficiated grade on a dry-product basis is expected to
be in the range 48-54 per cent Al2O3 and 8-12 per cent SiO2 assuming average 65 per cent
beneficiation recovery.
Bauxite
Plateau
No. of
holes
No. of holes
interpreted to intersect
bauxite
% of holes
interpreted to
intersect bauxite
Average
interpreted
thickness
BH1 1,482 1,226 86% 2.4
BH2 144 137 96% 1.8
BH3 138 7 5% n/a
BH4 166 75 45% 0.8
BH5 134 61 45% 1.0
BH6 505 428 92% 1.8
BH7 n/a n/a n/a n/a
Total 2,569
A reconnaissance and hand-auger sampling program at the
project’s BH7 plateau is planned to start in early December.
Planning for an infill drilling program for the 2012 dry season
has begun. This will lead to improved resource definition for
the project – specifically a Measured Resource for the deposits
at BH1, BH2 and BH6.
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Establish new barge loader <2 nautical
miles upstream from existing Skardon River
Port and ~2.5km from proposed BH1 mine.
Commence mine development at BH1 with
initial production rate of 2 Million tonnes per
annum rising to 5 Million tonnes per annum.
Utilise 10,000t self discharge barges for
offshore trans-shipment.
Sequential development of BH1-BH7 to
stage and defer capital expenditure.
Future development of BH1 and BH6 will
benefit from their proximity to the proposed
port and infrastructure sites for the project.
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Bauxite Hills development concept F
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2010 2011 2012 2013 2014
Preliminaries
Access Agts 1
Reconnaissance 1
Definition
Drilling ## ##
Analysis ##
Resources ## ##
Metallurgy ##
Scoping Study ##
IAS/Draft TOR ##
ILUA 1
Feasibility
Final TOR 1
EIS Base line studies 1
EIS Write-up/submission 1
EIS Public consultation 1
Draft EA 1
Final EA/ML grant 1
PFS 1
Marine & Port Studies 1 1
Geotechnical Studies 1
DFS 1
Commitment
Capital Raising 1
Construction 1
Production 1
2010 2011 2012 2013 2014
Preliminaries
Access Agts 1
Reconnaissance 1
Definition
Drilling ##
Analysis ##
Resources ##
Metallurgy ##
Scoping Study ##
IAS/Draft TOR ##
ILUA 1
Feasibility
Final TOR 1
EIS Base line studies 1
EIS Write-up/submission 1
EIS Public consultation 1
Draft EA 1
Final EA/ML grant 1
PFS 1
Marine & Port Studies 1 1
Geotechnical Studies 1
DFS 1
Commitment
Capital Raising 1
Construction 1
Production 1
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Bauxite Hills proposed development timeline
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This timeline is for illustration purposes..
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Continuous mining and continuous rehabilitation
Integrated mining process F
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Integrated mining and continuous rehabilitation
Cape Alumina has developed an innovative, integrated mining and progressive
rehabilitation process – based on proven technology – that reduces capital and
operating costs and minimises any long-term environmental impacts.
This includes:
in-pit beneficiation and fines disposal
use of conveyors
progressive and continuous environmental rehabilitation
use of self-discharge barges for offshore trans-shipment
All of which eliminates the need for large tailings dams, reduces capital and
operating costs, minimizes emissions and reduces the mine’s overall
environmental footprint.
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A small port and barge loading facility will
be located in the Skardon River.
Shallow draught barges will then tranship
the product 15 to 20 nautical miles
offshore to a mooring in the Gulf.
The product is then loaded and exported
to market.
Low environmental foot print, with
minimal onshore buildings, stockpiles and
reduced dust emissions is a key benefit
of the proposed transhipping system.
Cape alumina will develop its transhipping operations from the
ground up, with no existing infrastructure available.
Transhipment – the obvious solution
Transhipment is an obvious and innovative solution for the Bauxite Hills project as it is
in an area of Western Cape York where there is shallow water, sheltered seas and no
infrastructure.
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Port facilities The function of the barge loading terminal is to load beneficiated bauxite on to self
unloading barges of approximately 10,000 DWT. Production levels of 3, 5, 7 and 10
Mtpa have been considered.
The size of ship that the marine operation must be capable of handling is a
Panamax vessel up to 75,000 DWT with an option to facilitate loading of Cape size
vessels of 160,000DWT.
The facility would be designed to operate on a 24 hours per day, 7 days per week
basis and would only be shut down for scheduled maintenance, emergency
breakdowns and cyclones.
The limiting conditions for transhipping at sea would be winds gusting to 20 m/s.
The following port capacities have been assumed: 3.0 Mtpa 5.0 Mtpa 7.0 Mtpa
Maximum load out rate t/h 2,500 2,500 2,500
Average load out rate t/h 1,250 1,385 1,385
Ship capacity (average) t 75,000 160,000 160,000
No. of vessels per year 40 33 47 For
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Investment highlights
Cape Alumina has high-quality shareholders, an experienced board and an
established, experienced management team.
Cape Alumina has developed a world-leading innovative, low-cost mining and
continuous rehabilitation process.
Low-cost, efficient transhipment operations by Cape Alumina will be a key to the success of the Bauxite Hills Project.
Our product is export-grade quality, close to port and close to market.
Global demand for bauxite will remain strong over the long-term.
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Office Suite 6/56 Peel Street, South Brisbane Qld 4101
Postal GPO Box 291, Brisbane, 4001, Qld Australia
Phone + 61 7 3844 9911 Facsimile + 61 7 3844 9919
Email [email protected] Web www.capealumina.com.au
Cape Alumina Limited Office Suite 6/56 Peel Street, South Brisbane, Qld 4101
Postal PO Box 3732, South Brisbane, Qld 4101, Australia
Phone + 61 7 3844 9911 Facsimile + 61 7 3844 9919
Email [email protected] Web www.capealumina.com.au
ABN 88 107 817 694
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