investor presentation february 2014 - · pdf fileinvestor presentation february 2014 ... may...

ASX and Media Release: 24 February 2014 ASX code: RXM

Investor Presentation February 2014 Rex Minerals Limited (“Rex”) is pleased to release its latest investor presentation. This presentation will be used for investor road shows.

Mark Parry (Managing Director) or Amber Rivamonte (Company Secretary) Phone: +61 (0)8 8299 7100 E-mail: [email protected]

Media enquiries to:Simon Jemison C/. Collins Street Media Phone: 0408-004-848 or 03-9224-5319 Email: [email protected]

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AUSTRALIA’S NEXT GREAT COPPER PROJECT. HILLSIDE: SOUTH AUSTRALIA

Disclaim

er

Investor PresentationMark Parry – Managing Director & CEOFebruary 2014

Delivering Australia’s Largest Undeveloped Copper ProjectF

or p

erso

nal u

se o

nly

February 2014


Disclaim

er

The presentation (in this projected form and as verbally presented) (“Presentation”) is provided on the basis that none of the Company nor its respective officers, shareholders, related bodies corporate, partners, affiliates, employees, representatives and advisers make any representation or warranty (express or implied) as to the accuracy, reliability, relevance or completeness of the material contained in the Presentation and nothing contained in the Presentation is, or may be relied upon as a promise, representation or warranty, whether as to the past or the future. The Company herby excludes all warranties that can be excluded by law.

The Presentation contains prospective financial material which is predictive in nature and may be affected by inaccurate assumptions or by known or unknown risks and uncertainties and may differ materially from results ultimately achieved.

The Presentation contains “forward-looking statements”. All statements other than those of historical facts included in the Presentation are forward-looking statements. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to, copper and other metals price volatility, currency fluctuations, increased production costs and variances in ore grade or recovery rates from those assumed in mining plans, as well as political and operational risks and governmental regulation and judicial outcomes. The Company does not undertake any obligation to release publicly any revisions to any “forward-looking statement”.

The Presentation contains general background information about the Company and its activities current as at the date of this presentation. The information in this Presentation is in summary form only and does not contain all the information necessary to fully evaluate any transaction or investment. It should be read in conjunction with the Company’s other periodic and continuous disclosure announcements lodged with the ASX, which are available at www.asx.com.au and other publicly available information on the Company available at www.rexminerals.com.au.

The Presentation does not constitute an offer, invitation or recommendation to subscribe for or purchase any security and does not form the basis of any contract or commitment. The Presentation, the entitlement offer and the contracts formed on acceptance of the relevant applications are governed by the laws applicable in Victoria, Australia. Each person who applies for new shares submits to the jurisdiction of the courts of Victoria, Australia.

All persons should consider seeking appropriate professional advice in reviewing the Presentation and the Company.

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1 > Hillside Overview1 > Hillside Overview

2 > Rex Corporate Overview2 > Rex Corporate Overview

3 > The Resource3 > The Resource

4 > Mining4 > Mining

5 > Processing5 > Processing

6 > Approvals6 > Approvals

7 > Funding & Timeline7 > Funding & Timeline

8 > Growth Potential8 > Growth Potential

Hillside O

verviewFebruary 2014

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Hillside O

verview

Key Attributes‒ 100% ownership of project, no off-take encumbrances or royalties

‒ 2Mt of contained copper resources reported in accordance with the 2012 JORC (future additions likely)

‒ 12 year open pit Ore Reserve reported in accordance with the 2012 JORC

‒ >75 ktpa Cu or >110 ktp CuEq (first 10 years*)

‒ Close to existing major infrastructure (power, water, port)

‒ Simple, conventional metallurgy

‒ Clean, highly marketable concentrates expected for both copper/gold and iron products

‒ State government very keen for project to go ahead (jobs)

‒ Right team in place at the right time to build Hillside* Refer to Appendix 1

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Hillside O

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Output Key Features Advantage110+ ktpa CuEq Integrated modular plant Economies of scale

3 revenue streams

Copper (Cu) >75,000 tpa

• Open Pit• Shallow orebody• Moderate Strip• Conventional floatation to

Quality Cu-Au concentrate.• Slurry pipeline to existing

port (only 12kms).

• Good recovery• Low impurities• Easily saleable

concentrate

Gold (Au)>60,000 ozpa

Iron Ore>1.2 Mtpa

Conventional recovery from tailings of Cu/Au circuit.Slurry pipeline to existing port.

Refined product with >67%Fe and low impurities.Low cost delivered to port (~A$40/t)

Increased ProductionNew average production profile over first 10 years

February 2014

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Rex C

orporate Overview

February 2014

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Rex C

orporate Overview

Managing DirectorMr Mark Parry

Chief Financial Officer

Ms Rachel Rees

Financial and Accounting Team

ICT Team

Chief GeologistMr Patrick Say

Geology and Drilling Team

Project ManagerMr John Burgess

Project Commercial &Financial Manager

Mr Mark Terry

Environmental & Stakeholder MgmtMs Erica Dearlove

Regulatory and Community Liason

Team

Government & Regulatory Relations

Mr Marc Twining

Company SecretaryMs Amber Rivamonte

Mining ManagerMr James Nagel

Mining Engineering Team

Rex Minerals Executive Management Team – Building Capability

Blue denotes most hires as Rex builds capability

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Rex C

orporate Overview

February 2014

Major Shareholders %

Acorn 8.35

Directors & Management 5.7

Grand South Development 6.24

Northcape 4.16

Greenstone Property 4.32

JP Morgan Chase 3.74

Capital Structure and Ownership

*as at 31 December 2013**as at 31 January 2014

Capital Structure

Cash* $20.9m

Debt* NIL

Shares 188.9m

Options (unlisted) 4.6m

Market Capitalisation (undiluted)** $85m

Market Capitalisation (diluted)** $87m

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The Resource

February 2014

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The Resource

Measured, Indicated and Inferred Mineral Resources‒ Defined by magnetic anomaly‒ 584DD holes & 246RC holes for over 250,000m drilled‒ Resource audited by P. Stoker (AMC)‒ Stuart Masters Resource Validation Study

Hillside JORC Mineral Resource

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The Resource

HILLSIDE ORE RESERVE

Reserve Category Tonnes(Mt)

Grade Contained MetalCopper

(%)

Gold(g/t)

Iron(%)

Copper(kt)

Gold(koz)

Iron Ore(kt)

Proved 65 0.47 0.15 15.4 304.6 312.5 10,180.3

Probable 115 0.55 0.12 13.9 632.5 443.7 15,637.4

Total 180 0.52 0.13 14.4 936.0 752.3 25,743.5

Resource Reserve Conversion

‒ Exploration success has been followed by excellent conversion of Mineral Resources to Ore Reserves

‒ 2Mt contained copper classified as a Mineral Resource

‒ Of this, 64% classified as Measured and Indicated Resources

‒ Of this, 72% converted to Proved and Probable Ore Reserves

Hillside Ore Reserve Summary – June 2013

Hillside Ore Reserve

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The Resource

Based on company ASX announcements between June 2013 and December 2013

12 Year Ore Reserve

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Mining

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Large Scale Open Pit Planned‒ Proven, robust mining methods

‒ Excellent understanding of conditions

‒ Developing operable value focussed sequence

‒ BFS incorporates 12 year OP Ore Reserve shell

‒ Underground is a value accretive add on, not part of BFS or current Ore Reserves

‒ Optimisation opportunities

February 2014


Mining

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N

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20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

220,000

2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033

Tota

l M

ater

ial M

ined

OP - Capital WS OP - Operating WS OP - Ore Original Schedule

Mining Schedule Substantially Improved Since PFS

Peak mining rate reduced by ~25%

More consistent mining rate

February 2014M

ining

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0.00%

0.20%

0.40%

0.60%

0.80%

1.00%

1.20%

-

3,000

6,000

9,000

12,000

15,000

18,000 20

14

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

CuEq

%

Tota

l Ore

Mill

ed

Mill Feed - ExPit Mill Feed - Stockpile Mill Feed - Grade

Production Schedule based on 12 year reserve Production schedule provides generally superior feed grade to PFS at front end of plan.

Resource and underground options (not part of BFS) support mine life beyond 2029.

February 2014M

ining

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Mining

Underground‒ Significant amount of design work done (detailed PFS level)

‒ Confidence achieved in plans to continue mining beyond current Ore Reserve pit shell

‒ Planning to confirm with BFS level, detailed designs after open pit operations have commenced

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ProcessingFebruary 2014

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Processing

Testwork Programs‒ Pilot plant testing undertaken to de-risk the process design from both

a technical and economic perspective (using 9tn representative sample)

‒ Sufficient quantities of concentrate and tailings were produced for marketing and equipment selection and mineralogical purposes

‒ Final flowsheet has been optimised – value engineering completed (rationalised grind size & ball mills, drives, float circuit, thickener circuit, reagents, filters)

‒ Improvements in Cu in concentrate (26% increase vs. PF’s) and power usage (12% reduction) and increased grind size.

‒ Conventional process, high level of confidence, design complete (design signed off mid Feb 14)

‒ Testwork completed – Tunra, CSIRO, pipe line, thickeners, filters, column

‒ Tailings dam design finalised

‒ No outstanding issues remain in mineral processing

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Approvals

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Federal Government Approvals

‒ Complete – no further action required.

State Government Approvals (ML/MPL)

‒ Mining licence documents submitted (April 2013).

‒ Public consultation period complete, detailed responses and response document have been provided to the regulator.

‒ Recommendation for approval now awaiting final review by DMITRE (the regulator) and a ministerial decision (most likely post election in April 2014)

Section 49

‒ DAC have recommended for Ministerial approval.

Approvals

Mining Approvals on Track

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FundingFebruary 2014

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Funding

‒ Funding requirements in the order of approximately US $850million

‒ Financing strategy starts with securing senior construction/term debt

‒ Debt plans include formation of a club (on an N – 1 basis), which may include ECA support from EPC partner’s home country

‒ The process for the balance of funds required will be run in parallel with the debt process, seeking to leverage work done by debt providers and will include consideration of offtake linked financing, joint ventures at the project level, mezzanine finance, etc.

Funding Strategy

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Funding

Hillside Project – Indicative Timeline

Feb Mar Apr May Jun Jul Aug Sept Oct Nov Dec 2015Q1

2015Q2

Regulatory Approvals

EPCECI

EPC Final negotiations & contract approvals

BFS Finalisation

Debt FundingECA plus banks selectionBank credit processApproval

JV/Offtake Funding

Construction Commence

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Grow

th PotentialFebruary 2014

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Grow

th Potential

Project upside (opportunities for enhancement to the BFS)‒ Treatment of oxide ore

‒ Land acquisition to shorten waste haul (not required for decision until approximately year 4)

‒ Capturing hematite to add to magnetite concentrate (potential for up to 200kt pa for an additional estimated $17m capex)

‒ Underground mine life extension

‒ Resource growth potential at Hillside (both north and south) to prolong underground operations

‒ Combination mining methods to reduce the cost of moving waste and average mining costs

‒ Potential pelletising of concentrate at existing Australian operation

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Grow

th Potential

HILLSIDE PROJECT POTENTIAL

Regional Upside‒ Satellite targets to leverage

Hillside investment‒ 5 priority targets identified‒ Rapid soil testing (pXRF),

ground EM/IP and drill testing

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Appendix 1


February 2014

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Appendix 1 continued


February 2014

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investor presentation february 2014 - · pdf fileinvestor presentation february 2014 ... may...

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