Sunstone Metals Ltd · ASX:STM
Sunstone Metals — Avalon Minerals — Investor Presentation (January 2016)
28 slides from Sunstone Metals's investor presentation, January 2016
Slide 1: Avalon Minerals – Copper in Sweden
AVL ak AVALON MINERALS LTD COPPER IN- SWEDEN BUILDING A EUROPEAN COPPER PRODUCER
Slide 2: Disclaimer
DISCLAIMER DISCLAIMER FORWARD-LOOKING STATEMENTS To the maximum extent permitted by law, no This Presentation includes certain statements that may representation, warranty or undertaking, express or be deemed “forward-looking statements”. All implied, is made and, to the maximum extent permitted sta
Slide 3: Avalon Minerals – Key Points
AVALON MINERALS – KEY POINTS 1. Copper development company 2. Single high quality asset focus 3. Supported by outstanding infrastructure 4. Low sovereign risk 5. Highly competent team in place to deliver project If you believe in copper then Avalon represents a compelling investment opportunity As e
Slide 4: Copper Fundamentals – Good Timing
COPPER FUNDAMENTALS – GOOD TIMING Viscaria Production Start Historical price data and forecast market balance – At time of copper market deficit, source Deutsche Bank and assumed higher price ? 3
Slide 5: Consider an Investment Decision Based on Risk and a 3-5 Year Time Frame
AVALON MINERALS – CONSIDER AN INVESTMENT DECISION BASED ON RISK AND A 3-5 YEAR TIME FRAME General Risk – Low Technical Risk – Low • Sweden, low sovereign risk • 2015 drilling program very successful • Kiruna – a mining district • Strong upside case for delivery of additional • Viscaria Project resou
Slide 6: Viscaria Copper – 2015, Delivered to Goals
VISCARIA COPPER – 2015, DELIVERED TO GOALS Ownership • 100% ownership retained • Completed 8,000m of diamond drilling at D Zone in 2015 • Strongly outperformed historical results and delivered confidence Drilling • Outstanding results such as VDD 193, 26.7m at 2.6% Cu including 6.6m at 3.5% Cu • Rec
Slide 7: Viscaria Copper – 2015 Scoping Study
VISCARIA COPPER – 2015 SCOPING STUDY The 2015 Scoping Study confirmed the project description to begin ESIA process (Refer ASX Announcement 14 December 2015) Strip ratio (LOM) 5.8 Process plant Crush, grind and copper flotation plant, 1.2Mtpa throughput capacity Recovery rates 90.2% Copper Productio
Slide 8: What Has the 2015 Scoping Study Told Us?
VISCARIA COPPER – WHAT HAS THE 2015 SCOPING STUDY TOLD US? • ‘Main takeaway’ – increase the mining inventory from 10 mill tonnes to 18 mill tonnes to allow for a 2mtpa operation. This is in progress. • Scoping Study metrics clearly demonstrate that the project needs to deliver: – Annual production r
Slide 9: Viscaria Copper Project
VISCARIA COPPER PROJECT PROJECT SITE KIRUNA TOWN PUBLIC ACCESS ELECTRIC RAIL LOW COST HYDRO POWER 8
Slide 10: Viscaria Location
VISCARIA LOCATION • 3 Exploitation Concessions (valid to 2037 and 2039) approved covering the main areas of mineralisation at Viscaria • Viscaria is in an area of ‘National Interest for Minerals’ • Outstanding access to, and quality of, infrastructure, and low cost hydro power • Multiple Scandinavia
Slide 11: D Zone Long Section
VISCARIA D ZONE LONG SECTION Contours = Cu % x interpreted true thickness 2014 Mineral Resource Estimate boundary 2015 Mineral Resource Estimate boundary 10
Slide 12: Viscaria Cross Section
VISCARIA CROSS SECTION Section through main shoot - VDD 193, 193W, 195, 186 and shallower holes above 186 The widest reported intersections in each hole (red text) progressively thicken downward within the shoot. <10m > 18.1m > 21m > 37.5m > 40m > 47.5m > 101.8m. Broadly we see consistent trend of d
Slide 13: Mineral Resource Estimates and Mining Inventory
VISCARIA – MINERAL RESOURCE ESTIMATES AND MINING INVENTORY Mineral Resource Tonnes (Mt) Grade (% Cu) A Zone# 21.6 1.5 B Zone# 19.7 0.8 D Zone Open Pit* 3.1 0.8 D Zone Underground* 8.0 1.4 Total 52.4 1.2 Mining inventory Tonnes (Mt) Grade (% Cu) A Zone Open Pit @ 2.6 1.3 B Zone Open Pit @ 2.0 0.7 D Z
Slide 14: Don't Underestimate the Value of Location and Existing Infrastructure
VISCARIA – DON’T UNDERESTIMATE THE VALUE OF LOCATION AND EXISTING INFRASTRUCTURE Mining infrastructure in place adjacent to the world’s largest underground magnetite mine and iron pellet manufacturing facility Airport Mining town with mining contractors Low cost hydro power Highway access
Slide 15: D Zone – Mine Planning
D ZONE – MINE PLANNING D Zone showing planned open pits and schematic underground mine planning scenario based on 2015 Scoping Study 14
Slide 16: D Zone – Very Confident It Will Be Larger
D ZONE - VERY CONFIDENT IT WILL BE LARGER N D Zone orebody; black dashed line D Zone is delivering D Zone Magnetic very robust model; green, blue, intersections yellow domains Geophysical modelling and structural geology is enabling the delivery of a predictive model for resource growth VDD196 VDD19
Slide 17: Development Area – Outstanding Upside
DEVELOPMENT AREA - OUTSTANDING UPSIDE Mine scale orebody extensions, low technical risk Exploration success within 5km A rich portfolio of near mine targets to add to the scale of the project 16
Slide 18: Stakeholder Engagement
STAKEHOLDER ENGAGEMENT Proposed development area is in a window Area of surrounded by Development Focus multiple land use areas The key issues are (1) a strong mining heritage, (2) reindeer herding (3) Natura 2000 (4) recreation Area of National Interest for Minerals 17
Slide 19: Planning to Deliver
PLANNING TO DELIVER 2015 2016 2017 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 STUDIES AND EXPLORATION Exploration (discretionary) Scoping Study Copper Production + 18 months Updated Scoping Study Decision to Mine Accelerate Feasibility Study PERMITTING ESIA Baselines ESIA Assessments and Application ESIA review to
Slide 20: Corporate
CORPORATE Top 10 shareholders hold 72% of shares on issue TICKER ASX:AVI Frankfurt:AL9 Top 10 comprise institutions and high net worth SHARE PRICE* $0.022 individuals SHARES ON ISSUE 332,690,122 Board and management hold 3.5% and have participated in recent placements MARKET CAP $7.3M European and U
Slide 21: Appendices
APPENDICES 20
Slide 22: D Zone – High Grade Intersections
VISCARIA D ZONE – HIGH GRADE INTERSECTIONS Shoot Drill hole number From (m) To (m) Interval (m) % Cu 1 VDD 171 89.0 103.2 14.2 2.0 oxide Summary of high VDD 149 225.0 230.7 5.7 1.7 grade intersections oxide 2 VDD 163 399.2 403.0 3.8 1.8 VDD 155 389.0 394.0 5.0 1.4 taken from various VDD 196 559.5 56
Slide 23: Viscaria Copper – Mineral Resources
VISCARIA COPPER – MINERAL RESOURCES Viscaria Copper Project Mineral Resource Estimates Summary – Nov 2015 Resource Area Location Classification Tonnes (Mt) Cu Grade (%) Contained Cu (kt) Measured 14.44 1.7 240.0 Indicated 4.69 1.2 57.2 A Zone Open Pit Inferred 2.48 1.0 25.5 Subtotal 21.61 1.5 322.7
Slide 24: A Very High Quality Leadership Team
A VERY HIGH QUALITY LEADERSHIP TEAM Chairman Resources executive. Broad global experience with large Graham Ascough companies and building juniors CEO and Managing Director Geologist and Business Development. Track record of Malcolm Norris discovery and growth General Manager Mining Engineer. Studie
Slide 25: Kiruna Location Map
KIRUNA LOCATION MAP Railway Line 2030 Deformation Zone Proposed E10 Bypass * New connection to E10 Viscaria Project Kirunavarra Mine Luossavaara Ski Hill @) Existing Town Centre ©) Power Station - Waste to Energy Golf Course @) Proposed New Town Centre Airport ® Public Rail Terminal AVALON 24
Slide 26: Chile – Total Cost of Production, Cu
CHILE - TOTAL COST OF PRODUCTION, Cu USc/lb Average Copper Price and Total Cost of Production (Chile) 450 400 402 363 350 346 327 332 311 311 308 300 250 248 US c/lb 242 220 218 217 210 200 170 175 171 150 150 134 106 Total Cost of Production (Chile) 100 90 Cu Price (average) c/lb 50 0 2005 2006 200
Slide 27: China – Copper Ore and Concentrate Imports
CHINA – COPPER ORE AND CONCENTRATE IMPORTS Chinese copper ore and concentrate imports were strong during December 2015 Copper ores and concentrates imports rose to 1480Kt, up 3% m/m and 26.8% y/y. For 2015, imports rose 12.3% y/y, compared with 17.7% for 2014. For 2015, imports of ores and concentra
Slide 28: Competent Persons Statement
COMPETENT PERSONS STATEMENT Competent Persons Statement The information in this report that relates to exploration results is based upon information reviewed by Mr Malcolm Norris who is a Fellow of the Australasian Institute of Mining and Metallurgy. Mr Norris is a full-time employee of Avalon Miner
Avalon Minerals — Investor Presentation (January 2016) on 6ix