Hillgrove Resources Limited · ASX:HGO
Hillgrove Resources — Investor Presentation (December 2010)
36 slides from Hillgrove Resources's investor presentation, Dec 7, 2010
Slide 1: Asia Pacific Copper Miner Presentation December 2010
For personal use only ASIA PACIFIC COPPER MINER PRESENTATION DECEMBER 2010
Slide 2: Disclaimer
DISCLAIMER For personal use only No representation or warranty is or will be made by any person (including Hillgrove Resources Limited ACN 004 297 116 (Hillgrove) and its officers, directors, employees, advisers and agents) in relation to the accuracy or completeness of all or part of this document
Slide 3: Company Overview
COMPANY OVERVIEW AUSTRALIAN MINING COMPANY WITH AUSTRALIAN-INDONESIAN GROWTH PIPELINE Hillgrove Resources (“HGO”) is an Australian based For personal use only minerals exploration and development company HGO’s flagship project is the Kanmantoo Copper Mine project (100% owned) 55km from Adelaide
Slide 4: Strategic Direction and Focus
STRATEGIC DIRECTION AND FOCUS NEAR TERM PRODUCTION, HIGHLY PROSPECTIVE EXPLORATION For personal use only Deliver Kanmantoo as a producing asset, within time and budget estimates Single mine producer in 12 months Multi-mine producer within 5 years Australia and Indonesian focus for near term
Slide 5: Corporate Snapshot
CORPORATE SNAPSHOT DETAILS AND SHAREHOLDER DISTRIBUTION For personal use only ASX listed: HGO SHAREHOLDER DISTRIBUTION Shares on issue: 540.8 million J.P. Morgan Metals & Share price: A$0.265 Concentrates 10% Market capitalisation: A$143.3 million (30 November 2010) Cash and cash equivalen
Slide 6: FID and Financing Plan
For personal use only FID AND FINANCING PLAN 6
Slide 7: Financing Plan
FINANCING PLAN UTILISES EXISTING CASH, PROJECT FINANCE AND EQUITY OFFER For personal use only FINANCING PLAN UTILISES CASH, DEBT AND EQUITY OFFER PROCEEDS Existing cash of circa AUD 77 million at 31 August, 2010 EGM approved Equity raising of AUD 65 million Share Purchase Plan (SPP) Project
Slide 8: Estimated Capital and Development Costs
ESTIMATED CAPITAL AND DEVELOPMENT COSTS SUMMARY OF COSTS TO BRING KANMANTOO TO PRODUCTION For personal use only Total Capital costs Remaining capital costs spent to date capital costs (AUD million) (AUD million) (AUD million) Capital costs Mining 17.1 0.1 17.0 Pillara processing plant 67.9 21.3 46.6
Slide 9: Sources and Uses of Capital from September 2010 through May 2012
SOURCES AND USES OF CAPITAL FROM SEPTEMBER 2010 THROUGH MAY 2012 KANMANTOO COPPER/GOLD PROJECT, INDONESIAN EXPLORATION AND CORPORATE EXPENSES For personal use only Sources of capital AUD million Opening Cash Balance 76.5 Project finance loan 30.0 Project finance bonding & guarantee facility1 20.0 Ea
Slide 10: Offer Rationale: Why AUD65 Million?
OFFER RATIONALE WHY AUD65 MILLION? For personal use only Banks required forecast positive cash balance at Completion in May/June 2012, based on conservative assumptions of construction costs, ramp up revenue and operating performance Only levers HGO had were size of equity raising and level of e
Slide 11: Type of Offer: Why a Placement and Not a Rights Issue?
TYPE OF OFFER WHY A PLACEMENT AND NOT A RIGHTS ISSUE? For personal use only Hillgrove considered a number of different funding options for the “funding gap” Joint venture discussions were re-instigated but dismissed after consideration of timing and execution risks Convertible notes were consi
Slide 12: Type of Offer (continued)
TYPE OF OFFER (continued) WHY A PLACEMENT AND NOT A RIGHTS ISSUE? For personal use only Because of time delays and market risks between launch and settlement, a Rights issue would have attracted a deeper discount and therefore even greater potential dilution than through the chosen institutional p
Slide 13: Indicative Offer Timetable
INDICATIVE OFFER TIMETABLE FULLY UNDERWRITTEN INSTITUTIONAL PLACEMENT For personal use only EVENT DATE Settlement of conditional placement Tuesday, 7 December 2010 Expected trading date of new shares Wednesday, 8 December 2010 issued under conditional placement SPP closes Tuesday, 14 December 2010 S
Slide 14: Kanmantoo Copper Mines Project
For personal use only Kanmantoo Copper Mines Project
Slide 15: Kanmantoo Copper Mines Highlights and Location
KANMANTOO COPPER MINES HIGHLIGHTS AND LOCATION AUSTRALIA’S NEXT PRODUCING COPPER/GOLD MINE For personal use only 100%-owned by Hillgrove Located just 55km from Adelaide, in SA The project enjoys commensurate capital cost advantages Exploration Close to necessary power, water, road, rail Area
Slide 16: Kanmantoo Copper Mines 2010
KANMANTOO COPPER MINES 2010 For personal use only 16
Slide 17: Kanmantoo Copper Mines Overview
KANMANTOO COPPER MINES OVERVIEW PLANNED PROJECT HIGHLIGHTS For personal use only Pre-strip and Tailings dam construction commenced Plant construction commenced First copper/gold production scheduled for November 2011 10 year mine life with potential to expand Life-of-mine (“LOM”) average p
Slide 18: Kanmantoo Copper Mines – Current Activity
KANMANTOO COPPER MINES – CURRENT ACTIVITY SITE VIEW WITH PLANT LOCATION SCHEMATIC For personal use only Abesque York Civil Concentrate Process Water Construction Administration Construction Workshop & Storage Area Pond Office Area Office Stores Area Filter Concentrate Floatation Mill Processing Thic
Slide 19: Kanmantoo Processing Overview
KANMANTOO COPPER MINES PROCESSING OVERVIEW Lime ROM For personal use only Construction and commissioning VIBRATING BIN FEED BIN PRODUCT SCREEN GRIZZLY NEUTRAL- contract with Abesque Engineering FEEDER JAW CRUSHER ISATION TANK Simple, standard flowchart and STOCK PROCESS SECONDARY PILE HYDRO WATER
Slide 20: Kanmantoo Copper Mines Ore Body
KANMANTOO COPPER MINES ORE BODY For personal use only NW Zone Waste Rock Stockpile NE Zone Main Zone Green Zone SE Zone Plant Site Emily Star Green Zone Sth O’Neil 20
Slide 21: Exploration Has Improved Resource Certainty and Conversion Ratio
EXPLORATION AT KANMANTOO HAS IMPROVED RESOURCE CERTAINTY AND INCREASED THE RESOURCE-RESERVE CONVERSION RATIO RESOURCE GROWTH RESERVE GROWTH For personal use only Inferred Indicated Measured Mt Mt 20.0 Probable Proved 40.0 18.0 35.0 31.8 32.2 16.0 14.8 30.0 28.0 14.0 25.0 12.0 11.1 20.0 18.4 10.0 15.
Slide 22: Key Attributes / Low Risk Features
KANMANTOO COPPER MINES KEY ATTRIBUTES / LOW RISK FEATURES For personal use only Historical operations significantly de-risk the project Environmental, construction & mining licenses granted; all approvals to mine in place Known, simple metallurgy with excellent recoveries Large database of e
Slide 23: Exploration
For personal use only EXPLORATION
Slide 24: Exploration Assets: Indonesia
EXPLORATION ASSETS: INDONESIA HIGHLY PROSPECTIVE GOLD, COPPER & BULKS EXPLORATION WHY INDONESIA? For personal use only Proven geological provenance for target commodities (Cu, Au) Hillgrove’s position obtained through strong in-country experience base and development of pre-existing formal/infor
Slide 25: Sumba Island – Hillgrove 80%
SUMBA ISLAND HILLGROVE 80% For personal use only Hillgrove is an 80% beneficial shareholder in PT Fathi, holding IUP over ~1,000km2 for a period of six years Hillgrove is responsible for sole funding and management of all exploration and development activities up to decision to mine Main proje
Slide 26: Sumba Island – Masu Project
SUMBA ISLAND – MASU PROJECT HILLGROVE 80% For personal use only Major structural corridor identified over >20km with associated intensive hydrothermal alteration, silicification and gold mineralisation Numerous prospects identified for scout drilling Large airborne geophysical survey to commen
Slide 27: Sumba Island Masu Project
SUMBA ISLAND MASU PROJECT For personal use only Trenching 7m @ 8.3g/t Au, 8m @ 3.1g/t Au, 4m @ 10.0g/t Au Drilling MADPH003: 6.45m @ 4.1g/t Au MADPH013: 13m @ 2.0g/t Au MADPH014: 8.05m @ 1.3g/t Au MADPH015: 10.05m @ 3.4g/t Au Most recent drilling of West Vein confirms consistent gold
Slide 28: Sumba Island Tanah Daro
SUMBA ISLAND TANAH DARO Tanah Daro rocks to 73g/t Au, For personal use only 3.68% Cu and 765g/t Ag Insert Surface sampling recommenced: Soil sampling identifies gold anomaly 200m x 300m with values > 1g/t Au Rock chip sampling of highly altered, silicified hill identifies additional high grade
Slide 29: Indonesia Bird's Head Project Regional Setting
INDONESIA BIRD’S HEAD PROJECT REGIONAL SETTING For personal use only Bird’s Head covers part of the interpreted westward continuation of the New Guinea ‘Orogenic Belt’ 29
Slide 30: Bird's Head Project – Hillgrove 80%
BIRD’S HEAD PROJECT HILLGROVE 80% For personal use only Hillgrove is an 80% beneficial shareholder in PT Akram: Rights cover almost 1,000km2 granted IUP for six years Hillgrove sole funding and manager to decision to mine Ex Normandy project: Hillgrove has acquired drilling and geophysics da
Slide 31: Bird's Head Project – Porphyry Targets
BIRD’S HEAD PROJECT HILLGROVE 80% For personal use only Focus on porphyry copper targets within overlapping hydrothermal alteration systems in a 6.5km x 1.5km corridor Aeromagnetic imaging shows strong mag’ high and low anomalies associated Porphyry Porphyry with intense hydrothermal Targets Tar
Slide 32: Bird's Head Project – West Delta Magnetic Modelling
BIRD’S HEAD PROJECT Green Cliffs HILLGROVE 80% Breccia Target 3D magnetic inversion modelling For personal use only of West Delta area showing modelled magnetic targets on Analytical Signal Image Magnetic High Inversion Approximate Modelling Outlines outline of Figure 1 West Delta channel sampling l
Slide 33: Appendix
For personal use only APPENDIX
Slide 34: Management Team & Board of Directors
MANAGEMENT TEAM & BOARD OF DIRECTORS EXPERIENCED MANAGEMENT TEAM WITH PROVEN TRACK RECORD For personal use only Drew Simonsen, Managing Director & Chief Executive Officer BE (Mining); Dip Geo Sci (Min Eco); GAICD Appointed MD & CEO in August 2010 35 years in resources, investment and commercial
Slide 35: Management Team & Board of Directors
MANAGEMENT TEAM & BOARD OF DIRECTORS EXPERIENCED MANAGEMENT TEAM WITH PROVEN TRACK RECORD For personal use only Jim Kerr, General Manager – Exploration BSC(Geology); MSc(Mineral Economics) Joined Hillgrove Resources in late 2009 and was appointed to the role of General Manager – Exploration in Jul
Slide 36: Management Team & Board of Directors
MANAGEMENT TEAM & BOARD OF DIRECTORS EXPERIENCED BOARD OF DIRECTORS WITH PROVEN TRACK RECORD Hon. Dean Brown AO Non-Executive Chairman For personal use only Former Premier and Minister of the South Australian Government and Member of the South Australian Parliament Chairman of InterMet Resources
Hillgrove Resources — Investor Presentation (December 2010) on 6ix