Alara Resources Limited · ASX:AUQ
Alara Resources — Investor Presentation (May 2013)
32 slides from Alara Resources's investor presentation, May 21, 2013
Slide 1: ASX/Media Release: Investor Presentation
Alara Resources Limited Telephone | +61 8 9214 9787 A.B.N. 27 122 892 719 Facsimile | +61 8 9322 1515 Level 14, The Forrest Centre Web | www.alararesources.com 221 St Georges Terrace Email | info@alararesources.com Perth Western Australia 6000 ASX/MEDIA RELEASE For personal use only Tuesday, 21 May
Slide 2: Alara Resources Limited Investor Presentation May 2013
Alara Resources Limited For personal use only Investor Presentation May 2013 ASX: AUQ www.alararesources.com www.alararesources.com
Slide 3: Company profile
Company profile For personal use only Board of Directors Company Data Ian Williams AO Chairman ASX Code AUQ 40+ years of mining industry experience, including Hamersley Iron, Market Capital (17 May 2013) $18M Rio Tinto, Century Zinc and Pasminco Awarded Order of Australia for services to Indigenous
Slide 4: Management team
Management team For personal use only Shanker Madan – Managing Director 35+ years of mining industry experience, including BHP, Rio Tinto and Hamersley Iron. Justin Richard – Country Manager, Saudi Arabia 20+ years of experience, including Corporate Counsel and head of legal for UGL Limited’s resour
Slide 5: Project locations
Project locations For personal use only Moving from Exploration into Development and Production Washihi & Daris Khnaiguiyah Project Projects (Saudi Arabia) Alara is an Australian-based minerals (Oman) exploration and development company, with its head office located in Perth, Western Australia. Alar
Slide 6: Recent milestones and highlights
Recent milestones and highlights For personal use only • New Director appointed in May 2013 – Philip Hopkins – Philip Hopkins is a mining executive with over 30 years’ experience in the industry with a combination of executive, operational, project and corporate experience in both open pit and under
Slide 7: Moving into production
Moving into production For personal use only © Alara Resources Limited www.alararesources.com 6
Slide 8: Khnaiguiyah Zinc-Copper Project (50%)
Khnaiguiyah Zinc-Copper Project (50%) For personal use only • Located ~200km west of Riyadh, the capital of Saudi Arabia (170km from Riyadh on a 6-lane highway, then 30km on a 2-lane highway into the project • Nearby town of Al Quwayiyah has a population of ~200,000 people, light industry and techni
Slide 9: Project layout
Project layout For personal use only © Alara Resources Limited www.alararesources.com 8
Slide 10: DFS Highlights – robust returns
DFS Highlights – robust returns For personal use only Highlights (100% basis) • Project revenue: A$2,074 M • Project costs : A$1,201M • EBITDA: A$873M • Project free cash flow: A$467M (after Capex paid) • Capex: US$257 million, including owner’s cost and contingency • Project NPV: A$170 million at a
Slide 11: Mining
Mining For personal use only • The DFS contemplates three open cut pits (K1, K2 and K3) within 3km distance of each other and a centrally located ROM pad and processing facility. • It is envisaged that 100% drill and blasting for ore and waste will occur with truck and shovel operation occurring on
Slide 12: Mining and milling
Mining and milling For personal use only The current plan sees mining completed in 9 years. Processing from years 10 to 13 will be from the stockpiles at 2Mtpa. Mining Total • Mined & Processed (tonnes, Years 1 to 9) 18,000,000 • Mined grade (Zn) 4.0% • Mined grade (Cu) 0.34% • Strip ratio (waste:or
Slide 13: Processing
Processing For personal use only • 9 years mining • 4 years stockpile reclaim • Ore suitable for conventional differential floatation of sulphide ores. • Design based on grades averaging greater than 6% Zn. Plant design is thus conservatively designed to treat larger volumes of material . • Crushing
Slide 14: Production profile (concentrate)
Production profile (concentrate) For personal use only © Alara Resources Limited www.alararesources.com 13
Slide 15: Funding
Funding For personal use only In addition to the share market, several avenues of raising finance are available. These comprise: • SIDF • Debt finance • Leasing finance • Off take finance • Private equity • Corporate sell down • Partial listing of combined holding on the local exchange © Alara Resou
Slide 16: SIDF
SIDF For personal use only • SIDF and other Saudi Arabian banks have Value of SIDF Approved Loans expressed interest in funding the Project 2006-2011 (US$M) • The Saudi Arabia Industrial Development Fund 2,500 (SIDF) provides loans of up to 75% for industrial and mining development in Saudi Arabia 2
Slide 17: Project schedule
Project schedule For personal use only 2013 2014 2015 2016 2025 2026 2027 2028 2029 2030 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Design A Procurement Construction Dry Commissioning Wet Commissioning Mining Ramp-Up Prod
Slide 18: Identified upside
Identified upside For personal use only • DFS based on current reserves only - JORC Proved and Probable Reserves of 26.1 million tonnes at 3.3% Zn and 0.24% Cu . • All ore bodies are open along strike and depth. Significant upside exists for further discoveries along the host shear zones which have
Slide 19: Significant exploration upside
Significant exploration upside For personal use only • Zinc and copper mineralisation is focused along the carbonatised shear zones. • Numerous additional shears have been identified and are yet to be drilled. • Strong potential exists to significantly grow the resource base. • Zone 4 is yet to be d
Slide 20: Strengths and opportunities
Strengths and opportunities For personal use only • Unexplored shear zones have the potential of doubling the resource; mapping and geophysical work yet to be completed. • Potential for SIDF funding • Resource/Reserve expansion • Adjoining high potential tenements • Strong relationship with local go
Slide 21: Project ownership and partners
Project ownership and partners For personal use only • The Khnaiguiyah Project is operated by Khnaiguiyah Mining Company LLC (KMC), a 50:50 joint venture between Alara and United Arabian Mining Company LLC (Manajem), a privately owned Saudi Arabian mining company. • Manajem was established in 2004 a
Slide 22: Oman (70-75%)
Oman (70-75%) For personal use only © Alara Resources Limited www.alararesources.com 21
Slide 23: Oman - Washihi Copper Gold Project
Oman - Washihi Copper Gold Project For personal use only The Washihi Copper-Gold Project is located approximately 100km south-southeast of Alara’s Daris Copper- Gold Project and adjacent to a high quality bitumen road. Initial JORC Resource estimate1 (excludes the recent drilling outlined below): •
Slide 24: Oman Project Funding
Oman Project Funding For personal use only Further Work and Project Funding • The Company is well advanced in Environmental approval, Mining lease approval and development of Water resources to advance Washihi and Daris Projects to production. • In the wake of a formal declaration by the Sultan of O
Slide 25: Conclusions
Conclusions For personal use only • Strong Team – in place and highly experienced • Supportive Government – mining licence and environmental approvals received • Long life, Low cost – 13 year mine life, strong margins • Attractive Payback – higher production and lower costs in early years • Growing
Slide 26: JORC Code Competent Person Statements
JORC Code Competent Person Statements For personal use only The information in this announcement that relates to Ore Reserves in relation to the Khnaiguiyah Project (Saudi Arabia) has been compiled by Mr Geoff Davidson, who is a member of the Australian Institute of Mining and Metallurgy and a consu
Slide 27: Additional slides - Capex summary
Additional slides - Capex summary For personal use only • Capex based on a contracting strategy and fixed lump sum prices • Mobile mining equipment is proposed to be leased • Tender bids have been received, reviewed and compiled into the Capex as follows: Item US$M Process facilities including desig
Slide 28: Cross Section Zone
Cross Section Zone 1 For personal use only © Alara Resources Limited www.alararesources.com 27
Slide 29: Cross Section Zone
Cross Section Zone 2 For personal use only © Alara Resources Limited www.alararesources.com 28
Slide 30: Cross Section Zone
Cross Section Zone 3 For personal use only Khnaiguiyah Mineralized Zone K3 Section Profile 16 © Alara Resources Limited www.alararesources.com 29
Slide 31: Appendix: Zinc price forecasts
Appendix: Zinc price forecasts For personal use only © Alara Resources Limited www.alararesources.com 30
Slide 32: Alara Resources Limited contact and disclaimer
Alara Resources Limited For personal use only ABN: 27 122 892 719 ASX Code: AUQ Level 14, The Forrest Centre 221 St Georges Terrace Perth, Western Australia 6000 Telephone: +61 8 9214 9787 Facsimile: +61 8 9322 1515 info@alararesources.com www.alararesources.com DISCLAIMER This presentation contains