Diatreme Resources Limited · ASX:DRX
Diatreme Resources — Non-Deal Roadshow (April 2012)
59 slides from Diatreme Resources's roadshow presentation, Apr 16, 2012
Slide 1: Investor Roadshow Presentation
ASX:DRX ASX ANNOUNCEMENT For personal use only 16 April 2012 Diatreme Resources is an Australian based diversified mineral explorer with significant projects in heavy mineral sands, copper, base metals and gold. INVESTOR ROADSHOW PRESENTATION The Company owns the world class Cyclone Zircon Deposit i
Slide 2: Cyclone Zircon Project – Eucla Basin WA
For personal use only Attachment 1 CYCLONE ZIRCON PROJECT – EUCLA BASIN WA (Company Presentation) April 2012 Diatreme Resources Limited - ASX announcement – 16 April 2012
Slide 3: Tony Fawdon, Executive Chairman/CEO
For personal use only Tony Fawdon Executive Chairman/CEO April 2012
Slide 4: Disclaimer
DISCLAIMER For personal use only This presentation contains certain forward-looking statements and forecasts which include without limitation, expectations regarding future performance, exploration, mineral resources, the financial position of Diatreme Resources Limited (the “Company”), industry gro
Slide 5: DRX Profile
DRX PROFILE For personal use only MINERAL SANDS (100%) Mid Tier Zircon Deposit in WA Probable Reserve 97Mt @ 2.5% HM 950,000 Tonnes of Zircon in Ground Prefeasibility Study Completed Decision to Proceed to Definitive Feasibility Study Further HMS Prospects in WA, SA and QLD COPPER /
Slide 6: Project Locations
PROJECT LOCATIONS For personal use only CYCLONE
Slide 7: Cyclone Location
For personal use only CYCLONE LOCATION
Slide 8: Cyclone Deposit Operations
CYCLONE DEPOSIT OPERATIONS For personal use only
Slide 9: Mining Lease Application
MINING LEASE APPLICATION For personal use only
Slide 10: Resource & Reserves
RESOURCE & RESERVES For personal use only MINERAL RESOURCE Head Grade HM Resource Material HM HM Slime OS Zircon cut-off Zircon Rutile Leuc HiTi Alt Ilm Si TiOx Category Mt % Mt % % Kt % % % % % % % MEASURED 1.0 107 2.4 2.63 4.1 5.6 0.77 0.08 0.17 0.52 0.26 0.55 830 INDICATED 1.0 29 1.6 0.47 3.6 6.1
Slide 11: Bulk Sample Testwork
BULK SAMPLE TESTWORK For personal use only CPG Resources - Mineral Technologies tested a 7 tonne bulk sample. Key outcomes from the metallurgical testing include: The wet concentrator testwork produced a high grade HM concentrate (97.8% HM) utilising conventional mineral sand separation technology
Slide 12: Cyclone Products
CYCLONE PRODUCTS For personal use only Zircon: 65,000 tonnes per year ZrO2 % FE2O3 SiO2 % Al2O3 % TiO2 % P2O5 % U+Th CeO2 % % ppm 66.0 0.10 32.8 0.20 0.31 0.07 369 0.020 HiTi87: 10,000 tonnes per year TiO2 % FE2O3 SiO2 % Al2O3 % ZrO2 % MgO % MnO % CaO % CR2O3 % U+Th % ppm 86.6 2.6 5.0 1.01 3.3 0.04
Slide 13: Cyclone Deposit – 3D
For personal use only CYCLONE DEPOSIT – 3D
Slide 14: Cyclone Project Proposed Operations – Deposit / Site Layout
CYCLONE PROJECT PROPOSED OPERATIONS – VIDEO STILLS For personal use only CYCLONE DEPOSIT / SITE LAYOUT
Slide 15: Proposed Mining Methods
CYCLONE DEPOSIT For personal use only PROPOSED MINING METHODS
Slide 16: Mining Operations
CYCLONE PROJECT PROPOSED OPERATIONS – VIDEO STILLS For personal use only MINING OPERATIONS
Slide 17: Overburden Removal
CYCLONE PROJECT PROPOSED OPERATIONS – VIDEO STILLS For personal use only OVERBURDEN REMOVAL
Slide 18: Top Soil Removal
CYCLONE PROJECT PROPOSED OPERATIONS – VIDEO STILLS For personal use only TOP SOIL REMOVAL
Slide 19: Slurry Ore to Plant
CYCLONE PROJECT PROPOSED OPERATIONS – VIDEO STILLS For personal use only SLURRY ORE TO PLANT
Slide 20: Wet Concentration Plant
CYCLONE PROJECT PROPOSED OPERATIONS – VIDEO STILLS For personal use only WET CONCENTRATION PLANT
Slide 21: Transport Options
CYCLONE PROJECT PROPOSED OPERATIONS – VIDEO STILLS For personal use only TRANSPORT OPTIONS
Slide 22: Cyclone Feasibility Study & Schedules
CYCLONE FEASIBILITY STUDY & SCHEDULES For personal use only FEASIBILITY STUDY • Geology & Mineralogy • Resources & Reserves • Hydrology • Mine Planning • Metallurgy & Mineral Processing • Environmental Studies • Infrastructure & Operations • Site Access & HMC Transport • Markets & Economics • Capita
Slide 23: Cyclone Feasibility Study & Schedules
CYCLONE FEASIBILITY STUDY & SCHEDULES For personal use only 2 2 3 2 2 2 12 12 13 3 3 12 13 13 2 -1 2 -1 -1 3 -1 -1 -1 -1 -1 -1 -1 -1 p- c- b- r- n- r- ay ay g v ar ar n n ct DFEFINITIVE FEASIBILITY STUDY l l Ap Au No Ap Se De Fe Ju Ju Ju Ju Ja M M M M O METALLURGY SAMPLES NATIVE TITLE AGREEMENT GEOL
Slide 24: Products & Uses
PRODUCTS & USES For personal use only Titanium 93% of world titanium minerals used to produce TiO2 pigment. TiO2 is a white powder with high opacity and brilliant whiteness. Zircon Over 50% of the world's zircon is used as an opacifier in ceramic glazes. Australia produces 40% of the world’s zircon
Slide 25: Mineral Sands Projects – Zircon Comparison
MINERAL SANDS PROJECTS – ZIRCON COMPARISON For personal use only CYCLONE – PLANNED ZIRCON PRODUCTION vs CURRENT OPERATIONS
Slide 26: Global Mineral Sands Deposits – Zircon Supply/Demand
GLOBAL MINERAL SANDS DEPOSITS – Zr:Ti Ratio For personal use only Cyclone – High Zircon assemblage ZIRCON SUPPLY / DEMAND ANALYSIS TZMI
Slide 27: Project Financials – PFS
PROJECT FINANCIALS - PFS For personal use only Capital Investment (including PFS & DFS) A$223 M Average Annual Sales Revenue A$191 M Average Annual Operating Costs A$88 M Average Annual Tax Payable A$24 M Average Annual Operating Cash Flow After Tax A$78 M Payback Period (Years) 2.1 IRR 32% NPV (10%
Slide 28: Cyclone Project Dynamics & DRX Values
CYCLONE PROJECT DYNAMICS & DRX VALUES For personal use only • 950,000 tonne zircon resource • Current zircon price of US$2,500 • Zircon constitutes >80% of revenue • Independent valuation of Cyclone Project $300 Million • DRX Market capitalisation $28 Million 600 CYCLONE DEPOSIT CUMULATIVE NET CASHF
Slide 29: Corporate Information
CORPORATE INFORMATION For personal use only DRX CAPITAL DIRECTORS BACKGROUND Shares on Issue 355 Million A.J. FAWDON Mining Exploration, 41 Years Options on Issue D.H. HALL Exploration, Administration 89 Million (ex Sept 2013 @ $0.15) A. TSANG Industrial Share Price 8.0 cents G.WHITE Mine & Company
Slide 30: Summary
SUMMARY For personal use only • Advanced project in strengthening Zircon market • Highly experienced & effective Geological & Engineering Team • Right project in the right sector with large upside • Seeking Project or Equity Partners.
Slide 31: Diatreme Resources – Investor Handout
For personal use only Attachment 2 DIATREME RESOURCES RIGHT PROJECT IN THE RIGHT SECTOR WITH LARGE UPSIDE (Investor Handout) April 2012 Diatreme Resources Limited - ASX announcement – 16 April 2012
Slide 32: Diatreme Resources
For personal use only DIATREME RESOURCES Right project in the right sector with large upside April 2012
Slide 33: Statements
Statements For personal use only • This presentation contains certain forward-looking statements and forecasts which include without limitation, expectations regarding future performance, exploration, mineral resources, the financial position of Diatreme Resources Limited (the “Company”), industry g
Slide 34: Diatreme Resources Limited – A Snapshot
Diatreme Resources Limited For personal use only A Snapshot Capital Structure • Project located in Western Australia Shares on Issue 355 Million • ASX listed with code DRX Options on Issue (ex Sept 2013 @ $0.15) 89 Million Share Price (as at 30/03/2012) A$0.07 • 100% owner of the high grade Cyclone
Slide 35: Investment Fundamentals
Investment Fundamentals For personal use only • Mineral Sands sector commanding attention with demand driven by urbanisation and wealth • Emerging supply shortfall of Zircon worldwide • Massive imbalance between current share price and value of Cyclone deposit • PFS completed, NPV of Cyclone is AUD$
Slide 36: Products & Uses for Heavy Mineral Sands
Products & Uses for Heavy Mineral Sands For personal use only Zircon Over 50% of the world's zircon is used as an opacifier in ceramic glazes. Australia produces 40% of the world’s zircon which is mostly used in China and Europe. Titanium 93% of world titanium minerals used to produce TiO2 pigment.
Slide 37: Zircon Supply / Demand Analysis
Zircon Supply / Demand Analysis For personal use only TZMI 6
Slide 38: Cyclone Deposit – Eucla Basin Western Australia
CYCLONE DEPOSIT For personal use only EUCLA BASIN WESTERN AUSTRALIA
Slide 39: Location
Location For personal use only •The Cyclone Deposit is in the highly prospective Eucla Basin • Eucla Basin known for very high value mineral sand deposits including Iluka’s Jacinth-Ambrosia Project. • Single underlying landowner who is committed to development. • Port options by standard CYCLONE gau
Slide 40: Resource & Reserves
Resource & Reserves For personal use only MINERAL RESOURCE Head Grade HM Materia Zirco Resource HM HM Slime OS Zirco cut-off l Rutile Leuc HiTi Alt Ilm Si TiOx n Category % Mt % % n % Mt % % % % % Kt % MEASURED 1.0 107 2.4 2.63 4.1 5.6 0.77 0.08 0.17 0.52 0.26 0.55 830 INDICATED 1.0 29 1.6 0.47 3.6
Slide 41: Cyclone Project Dynamics
Cyclone Project Dynamics For personal use only Zircon Reserve 770,000 Tonnes (Current) Zircon Price US$2,500 Zircon Constitutes >80% Revenue Independent Value of Cyclone Project AUD $300 Million 2011 – Wilsteed Valuation NPV (March 2012) AUD $194 Million DRX Pre-feasibility Study DRX Market Capitali
Slide 42: Project Financials – PFS
Project Financials – PFS For personal use only Capital Investment (including PFS & DFS) AUD$223 Million Average Annual Sales Revenue AUD$191 Million Average Annual Operating Costs AUD$88 Million Average Annual Tax Payable AUD$24 Million Average Annual Operating Cash Flow After Tax AUD$78 Million Pay
Slide 43: Project Timeline
Project Timeline For personal use only Schedule Date Pre-Feasibility Study Completed MARCH 2012 Definitive Feasibility Study Q3 2012 Project Financing Q4 2013 Construction & Development 2014 Mining & Production 2015 12
Slide 44: DFS Schedule
DFS Schedule For personal use only 2 2 3 2 2 2 12 12 13 3 3 12 13 13 2 -1 2 -1 -1 3 -1 -1 -1 -1 -1 -1 -1 -1 p- c- b- r- n- r- ay ay g v ar ar n n ct DFEFINITIVE FEASIBILITY STUDY l l Ap Au No Ap Se De Fe Ju Ju Ju Ju Ja M M M M O METALLURGY SAMPLES NATIVE TITLE AGREEMENT GEOLOGY, MINERALOGY, RESOURCE
Slide 45: Peer Comparison
Peer Comparison For personal use only 2 1.8 Min. Comm. - Tormin 1.6 In-situ Zircon Grade (%) 1.4 1.2 Astron - Donald 1 Exxaro - Fairbreeze 0.8 Diatreme - Cyclone 0.6 BeMax - Snapper 0.4 WTR-Toliara Base - Kwale Gunson - Coburn 0.2 Matilda -Keysbrook Ti Corp - Athabasca MDL - Grand Cote 0 0 10,000 20
Slide 46: Planned Zircon Production vs Current Operations
Planned Zircon Production vs Current Operations For personal use only Cyclone – High Zircon assemblage 15
Slide 47: Cyclone Products
Cyclone Products For personal use only Zircon: 65,000 tonnes per year ZrO2 % FE2O3 % SiO2 % Al2O3 % TiO2 % P2O5 % U+Th CeO2 % ppm 66.0 0.10 32.8 0.20 0.31 0.07 369 0.020 HiTi87: 10,000 tonnes per year TiO2 % FE2O3 SiO2 % Al2O3 ZrO2 MgO MnO CaO % CR2O3 U+Th % % % % % % ppm 86.6 2.6 5.0 1.01 3.3 0.04
Slide 48: Mining Lease Application
Mining Lease Application For personal use only 17
Slide 49: Cyclone Deposit – 3D
Cyclone Deposit – 3D For personal use only 18
Slide 50: Cyclone Deposit – Layout
Cyclone Deposit – Layout For personal use only 19
Slide 51: Proposed Mining Methods
Proposed Mining Methods For personal use only 20
Slide 52: Mining Operations
For personal use only Mining Operations 21
Slide 53: Overburden Removal
For personal use only Overburden Removal 22
Slide 54: Top Soil Removal
For personal use only Top Soil Removal 23
Slide 55: Slurry Ore to Plant
Slurry Ore to Plant For personal use only 24
Slide 56: Wet Concentration Plant
Wet Concentration Plant For personal use only 25
Slide 57: Transport Options
For personal use only Transport Options 26
Slide 58: Investment Summary
Investment Summary For personal use only • Advanced project in strong Zircon market • Highly experienced & effective Geological & Engineering Team • Right project in the right sector with large upside • Independent Broker values DRX at 36c per share (current price $0.08) 27
Slide 59: Diatreme Resources Limited contact details
www.diatremeresources.com.au For personal use only Diatreme Resources Limited Level 2, 87 Wickham Terrace Spring Hill QLD 4000 AUSTRALIA Tony Fawdon Executive Chairman / CEO +61 7 3832 5666