Eastern Resources Limited · ASX:EFE
Eastern Resources — Eastern Iron — Investor Presentation (November 2012)
24 slides from Eastern Resources's investor presentation, November 2012
Slide 1: Eastern Iron — Iron's New Horizon
Eastern Iron — Iron’s New Horizon
Slide 2: Disclaimer
Disclaimer This release may include forward-looking statements. These forward-looking statements are based on management’s expectations and beliefs concerning future events. Forward-looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the co
Slide 3: Overview
Overview • Eastern Iron Limited has three significant iron projects on the East Coast of Australia • Strategic focus on low capex, high margin iron ore developments, close to bulk transport/export infrastructure in Australia and overseas • Present focus on high grade Nowa Nowa magnetite/hematite dep
Slide 4: Project Portfolio
Project Portfolio Nowa Nowa Project (100%) • High grade resource: Inferred 11.5Mt @ 49% Fe (magnetite/hematite) • Scoping near-term mining development producing 0.5 - 1 Mtpa +60%Fe LIMS product • Low Capex ($20-30 million est.) • Eastern Victoria, good project infrastructure, roads, power, port • Ac
Slide 5: Recent Activity
Recent Activity Rapid progress on priority Nowa Nowa Project in 2012 • Sept 2012 – Updated resource for Nowa Nowa of 11.5Mt @ 49.8% Fe • July 2012 – Completion of drilling program at Nowa Nowa and initial drilling results • July 2012 – Completion of Entitlements offer to raise ~$1.27 million • May 2
Slide 6: Corporate Overview
Corporate Overview Capital Structure Experienced Board and Management • 114.6 million shares on issue Chairman: Glenn Goodacre • $3.0 million cash MD: Greg De Ross • PlatSearch NL (ASX:PTS) NED’s : Greg Jones, Wendy Corbett, Ivo major shareholder (46%) Polovineo, Steve Gemell, Adrian Critchlow • Sha
Slide 7: Nowa Nowa Iron Project
Nowa Nowa Iron Project • Eastern Victoria – good local power, roads, labor, port infrastructure • 50km2 under exploration license • 100% owned by Eastern Iron • Existing global inferred resource 11.5Mt @ 49% Fe at a lower cutoff of 40% Fe • Multiple deposits; further resource and exploration upside
Slide 8: Nowa Nowa – Primary Prospects
Nowa Nowa – Primary Prospects Six Mile Deposit • Exploration upside – yet to be drilled Five Mile Deposit • Drilled in 1950’s by Seven Mile Deposit Vic Govt. • Massive • High grade DSO hematite at surface magnetite/hematite • Potential small open cut at start of body development • Unoccupied Crown •
Slide 9: Recent drilling results confirm historical drilling
Recent drilling results confirm historical drilling NND014 62.9m from 67.7m @ 57.6% Fe, 9.78% SiO2, 1.77% Al2O3, 0.03% P
Slide 10: Nowa Nowa – Additional Resource
Nowa Nowa – Additional Resource Potential 7 Mile: 0.55Mt1 DSO hematite • Multiple bodies of massive magnetite • Exploration and resource 6 Mile: undrilled upside potential: • Extensions to Five Mile • Undrilled Six Mile 5 Mile: 8.92Mt1 50%Fe mag/hem 1 Details included in resource announcement by EFE
Slide 11: Five Mile Deposit - Metallurgy
Five Mile Deposit - Metallurgy • Preliminary results from sampling of old drill core • Crushing and Dry LIMS gives low cost high quality magnetite product similar to Pilbara fines Dry LIMS -6.3mm Wt% Fe% SiO2% Al2O3% P% S% Upper Composite 99.7 61.9 6.7 0.9 <0.01 0.62 Intermediate Composite 35.5 58.9
Slide 12: Nowa Nowa – Development Concept
Nowa Nowa – Development Concept • Open Pit Mine producing 1Mtpa iron product. • Mine DSO hematite from 7 Mile first then magnetite/hematite from 5 Mile • Explore other ore sources (6 Mile and extensions to 5 Mile) • Road transport 220km to Eden Port (other transport options to Port Anthony and Weste
Slide 13: Nowa Nowa – Activity Outlook
Nowa Nowa – Activity Outlook Jul – Sept 12 Oct – Dec 12 Jan – Mar 13 Apr – Jun 13 Jul – Sept 13 Oct – Dec 13 Scoping Study Upgrade Five and Seven Mile resource Large diameter core drilling for metallurgical and market testing Firm transport arrangements Investigate off take options Opex an
Slide 14: Central Queensland Iron Project
Central Queensland Iron Project A unique combination of large iron resources in an area of established infrastructure • Hawkwood Project (50% earning 80%) • Eulogie Project (100%) • Auburn exploration permit (100%)
Slide 15: Eulogie Iron – Vanadium Project
Eulogie Iron – Vanadium Project • Completed development study. • Close proximity of existing infrastructure incl. Port and rail (80km west of Gladstone) • JORC Resource: 465 Mt @ 14.2% Fe, 3.0% TiO2, 0.097% V • Vanadiferous Magnetite concentrate product • Potential Resource +1000Mt1 • Granted Mining
Slide 16: Eulogie Project – Concept
Eulogie Project – Concept Development Study • Open Pit mine, 20Mtpa ROM ore • Low waste to ore ratio (0.3) • 3.2 Mtpa magnetite concentrate • 80km road transport to Gladstone Port • Loading through multi-user wharf at Gladstone to +100 DWT vessels • Total Capital Cost est. $606M • Cash costs est. $7
Slide 17: Hawkwood Iron – Vanadium Project
Hawkwood Iron – Vanadium Project • Eastern Iron earning 80% (JV with Rugby Mining Ltd, RUG:TVX) • 4 Exploration licenses totalling 345 km2 • Work completed includes: • High resolution airborne magnetic survey • RC drilling program (2010, 11) • Diamond drilling (2011) • Metallurgical testwork (2010)
Slide 18: Eulogie/Hawkwood Projects - Infrastructure
Eulogie/Hawkwood Projects - Infrastructure Access to Local Infrastructure Supports Potential Development Eulogie Project: Transport options include: • Option 1 - 50km road to Blackwater rail line 140km to Port. • Option 2 – 50km road to Moura rail line 100km to Port • Option 3 - 80km haul road to Po
Slide 19: Central Queensland Transport Infrastructure
Central Queensland Transport Infrastructure Blackwater rail line Moura rail line Gladstone Port RG Tanna coal loader Barney Point
Slide 20: Recent downturn due to destocking in China
Recent downturn due to destocking in China Recent prices below $90/t were temporary due to Chinese destocking and have rebounded as buyers returned to the market. Source Macquarie Research July Sept 2012
Slide 21: Iron Ore Pricing – look for value
Iron Ore Pricing – look for value • Medium term pricing will be determined by pace of new supply additions (over-estimated?) and the capital and operating costs of new capacity • Successful new projects will be those with low capital intensity (low capex/tonne of annual production) and low operating
Slide 22: Eastern Iron – Value Proposition
Eastern Iron – Value Proposition Eastern Iron poised for a valuation re-rating as the Nowa Nowa Project moves to completion of Scoping Study, to Feasibility Study, to Production. Enterprise Value – Iron producers Eastern Iron A$1.4/t - 1Mtpa BC Iron A$93.9/t - 1.5Mtpa Mount Gibson Iron A$110.5/t - 4
Slide 23: Investment Summary
Investment Summary • Eastern Iron is focused on: • Potential for near-term development of Nowa Nowa • Realising value from its large scale Queensland magnetite projects • Recent capital raising – well funded to complete scoping study at Nowa Nowa. • Potential to complete feasibility study & commence
Slide 24: Eastern Iron Limited
Eastern Iron Limited Level 1, 80 Chandos Street St Leonards, NSW 2065 T: +61 2 9906 7751 www.easterniron.com.au Twitter: @EasternIronEFE