Slide 1: Business update and half-year results
For personal use only Business update and half-year results September 28th, 2010
Slide 2: Disclaimer
DISCLAIMER For personal use only Important Notice 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
Slide 3: Half-year results
For personal use only Half-year results ((Half-year y ended 31 July y 2010)) 3
Slide 4: Summary of results
SUMMARY OF RESULTS Highlights For personal use only HGO’s loss for the half-year was A$2.7 million (half year to 31 July 2009: gain of A$53.8 million) Continued development of the Kanmantoo project. A$22.6 million was spent on capital expenditures for Kanmantoo during the period. The decommissio
Slide 5: P&L statement
P&L STATEMENT Overview For personal use only Half-year ended 31 July 2010 (A$ million) Revenue 4.3 Cost of goods sold (1.0) Employee benefits expense (2.5) Impairment of plant and equipment (2 1) (2.1) Other (3.2) (Loss)/profit before income tax expense (4.5) Income tax expense 1.8 Net (loss) profit
Slide 6: Balance sheet
BALANCE SHEET Summary For personal use only Assets 31 July 2010 (A$ million) Cash and cash equivalents 93.7 Derivative financial instruments 7.8 Other current assets 4.7 PP&E 46.3 Exploration and evaluation expenditure 43.3 Goodwill 3.5 Total assets 199.3 Liabilities 31 July 2010 (A$ million) Income
Slide 7: Business update
For personal use only 7 Business update
Slide 8: Company overview
COMPANY OVERVIEW AUSTRALIAN MINING COMPANY WITH AUSTRALIAN-INDONESIAN GROWTH PIPELINE Overview Hillgrove’s key projects For personal use only Hillgrove Resources (“HGO”) is an Australian based minerals exploration and development company HGO’s flagship project is the Kanmantoo copper/gold Landak
Slide 9: Corporate snapshot
CORPORATE SNAPSHOT Corporate details Shareholder distribution For personal use only ASX listed: HGO J.P. Morgan Shares on issue: 483 million Metals & Concentrates 10% Share price: A$0 A$0.335 335 Market capitalisation: A$162 million (27 September p 2010)) Institutions 24% Cash and cash equ
Slide 10: Investment highlights
INVESTMENT HIGHLIGHTS HILLGROVE OFFERS A HIGHLY COMPELLING INVESTMENT OPPORTUNITY Investment highlights For personal use only Australia Australia’ss next copper/gold producing mine Flagship project is located in a favourable asset location with no additional transport/power infrastructure requir
Slide 11: Strategy
STRATEGY NEAR TERM PRODUCTION, HIGHLY PROSPECTIVE EXPLORATION Strategic Direction & Focus For personal use only Deliver Kanmantoo as a producing asset, within time and budget estimates Single mine producer in 12 months Multi-mine Multi mine producer within 3 3-5 5 years Australia and Indones
Slide 12: Kanmantoo Project Overview
For personal use only Kanmantoo Project Overview 12
Slide 13: Kanmantoo is Australia's next producing copper/gold mine
KANMANTOO IS AUSTRALIA’S NEXT PRODUCING COPPER/GOLD MINE FULLY OWNED BY HILLGROVE Highlights Geographic location For personal use only 100% 100%-owned owned by Hillgrove Located just 55km from Adelaide, in South Australia The project enjoys commensurate capital cost advantages Close to neces
Slide 14: Kanmantoo copper/gold financing
KANMANTOO COPPER/GOLD FINANCING Financing update For personal use only HGO is continuingg discussions with various banks and financial institutions on the financing for Kanmantoo HGO expects to receive a binding offer and commitment in the near future regarding the p proposed p financing g of Ka
Slide 15: Kanmantoo copper/gold project overview
KANMANTOO COPPER/GOLD PROJECT OVERVIEW Highlights For personal use only Mining and stockpiling of ore to begin in March 2011 First copper/gold production scheduled for Q4 2011 10 year mine life with potential to expand LOM average payable metals production: 22k tonnes p.a. copper 9k ounc
Slide 16: Tenements, site plan and interpreted cross section
KANMANTOO COPPER/GOLD PROJECT TENEMENTS, SITE PLAN AND INTERPRETED CROSS SECTION Tenements Site plan For personal use only Summary of Hillgrove Kanmantoo tenement status Tenement Tenement Area EL Number N b Name type (sq km) Expiry date Holding and Comments EL4401 Kanmantoo Exploration 489 16/12/201
Slide 17: Processing overview
KANMANTOO COPPER PROJECT Processing overview For personal use only Lime ROM BIN FEED PRODUCT Construction and commissioning VIBRATING GRIZZLY BIN SCREEN NEUTRAL- FEEDER ISATION contract with Abesque Engineering JAW CRUSHER STOCK PROCESS TANK SECONDARY PILE HYDRO WATER TANK CYCLONE CRUSHER Simple,
Slide 18: The Pillara processing facility; logistics and services
KANMANTOO COPPER PROJECT The Pillara processing facility Logistics and services For personal use only Similar processing flowchart to that originally designed Mine site is close to the city of Adelaide, the main for Kanmantoo highway and to port facilities Greater throughput capacity provides
Slide 19: Exploration has improved resource certainty
EXPLORATION AT KANMANTOO HAS IMPROVED RESOURCE CERTAINTY AND INCREASED THE RESOURCE-RESERVE CONVERSION RATIO Resource growth Reserve growth For personal use only Mt Mt Inferred Indicated Measured 20.0 Probable Proved 18.0 40.0 16.0 14.8 35.0 31.8 32.2 14.0 30.0 28.0 12 0 12.0 11 1 11.1 25.0 18.4 10.
Slide 20: Attractive reserve and resource base with growth potential
KANMANTOO HAS AN ATTRACTIVE RESERVE & RESOURCE BASE WITH SIGNIFICANT GROWTH POTENTIAL Undervalued emerging copper producer For personal use only EV/resource Producers (US$/t Cu eq.) 1,000 800 600 400 200 0 Aditya Birla Minerals Hillgrove Resources Jabiru Metals Ltd. PanAust Ltd Equinox Minerals Ltd.
Slide 21: Key milestones
KANMANTOO COPPER/GOLD PROJECT KEY MILESTONES Overview For personal use only Kanmantoo was operated by North Broken Hill Pty Limited, South Broken Hill Pty Limited and Electrolytic Zinc Pty Limited as their first open cut mine from 1971 1971-1976, 1976 mining around 4 4.1Mt 1Mt of copper ore Hist
Slide 22: Estimated capital and ramp-up costs
SUMMARY OF ESTIMATED CAPITAL AND RAMP-UP COSTS TO BRING KANMANTOO TO FULL PRODUCTION Capital costs For personal use only Total capital costs Capital costs spent to date Remaining capital costs (A$mm) (A$mm) (A$mm) Mining 17.2 0.2 17.0 Pillara processing plant 66.9 20.3 46.6 Other infrastructure 9.9
Slide 23: Cash costs
CASH COSTS Competitive cash cost of production For personal use only Cash C h costt b breakdown kd US$/lb Mining costs 0.95 Processing 0.52 Transport p ((includes trucking, g pport and ship) p) 0.12 Treatment charges, refining charges and price participation 0.27 Sub-total 1.86 Gold/silver by-produc
Slide 24: Low risk features
KANMANTOO COPPER-GOLD PROJECT LOW RISK FEATURES Kanmantoo’s key attributes For personal use only Historical operations significantly de-risk the project Environmental, construction & mining licenses granted; all approvals to mine in place Known, Known simple metallurgy with excellent recoverie
Slide 25: Exploration
For personal use only 25 Exploration
Slide 26: Exploration assets: Indonesia
EXPLORATION ASSETS: INDONESIA HIGHLY PROSPECTIVE GOLD, COPPER & BULKS EXPLORATION Why Indonesia? Map of development projects For personal use only Proven geological provenance for target commodities (Cu, Au) HGO’s position obtained through strong in- country experience base and development of La
Slide 27: Sumba Island
SUMBA ISLAND HILLGROVE 80% Key highlights Sumba Island For personal use only Hillgrove is an 80% beneficial shareholder in PT F thi which Fathi, hi h hholds ld exploration l ti and d mining i i business licenses on the island of Sumba Rights cover almost 1,000 km2 for a period of six years Hil
Slide 28: Bird's Head project
BIRD’S HEAD PROJECT HILLGROVE 80% Key highlights Geographic location For personal use only Hillgrove is an 80% beneficial shareholder in PT Ak Akram, which hi h h holds ld exploration l ti and d mining i i licenses in the Bird’s head area of the autonomous region of West Papua Rights cover almos
Slide 29: Bauxite tenements – West Kalimantan
BAUXITE TENEMENTS – WEST KALIMANTAN HILLGROVE OPTION TO ACQUIRE 70% Highlights Geographic location For personal use only Options in place to acquire a 70% interest in exploration l ti permits it att Landak L d k andd Tayan T S th South LANDAK covering approx. 1,400km² in West Kalimantan 48.8% Al2O
Slide 30: Appendix
For personal use only 30 Appendix
Slide 31: Management team & board of directors
MANAGEMENT TEAM & BOARD OF DIRECTORS EXPERIENCED TEAM WITH PROVEN TRACK RECORD Key management team For personal use only Drew Simonsen Cam Schubert Managing Director & Chief Executive Officer General Manager – Kanmantoo Project Appointed MD & CEO in August 2010 Appointed pp late 2009 35 years
Slide 32: Management team & board of directors
MANAGEMENT TEAM & BOARD OF DIRECTORS EXPERIENCED TEAM WITH PROVEN TRACK RECORD Board of Directors For personal use only Hon. Dean Brown AO Non-Executive Chairman Former Premier and Minister of the South Australian Government and Member of the South Australian Parliament Chairman of InterMet Reso