Ormonde Mining Plc · AQUIS:ORM
Ormonde Mining — Investor Presentation (October 2012)
32 slides from Ormonde Mining's investor presentation, October 2012
Slide 1: Near Term Tungsten Producer
ORMONDE MINING PLC NEAR TERM TUNGSTEN PRODUCER Barruecopardo La Zarza Exploration TUNGSTEN COPPER GOLD OCTOBER 2012
Slide 2: Disclaimer
DISCLAIMER The content of this document has not been approved by an authorised person within the meaning of the Financial Services and Markets Act 2000 (as amended). Reliance on this document for the purpose of engaging in any investment activity may expose an individual to a significant risk of los
Slide 3: Corporate Structure
CORPORATE STRUCTURE Quoted on AIM and ESM (ticker = ORM) Issued Shares: 373 m Current Price: 7p Market Capitalisation: £26M NOMAD & Joint Broker: Davy Joint Broker: Fairfax Institutional Shareholding: ~30% JP Morgan 6.7% Jupiter 6.0% SOURCE: DAVY SHAREHOLDER ANALYSIS Blackrock 5.0% Fidelity 3.9% Sar
Slide 4: Strategy & Projects
STRATEGY & PROJECTS Focus on Spain Barruecopardo - Tungsten: World Class Tungsten Project which would produce ~12% of current, non-Chinese global mine tungsten supply La Zarza - Copper: JV with Antofagasta Minerals, exploring to expand the existing copper resources – funded by Antofagasta Salamanca/
Slide 5: Projects in Spain
PROJECTS Salamanca & Zamora Gold Barruecopardo Tungsten Madrid Lisbon SPAIN La Zarza Copper
Slide 6: Directors – Experienced Miners
DIRECTORS – EXPERIENCED MINERS Experienced +75 years of direct experience in exploration, development Board: and running of mining / processing operations Mike Donoghue Mining Engineer with +30 yrs European, African, Australian Exec Chairman experience in development and operation of mines Kerr Ande
Slide 7: Barruecopardo Tungsten Project
Barruecopardo Tungsten Project An Essential Secure Tungsten Supply Salamanca Castilla y León Western Spain Province Region (100% Ormonde; 351 sq km permit area)
Slide 8: Tungsten Price Chart
TUNGSTEN PRICE CHART Tungsten Price (US$/mtu for European APT) from 2004 - 2012 $500 $450 $400 Continuing increase in Chinese domestic $350 consumption and $300 export reduction $250 $200 China increasing $150 domestic consumption Global $100 Recession $50 SOURCE: METAL BULLETIN
Slide 9: Tungsten Properties & Uses
TUNGSTEN PROPERTIES & USES Metal with many outstanding properties – o Second strongest material after diamond o Highest melting point of all metals - 3,400°C As a result no real satisfactory substitute for key applications Most important use is as tungsten carbide (hardmetals) in all cutting & drill
Slide 10: China and the Tungsten Market
CHINA AND THE TUNGSTEN MARKET China Dominates World Primary And is the Main Source of Tungsten Tungsten Production to the Rest of World (RoW) World mine Production RoW Primary Tungsten demand SOURCE: ITIA (2011) SOURCE: ITIA (2011)
Slide 11: China's Rapidly Increasing Domestic Consumption
CHINA’S RAPIDLY INCREASING DOMESTIC CONSUMPTION China’s requirement for tungsten in its indigenous industry is increasing, with reductions of supply to RoW China’s Domestic Demand vs China’s Supply to RoW (Primary Tungsten) 45,000 40,000 35,000 Metric Tonnes of Tungsten 30,000 25,000 20,000 15,000 1
Slide 12: China vs RoW Demand for Primary Tungsten
CHINA vs ROW DEAMND FOR PRIMARY TUNGSTEN China has become the dominant consumer of primary tungsten China's Increasing Domestic Demand vs RoW Demand (Primary Tungsten) 45,000 40,000 35,000 Metric Tonnes of Tungsten 30,000 25,000 20,000 15,000 10,000 5,000 0 1999 2000 2001 2002 2003 2004 2005 2006 20
Slide 13: Positive Outlook for Tungsten
POSITIVE OUTLOOK FOR TUNGSTEN APT Prices are forecast by one leader in international metals research to average US$415 over the period 2012-2016 Global tungsten demand is forecast to increase at an annual rate of 5-6% from 75,000 tonnes at end 2011 to 98,500 tonnes by end 2016 China produces around
Slide 14: Barruecopardo and Non-Chinese Production
BARRUECOPARDO and NON-CHINESE PRODUCTION World Primary Tungsten Production (tonnes of metal) Excluding China (2011) 2,500 2,000 1,500 1,000 500 - Source: ITIA
Slide 15: Barruecopardo Progress in 2011/12
BARRUECOPARDO PROGRESS IN 2011/12 Feasibility Study (DFS) with a nine-year open pit mine life Potential to extend mine life thereafter by underground mining; not in DFS Favourable project economics (APT price of US$350): • NPV of €120 million (pre-tax ungeared at 8% discount) • IRR of 52.0% Collabor
Slide 16: DFS - Key Outcomes
DFS - KEY OUTCOMES Units Base Case ATP Price US$/mtu 350 Life of Open Pit Years 9 Years Averaged Annual Tungsten Production Mtu’s 227,000 Total Production from Open Pit Mtu’s 2.04M CAPEX (Incl. Contingency) € 48.5M Average Cash Operating Costs €/mtu 99 Project NPV (8% Discount, Pre-tax Ungeared) € 1
Slide 17: Project Cashflows
PROJECT CASHFLOWS Barruecopardo - Project Pre-tax Cash Flows at APT Price of US$350 250 200 150 Million € 100 50 - Year 0 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 -50 Tungsten APT Price Sep’12: U$360/mtu
Slide 18: Mineral Resources and Ore Reserves
MINERAL RESOURCES AND ORE RESERVES Total Mineral Resources Category Tonnes (millions) Grade (WO3%) Contained WO3 (mtu) Measured 5.47 0.34 1.86 million Indicated 12.33 0.26 3.20 million Inferred 9.59 0.23 2.20 million Total 27.39 0.26 7.12 million Ore Reserves within the Open Pit Category Tonnes (mil
Slide 19: Potential to Extend Mine Life
POTENTIAL TO EXTEND MINE LIFE OUTSIDE OF OPEN PIT: The planned open pit captures only 40% of the current total Resources Once in production, the Company plans to commence studies further extending the mine life by underground mining methods The deposit is open along strike and at depth (deposit only
Slide 20: Barruecopardo Operation 1970s
BARRUECOPARDO OPERATION 1970s Historic Open Pit
Slide 21: Site Layout
SITE LAYOUT Water management System Waste dumps Plant Haul road New pit shell
Slide 22: Process Flow Sheet
PROCESS FLOW SHEET Crush to maximum liberation size of 5mm ROM Ore, 1.1 Mtpa, 0.30% WO3 Pre-conc. Circuit Jig tails Reject 99% of feed by Jigs and Spirals -5 mm Jigs 797 ktpa +1 mm 807 ktpa -1 mm 293 ktpa Roll crusher Upgrade circuits very small Spiral tails Spirals 290 ktpa -1 mm, 8,400 tpa Gravity
Slide 23: Barruecopardo Tungsten Concentrate
BARRUECOPARDO TUNGSTEN CONCENTRATE
Slide 24: Operating Costs
OPERATING COSTS Life of mine cash operating costs are €23.21 per tonne of ore processed or €99 (US$129) per mtu processed ITEM €/tonne €/mtu Mining (Ore) 4.07 17.3 Mining (Waste)* 14.47 61.6 Processing 3.50 14.9 General & Administration 1.27 5.4 TOTAL OPERATING COST 23.31 99.2 *Strip ratio ore to wa
Slide 25: Low Capital Costs
LOW CAPITAL COSTS ITEM COST (€M) Mining 3.9 Process Plant, associated Infrastructure and EPCM 26.8 Water Management System 8.2 Owner Costs 5.2 Contingency 4.4 TOTAL 48.5
Slide 26: Permitting
PERMITTING Located in a country and region very supportive of mining industry Disturbed site from previous activities which will be rehabilitated Large abandoned water body to be converted to a useful resource Compensating measures adopted to offset project impacts, designed in conjunction with loca
Slide 27: Sensitivity to Tungsten Price
SENSITIVITY TO TUNGSTEN PRICE Tungsten APT Price US$250 US$350 US$450 US$ to Euro 1.30 1.30 1.30 Pre-tax ungeared NPV (8% discount rate) €28M €120M €212M Pre-tax IRR 19.9% 52.0% 80.3% Average annual pre-tax net operating cash flow €13M €29M €45M Pre-tax net operating cash flows over life of €120M €2
Slide 28: 2012-2013 Development Plan
2012-2013 DEVELOPMENT PLAN 2012 2013 Q3 Q4 Q1 Q2 Q3 Q4 FEASIBILITY & PERMITTING STAGE Engineering design Permitting DEVELOPMENT STAGE Capital funding & off-take arrangements Plant construction & commissioning PRODUCTION Open pit mining Underground mining UNDERGROUND FROM 2023
Slide 29: La Zarza - Copper
La Zarza - Copper JV With Antofagasta Minerals Huelva Andalucia Southern Spain Province Region (100% Ormonde; 109sq km permit)
Slide 30: La Zarza Project
LA ZARZA PROJECT Antofagasta has right to earn 51% by spending $7M and can increase its interest to 75% by the completion of a feasibility study; Ormonde Manager New permits covering the extension of the La Zarza system were granted in Aug’11 and a $1.3m work programme undertaken including VTEM and
Slide 31: Gold Properties
Gold Properties Salamanca & Zamora Castilla y León Western Spain Provinces Region (100% Ormonde; 388km permit area – includes tungsten)
Slide 32: Gold Properties Overview
GOLD PROPERTIES OVERVIEW Independent Report by CSA Global (Aug’10) outlined significant “1M oz+” gold potential Exploration on four permit areas being funded through JV with Aurum Mining plc Drilling at the El Facho Prospect has identified an in-house Resource Estimate (non-JORC) of 122,000-145,000
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