Sandfire Resources Ltd · ASX:SFR
Sandfire Resources — Shareholder Meeting (November 2011)
32 slides from Sandfire Resources's shareholder meeting presentation, Nov 28, 2011
Slide 1: DeGrussa and beyond
For personal use only DeGrussa and beyond Annual General Meeting – 28 November 2011 1
Slide 2: Important Information and Disclaimer
Important Information and Disclaimer Competent Person’s Statement For personal use only • The information in this public presentation that relates to Exploration Results and Mineral Resources is based on information compiled by Mr John Evans who is a Fellow of the Australasian Institute of Mining an
Slide 3: Our Mission
For personal use only Our Mission • To develop and operate the 100%-owned premier high-grade DeGrussa VMS copper-gold mine • To deliver superior returns to our owners • To discover additional VMS deposits within the emerging Doolgunna mineral field • To make new discoveries within our existing portf
Slide 4: Company Snapshot – cash flow imminent
For personal use only Company Snapshot – cash flow imminent • DeGrussa Project moving into production: • Discovery to development in two years (2009- 2011) • DFS* project operating cash flow of A$2.4 billion (pre-tax) on A$4.2 billion revenue • DFS does not include oxide copper (44,000 tonnes Cu and
Slide 5: Company Snapshot – the next phase of growth
Company Snapshot – the next phase of growth • Exploration ramping up targeting additional VMS For personal use only clusters within 400km2 Doolgunna Project: • Extensive bank of information now accumulated within prospective DeGrussa mine corridor • Prospective corridor extended to 22km, providing o
Slide 6: Recent Achievements
For personal use only Recent Achievements • DeGrussa Definitive Feasibility Study completed and approved • Development activities well advanced with ~500 personnel on site • Mining and process plant construction underway • Open pit well advanced - 67% of material moved to access first Direct Shippin
Slide 7: Corporate Summary
For personal use only Corporate Summary • Issued Capital: 150.9M ordinary shares, 9.4M options OZ Minerals 19.8% Posco 15.8% Institutions 22.8% Founders/Board 8% Others 33.6% 7
Slide 8: Key Personnel – Board
Key Personnel – Board Mr Derek La Ferla Non-executive Chairman - Qualifications B. Arts (Politics and Industrial Relations), B. Juris, B. Law, Fellow of AICD For personal use only Experience and other directorships Mr La Ferla has been legal advisor on a large number of corporate and commercial tran
Slide 9: Key Personnel – Management
For personal use only Key Personnel – Management Mr Matthew Fitzgerald Chief Financial Officer and Company Secretary - Qualifications B. Comm, CA Experience Mr Fitzgerald is a chartered accountant with extensive experience in the resources industry. He began his career in the Assurance & Advisory di
Slide 10: Asset Overview
Asset Overview Western Australia Northern Territory – For personal use only Borroloola Project COPPER-GOLD LEAD-ZINC • DeGrussa – production and exploration • Warramana • Greater Doolgunna – exploration COPPER GOLD • Greater Doolgunna – • Tawallah 1/2 exploration LEAD-ZINC IRON ORE • Yannarie • Rope
Slide 11: From Concept to Cash
For personal use only From Concept to Cash DFS Outcomes First Production Q1 2012 (DSO), Q3 2012 (Conc.) 10.72Mt @ 5.1% Cu, 1.7g/t Au Life-of-mine extraction from Ore (541,000t contained copper, Reserves and Mineral Resources 599,000oz contained gold) discovered to date 93% Mineral Resource to Ore Re
Slide 12: Years, +200,000m of Drilling, Four Deposits
For personal use only 2 Years, +200,000m of Drilling, Four Deposits (in plan view) 12
Slide 13: DeGrussa Project – Open Pit Operations
For personal use only DeGrussa Project – Open Pit Operations • Early extraction of DSO Ore Reserves: • 0.14Mt @ 25.6% Cu, 2.5g/t Au • 37,000t copper, 12,000oz gold (Contained) • Early sulphide copper ore for plant commissioning • Oxide copper resources being stockpiled for proposed processing (testw
Slide 14: DeGrussa – Key Parameters
DeGrussa – Key Parameters • Established mining district with key infrastructure For personal use only • Life-of-mine extraction of 10.72Mt @ 5% Cu, 1.7g/t Au (541,000t copper, 599,000oz gold – contained) • Conventional open pit mining operation (~2 years) and long-term underground mine (initial 7+ y
Slide 15: DeGrussa – Annual Grade and C1 Cost Profile
For personal use only DeGrussa – Annual Grade and C1 Cost Profile 15
Slide 16: DeGrussa – Annual Grade and C1 Cost Profile
For personal use only DeGrussa – Annual Grade and C1 Cost Profile • Definitive Feasibility Study optimises project cash flows • Higher grades + lower C1 costs in first three years = increased cash flow 16
Slide 17: DeGrussa Project – Development Underway
DeGrussa Project – Development Underway • Box-cut excavation completed – For personal use only development of Evans Decline advanced to +775m (675m remaining to first ore) • Pre-strip of open pit commenced April 2011 – two years from discovery • Bulk earthworks for process plant completed and concre
Slide 18: DeGrussa Project – Development
For personal use only DeGrussa Project – Development Pre-Feasibility Definitive Feasibility Study Project Financing Infrastructure Construction Major Equipment Concentrator Construction Open Pit Direct Shipping Ore Underground Massive Sulphide Concentrator Ramp-up Shipment 18
Slide 19: VMS Geological Model
VMS Geological Model • Volcanogenic massive sulfide (VMS) ore deposits are a type of metal sulfide For personal use only ore deposit (mainly copper, zinc and lead) created by volcanic-associated hydrothermal events in submarine environments • Predominantly layered accumulations of sulfide minerals t
Slide 20: Global VMS Camps
For personal use only Global VMS Camps • Most significant VMS deposits occur in clusters that define major mining camps – major source of global copper, zinc, lead production, eg: • Bathurst (New Brunswick) – 229.8Mt @ 0.46% Cu, 7.66% Zn, 3.01% Pb, 91g/t Ag, 0.46g/t Au (camp discovered 1952) • Kidd
Slide 21: Is DeGrussa a VMS deposit?
Is DeGrussa a VMS deposit? • Four lenses of mineralisation typical of VMS For personal use only deposit cluster • Classic host sequence of intra-volcanic sediments • Typical seafloor alteration with regionally extensive litho-geochemical signature • Classic VMS sulphide textures, including remnant c
Slide 22: Potential of Global VMS Camps
Potential of Global VMS Camps Volcanic District No. of Deposits Million Tonnes Ore Million Tonnes Metal Area of District (km²) For personal use only Hokuroku, Japan 18 90 6.2 720 Bathurst No1, Canada 12 180 15.1 880 Bathurst No2, Canada 15 98 5.8 1150 Flin Flon, Canada 10 65 4.3 560 Snow Lake, Canad
Slide 23: DeGrussa – Unlocking the “Corridor of Riches”
For personal use only DeGrussa – Unlocking the “Corridor of Riches” • 22km long, 1.2km wide prospective corridor which can be explored to +2km vertical depth • Of this, only 1.2km strike length has been intensively explored to 600m vertical depth • Minimal drilling has been conducted below 50m depth
Slide 24: Major Exploration Push
For personal use only Major Exploration Push • Developing regional geology model from: • Deep drilling • Sterilisation & pre-development drilling • Mapping & geophysical interpretation • Priority VMS corridor extends for 22km • Lithogeochemistry program underway to aid target vectoring • Intensive e
Slide 25: DeGrussa Mineral Field – Regional Exploration
For personal use only DeGrussa Mineral Field – Regional Exploration 25
Slide 26: Summary
For personal use only Summary • Development of DeGrussa Project underway • On track to produce first copper next year: • First DSO ore from open pit due Q1 2012 • First underground ore expected Q2 2012 • High-margin production profile • Regional exploration objective to establish a VMS copper- gold
Slide 27: DeGrussa and beyond
For personal use only DeGrussa and beyond Annual General Meeting – 28 November 2011 27
Slide 28: Appendix – DeGrussa: Financial Evaluation and Price Assumptions
Appendix – DeGrussa: Financial Evaluation and Price Assumptions Life-of-mine (LOM) For personal use only $ Billion Project revenue 4.2 Royalties (5% weighted average) (0.2) Operating costs and sustaining capital (1.6) Project operating cash flow (pre-tax) 2.4 Pre-production capital expenditure (0.4)
Slide 29: Appendix – DeGrussa: Capital and Operating Costs
For personal use only Appendix – DeGrussa: Capital and Operating Costs Capital Cost Breakdown A$M Construction (plant, equipment and infrastructure) 267 Open pit mining to access DSO 44 Underground mine development 56 Other pre-production 17 Total pre-production capital 384 Life-of-Mine Operating Co
Slide 30: Appendix – DeGrussa: Mineral Resources
Appendix – DeGrussa: Mineral Resources Table 1: DeGrussa Copper-Gold Project – March 2011 JORC Resource Statement For personal use only Resource Contained Contained Competent Zone Location Tonnes (Mt) Copper (%) Gold (g/t) Category Copper (t) Gold (oz) Person Gold Measured Open Pit 0.14 - 1.5 - 7,00
Slide 31: Appendix – DeGrussa: Ore Reserves
Appendix – DeGrussa: Ore Reserves Table 2: DeGrussa Copper-Gold Project – March 2011 Ore Reserve Statement Reserve Mining Contained Copper Contained Gold For personal use only Deposit Tonnes (Mt) Copper (%) Gold (g/t) Category Method (t) (oz) Open Pit - DeGrussa Probable 0.14 25.6 2.5 37,000 12,000
Slide 32: Appendix: Competent Person’s Statements
Appendix: Competent Person’s Statements Competent Person’s Statement – Mineral Resources For personal use only • The information in this report that relates to Mineral Resources (except the Indicated Resource of Supergene Chalcocite) is based on information compiled by Diederik Speijers who is a Fel
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