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For personal use only Chinese Backed Magnetite & Port Chinese Backed Magnetite & Port Development in South Australia Development in South Australia Investor Presentation Investor Presentation May 2012 May 2012 SOUTH AUSTRALIAS
Chinese Backed Magnetite & Port Development in South Australia Investor Presentation
May 2012
Chinese Backed Magnetite & Port Development in South Australia Investor Presentation
May 2012
SOUTH AUSTRALIA’S DEVELOPING IRON ORE HUB FOR HIGH QUALITY MAGNETITE CONCENTRATE Ben Hammond, Chief Operating Officer
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FORWARD LOOKING STATEMENTS
These materials include forward looking statements. Forward looking statements inherently involve subjective judgement and analysis and are subject to significant uncertainties, risks and contingencies, many of which are outside of the control of, and may be unknown to Centrex Metals Limited (‘Centrex’ or the ‘Company’). Actual results and developments may vary materially from those expressed in these materials. The types of uncertainties which are relevant to the Company may include, but are not limited to, commodity prices, political uncertainty, changes to the regulatory framework which applies to the business of the Company and general economic conditions. Given these uncertainties, readers are cautioned not to place undue reliance on such forward looking statements. Forward looking statements in these materials speak only at the date of issue. Subject to any continuing obligations under applicable law or any relevant stock exchange listing rules, the Company does not undertake any obligation to publicly update or revise any of the forward looking statements or any change in events, conditions or circumstances on which any such statement is based. Forward looking statements include, but are not limited to, statements concerning Centrex’s planned exploration program, targeted resources, commencement of product export and other statements that are not historical facts. When used in this document, the words such as “could”, “target”, “plan”, “estimate”, “intend”, “may”, “aim”, “potential”, “should”, and similar expressions reflected in these forward-looking statements are reasonable, such as statements involving risks and uncertainties and no assurance can be given that actual results be consistent with these forward-looking statements. 2
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Current Projects
Wuhan Iron & Steel, fully funded to Feasibility
with Wuhan Iron & Steel
venture with Baotou Iron & Steel, fully funded to Feasibility
project
exploration licences outside current joint ventures in South Australia
CENTREX’S PROJECTS ARE WITHIN CLOSE PROXIMITY OF ITS PROPOSED PORT
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advantages does Centrex have in getting a magnetite project off the ground?
from the rest of the pack?
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The Gap… Represents An Implied Market Value of Centrex’s Project Portfolio of $0.082/share or $A 26M
$0.082/share or $A 26M for; – WISCO Magnetite JV – WISCO Port JV – Baotou Magnetite JV – Wilgerup DSO Project – 8 Iron Ore Exploration Licences – 2 Base Metals Exploration Licences
NOT BAD VALUE!
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78M directly to Centrex for 60% of the iron ore rights to 5 Exploration Licences on the Southern Eyre Peninsula
exploration and study costs, enough to complete a Definitive Feasibility Study for the initial magnetite iron ore project
Centrex if the Joint Venture reaches certain Inferred Mineral Resource milestones (up to the value of $A 108M)
Magnetite Project (“Fusion”) and a Definitive Feasibility Study well under way
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Carrow Greenpatch Iron Mount Koppio, Brennand, Kapperna Exploration Target Minimum Exploration Target Maximum
1.25Bt 1.5Bt 1.75Bt 2.0Bt
for each of the four resource milestone payments
each resource milestone payment
equivalent to $0.06/share
approved 108,000m program for infill drilling and exploration to expand resource base in 2012!
*See slides 23, 24 & 25 for full details ^See slides 23, 24, 25 & 27 for full details ^The Exploration Targets quantities and grades presented are conceptual in nature, as there has been insufficient exploration to define an overall Mineral Resource and it is uncertain if further exploration will result in the determination of additional Minerals Resources other than those stated.
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for the development of a deep-water bulk commodity facility at Port Spencer
next $4 M of development studies
South Australian Government and PER released
tide or channel restrictions, minimal weather delays
WISCO Magnetite JV
addition
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earn up to a 50% interest by spending $A 40M on exploration and studies
and earned a 30% participating interest
development studies
in late 2012
to 750Mt Exploration Target at present*
*See slide 26 for full details *The Exploration Targets quantities and grades presented are conceptual in nature, as there has been insufficient exploration to define an overall Mineral Resource and it is uncertain if further exploration will result in the determination of additional Minerals Resources other than those stated.
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– 100% Centrex owned DSO hematite project at Wilgerup – Massive hematite JORC Mineral Resources of 10.5Mt @ 59.8% Fe* – All Mining approvals received for a proposed 1 to 1.5Mpta operation over 7 years with production commencing in line with Port Spencer Development – Off-take agreements already in place
– 8 tenements outside current projects still to be explored on the Eyre Peninsula
*See slide 28 for full details WISCO JVs Baotou JV
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prospective primarily for VHMS style base metal mineralisation
historically identified
mineral within the tenements, plus historic gold occurrences
flown in 2010 with many high priority targets identified for follow-up
agreements for target drilling in 2012
intercepts at Collector Prospect*
VHMS Prospects Unknown SKARN Prospects
*See AGM Presentation 21st January 2010 page 36 for full details
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777Mt 178Mt 146Mt 57Mt
Fines Lump Pellets Pellet Feed 2011 TOTAL SEABORNE IRON ORE EXPORTS
market due to the relatively fine passing size
to sell concentrates into sinter market as dominantly ultra-fines (<150µm)
with only some mills using around 5- 10% as sinter feed
concentrate projects are large, an end user for the product must first be defined
SOURCE: CRU; Iron Ore Market Service, April 2012
Wuhan Iron & Steel Group– 4th Largest Global Steel Group (36.55Mt)
SOURCE: MetalBulletin Top Steelmakers 2010
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date at Fusion
still to be drilled out
site for a 108,000m infill and exploration program
*See slides 23 & 27 (Bald Hill & Charlton Gully only)
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mine designs for Koppio, Brennand, Kapperna and Iron Mount
defined for the project
boundaries, with ore transported to process plant by overland conveyor
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infrastructure scoping study completed by WorleyParsons
metallurgical core beneficiation test work shows high quality concentrate can be produced using conventional grinding and magnetic separation techniques
returned at nominated relatively coarse grind size
Diamond Core Composite Wet LIMS Results At P80 75µm Deposit Mass Recovery (%) Concentrate Fe (%) Concentrate SiO2 (%) Koppio 27.4 67.7 3.8 Brennand 34.4 64.8 7.1 Kapperna 45.3 68.4 3.6 Average 35.7 67.0 4.8
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tonne of concentrate produced
annum capacity desalination facility at Port Spencer for a 5Mtpa magnetite operation
approval studies
investment test for transmission upgrade of the Eyre Peninsula network
connections at Fusion and Port Spencer to upgraded network
the national grid meaning competitive power pricing
Option 1 Eyre Peninsula Transmission Solution
Fusion
SOURCE: ElectraNet; Lower Eyre Peninsula Reinforcement RIT-T Project Specification Consultation Report, February 2012
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distance slurry transport solution defined
Spencer able to ship 200,000t ships at any tide
due to weather
no channel restrictions
20Mtpa with a 5,000tph shiploader
capacity expansion beyond 20Mtpa
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relatively coarse grind size
partners (total supply chain control)
(important in a very tight labour market)
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Fusion Deposit Summary Mineral Resources & Exploration Targets Inferred Resource Tonnage (Mt) Head Grade DTR (%) Concentrate Grade Fe (%) SiO2 (%) Fe (%) SiO2 (%) Iron Mount(2) 135 25.5 36.7 29.3 62.1 9.1 Kapperna(3) 65.7 28.3 44.6 29.4 70.2 1.92 Brennand(3) 122.4 24.1 51.0 21.3 67.3 4.97 Koppio(3) 131.3 17.2 53.5 14.3 67.0 5.43 Total 454.4 23.1 46.5 22.8 66.1 5.9 Exploration Target Extension(3)(4) All Deposits Minimum 200 20 17 Maximum 400 24 22
*DTR (percent weight recovery) and concentrate results were from Davis Tube test work performed at P80 passing -75µm *Mineral Resources and Exploration Target estimates were carried out following the guidelines of the JORC Code (2004) by Coffey Mining Ltd(3) and Golder Associates(2) *Refer ASX announcement 28th September 2011
AS AT APRIL 2012
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AS AT APRIL 2012
Carrow Deposit Summary Mineral Resources & Exploration Targets Mineral Resource Classification Tonnage (Mt) Head Grade DTR (%) Concentrate Grade Fe (%) SiO2 (%) Fe (%) SiO2 (%) Indicated(3) 72.4 27.3 40.1 28.7 68.5 3.31 Inferred(3) 86.8 27.2 41.6 27.0 65.4 6.73 Total 159.2 27.2 41.0 27.8 66.9 5.18 Exploration Target Extension(3)(4) Minimum 40.0 25.0 25.0 Maximum 60.0 29.0 29.0
*DTR (percent weight recovery) and concentrate results were from Davis Tube test work performed at P80 passing -75µm *Mineral Resources and Exploration Target estimates were carried out following the guidelines
*Refer ASX announcement 1st of June 2011
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AS AT APRIL 2012
Greenpatch Deposit Summary Mineral Resources & Exploration Targets Mineral Resource Classification Tonnage (Mt) Head Grade DTR (%) Concentrate Grade Fe (%) SiO2 (%) Fe (%) SiO2 (%) Inferred(3) 54.8 24.9 33.8 26.8 68.3 2.97 Exploration Target Extension(3)(4) Minimum 60 23 25 Maximum 120 27 29
*DTR (percent weight recovery) and concentrate results were from Davis Tube test work performed at P80 passing -75µm *Mineral Resources and Exploration Target estimates were carried out following the guidelines
*Refer ASX announcement 1st of June 2011
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*DTR concentrate results were performed at - 38µm *Tonnages are Dry Metric Tonnes and grades are reported on a dry mass percent basis *The Mineral Resource figures have been rounded, hence small differences in the total figures *Mineral Resource and Exploration Target were reported in accordance with the guidelines of the JORC Code (2004) by SRK Consulting (Australasia) Pty Ltd(6) *Refer ASX announcement 9th of May 2011
AS AT ARPIL 2012
Bungalow Deposit Summary Mineral Resources & Exploration Targets(6)(4) Inferred Mineral Resouce Tonnage (Mt) Head Grade DTR (%) Concentrate Grade Fe (%) Fe (%) SiO2 (%) Bungalow South 78 24.0 27.5 68.1 3.7 Zone 36 15 31.3 39.8 70.5 2.1 Bungalow Central 11 26.6 29.1 67.1 2.5 Total 103 25.3 29.4 68.5 3.3 Exploration Target Extension(3)(4) Domain Tonnage Range (Mt) Head Grade Range (Fe%) Mimbrie 250 350 26 32 Bungalow North 150 190 26 32 Bungalow Central 100 145 26 35 Bungalow South 20 40 23 27 Zone 36 10 25 28 32 Total 530 750 25 32
ANOMALY DTS (%) FE CONC GRADE RANGE (%) INFERRED RESOURCE (INCLUDING HEMATITE) (MT) EXPLORATION TARGET RANGE (INCLUDING INFERRED RESOURCE) (MT) AVERAGE TRUE THICKNESS BASED ON INTERCEPTS > 20% DTS MAGNETITE (M) VERTICAL EXTENT OF OXIDE ZONE BELOW GROUND LEVEL (M) ASSUMED DIP OF BIF (DEG) DIP EXTENT OF MAGNETITE TO BIF (EXCL OXIDE ZONE) 200M BELOW GROUND LEVEL (M) STRIKE LENGTH OF ANOMALY BASED ON AEROMAGNETIC ANOMALY (M) BIF DENSITY (G/CM3) NUMBER DRILLHOLES Bald Hill - East 27.7 63.0 to 70.0 29 257 to 325 24.4 23.4 70 186 4,531 4,531 3.4 1 Bald Hill - West 30.0 33.8 40 272 9,254 9,254 3.4 1 Charlton Gully - A 244 to 290 24.4 #1 23.4 #1 70 #1 186 4,050 4,050 3.4 Charlton Gully - B 30.0 #2 33.8 #2 40 #2 272 6,550 to 8,190 3.4 Dutton Bay - North 32 to 57 37.2 #3 50.0 90 150 1,290 1,290 3.4 Dutton Bay - South 37.2 #3 50.0 90 150 1,710 1,710 3.4 Mount Hill - A 266 to 1,048 30.0 to 75.0 50.0 90 150 17,370 17,370 3.4 Mount Hill - B 30.0 to 75.0 50.0 90 150 11,990 11,990 3.4 124 877 to 1,883 60,970 to 63,387 (4)(5)The potential quantities and grades presented are conceptual in nature. There has been insufficient exploration
to define an overall Mineral Resource and it is uncertain if further exploration will result in the determination of additional Mineral Resources other than those stated. *Refer ASX announcement 17th of April 2008
NOTES
#1 assumed same as Bald Hills West #2 assumed same as Bald Hills East #3 assumed same as Carrow initial exploration target
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AS AT APRIL 2012
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Indicated Resources Ore Type Fe% Cut-Off Mt Fe% SiO2% Al2O3% LOI % P % Massive Hematite 55 10.5 59.8 3.6 2.3 4.5 0.49 Hematite Carbonate 45 0.6 50.1 6.5 3.6 7.8 0.65 Hematite Clay 45 2.2 50.0 10.4 4.8 6.7 0.54 Total 13.3 57.7 4.8 2.8 5.0 0.51 Inferred Resources Ore Type Fe% Cut-Off Mt Fe% SiO2% Al2O3% LOI % P % Massive Hematite 55 0.6 58.9 4.0 2.3 2.9 0.56 Hematite Carbonate 45 0.1 50.3 6.3 2.8 7.9 0.54 Hematite Clay 45 0.1 50.3 10.0 3.3 6.4 0.60 Total 0.8 56.6 5.2 2.5 4.0 0.57
*Mineral Resource estimates compiled by Snowden Mining Industry Consultants(7)
*Refer ASX announcement 17th July 2008
AS AT APRIL 2012
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Competent Persons Statements (2)The information in this report relating to Mineral Resources is based on and accurately reflects information compiled by Mr Alan Miller of Golder Associates who is a consultant and adviser to Eyre Iron Pty Ltd and who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Miller has sufficient experience, which is relevant to the style of mineralization and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting
which it appeared in that document. (3)The information in this report relating to Mineral Resources and current Exploration Targets is based on and accurately reflects information compiled by Mr Alex Virisheff of Coffey Mining Limited who is a consultant and adviser to Eyre Iron Pty Ltd and who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Virisheff has sufficient experience, which is relevant to the style of mineralization and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Virisheff consented to the inclusion of this information in the 28th September 2011 announcement in the form and context in which it appeared in that document. (4)The Exploration Targets quantities and grades presented are conceptual in nature, as there has been insufficient exploration to define an overall Mineral Resource and it is uncertain if further exploration will result in the determination of additional Minerals Resources other than those stated. (5)The information in this report relating to Exploration Targets is based on and accurately reflects information compiled by Mr Alastair Watts of Centrex Metals Limited who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Watts has sufficient experience, which is relevant to the style of mineralization and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Watts consents to the inclusion in the report of the matters based on his information in the form and context in which it appear.
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(6)The information in this report relating to Mineral Resources and current Exploration Targets is based on and accurately reflects information compiled by Mr Bruce Sommerville of SRK Consulting (Australasia) Pty Ltd who is a consultant and adviser to Centrex Metals Limited and who is a Member of the Australasian Institute of Mining and Metallurgy. Mr Sommerville has sufficient experience, which is relevant to the style of mineralization and type of deposit under consideration and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Sommerville consented to the inclusion of this information in the 10th May 2011 announcement in the form and context in which it appeared in that document. (7)The information in this report relating to Mineral Resources is based on and accurately reflects information compiled by Mr Alastair Watts of Centrex Metals Limited, and Mr Adam Miethke of Snowden Mining Industry Consultants who was a consultant and adviser to Centrex Metals Limited and who are Members of the Australasian Institute of Mining and Metallurgy. Mr Watts and Mr Miethke have sufficient experience, which is relevant to the style of mineralization and type of deposit under consideration and to the activity, which they are undertaking to qualify as a Competent Persons’ as defined in the 2004 Edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr Watts and Mr Miethke consented to the inclusion of this information in the 28th November 2008 AGM presentation in the form and context in which it appeared in that document.