Tungsten in Spain & Portugal
AIM : WRES www.wresources.co.uk May 2016
Spain & Portugal AIM : WRES www.wresources.co.uk May 2016 - - PowerPoint PPT Presentation
Tungsten in Spain & Portugal AIM : WRES www.wresources.co.uk May 2016 Disclaimer This presentation was prepared by and is the property of W Resources Plc (W Resources or the Company). No reproduction or distribution this
AIM : WRES www.wresources.co.uk May 2016
May 2016
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This presentation was prepared by and is the property of W Resources Plc (“W Resources” or “the Company”). No reproduction or distribution this material is permitted to companies or individuals outside of those for whom this is intended. No agents, brokers or investment banks are authorised to present this material to other parties for the purpose of soliciting potential clients or transactions of any kind without prior consent to do so. While the Company is not aware of any inaccuracies, no warranty or representation is made by the Company or their respective employees and representatives as to the completeness or accuracy of the information contained herein. The Company, JLSI and their respective employees and representatives expressly disclaim any liability for damages, direct or consequential, arising out of or related to this presentation or omissions there from, or any other information provided in writing, orally or otherwise regarding this potential transaction. Any party considering a transaction with the Company agrees to look solely to its own due diligence and any representations, warranties and/or covenants set forth in a fully-executed, definitive written agreement with the Company relative to the transaction. Certain matters discussed in this presentation are “forward-looking statements”. These forward-looking statements can often but not always be identified because the context of the statement will include words such as “the Company expects,” “anticipates” or words of similar import. Similarly, statements that describe the Company’s capabilities, future plans, objectives or goals are also forward-looking statements. Such forward looking statements are subject to significant risks and uncertainties, including the financial performance of the Company and the viability of its technology. These risks could cause actual results to differ materially from those currently anticipated. Although the Company believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be attained. Potential investors, customers, suppliers and other readers are urged to consider this factor carefully in evaluating any forward-looking statements. Forward-looking statements made herein are only made as of the date of this presentation and the Company undertakes no obligation to update such forward looking statements to reflect subsequent events or circumstances. Technical information in this presentation has been prepared and approved for inclusion by Mr Fernando de la Fuente, who is a “qualified person” in respect of the AIM Rules for Companies with over 39 years experience in the Exploration and Mining Geology industry. Mr de la Fuente holds a B.Sc. in Geology and a MSc in Geology from the University of Granada in Spain. He is also a member of the Spanish College of Geologists (Number 49), the Spanish Society of Mineralogy, founder member of the Spanish Society of Geology, member of the Spanish Association of Applied Geology to Mineral Deposits, member of the Society for Mining, Metallurgy and Exploration, Inc., member of PDAC. Some of the technical information contained in the W Resources Plc May 2016 Presentation was prepared and first disclosed under the JORC Code
reported. Foreign Exchange rate used in this presentation - US$1.00 = €0.90
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Projects Two large tungsten mines in development La Parrilla Mine, Spain: JORC Resource of 51mt @ 0.096% WO3. Open pit tungsten mine development. Fast tracking for 2016 production Régua, Portugal: Tungsten development. JORC resource of 5.46mt @ 0.28% WO3, at a cut-off of 0.10% WO3. Focussed on trial mine production in 2017 Tarouca, Portugal: Former tungsten and tin mine where advanced exploration is progressing CAA / Portalegre, Portugal: Advanced copper-gold exploration
Ticker: AIM: WRES Focus: Tungsten, copper & gold - production, development & exploration Shares in issue: 3.88 billion ordinary shares Market cap: GBP 17.8m (@ 0.46p – 4 May 2016) Experienced Directors: Michael Masterman Byron Pirola David Garland M Masterman 19.95% Hansource Investments Ltd 8.58 % B Pirola 6.44 % H Gibson 4.41 % C Scott 4.29 %
Significant Shareholders (as at 18 March 2016)
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La Parrilla Régua Tarouca Portalegre
PORTUGAL
Madrid Lisbon Porto Seville
Tarouca, Portugal Former tungsten / tin mine advanced exploration progressing La Parrilla Mine, Spain Open pit tungsten mine development - 1,300 tpa expanding to 5,000 tpa JORC Resource of 51mt @ 0.096% WO3 Régua, Portugal Open pit / UG tungsten mine development - 1,300 tpa JORC Resource of 5.46mt @ 0.28% WO3 CAA / Portalegre, Portugal Advanced copper-gold exploration Non JORC Resource of 328,621oz @ at 1.37 g/t Au
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Tungsten and Tin prices up La Parrilla
Régua
Continued price rises La Parrilla
Régua
development
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W to be one of the top 5 global tungsten producers
La Parrilla one of only a few Tin projects
150 175 200 225 250
Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16
13.0 14.0 15.0 16.0 17.0 18.0
Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16
US$ per tonne US$000’s per tonne
+15.7% +25.6 European Tungsten APT price Tin price
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Source: Northland Capital Partners estimates - 2015-2020 and Bloomberg 2013 – 2002-2014
Tungsten is a rare metal that is critical to some key applications with no satisfactory substitutes due to its unique properties Worlds hardest element with the highest boiling point China with 80% of global supply increasingly exerts market power Resilient price trend Strong demand growth Constrained supply
0.0 100.0 200.0 300.0 400.0 500.0 600.0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016E 2017E 2018E 2019E 2020E
APT price (US$/mtu)
Scenario 1 European APT free market Scenario 2 European APT free market Scenario 3 European APT free market Historic APT Chinese No 1 HK Index
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By 2018:
150% increase
large profitable mining company
FTM capital cost
low operating costs
net present value
robust high return project
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70% / 36mt Indicated (Increase from zero to 36mt) Open at higher grades to North, South, West and at Depth 3 high grade zones at surface identified for initial mining
Classification Tonnage (Mt) WO3 (ppm) Sn (ppm) Indicated 36 965 115 Inferred 15 947 92 Total 51 960 108
Golder Associates Pty Ltd – February 2016
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La Parrilla West (LPW) Area Fast Track Mine (FTM) Area
IP04 Significant intersection 32 metres @ 0.55% WO3
IRC1-33 19 metres @ 0.20% WO3 IRC1-40 40 metres @ 0.32% WO3
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U.V
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Initial 5 years of operation Low strip ratio in initial years (1.02:1) Feed Grade average of 0.110% WO3 Lateral N, S, W resource expansion will increase NPV
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FTM US$ 16m US$ 6m
US$ 30m
(starting late 2016)
upgrades
increased jig capacity
upgrades
* Concentrate @ 66% WO3
capacity upgrades
Upgrades
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Project Capex Required $’000 / tonne Long term Production La Parrilla
(W Resources Plc)
10,400 5,000 Barruecopardo
(Ormonde)
23,076 2,600 Drakelands
(Wolf Minerals)
58,260 ~3,450 Nui Phao
(Masan Group)
73,300 6,000
36 52
60 201 440
16 US$ Millions
FTM
Source: Ormonde, Wolf Minerals & MasanGroup Websites
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Initial Fast Track Mining Area Mine Waste Dump Existing Tailings Dump Coarse Jig Rejects & Dry Stacked TSF Extra TSF Storage Capacity
Open pit = low mining costs
Existing Open Pit
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7km from main Seville / Madrid Highway Power grid connection established Access to quality water supply Short trucking distance from both Atlantic and Mediterranean ports Accommodation, office and employee facilities operational On-site laboratory
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Pre-concentrate Stockpile Concentration Plant Spirals Concentrate Plant Ball Mill Concentrate Plant Flotation Cells Concentration Plant Shaking Tables Concentrate Plant Dryer
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200 tph jig Upgrade capacity from 40 tph to 80tph 325 tph Crushing and Screening Circuit
100 tph roller mill
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Source: Northland Capital Partners estimates. W Resources La Parrilla and Régua projects displayed in red
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SPAIN - LA PARRILLA PORTUGAL
Tailings FTM / FM RÉGUA
WO3 Concentrate WO3 Concentrate Sn Concentrate WO3 Concentrate WO3
60-62 66-67 < 2 64-65
Sn
6.95 1.23 > 60 < 3
As
0.30 0.14 < 0.2 < 0.3
S
0.86 0.52 < 0.6 < 0.3
ALS Chemex Vancouver - January 2014 ALS Brisbane - April 2015
Sales to one of Europe’s largest consumers Good pricing Strong demand for long term off-take agreement, with discussions underway
Golder Associates Pty Ltd - October 2015
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Customers: Large European
Simple truck delivery Good terms 600 tpa
Large Middle East
Largest in region Good terms 600 tpa
Large United States
New plant 600 tpa
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Current Mining Lease
FTM Mining Lease
FM Mining Lease*
*All required approvals (environmental, water, heritage, etc.) fall under the single mining lease application
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Resource up 76% to 3.76mt at 0.304% WO3 Total resource tonnage up 22% to 5.46mt at 0.28% WO3 High grade open pit mining opportunity Strong metallurgical results and simple flow sheet Development study on-track for H1 2016
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Location: 133km east of Porto Licence Status: Granted trial mining licence (2018 + 1 year option) JORC Resources: 5.46mt @ 0.28% WO3 Metres Drilled: 6,310 metres from 38 holes Mine Life: 7 to 10 years (Golders) Mine Capex: US$18m* Mine Economics: US$35m NPV / 52% IRR* Milestones:
equipment testing Q2 2015
1,200m drilling in Q3 2015
development options
* Historical Estimate Only
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Open at depth and on all sides, with significant potential resource growth to the north east Key results include:
from 16.50 metres
from 33.60 metres Conceptual mine study completed JORC increased from 4.46Mt at 0.308% WO3 to 5.46Mt at 0.280% WO3 Bulk samples at surface returned assays of 0.33% to 1.0% WO3 from initial 4 tonne sample Drilling results highlight 6 zones (compared to expected 3) of tungsten bearing skarn including 10 metres at 0.6% WO3
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Scheelite is the dominant tungsten mineralisation present Main gangue minerals present at Régua: vesuvianite, zoisite, axinite, carbonates, sericite , quartz, fluorite Minor heavy minerals: rutile, pyrite, and arsenopyrite in minor concentrations present The mineral resource consists of mineralised skarn horizons hosted within calcsilicate- altered schists and greywackes.
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Located 200km east of Lisbon covering a total of 289.75km2 São Martinho Gold Project - Includes high grade intersections - Hole SMRC025 15 grams / tonne including 1 metre at 44.9 grams per tonne. Portalegre Project - Positive initial assay results completed with a total of 1,600m. Rock surface sampling identified a number of high grade copper – gold samples CAA Project - 1,100 metre scout drilling programme completed in April 2015 showed encouraging results - Hole CAAD-05 16m of gold at 1.37 g/t between 124m and 140m
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High grade intersections: Resource (Non JORC) 9.62g/t @ 18.55m 7.52g/t @ 31m
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Best intersection
HOLE POR-96-2 14m @ 7.52 g/t Au from 31m, including 2m @ 49 g/t Au from 31m
Best intersection
HOLE POR 96-5 8m @ 6.5 g/t Au from 27m, including 2m @ 24.75 g/t Au from 29m
Does West link to East?
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Project Value Status La Parrilla Mine Definition Study US$400k Funded (NPV US$124m) Fast-track mine US$16m EU Govt or JV Régua (NPV US$35m) Metallurgical testing / Geological Extension US$300k Funded Trial Mine TBE 2016 W Exploration CAA / Portalegre US$200k Funded São Martinho US$300-500k Farm-out
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Two tungsten mines – exceptional exploration acreage La Parrilla targeting first mine production 2016 Régua advancing well and targeting first mine production in 2017 Large scale exploration potential Strong tungsten price fundamentals Financing discussions advancing at asset level (less dilution)
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La Parrilla Total JORC resources estimate increased 16% to 51 mt at 0.096% WO3 and 0.108% Sn Built and commenced production at La Parrilla tailings, achieving product quality of 60% WO3 Shipped over 111 tonnes of tungsten concentrate to date Strong customer relationships and credibility of product Established infrastructure base for FTM development, grid power connection, road, laboratory and water access Environmental and development approval received in H2 2015 On track for first mine production in late 2016 Régua Drilled extensions – remains open in all directions and at depth Conceptual mine study completed New JORC Resource increased from 4.46Mt at 0.308% WO3 to 5.46Mt at 0.280 WO3 Trial Mine targeting first mine production in 2017