Exciting New Developments at Botswana Copper Project. Africa Down Under Conference August, 2018

Transcription

1 Exciting New Developments at Botswana Copper Project Africa Down Under Conference August, 2018

2 Disclaimer & Forward Looking Statement Forward Looking Statements The document contains background Information about Tshukudu Metals Botswana (Pty) Ltd and MOD Resources Limited current at the date of this presentation. The presentation is in summary form and does not purport to be all inclusive or complete. Recipients should conduct their own investigations and perform their own analysis in order to satisfy themselves as to the accuracy and completeness of the information, statements and opinions contained in this presentation. Neither this presentation nor the information contained in it constitutes an offer, invitation, solicitation or recommendation in relation to the purchase or sale of shares in any jurisdiction. The presentation may not be distributed in any jurisdiction except in accordance with the legal requirements applicable in such jurisdiction. Recipients should inform themselves of the restrictions that apply to their own jurisdiction as a failure to do so may result in a violation of securities laws in such jurisdiction. This presentation does not constitute investment advice and has been prepared without taking into account the recipient s investment objectives, financial circumstances or particular needs and the opinions and recommendations in this presentation are not intended to represent recommendations of particular investments to particular persons. Recipients should seek professional advice when deciding if an investment is appropriate. All securities transactions involve risks, which include (among others) the risk of adverse or unanticipated market, financial or political developments. To the fullest extent of the law, MOD Resources Limited, its officers, employees, agents and advisers do not make any representation or warranty, express or implied, as to the currency, accuracy, reliability or completeness of any information, statements, opinion, estimates, forecasts or other representations contained in this presentation. No responsibility for any errors or omissions from the presentation arising out of negligence or otherwise is accepted. This presentation may include forward-looking statements that are only predictions and are subject to risks, uncertainties and assumptions which are outside the control of MOD Resources Limited. Actual values, results or events may be materially different to those expressed or implied in this presentation. Given these uncertainties, recipients are cautioned not to place reliance on forward-looking statements in the presentation as they speak only at the date of issue of this presentation. Subject to any continuing obligations under applicable law and ASX Listing Rules, MOD Resources Limited does not undertake any obligation to update or revise any information or any of the forward-looking statements in this presentation or any changes in events, conditions or circumstances on which any such forward-looking statement is based. No New Information To the extent that this presentation contains references to prior exploration results and Mineral Resource estimates, which have been cross referenced to previous market announcements made by the Company, unless explicitly stated, no new information is contained. The Company confirms that it is not aware of any new information or data that materially affects the information included in the relevant market announcements and, in the case of estimates of Mineral Resources that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement continue to apply and have not materially changed.

3 PFS Cautionary Statements Competent Person s Statement The information in this announcement that relates to Geological Data and the T3 Mineral Resource described in this release is reviewed and approved by Mr Bradley Ackroyd, BSc (Hons), Manager Mine Geology for MOD Resources Ltd. Mr Ackroyd is a registered member of the Australian Institute of Geoscientists and has reviewed the technical information in this report. Mr Ackroyd has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration and the activity, which it is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Ackroyd consents to the inclusion in this announcement of the matters based on information in the form and context in which it appears. The information in this news release that relates to Mineral Resource estimates announced on 2 July 2018 (excluding prior estimates) is based on and fairly represents information and supporting documentation compiled by Dr Matthew Cobb; an employee of CSA Global Pty Ltd. Dr Cobb is a member of both The Australasian Institute of Mining and Metallurgy and Australian Institute of Geoscientists. Dr Cobb has sufficient experience relevant to the style of mineralisation under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Pre-Feasibility Study Base Case - Cautionary Statement The T3 PFS Base Case is based on a Proved and Probable Ore Reserve derived from Measured and Indicated Mineral Resources respectively. No Inferred Mineral Resource has been included in the estimation of Ore Reserves. The PFS has been prepared to an overall level of accuracy of ±25%. It is based on material assumptions outlined in Appendix 1 Material Assumptions PFS Base Case announced 31 January The Company has concluded it has a reasonable basis for providing the forward-looking statements included in this announcement. Pre-Feasibility Study Expansion Case - Cautionary Statement The T3 PFS Expansion Case assumes open pit mining and conventional flotation processing with a plant throughput of 2.5Mtpa for the first three years. Assuming the Expansion Case proceeds, the plant will then be upgraded to 4Mtpa throughput rate during Year 4. The first three years of production are based upon the processing of Measured and Indicated Mineral Resources only. Thereafter the Expansion Case allows for processing of existing Inferred Mineral Resources in addition to the Measured and Indicated Mineral Resources. Resource infill and extensional drilling is ongoing with the objective to convert Inferred Mineral Resources to Measured and Indicated Mineral Resource categories. An updated Mineral Resource estimate is expected in Q The Expansion Case includes material that is currently in the Inferred Mineral Resource category. Inferred Mineral Resources represent approximately 34% of the Expansion Case Production Target by tonnage. There is a low level of geological confidence associated with Inferred Mineral Resources and there is no certainty that in-fill drilling of the T3 deposit will result in confirmation of additional Measured and Indicated Mineral Resources or that the Expansion Case Production Target will be realised. A substantial in-fill drilling program is in progress with the objective to upgrade Inferred Mineral Resources to Measured and Indicated Mineral Resource category. The Expansion Case is based on a production target and material assumptions outlined elsewhere in this announcement and summarised in Appendix 2 Material Assumptions PFS Expansion Case announced 31 January While MOD considers all the material assumptions to be based on reasonable grounds, there is no certainty that they will prove to be correct or that the range of outcomes indicated in the Expansion Case will be achieved. The company has concluded it has a reasonable basis for providing the forward looking statements included in this announcement. Given the uncertainties involved, investors should not make any investment decisions based solely on the Expansion Case.

4 Agenda Who is MOD? Regional Exploration it s all about Domes T3 Project Feasibility Study for First Mine

5 Who is MOD? Largest licence holder and copper explorer in Botswana with JV partner, Metal Tiger Dominate central Kalahari Copper Belt, major drilling campaign underway (9 DDH rigs) Discovered the substantial T3 deposit (590Kt Cu) in the first drill hole in March 2016 Completion of Feasibility Study for ~12 Year T3 Pit Project expected March 2019 Breakthrough technology (EM) defining many conductive domes similar to T3 1.5% Cu intersected in second hole into A4 Dome (8km west of T3) in August 2018 Seeking to dual list MOD on the London Main Market in December Q 2018 Building strong government and community relations, local employment and training

6 Meet the MOD Team at Africa DownUnder Julian Hanna Director Mark Clements Director Steve McGhee Technical Director Gaba Chinyepi In-Country Manager Kebalemogile (KB) Tau Exploration Manager Stef Weber Chief Financial Officer Jacques Janse van Rensburg Business Development Manager

7 Location of Kalahari Copper Belt ~11,500km 2 landholding in Kalahari Copper Belt Sediment hosted copper deposits similar to Zambia / DRC Copper Belt Minimal prior exploration. State-of-the-art EM is discovering copper below calcrete cover Immediate success drilling at T3 (March 2016) and A4 Dome (August 2018) Botswana copper grade niche 1% to 2% Cu with significant silver credits High quality and grade concentrates (30-40% Cu) Well established in-country operator, Tshukudu Low country risk supportive, stable government

8 MOD Holdings in Kalahari Copper Belt T1 Copper Project 2% Cu and 50 g/t Ag ~7Mt Cu in Resources in eastern end of belt. Domes largely eroded Joint Venture licences previously undrilled due to extensive calcrete cover >140km of soil anomalies, EM anomalies, and domes with similarities to T3 Major drilling campaign testing domes in T3 Dome Complex (~700km 2 ) Intersected significant copper in first dome (A4 Dome) 8km west of T3 T20 Dome complex (~2,000km 2 ) west of Ghanzi next regional scale target

9 Copper Belt Scale Opportunity Domes, Domes, Domes! It s MOD s district scale exploration potential that excites us Blue Ocean Equities

10 Two District Scale Exploration Projects T3 Dome Complex (~700km 2 ) numerous EM targets, including at least 7 large conductive domes T20 Dome Complex (~2,000km 2 ) Previously unexplored region with domes, EM targets and Cu/Zn soil anomalies

11 Why Target Domes? T3 is a substantial 590Kt copper resource on top of a large conductive dome Numerous, undrilled conductive domes interpreted from EM along ~700km 2 T3 Dome Complex Two deposit types : T3 Vein Type and NPF Contact Type within ~300m wide Target Sequence Domes occur below the surface calcrete layer. Any copper deposited within domes is still there

12 A4 Dome within ~700km 2 T3 Dome complex T3 Dome Complex along same structural corridor that hosts major deposits including Cupric s 2Mt Cu Zone 5 resource 7 EM conductive buried domes targeted for drilling within T3 Dome Complex Immediate success at A4 Dome with significant copper intersected in first holes 5 drill rigs extending mineralisation along dome

13 T3 Dome Complex buried domes Interpreted Airborne EM section across T3 Dome with T3 Pit Interpreted Airborne EM section across A4 Dome, 8km West of T3 Interpreted Airborne EM section across A1 Dome, 20km NE of T3 Interpreted Airborne EM section across A27 Dome, 3km South of A1

14 A4 Dome first dome drilled outside T3 State-of-the-Art airborne EM breakthrough technology for targeting copper EM is defining large conductive domes below surface calcrete layer Immediate success: 1.5% Cu & 14g/t Ag in 2 nd hole (announced 6 August 2018)

15 A4 Dome Drilling two targets High grade stockwork chalcopyrite and bornite veins and: Disseminated chalcocite and bornite on NPF contact Hole ID MO-A4-003D Stockwork Vein Intersections 1.5% Cu and 14g/t Ag from 232m Includes: 2.9% Cu and 42g/t Ag from 268.8m Includes: 5.3% Cu and 90g/t Ag from 279.9m Individual veins 11% Cu, 11.5% Cu, 8.4% Cu, 12.2% Cu, 15.6% Cu

16 T20 Dome Complex next district scale target Zone of Cu & Zn anomalies extends up to ~60km EW and ~20km NS T23 MOD RC drilling at T4 intersected 6.1%Cu & 111g/t Ag from 61m Airborne EM completed over ~790km 2. Extension EM survey September 2018 Initial drilling to test T23 Dome (below)

17 Flagship T3 Project T3 expected to become MOD s first mine

18 T3 Rapid Growth Since Discovery T3 Copper Project (Motheo) discovered March Mt maiden resource in T3 September Mt total resource upgrade in August 2017 PFS for robust, long-life mine announced January Mt total resource upgrade in July 2018, includes: and 16g/t Ag (Indicated Resource) Decision to Mine targeted by end March 2019 Target First Production by end 2020

19 T3 Pit PFS Robust Project 9 year Base Case, 2.5Mtpa production, A$370m NPV (pre-tax) 12 year Expansion Case, 4.0Mtpa production, A$529m NPV (pre-tax) Key Outcomes (Base Case): C1 Cash Cost US$1.22/Ib Cu AISC US$1.36/Ib Cu IRR (pre tax) 39% Payback 2.7 years T3 Project Summary 2.5Mtpa Base Case Expansion Case 4Mtpa Development Capital US$154.8m US$191.6m Life of Mine from production start 8.8 years 11.7 years Waste: Ore Ratio Copper Grade 1.02% 0.86% Average Annual Production 23kt Cu,690koz Ag 28kt Cu, 903koz Ag Life of Mine Financials (US$3.00/lb, AUD:USD $0.76) Base Case Expansion Case Revenue US$1,410m US$2,263m C1 Cash Costs LOM US$1.22/lb Cu US$1.30/lb AISC, LOM US$1.36/lb Cu US$1.46/lb EBITDA US$734m US$1,103m Net Cash Flow (pre-tax) US$530m US$840m NPV (8% real, pre tax) US$281m US$402m NPV (8% real, pre tax) A$370m A$529m IRR (pre tax) 39% 38% Payback (from first production) 2.7 years 3.3 years

20 T3 PFS Pit Big widths, good continuity, near surface Low stripping ratio (4.8 to 1) PFS Expansion Case target ~30Ktpa Cu in concentrate 44% increase in total resource announced 2 July Kt Cu and 27Moz Ag 0.4% Cu cut-off

21 T3 Underground Project High grade Cu veins (cut-off 1.5% Cu) extend outside Base Case pit Underground Resource drilling in progress. Target 10Mt resource

22 T3 Outstanding Metallurgy Copper Silver Mass Domain Recovery Grade Recovery Grade Recovery % % % g/t % Chalcocite Bornite Chalcopyrite Locked Cycle results Excellent recoveries High grade concentrates Low mass recovery Low deleterious elements Plan export through Namibia

23 T3 Site Layout and Infrastructure Near Ghanzi-Maun Highway (12km) BPC grid power expected 2020 Process water available on site Minimise water usage and recycle Innovative waste and tailings storage Agreement to purchase farm

24 Project Timeline 3 Resource Projects and 3 Exploration Projects:

25 Employment, Training and Community In-country operating company, Tshukudu Metals Training programs underway building Tshukudu team Specialist technical inputs from Australia Substantial increase in employment expected in 2019 Accommodation village (Stage 1) nearing completion Community Relations Office now operating in Ghanzi Support and sponsor local community initiatives 25

26 Investment Case The beginning of a much larger story T3 is the first of a new type of copper/silver deposits and PFS confirms robust project Exploring district scale targets - numerous compelling targets within 11,500km 2 holdings Airborne EM is defining large conductive domes with potential for significant vein and contact hosted deposits Major DDH drilling campaign (9 drill rigs) testing domes with immediate success at A4 Dome Low sovereign risk, supportive government, excellent infrastructure, strong community presence

27 Corporate Overview Key Corporate Data 230M Issued Capital Market Cap A$104M at $0.45 Cash A$17.3M Options ~8M (includes Performance Rights) Top 20 ~60% In-Country Operating Company Tshukudu Metals Botswana Top Shareholders % Board and Management ~14 Australian Super ~9 LIM Asia ~6.7 Metal Tiger ~6 Current Broker Coverage 3 year share price High Low 0.040

28 @ Perth Office Follow us on First Floor, 1304 Hay Street West Perth WA 6005 Australia