Metal Bulletin Iron Ore Conference 22 November 2005 Koolan Island Iron Ore Project

Transcription

1 Metal Bulletin Iron Ore Conference 22 November 2005 Koolan Island Iron Ore Project

2 Contents Location Project Outline Project Schedule Corporate Overview History Equipment Geology Resource Development Data

3 Location Western Kimberley Region WA 2,000km NNE of Perth Koolan Island Project WA Map Nearest towns: Derby 150km S and Broome 320km SW

4 Koolan Island

5 Project Outline Brownfields development Based on Main orebody, supplemented by four satellites, Mullet, Acacia, Eastern and Barramundi Deepwater port able to accommodate panamax vessels to 75,000 dwt Resource sufficient to support 4Mta operation for 10+ years

6 Project Schedule (As Anticipated 14/11/2005) BFS completed August 2005 Environmental Recommendations in Approval stage Land Access Agreement with Traditional Owners being completed Mining Lease Grant expected early 2006 Construction Commencement Q1, 2006 Plant Commissioning Q2, 2006 Wharf & Shiploader Completion Q3, st Shipments Q3, 2006

7 BFS Highlights Bankable Feasibility Study (BFS) completed, with positive results, encouraging the Company to proceed with mine development, subject to Government approvals, formalisation of off-take contracts and Board approval of funding arrangements Initial capital costs of A$108 million, inclusive of mine development costs of A$26 million Financial modeling of the Project has been based on a sales mix of fines (70%) and lump (30%), producing total revenues of A$1.4 billion over the nine year life of the mine Operating cash surplus of A$583 million (EBITDA) over the nine year life of the project The project returns, based on 29.1 million tonnes of saleable ore, a net present value (NPV) of A$217 million (before interest and tax) at a 10% discount rate, with an Internal Rate of Return (IRR) of 39.7% First shipment of iron ore scheduled to commence in second half of 2006 BFS takes no account of exploration upside of the Koolan Island Project

8 Corporate Overview Aztec Resources Limited is a public company listed on ASX and the London Stock Exchange s AIM market Market Capitalisation: A$85,000, ,700,000 + shares Major Shareholders: Cambrian Mining plc % National Nominees Limited.6.3% ANZ Nominees Limited % CITIC Resources Australia Pty Ltd % HSBC Custody Nominees (Australia) Ltd 3.1% (10/10/2005)

9 History Pre BHP Ore deposits on Koolan and Cockatoo Islands discovered in 1880 First mining leases granted, small scale mining commenced 1907 First attempt at large scale mining in 1936 when Yampi Sound Mining Company (a consortium including Nippon Mining Co) announced intention to export to Japan Federal Government embargo on all iron ore export in 1938 First ore mined on Koolan fed small charcoal-iron plant built by State Government in 1945 BHP granted leases in 1951

10 The BHP Years By the conclusion of mining in 1993, 68Mt ore had been produced Shipment grade declined from >67%Fe for the early Main pit production to 65% %Fe for the final blend On closure, all infrastructure removed or buried, stockpiles and roads moonscaped and the Main pit opened to allow ingress of the sea

11 The Aztec Era Aztec granted tenements in 2003 Notice of Intent approved January 2004, drilling commenced February 2004 Camp established on Koolan Island August 2004 Data collection for BFS completed February 2005 Land Access Agreement negotiations commence with Traditional Owner s March 2005 BFS completed August 2005

12 Koolan Island Mine & Infrastructure Layout

13 Mining Operations Contractor-based operation Conventional open-pit operation, rotary drills, 200t hydraulic backhoes, FEL s, rear dump trucks and ancillary plant

14 Transportation System Truck haulage to ROM pad, primary crusher and stockpiles Conveyor to shipping stockpile FEL reclaim from shipping stockpile Conveyor to sampling station, wharf and shiploader

15 Port Facilities Steel-pile wharf able to accept Panamax vessels up to 75,000 dwt Berth pocket 16m draft Fixed, luffing shiploader, capacity 3,000tph 20m minimum draft in departure channel - no dredging required Vessel berthing/departure assisted by tugs

16 Regional Geology Kimberley Basin is a large structural basin occupying most of the Kimberley region with sediments of Lower- Mid Proterozoic age dominant The Yampi ore bodies lie at the western end of the NW SE trending King Leopold Mobile Zone which forms the south western border of the Kimberley Basin Hematite concentration occurs in the basal Yampi, member of the Pentecost Sandstone in the Kimberley group

17 Local Stratigraphy Pentecost Sandstone White well sorted quartz sandstone, grey siltstone Yampi Member Pink-brown arkose and feldspathic sandstone; minor siltstone, hematitic quartz sandstone, glauconitic sandstone Iron ore Elgee Siltstone Red-brown and grey sitstone and minor phyllite; thin sandstone interbeds Basal boulder to pebble conglomerate Warton Sandstone White well-sorted quartz sandstone and feldspathic sandstone; siltstone interbeds; andalusite granofels in places. The Kimberley Group comprises essentially a succession of sandstones, quartzite's and siltstones, with some interbedded phyllite, unconformably overlying the Speewah Group The stratigraphy on Koolan Island comprises the Warton sandstone, Elgee Siltstone and Yampi Member of the Pentecost Sandstone (distinguished by its hematite content)

18 Local Structure

19 Yampi Member Main Ore Body Elgee Siltstone Warton Sandstone

20 Main Ore Body

21 Eastern-Barramundi Ore Body

22 Eastern-Barramundi Ore Body

23 Mullet-Acacia Ore Body

24 Mullet-Acacia Ore Body

25 Resource Drilling

26 Resource Estimates 55% Fe cut off grade (as at 14 Oct 2005) Orebody Tonnes Fe SiO 2 Al 2 O 3 ('000) % % % Main Eastern-Barramundi Mullet-Acacia Acacia-East 3, Total 53,

27 Koolan Island Date January 2006 Feb - May 2006 June 2006 August 2006 September / / / 2009 December / / 2015 KEY MINE DEVELOPMENT DATES (As Anticipated 14/11/2005) Activity Mobilise first mining fleet Establish mining facilities and roads, initial clearing Mobilise remaining fleet Commence mining Mullet/Eastern Waste stripping at Main Commence seawall construction Commence crushing First ore shipment Seawall construction De-water Main pit lake and re-hab footwall Full production 4mtpa Waste stripping at Main pit reaches sea level Complete mining Eastern and Mullet Pits Complete mining Main Pit