GREENLAND: A SECURE SUPPLY OF NEODYMIUM. 7th International Rare Earths Conference Kowloon Shangri-La Hotel, Hong Kong November 15-17, 2011

Transcription

1 GREENLAND: A SECURE SUPPLY OF NEODYMIUM 7th International Rare Earths Conference Kowloon Shangri-La Hotel, Hong Kong November 15-17, 2011

2 Forward Looking Statements Forward-looking Statements This presentation includes certain forward-looking statements about future events and/or financial results which are forward-looking in nature and subject to risks and uncertainties. Forward-looking statements include without limitation, statements regarding the company s plan, goals or objectives and future mineral projects, potential mineralization, resources and reserves, exploration results and future plans and objectives of Hudson Resources. Forward- looking statements can generally be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "believe", or "continue" or the negative thereof or variations thereon or similar terminology. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. Important factors that could cause actual results to differ materially from expectations include risks associated with mining generally and pre-development stage projects in particular. Potential investors should conduct their own investigations as to the suitability of investing in securities of Hudson Resources. Cautionary Note Regarding Mineral Reserves and Mineral Resources Readers should refer to the current Technical Report of Hudson and other continuous disclosure documents filed by Hudson available on SEDAR at for further information on Mineral Resources, which is subject to the qualifications and notes set forth therein as well as for additional information relating to Hudson more generally. Mineral Resources which are not Mineral Reserves, do not have demonstrated economic viability. Cautionary Note to U.S. Investors Concerning Estimates of Measured, Indicated and Inferred Resources This presentation uses the term "Inferred" Mineral Resources. U.S. investors are advised that while such terms are recognized and required by Canadian regulations, the Securities and Exchange Commission does not recognize them. "Inferred Resources" have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an inferred resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Resources may not form the basis of feasibility or other economic studies. U.S. investors are also cautioned not to assume that all or any part of an Inferred Mineral Resource exists, or is economically or legally mineable. Qualified Person (QP) Dr. Michael Druecker, CPG, is a qualified person as defined by National Instrument and reviewed the preparation of the scientific and technical information in this presentation. Ronald G. Simpson, B.Sc., P,Geo., President of Geosim Services Inc., is an independent Qualified Person as defined by NI and was responsible for the resource estimate on the ST1 Zone. QP certificates can be found on Hudson s website. 2

3 Corporate Summary Issuer: Ticker (Exchange): Working Capital: Project: Current Shares Outstanding: Options and Warrants: Average Daily Trading Volume: Hudson Resources Inc. HUD (TSX.V) / HUDRF (OTCQX) Approximately C$13.0 million Advancement of the world class Sarfartoq Carbonatite Rare Earth project 80.2 million (basic) / 88.9 million (fully diluted) 3.1 million warrants ($1.20 strike price expiring April 6, 2012) and 5.6 million options (average strike $0.61) 150,000 shares (TSX.V & OTCQX combined) 52 Week Trading Range : C$ $1.86 (TSX.V) Last Financing: million shares at C$0.95 lead by Dahlman Rose & Co. and GMP Securities L.P. Closed April 5,

4 Investment Highlights Advanced rare earth ( REE ) project Initial resource identified, deposit still open in all directions with lots of room to grow Carbonatite deposit reduces metallurgical recovery risks Large-scale work program in 2011 will provide good news flow PEA expected mid/late November 2011 Located in mining-friendly Greenland Ranks #12 in the Fraser Institute s Potential Policy Index out of 79 countries Provides faster path to production Project near existing transportation infrastructure and hydroelectric power potential Substantial high-grade exploration upside on other targets Large prospective land position with multiple high grade targets (30 km strike length) ST19 target has drill results grading up to 4.9% ST40 target has 46% neodymium Strong management team and Board of Directors (Experience + Credibility) Significantly undervalued relative to peers and the underlying value of the deposit Well capitalized 4

5 2011 Exploration Highlights Drilling continues to confirm high grade zones at the ST1 body including 19 intercepts of 10 meters or more averaging 3.3% TREO over 13m 2011 Phase One assays have extended the ST1 body by at least 200m to the North East Wide zones of mineralization at ST1 include include 60m of 2.7%, 74m of 2.2% and 66m of 2.0% TREO. Drilling at ST40 continues to intersect a very high ratio of neodymium oxide to TREO at 46% Preliminary Economic Assessment (PEA) on track for completion in November 2011 Metallurgical test programs ongoing at two facilities 5

6 Management & Board James Tuer - President & Director; MBA, Mechanical Engineer. CEO of Hudson since Public company & corporate finance background (TD Securities) Jim Cambon VP Project Development; B.Sc. Geology. Over 20 years international mining/engineering project experience (AMEC, Bateman) including specific arctic project experience (Ekati, Snap Lake). John McConnell - Director Professional Mining Engineer with an extensive background developing and operating mining projects, particularly in arctic regions. President of Victoria Gold Flemming Knudsen - Director; Retired CEO of Royal Greenland A/s, Greenland s largest company. Extensive world-wide business experience. Strong connections in the EU. John Hick - Director; Has served in a senior capacity and/or on the board of directors of major mining companies (Placer Dome, TVX Gold, Rio Narcea). Dr. John A. McDonald - Director; He and his technical team were directly responsible for the discovery and development of the Snap Lake diamond deposit, acquired by De Beers for $480 million in Dr. Peter Le Couteur Consulting Mineralogist; A mineralogist with significant experience working with carbonatites. Ex-Cominco. Dr. Mike Druecker Consulting Geologist: Ex-Hecla, professional geologist, one of the pioneers in rare earth exploration dating back to the 1970 s. John Goode Consulting Metallurgist: 48 years experience with numerous rare earth projects in China, Canada and the USA. 6

7 Sarfartoq A Strategically Located Project Shipping route 7

8 Greenland Overview Population: 56,400 GDP: $1.1B Mining Governing Body: BMP - Bureau of Minerals & Petroleum Current Mining Licenses: Prospecting: Active = 16 Under Application = 1 Exploration: Granted = 71 Under Application = 17 Exploitation: Granted = 4 Six month permitting timeline for exploitation license Selected companies with Greenland assets Source: Bureau of Minerals and Petroleum. 8

9 The Greenland Advantage Mining-friendly jurisdiction Ranks #12 of 79 countries in the Fraser Institute s Policy Index Select Mining Jurisdictions Fraser Institute Policy Index Community supportive of foreign investment for developing natural resources Streamlined permitting process with oversight from only one government body Six month process to receive exploitation permit Skilled labor force Excellent access to both North American and European markets No royalties Source: Lynas Rare Metals Summit October

10 Exploration Licenses Conveniently Located KANGERLUSSUAQ (SONDRE STROM) 20 minutes away by helicopter SARFARTOQ CARBONATITE COMPLEX HEADWATERS OF ALCOA 600 MW POWER PROJECT 10

11 High Grade Samples Found Regionally Prospecting in 2009 and 2010 demonstrated the exploration upside across the entire region 385 Rock Samples Collected in 2009/ samples (30%) assayed greater than 1% TREO 23 samples (6%) assayed greater than 5% TREO Radiometric high + Mag Low =>REE 12km Previously Established Niobium/Tantalum/REE Deposit (SU1) Note: Reconnaissance image represents approximate extent of Sarfartoq Carbonatite Complex. 11

12 Initial Resource Estimate ST1 Deposit Inferred carbonatite resource of 1.5% TREO Substantial potential to expand tonnage, upgrade resource and increase the grade with additional drilling Resource based on only one of several target zones and assumes an 80% recovery rate (1) GeoSim considers a cut-off grade of 0.8% TREO to be reasonable in preliminary estimation of potentially economic resources extractable by open pit methods. 12

13 Upgrade ST1 by Pre-Concentration Re 2 O 3 (~16%) is concentrated in the red-purple Fe dolomite White ankerite, yellowish siderite and pink feldspars are void of rare earths Average grade at ST1 of 1.5% could be significantly upgraded by separating out the waste material in a pre-concentrate phase Pre-concentration methods being tested include: Gravity separation, Magnetic Separation, Optical sorting, and Radiometric sorting ST1 Float Sample: 10% TREO ST1 Drill Core: Average 1.5% TREO 13

14 ST1 High Grade Intervals 14

15 ST1 Drill Plan View 15

16 ST1 Southern Section 16

17 ST1 Middle Section 17

18 ST40 High Value Neodymium Target In 2009, Hudson intercepted 10.22m of 1.36% TREO in Hole SAR09-03 which contained 54% neodymium oxide and praseodymium oxide Contains one of the industry s highest ratio of neodymium at 45% TREO Recently completed mineralogical work shows that the rare earths are present in synchysite and zhonghuacerite The only other known location of zhonghuacerite is the Bayan Obo rare earths mine in China 2011 drill results confirmed the neodymium oxide averaged 47% of total rare earth oxides at ST40 18

19 Existing Infrastructure Lowers Costs Deep water access within 20 km of site Location is critical given that reagents comprise 40% of operating costs in a production facility Low-cost hydroelectric power potential Alcoa is planning to construct an aluminum smelter on the coast 600MW hydroelectric power plant located within several km of the project International airport 60 km from the project located in the town of Kangerlussuaq Year round access available for drilling and development Harbour Potential SCC Airport 19

20 Timeline of Key Events 1H H H H 2012 Bench Scale Metallurgical Testing Preliminary Economic Assessment (ST1) 10,000m Drill Program (ST1/Exploratory) ONGOING UNDER DIRECTION OF JOHN GOODE DUE BY MID TO LATE NOVEMBER COMPLETED 16,557m DRILL PROGRAM Pre-feasibility Study Large Sample Metallurgical Testwork Environmental Baseline Assessment Begin SIA for Mining Application Exploitation License Submission (first half of 2013) 20 20