Pele Mountain Investor Presentation

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Pele Mountain Investor Presentation

  1. 1. Forward Looking Statements The information in this document has been prepared as at September 21, 2012 Certain statements contained in this document constitute “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995 and forward looking information under the provisions of Canadian provincial securities laws. When used in this document, the words “anticipate”, “expect”, “estimate”, “forecast”, “will”, “planned”, and similar expressions are intended to identify forward‐looking statements or information. Such statements include without limitation: statements regarding timing and other assumptions; estimates of future resources, mineral production, optimization efforts and sales; estimates of mine life; estimates of future internal rates of return, mining costs, processing costs, cash costs, mine site costs and other expenses; estimates of future capital expenditures and other cash needs, and expectations as to the funding thereof; statements and information as to the projected development of the Eco Ridge Mine, including estimates of exploration, development and production and other capital costs, and estimates of the timing of such exploration, development and production or decisions with respect to such exploration, development and production; estimates of resources, and statements and information regarding anticipated future exploration; the anticipated timing of events with respect to the Companys Eco Ridge Mine project and statements and information regarding the sufficiency of the Companys cash resources. Such statements and information reflect the Companys views as at the date of this document and are subject to certain risks, uncertainties and assumptions, and undue reliance should not be placed on such statements and information. Many factors, known and unknown could cause the actual results to be materially different from those expressed or implied by such forward looking statements and information. Such risks include, but are not limited to: the volatility of prices of rare earth oxides and uranium oxide and other metals; uncertainty of mineral resources, mineral grades and mineral recovery estimates; uncertainty of future production, capital expenditures, and other costs; currency fluctuations; financing of additional capital requirements; cost of exploration and development programs; mining risks; community protests; risks associated with governmental and environmental regulation; the volatility of the Companys stock price; and other associated risks. The Company does not intend, and does not assume any obligation, to update these forward- looking statements and information. Note: The Preliminary Economic Assessment (“PEA”) is preliminary in nature. It includes inferred mineral resources, which are considered too speculative geologically to have the economic considerations applied to them that would enable their categorization as mineral reserves. There is no certainty that the PEA forecast will be realized.2
  2. 2. The Eco Ridge Mine Rare Earth & Uranium Project Located in Elliot Lake: North America’s proven heavy rare earth mining camp. Heavy rare earth enriched mineralogy is well understood and provides excellent recovery. NI 43-101 Preliminary Economic Assessment (“the PEA”) indicates robust economics. Heavy REO, Neodymium Oxide (Nd2O3) & Uranium Oxide (U3O8) provide 85% of revenue. Mine construction targeted for 2015. World-class technical team, experienced in Elliot Lake.3
  3. 3. PROPERTY PEOPLE PRODUCTS ECO RIDGE COMPETITIVE ADVANTAGES PERMITTING PROCESSING PLAN PROJECT ECONOMICS4
  4. 4. Elliot Lake: A Proven Mining Camp 300M lbs of historic U3O8 production from Elliot Lake. Only Canadian camp to produce REO commercially. Well-understood geology, mineralogy and metallurgy. Outstanding regional infrastructure – highways, railway, power, airport & deep water ports. Qualified work force & enthusiastic local support. Politically stable and mining friendly jurisdiction. Ideal location for safe, secure, reliable, long-term supply of heavy REO & U3O8.5 ECO RIDGE PROPERTY
  5. 5. 6 ECO RIDGE PROPERTY
  6. 6. REO & U3O8 Mineral Resources Source: NI 43-101 Mineral Resource Estimate as reported by Roscoe Postle Associates, April 2012 Zone & Tonnes Total REO Uranium Oxide Classification (000) Lbs (000) ppm Lbs (000) % MCB – Indicated 20,514 73,184 1,618 20,447 0.045 HWZ – Indicated 28,223 51,111 821 7,214 0.012 TOTAL - Indicated 48,737 124,295 1,157 27,661 0.026 MCB – Inferred 16,906 54,515 1,463 15,940 0.043 HWZ – Inferred 20,956 37,329 808 5,822 0.013 TOTAL - Inferred 37,863 91,843 1,100 21,762 0.026• Note: Historic drilling shows deposit continues well beyond resource wireframe. ECO RIDGE PRODUCT7
  7. 7. Critical Rare Earths Diversified with Uranium Heavy REO, neodymium Oxide (Nd2O3) & uranium oxide (U3O8) provide 85% of project revenue in PEA. US Dept. of Energy sees supply risks for neodymium, dysprosium, europium, yttrium & terbium (the “Critical Rare Earths”) Vast majority of REO revenue at Eco Ridge from Critical Rare Earths Uranium oxide provides important by- product revenue diversification. 8 ECO RIDGE PRODUCT
  8. 8. Uranium Demand is Strong Nuclear reactors worldwide: >400 currently operating 61 under construction 156 planned 343 proposed Global production is less than reactor consumption. Balance supplied from secondary sources, which are nearing depletion.Source: mining.com 9 ECO RIDGE PRODUCT
  9. 9. NI 43-101 Preliminary Economic Assessment Mining Cost per Tonne1 $41.52 9,000-tonne per day operation to produce Processing Cost per Tonne $26.31 97.2M lbs of Total REO & 27.5M lbs of U3O8 G&A Cost per Tonne $3.50 over 11-year mine life. Total Operating Cost Production of strategic combination of Critical $71.33 REO forecast to remain in supply deficit – per Tonne Majority of REO revenue from Heavy REO. Net Revenue per Tonne $154.22 Life-of-mine production includes 14.2M lbs of Pre-Tax Cash Flow $2.16 Billion neodymium oxide (Nd2O3) & 882K lbs of IRR 50% dysprosium oxide (Dy2O3), 4.1M lbs of yttrium Before-Tax Payback Period 1.5 Years oxide (Y2O3) etc. providing a vital source of Critical REO in Canada. Net Present Value (10% $1.02 Billion discount rate) Source: NI 43-101 Preliminary Economic Assessment as reported by Roscoe Postle Associates, April 201210 ECO RIDGE ECONOMICS
  10. 10. Processing Circuit Optimized for HREO and Uranium• Conventional milling achieves excellent recovery from heavy rare earth enriched uranium minerals.• Bench scale acid baking tests have achieved dramatic increase in recoveries compared to July 2011 PEA.• Physical concentration of ore prior to acid baking will reduce the amount of material to be processed by acid baking. ECO RIDGE PROCESSING11
  11. 11. Preliminary Processing Block Flow DiagramCrushing, grinding, mineral concentration,acid baking, and oxide precipitation will occurat on-site processing complex, producing rareearth carbonate and U3O8 “yellowcake”.12 ECO RIDGE PROCESSING
  12. 12. Sustainable Development at Eco Ridge Project Description detailing Pele’s approach to sustainable development is currently being prepared, targeting the License to Construct the mine in 2015. Local support for Eco Ridge highlighted by long-term lease with the City of Elliot Lake for key surface rights. Pele is continuing friendly and productive engagement with Aboriginal communities. ECO RIDGE PERMITTING PLAN13
  13. 13. Pathway to Production 2005 – Sept 2012 Q4 2012 Year 2013 Year 2014 Year 2015✔ Acquire Property Submit Project Description to Commence Feasibility Regulatory Review & Issue Site CNSC Study EA Decision Preparation / Statement Construction✔ Outline NI 43-101 Advance Baseline Complete detailed Engineering Design Begin Process Plant Resources Characterization engineering plans for for Process Plant Construction Program/Reporting mining and processing✔ Mine Engineering Launch Environmental Impact Advance the Complete Detailed Begin mine Study Environmental Impact Tailings Facility construction Study Design Engineering✔ Process Engineering Additional Resource Drilling Continue permitting Continue permitting Construct waste process process management system✔ NI 43-101 Positive PEA Public and Aboriginal Public and Aboriginal Public and Aboriginal Public and Aboriginal Consultation Consultation Consultation Consultation✔ Initiate Baseline Environmental Studies ECO RIDGE PERMITTING PLAN14
  14. 14. World-Class Development Team Roger Payne P. Eng• Technical team led by Roger Payne P. Eng., former Rio Algom GM for Elliot Lake.• Rare Metals Advisory Board features Dr. Anthony Mariano and Dr. William Bird.• Key consultants include Roscoe Postle Assoc., Dr. Anthony Mariano SNC-Lavalin, Senes, Golder Asso., and Saskatchewan Research Council. ECO RIDGE PEOPLE 15
  15. 15. Pele’s Competitive Advantages at Eco Ridge• Proven REO mining camp at Elliot Lake PROPERTY• 85% of revenue from Critical REO & Uranium PEOPLE PRODUCTS• Excellent REO recoveries with acid baking ECO RIDGE COMPETITIVE ADVANTAGES• Updated PEA indicates robust potential PERMITTING PROCESSING• Updated Project Description being prepared PLAN PROJECT• World-class team, experienced in Elliot Lake ECONOMICS16
  16. 16. Pele Capital Structure Average Cash on Price Exercise Shares 149.0 M Options 12.3 M $0.23 $2.8M Warrants 14.6 M $0.27 $3.9M Diluted 175.9M $6.7M Share Price (14-September-12) $ 0.07 Market Cap (undiluted) $10.4 M TSX-V : GEM OTCQX : GOLDF Market Cap (diluted) $12.3M17
  17. 17. Mountain Pass Project18
  18. 18. For More Information on Pele Mountain Resources Inc.: Email: ashefsky@pelemountain.comTelephone: 416.368.7224 or 1 800.315.7353 Website: www.pelemountain.com Twitter: @pele_mountain

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