Dacha april 27__2011

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Dacha april 27__2011

  1. 1. Corporate Presentation<br />TSX-V:DSM OTCQX:DHCAF<br />April 25 2011<br />A Forbes & Manhattan Group Company<br />
  2. 2. Forward Looking Statements<br />Caution regarding forward-looking information:<br />This presentation contains "forward looking information" within the meaning of applicable Canadian securities legislation. Forward looking information includes without limitation, statements regarding the proposed use of the proceeds of the financing, the receipt of all necessary approvals, the issue of permits, progress in development of mineral properties, future production and sales volumes, capital and mine production costs, demand and market outlook for rare earth metals, future metal prices and treatment and refining charges, the financial results of the Company, the future financial or operating performance of the Company, and terms and the availability and likelihood of future acquisitions. Generally, forward looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved". Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of the Company to be materially different from those expressed or implied by such forward-looking information, including but not limited to: general business, economic, competitive, geopolitical and social uncertainties; market risks; risks related to leverage; acquisition risks; and other risks of the mining and trading industries. Although the Company has attempted to identify important factors that could cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward looking information. The Company does not undertake to update any forward-looking information, except in accordance with applicable securities laws.<br /> <br />This presentation does not constitute an offer to sell or a solicitation of an offer to sell any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act") or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless registered under the U.S. Securities Act and applicable state securities laws or an exemption from such registration is available.<br />2<br />
  3. 3. Investment Objectives<br />3<br /><ul><li>Hold Physical Inventory of Heavy Rare Earth Elements</li></ul>without any mining risk<br /><ul><li>Diversified basket of metals eliminates single element exposure risk
  4. 4. Generate profits from trading individual elements to downstream customers
  5. 5. Inventory located LME approved warehouses located off-shore near end-users
  6. 6. Tax effective corporate structure to maximize inventory and trade gains</li></li></ul><li>Capital Structure<br />4<br />
  7. 7. Management<br />5<br />Scott Moore, MBA, President & Chief Executive Officer<br /><ul><li>Mr. Moore is an experienced capital markets executive with 20 years experience in the resource sector.
  8. 8. Former CEO of Franc-Or Resources Corp and VP Corporate Development for Aberdeen International. Former Director of Sulliden Gold and Avion Gold. He has raised in excess of $250 million in resource companies in the last 3 years.
  9. 9. He holds a Bachelor of Arts degree from the University of Toronto and an MBA from the Kellogg School of Management</li></ul>Alastair Neill, P.Eng., MBA, Executive Vice-President<br /><ul><li>Mr. Neill is the former GM, Rare Earth Division and VP Business Development for Neo-Material Technologies (TSX:NEM) and brings over 15 years of direct Rare Earth experience. Mr Neill lives full time in Beijing.
  10. 10. He holds a MBA from York University and a Bachelor of Engineering in Material Science from the University of Western Ontario</li></ul>Brad Boland, C.M.A., Chief Financial Officer<br /><ul><li>Mr. Boland was the CFO of Consolidated Thompson Iron Mines Limited until July 2009
  11. 11. From May 2005 to September 2007, he was at Kinross Gold Corp., most recently serving in the position of Vice President, Corporate Controller.
  12. 12. Prior to that, from August 1998 to February 2005, Mr. Boland was at Goldcorp Inc., as Corporate Controller and the Vice President, Finance.</li></ul>Jihong Gan, BA, MA, Manager Contracts and Administration<br /><ul><li>Ms. Gan is an accomplished administrator with a specialization in East Asian languages.
  13. 13. Ms. Gan has a Bachelor of Arts (Major: Japanese) from the Shanghai International Studies University in Shanghai and a Masters of Arts in East Asian Language studies from Osaka University of Foreign Studies. </li></li></ul><li>BUSINESS MODEL2010 Achievements<br />6<br /> 300,000 + kilograms of Heavy Rare Earth Oxides Acquired in F2011<br />202,000 kilograms of Heavy Rare Earth Oxides in Inventory at April 21<br />12 acquisition trades executed totaling $33.84 million<br />5 Sales contracts with 4 different customers executed in Q3 2011<br />$15.65 million in gross sales and $5.2 million in gross profit in Q3 2011<br />
  14. 14. Attractive Value Proposition<br />7<br />Participate in the expected price appreciation of <br />rare earths and strategic industrial metals<br />No Exploration or Mining Risk<br />
  15. 15. • Produces +95% of Global Supply• Export Tariffs of 25% imposed to drive manufacturing to China• Export Quotas reduced every year for last 5 years• China reduces Quotas for second half 2010 by 70%CHINA REDUCES QUOTAS FOR H1-2011 BY 35%<br />8<br />China - Guarding the Supply<br />“Chinese adamant on rare-earth metal cuts”- Aug 30-2010<br />
  16. 16. Rare Earths in the Limelight<br />“China Tightens Grip on Rare Minerals” <br />“China slashes first batch of rare earth export quotas by 35.17%”- Dec 30-2010<br />“China Cuts Rare Earth Exports” <br />Japan rare earths imports from China plunge in Nov <br />December 27, 2010 -- TOKYO  (Source: Reuters) <br />“China Cracks Down on Illegal Mining of Rare Earth Metals” – Dec 2010<br />9<br />
  17. 17. A Paradigm Shift in the REE Industry<br />Security of supply no longer just a commercial Issue <br />It is now a Political Issue<br />Rare Earth Supply Technology and Resources Transformation Act [RESTART] introduced to both the U.S House of Representatives and the U.S. Senate in 2010<br />Japanese Industry Minister asked Chinese Minister of Industry and Information for reductions to this year's export quota to be reversed. “We are concerned that rare-earth metals will not come to Japan in the future”.<br />“ China Defends Rare Earth Quotas as inline with WTO” Bloomberg Dec 30-2010<br />10<br />
  18. 18. “What Are Rare Earth Elements”<br />11<br /><ul><li>Rare Earth Element or REE are Lanthanide series elements and are found at the bottom of the Periodic Table
  19. 19. 15 elements plus Yttrium are classified as REE and have specific magnetic, fluorescent and chemical properties
  20. 20. Some are classed as Light, Medium or Heavy REE and have varying applications in laptops, LCD’s , cellular phones and hybrid vehicles.
  21. 21. Heavy REE such as Europium, Terbium and Dysprosium command the highest value</li></li></ul><li>12<br />Lighter Weight<br />Product Miniaturization<br />Enhanced Performance and Functionality<br />Enhanced Control and Measurement<br />Energy Efficiency / Environmental Compliance<br />Rare Earth ElementsIndustry Primer<br /><ul><li>Essential inputs for virtually all electronic products
  22. 22. No substitutes exist that have the same characteristics and provide the same benefits</li></li></ul><li>Rare Earth Applications<br />13<br />Toyota Prius<br />Biggest User of Rare Earths of any Object in the World<br /><ul><li>1kg Neodymium
  23. 23. 15kg Lanthanum
  24. 24. 0.1kg Dysprosium
  25. 25. Top-selling car in Japan</li></ul>100 g of Dysprosium is worth approximately $10<br />Without Dysprosium you don’t have a Prius<br />
  26. 26. The Largest User of Rare Earths Tomorrow1mt Neodymium needed for every 3 MW of wind power generated<br />14<br />
  27. 27. Current State of the Rare Earth Markets<br />15<br />Source: Rhodia<br />
  28. 28. Supply Side Response<br />16<br /><ul><li>Lynas Corporation ASX-LYC
  29. 29. Starting Mt Weld mine with announced production in late 2011
  30. 30. Primarily a Light Rare Earth Deposit with 96% of 2012 production in Cerium, Lanthanum and Neodymium and Praseodymium
  31. 31. First production is 11,000 tonnes per year.
  32. 32. No production of Heavy Rare Earth Elements ( DY,Tb,Yt)
  33. 33. MolyCorp Inc AMEX-MCP
  34. 34. Re-opening the Mountain Pass mine closed since 1998 with production in 2013
  35. 35. Primarily a Light Rare Earth Deposit with 86% of 2013 production in Cerium, Lanthanum and Neodymium
  36. 36. Expected to produce approximately 40,000 Tonnes per year
  37. 37. No production of Heavy Rare Earth Elements ( DY,Tb,Yt)</li></li></ul><li>SUPPLY/Demand Gap Increasing<br />17<br />IMCOA Rare Earth Oxide Forecast<br />
  38. 38. SUPPLY/Demand Gap Increasing<br />18<br />Rare Earth Oxide Forecast<br />
  39. 39. Current State of the Rare Earth Markets<br />19<br /><ul><li>No significant commercial stockpile exists globally
  40. 40. No buffer to volatile pricing or actions from China
  41. 41. No ability to hedge against future price increases
  42. 42. Limited supply-side response
  43. 43. Most advanced Rare Earth mining projects are 2-5 years away from delivering product to market with substantial financial and technical hurdles to overcome</li></ul>Dacha has the inventory today and the ability to grow its stockpile quickly<br />
  44. 44. Risk Minimization<br />20<br />Inventory Insured at Market Value<br />Pacorini Metals Shanghai Warehouse<br />Pacorini Metals LME Warehouse<br />Korea<br />
  45. 45. Why buy DACHA?<br />21<br /><ul><li>Rising Commodity Prices For Rare Earth forecast in next 3-5 years
  46. 46. Only Rare Earth Company that actually owns the finished product
  47. 47. Focused on high value Heavy Rare Earths
  48. 48. Demonstrated Ability to acquire REE in China despite reduction in export quotas
  49. 49. No new supply of Heavy Rare Earths till 2015 at the earliest
  50. 50. Demonstrated Ability to trade with downstream customers</li></li></ul><li>A Forbes & Manhattan Group Company<br />22<br />Forbes & Manhattan<br />A Private Merchant Bank<br />Dacha Strategic Metals Inc.<br />Management Team<br />Scott Moore<br />President and CEO<br />Alastair Neill<br />Executive VP<br />Brad Boland<br />CFO<br />Board of Directors<br />Scott Moore<br />Alastair Neill<br />Jean-Guy <br />Lambert<br />Claude <br />Blanchet<br />Stan Bharti<br />George Faught<br />Gen. Ron Hite<br />Strategic Metal Advisory Board<br />Alastair Neill<br />Dr. Allen Alper<br />Don Bubar<br />
  51. 51. TSX:DSM OTCQX:DHCAF<br />China Office<br />11th Floor, Kerry Centre<br />North Tower<br />1 Guanghua Rd<br />Beijing, China<br />1000020<br />G. Scott Moore<br />President and CEO<br />Tel: 416-861-5903<br />smoore@dachametals.com<br />Toronto Office<br />65 Queen St west, Suite 800<br />Toronto, Ontario<br />M5h 2M5<br />

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