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7th Annual Mining NSW Conference
Taronga Tin Project – An Update
Peter Williams
Chief Executive Officer
26 June 2013
2.
Disclaimers
Forward Looking Statements
Whilst based on information from sources considered reliable by the Board, AusNi...
3.
The Taronga Tin Project is an Exciting Greenfields Development
Tin is predicted to out-perform other metals
− Market an...
4.
The Taronga Tin Project is located in a highly prospective area
Emmaville
• Mining activities since 1870’s
• Historic p...
5.
Tin’s everyday applications
Solder
52%
Tinplate
16%
Chemicals
15%
Brass &
Bronze
5%
Glass
2%
Others
10%
Distribution of...
6.
Tin price has performed strongly and forecast to appreciate
• Tin price increased 22% in 2012, largely on back of reduc...
7.Source: Minsur
Shortage to be compounded with the closure of a major mine
• San Rafael mine in Peru (9% of global mine p...
8.
0
50
100
150
200
250
300
ktcontainedtin
Global Undeveloped Hard Rock Tin Resources
Underground resources
Open Cut resou...
9.
… and Taronga well placed with a PFS previously completed
• Newmont led JV completed a pre-feasibility study in 1982
• ...
10.
Low strip ratio reduces mining costs
• Proposed open cut to a depth of 150m to 200m, early years mining a small ridge
...
11.
Centrifugal force
separates heavier
cassiterite from lighter
host rock
ROM
Tonnage (Mtpa) 3.7
Grade (%Sn) 0.21
Sn Dist...
12.
Simple mineralogy allows for conventional processing
Example of coarse cassiterite and
higher grade intercept (DG367)
...
13.
2013 2014 2015 2016 2017
Pre-feasibility Study
Bankable Feasibility Study
Project Finance / Funding Arrangement
Constr...
14.
Specific work activities associated with the Updated PFS
PFS Modules Comments
JORC Compliant Resource Leveraging histo...
15.
Recent review of plant CAPEX & OPEX confirms economics
• Independent re-costing of plant CAPEX & OPEX
• Predicted oper...
16.
Areas for potential PFS enhancement
Newmont PFS Updated PFS
Mine Schedule Two opens pits operating
concurrently
Earlie...
17.
Copper & Silver credits could enhance economics significantly
1 Refer ASX announcement 20th May 2013
2 Tin Equivalent ...
18.
Huge potential upside at McDonalds – 2.3km strike of mineralisation
Increased gravity
results indicated
possible areas...
19.
Focussed program and clear path for developing the Taronga Tin Project
Taronga Development Program - 2013
Progress pre...
20.
Appendix 1- Disclaimer for Historical Estimate
Pursuant to ASX Listing Rule 5.12, the following is applicable to repor...
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Peter Williams, CEO, AusNiCo Limited - Update on the Emmaville Project

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Peter Williams, CEO, AusNiCo Limited delivered the presentation at the 2013 Mining NSW Conference.

The 2013 Mining NSW Conference looked at mine exploration and development opportunities in Central NSW and the Northern Tablelands with a spotlight on capital raising outlook and overseas investment.

For more information about the event, please visit: http://www.informa.com.au/miningnsw13

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Transcript of "Peter Williams, CEO, AusNiCo Limited - Update on the Emmaville Project "

  1. 1. 7th Annual Mining NSW Conference Taronga Tin Project – An Update Peter Williams Chief Executive Officer 26 June 2013
  2. 2. 2. Disclaimers Forward Looking Statements Whilst based on information from sources considered reliable by the Board, AusNiCo Limited (AusNiCo), its directors, employees and consultants do not represent, warrant or guarantee, expressly or impliedly, that the information in this document and presentation is complete or accurate. To the maximum extent permitted by law, AusNiCo Limited disclaims any responsibility to inform any recipient of this document and presentation of any matter that subsequently comes to its notice, which may affect any of the information contained in this document and presentation. Competent Persons Statement The information in this presentation that relates to Exploration Results or Mineral Resources is based on information compiled by Mr Nicholas Mather B.Sc (Hons) Geol., who is a Member of The Australian Institute of Mining and Metallurgy. Mr Mather is employed by Samuel Capital Pty Ltd, which provides certain consultancy services including the provision of Mr Mather as a Director of AusNiCo. Mr Mather has more than five years experience which is relevant to the style of mineralisation and type of deposit being reported and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Minerals Resources and Ore Reserves’ (the JORC Code). This public report is issued with the prior written consent of the Competent Person(s) as to the form and context in which it appears. Historical Resource Estimate The Historical Resource Estimate is based upon work completed in the 1980s. Further details are provided in Appendix 1. The Historical Resource Estimate are not reported in accordance with the JORC Code; a competent person has not done sufficient work to classify the historical estimate as mineral resources or ore reserves in accordance with the JORC Code; and it is uncertain that following evaluation and/or further exploration work that the historical estimate will be reported an mineral resources or ore reserves in accordance with the JORC Code. Further information can be found at http://digsopen.minerals.nsw.gov.au/, Report GS1984/35. Exploration Target The Exploration Target is based on the Historical Resource Estimate of 46.7 million tonnes multiplied by the calculated average copper grade (0.085%Cu) and silver grade (5 g/t Ag) from drill assay data reported from the 1982 Pre-feasibility Study prepared by Newmont Holdings Pty Ltd. However, the potential grades are conceptual and there has been insufficient exploration to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.
  3. 3. 3. The Taronga Tin Project is an Exciting Greenfields Development Tin is predicted to out-perform other metals − Market analysts forecast the decline in mine production with continued moderate growth in consumption will result in an on-going supply deficit. The Taronga Tin Project is a World Class Project − Currently the 11th largest undeveloped hard rock tin project globally − A Historic Pre-feasibility Study (PFS) completed by a major resource company − AusNiCo have identified areas of potential upside Development Schedule − Clear project development program including the completion of an updated PFS in 2013 − Targeted production by the end of 2016
  4. 4. 4. The Taronga Tin Project is located in a highly prospective area Emmaville • Mining activities since 1870’s • Historic production over 89,000t • Over 500 known tin occurrences • Key regional targets include McDonalds and Emerald (within trucking distance of Taronga) Taronga Tin Project • Previous ownership included BHP and Newmont
  5. 5. 5. Tin’s everyday applications Solder 52% Tinplate 16% Chemicals 15% Brass & Bronze 5% Glass 2% Others 10% Distribution of Global Consumption 3 grams 1 gram 5 grams 15 grams Source: ITRI November 2012 Emerging Markets: • Lithium batteries • Fuel catalysts • Stainless steel • Fire retardants
  6. 6. 6. Tin price has performed strongly and forecast to appreciate • Tin price increased 22% in 2012, largely on back of reduced mine production from Indonesia Source: ANZ, Metals Bulletin Forecast
  7. 7. 7.Source: Minsur Shortage to be compounded with the closure of a major mine • San Rafael mine in Peru (9% of global mine production) to close in 2017.
  8. 8. 8. 0 50 100 150 200 250 300 ktcontainedtin Global Undeveloped Hard Rock Tin Resources Underground resources Open Cut resources Open Cut & Underground The race to production….. *Based on a Historical Resource of 47Mt @ 0.145% Sn for approximately 68kt contained tin Data sourced from ITRI and Company Reports Gold equivalent based on US$21,000/t Sn, US$1,450/oz Au; Au(eq) = (Sn%*21,000)/1450 Taronga ranked 11th* Historic Resource of 68kt contained tin equivalent to 985k oz Gold1
  9. 9. 9. … and Taronga well placed with a PFS previously completed • Newmont led JV completed a pre-feasibility study in 1982 • Over five years the JV spent over $7.4M ($21M 2012 terms) • Completed over 33,000m drilling (including over 73% diamond) and 3 adits for bulk samples • Comprehensive metallurgical test work, including 3 pilot plant programs • Complete engineering design & costing Wireframes and drill hole locations prepared from Newmont JV PFS data Northern Zone Hillside Payback 550m Strike 650m Strike Aueq calculated using US$21,000/t Sn, US$1,450/oz Au
  10. 10. 10. Low strip ratio reduces mining costs • Proposed open cut to a depth of 150m to 200m, early years mining a small ridge • Overall Life of Mine Strip ratio of 2:1
  11. 11. 11. Centrifugal force separates heavier cassiterite from lighter host rock ROM Tonnage (Mtpa) 3.7 Grade (%Sn) 0.21 Sn Distribution (%) 100 Rejects (siltstone / hornfels) Tonnage (Mtpa) 2.2 Grade (%Sn) 0.05 Sn Distribution (%) 15 Result ex Newmont PFS – Summary results of [8] tonne Heavy Medium Concentration pilot plant trials Cassiterite enriched Pre- concentrate Tonnage (Mtpa) 1.5 Grade (%Sn) 0.46 Sn Distribution (%) 85 Pre-concentration increases grade and reduces size of plant • Mineralogy allows for cleavage along veins, separating minerals from gangue • Pre-concentration lifts grade to 0.46% Tin at 85% recovery • Effective reduction in concentrator size from 3.7Mtpa to 1.5Mtpa
  12. 12. 12. Simple mineralogy allows for conventional processing Example of coarse cassiterite and higher grade intercept (DG367) 1m @0.73%Sn, 0.48%Cu, 20g/t Ag • Coarse cassiterite (up to 3mm) which is substantially liberated at 1.5mm • Metallurgical benefits of coarse cassiterite − Reduced comminution costs (coarse crush / grind achieves satisfactory liberation) − Higher recoveries (estimated at 70% with capacity to increase)
  13. 13. 13. 2013 2014 2015 2016 2017 Pre-feasibility Study Bankable Feasibility Study Project Finance / Funding Arrangement Construction Commissioning / Operations Baseline Environmental Monitoring Environmental Impact Statement Approval Mining Lease Approved Targeting production by end of 2016
  14. 14. 14. Specific work activities associated with the Updated PFS PFS Modules Comments JORC Compliant Resource Leveraging historic data plus recent QAQC data Mine design / schedule Open cut & production schedule Metallurgical test work Limited confirmatory work to be undertaken Processing Plant Based on 3.7Mtpa (ex Newmont PFS) Infrastructure Site / Off-site infrastructure Environmental Commence baseline monitoring for PFS Community Land Access & Community Consultation Marketing Preliminary off-take terms
  15. 15. 15. Recent review of plant CAPEX & OPEX confirms economics • Independent re-costing of plant CAPEX & OPEX • Predicted operating cash flow of $13.08/tonne over 12 to 13 year LOM • No inclusion for potential metal by-product credits, increased LOM or increased tin recovery Refer ASX announcement 27/3/13 for more details - 5 10 15 20 25 30 35 40 45 50 Value(A$/tonneROM) Taronga Tin Project - Unit Analysis
  16. 16. 16. Areas for potential PFS enhancement Newmont PFS Updated PFS Mine Schedule Two opens pits operating concurrently Earlier Schedule of Higher Grade Southern Zones Plant Location North of open pits South of open pits Tin Production Significant fines losses Centrifugal concentrators Copper / Silver Production Nil provision Conceptual Inclusion Tailings disposal Filtered concentrator tailings Un-filtered concentrator tailings Management of PAF Material Nil provision Encapsulated disposal Water Management Dam constructed at site Utilisation of water local dams
  17. 17. 17. Copper & Silver credits could enhance economics significantly 1 Refer ASX announcement 20th May 2013 2 Tin Equivalent calculated using US$21,000/t Sn, US$7400/t Cu, US$24/oz Ag Sn(eq) = (Sn%/100*21000)+(Cu%/100*7400)+(Agg/t/31.104*24))/21000 and is based on results from PFS pilot trials for pre-concentration Vein of Chalcopyrite Section of diamond drill hole DG 387 1m @ 0.23%Sn, 0.35%Cu, 17g/t Ag • Results from initial metallurgical test work include copper and silver flotation recoveries to concentrate of 68.2% and 51.2% respectively1 • Exploration target of 40kt copper and 7.5Moz silver based on extensive drill assay data1 • Inclusion of copper & silver list grade to is equivalent of lifting concentrator feed grade to 0.57% Tin Equivalent2
  18. 18. 18. Huge potential upside at McDonalds – 2.3km strike of mineralisation Increased gravity results indicated possible areas of high disseminated sulphides Increased chargeability / lower resistivity indicates areas of alteration & sulphides Elevated geochemistry results McDonalds Induced Polarisation Survey (80m blow surface) McDonalds Soil GeochemistryMcDonalds Airborne Gravity • Historic production dating back to late 1800’s, limited shallow shafts and pits • Considerable work completed by Electrolytic Zinc in mid 1980’s • Modern geophysical and geochemical surveys completed by AusNiCo (Taronga Mines) confirm extent of mineralisation
  19. 19. 19. Focussed program and clear path for developing the Taronga Tin Project Taronga Development Program - 2013 Progress pre-feasibility study, including i. Completion of a JORC compliant resource ii. Updated production profile based on 3.7Mtpa iii. Updated CAPEX / OPEX ±25% iv. Finalise location of plant & infrastructure v. Metallurgical test work to evaluate copper & silver recovery & tin recovery Commence baseline monitoring for Environmental Impact Statement (2014) Pre-Feasibility Study Bankable Feasibility Study Construction / Commissioning 2013 2014 2015 / 2016 Proposed Taronga Development Program
  20. 20. 20. Appendix 1- Disclaimer for Historical Estimate Pursuant to ASX Listing Rule 5.12, the following is applicable to reports of historical estimates of mineralisation for material mining projects included in this presentation The historical estimate is sourced from the relinquishment report submitted on behalf of the Taronga Joint Venture in October 1984. Further details can be found at http://digsopen.minerals.nsw.gov.au/, Report GS1984/35 The historical estimate did not categorise the mineralisation The Company considers the historical estimate to be substantially material. Consultants for Taronga have previously considered the criteria in Appendix 5A of the JORC Code and concluded that whilst many of the parameters associated with mining have changed from 1982 to 2012, the intrinsic assessment strategies of the historic resource estimate per se are generally similar and are transparent and well documented. The historical estimate is based upon (i) 33,350m of percussion and diamond drilling; (ii) sampling practices in accordance with Pieree Gy’s “Particulate Sampling Procedures”; (iii) three adits for bulk samples; (iv) geostatistical ore reserve estimation using inverse distance methodology; and (v) a 0.083% “break even” cut-off grade. No recent resources estimates have been completed Prior to completion of AusNiCo’s merger with Taronga, consultants for Taronga have undertaken an assessment of the historical estimate and recommended an infill and twinning drilling program to verify the historical estimate in accordance with the JORC Code. AusNiCo Limited intend, subject to a satisfactory capital raising, to complete the above program during 2013. The Historical Resource Estimate are not reported in accordance with the JORC Code; a competent person has not done sufficient work to classify the historical estimate as mineral resources or ore reserves in accordance with the JORC Code; and it is uncertain that following evaluation and/or further exploration work that the historical estimate will be reported an mineral resources or ore reserves in accordance with the JORC Code. Historical Resource Estimate is based upon work completed in the 1980s. Further details are provided in Appendix 1. The Historical Resource Estimate are not reported in accordance with the JORC Code; a competent person has not done sufficient work to classify the historical estimate as mineral resources or ore reserves in accordance with the JORC Code; and it is uncertain that following evaluation and/or further exploration work that the historical estimate will be reported an mineral resources or ore reserves in accordance with the JORC Code. Further information can be found at http://digsopen.minerals.nsw.gov.au/, Report GS1984/35 The information in this presentation that relates to Exploration Results or Mineral Resources is based on information compiled by Mr Nicholas Mather B.Sc (Hons) Geol., who is a Member of The Australian Institute of Mining and Metallurgy. Mr Mather is employed by Samuel Capital Pty Ltd, which provides certain consultancy services including the provision of Mr Mather as a Director of AusNiCo. Mr Mather has more than five years experience which is relevant to the style of mineralisation and type of deposit being reported and to the activity, which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Minerals Resources and Ore Reserves’ (the JORC Code). This public report is issued with the prior written consent of the Competent Person(s) as to the form and context in which it appears.
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