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Iron Ore Mine for Investment - LATAM - Privileged Mine location


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Our group is oriented to the international advising for businesses and projects into America & European regions as well as International trade agents that primarily work with various products, our main markets are LATAM, Asia and Europe.

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Iron Ore Mine for Investment - LATAM - Privileged Mine location

  1. 1. July 2013 Building a South American Iron Major
  2. 2. South American Iron Inc. Disclaimer This presentation was created for discussion purposes only. Materials and data discussed in this presentation may constitute forward-looking statements. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events revenues or performance, and underlying assumptions and other statements, which are other than statements of historical facts. The words “believe,” “expect,” “anticipate,” “intends,” “estimate,” “forecast,” “predict”, “could”, plan”, “project,” “will,” “may,” “should” and similar expressions identify forward-looking statements. Forward-looking statements include statements regarding: strategies, outlook and growth prospects; future plans and potential for future growth; liquidity, capital resources and capital expenditures, financing needs, plans or intentions relating to acquisitions, our competitive strengths and weaknesses, growth in demand for our products; economic outlook and industry trends; developments of our markets; legal trends and the impact of regulatory initiatives; and the strength of our competitors. The forward-looking statements in this presentation are based upon various assumptions, many of which are based, in turn, upon further assumptions, including without limitation, management's examination of historical operating trends, data contained in our records and other data available from third parties. Although we believe that these assumptions were reasonable when made, these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond our control and we may not achieve or accomplish these expectations, beliefs or projections. In addition, important factors that, in our view, could cause actual results to differ materially from those discussed in the forward-looking statements include the achievement of the anticipated levels of revenues, profitability and growth, costs, the impact of competition and competitive pricing, the ability to obtain necessary regulatory approvals and the ability to fund our future operations and capital needs through borrowing or otherwise, the ability to successfully implement any of our business strategies, the ability to integrate our business and to realize anticipated cost savings and operational benefits from such integration, our expectations about growth in demand for our products, the effects of inflation, interest rate and exchange rate fluctuations, and our success in identifying other risk to our business and managing the risk of the aforementioned factors, the condition of the economy and political stability in Russia and the other markets of operations and the impact of general business and global economic conditions. Neither we, nor any of our respective agents, employees or advisors intend or have any duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained in this presentation. The information and opinions contained in this presentation are provided as at the date of this presentation and are subject to change without notice.
  3. 3. South American Iron Inc. Company Profile A Compelling Iron Ore Development Opportunity Canadian Company: • Canadian-registered, privately held mining exploration company to develop South American iron ore assets. Potential to be one of the World’s largest deposits: • Controls la Doblada (Bolivia) iron ore license located on a major iron ore belt. • License area covers 4500 hectares. • Previous work shows massive ore body with up to 24 Billion ton potential. • Grab samples contain up to 65% Fe. Exceptional Infrastructure to access seaborne trade: • About 5km from railway. • Direct rail transport to river port. • Access to international markets and China . • Available electricity in immediate vicinity. Quick cash flow potential: • Permission to exploit up to 50,000 t/m from known outcrops. Experienced management team with proven track record.
  4. 4. South American Iron Inc. Investment Highlights Infrastructure Cost Advantage  Access to existing transport, power & water infrastructure  Reduced capex 3 Transport Advantage  Close to railroad and Paraguay river  Option to supply local demand and China 2 Advantageous Location  Located in known iron ore region  Proximity to worlds largest iron ore deposit, el Mutun 1 Quality Assets  Covers an area of 4500 hectares  Top samples show up to 65% Fe 4 Experienced Management  Well-connected and experienced management 5 Significant Resource Potential  Drilling expected to prove up a significant iron ore deposit 6
  5. 5. South American Iron Inc. Management & Advisory Team Gustavo Granier, Chief Executive Officer (GAP) Partner, 25 years of Executive and management experience mainly in natural resources and logistics. Currently serves as CEO of GAP. Previous roles include development and partner roles include Zinc/Silver company Royal Silver; FOSMIN, dedicated to the industrialization of fertilizers through a large phosphate rock deposit, both in Bolivia. Holds an MBA from Universidad Camilo Jose Cela, Spain. Member of the Mining Chamber of Commerce of Cochabamba, Bolivia. Michael Hellenbrand, Executive Chairman Founder, 20 years’ experience as an entrepreneur in Canada, FSU and emerging markets. Founded South American Iron to build into a major LATAM iron ore company. Founder and Executive Chairman of First Iron Group with significant iron ore assets in the Russian Federation. Previously Chief Executive Officer of First Iron, responsible for First Iron’s asset acquisition strategy, execution, fund raising, development and growth. Member of the Advisory Council of the American-Russian Business Institute. Luis O. Benavente, Financing/Budget Advisor Partner, 15 years experience with Fortune 100 companies mainly in the mining field, 7 years as financial advisor to Government and Industry. Previously Business Manager Planning & Control Latin America, Placer Dome Mining Co; Financial Planning & Capital Expenditure Supervisor, all Country budgeting for General Motors Chile; Financial Controller, Candelaria Copper, Phelps Dodge Inc.; Internal Auditor, Shell Forestry/Energy Group. CPA from the University of Chile, MBA from Escuela de Negocios MBA Business School, Spain. Jose Antonio Pimentel Castillo, Political Advisor Director of Bolivian state miner COMIBOL. Previously Government positions include: Minister of Mining and Metallurgy until 2012; Chief of the Bolivian Government Administration; National Deputy for the Potosi Region Bolivia; President of the mining Commission for the negotiation of the Trade Union force; and Chairman of the Committee for Economic Development. Author of many political publications. Professor of Economics and Socio-Politics. Political Science Degree from the University of San Simon, Cochabamba. Carlos Cardozo, Technical Advisor Mining engineer with over 50 year experience. Led technical work on la Doblada which showed potential resources of 24 billion tones. Currently Technical Director for el Mutun mine, Bolivia. Previous senior management positions at Bolivian state mining companies COMIBOL and Corocoro, President of Kanakar Technologies. Expert on the Mutun iron ore belt. Holds several patents in sponge iron processing technology. Author of numerous mining publications. Industrial Engineering degree from University Mayor de San Andres, Bolivia and Chemical Metallurgy Degree from University of Latin American Tokyo, Japan. Erika Medina Huaina, Environmental Advisor 16 years experience in Environmental Management in Bolivia. Legal/Environmental advisor for Medina Consultants SRL with focus on Mining and Metallurgical, Hydrocarbons, Natural Gas, Water and the use of Water Resources. She is a graduate of Business Administration from the Catholic University of Santa Maria in Arequipa Peru.
  6. 6. South American Iron Inc. La Doblada Clearly visible massive iron ore outcrops La Doblada covers an area of 4500 hectares located in a well known iron ore region of Chiquitos, in Bolivia. The License does not have an expiration date as long as Government fees are made on a yearly basis. Current studies show a massive iron ore body with potential be one of the world’s largest iron ore deposit containing as much as 24 billion tones. Massive iron ore outcrops clearly visible to the naked eye. On same trend 250km from el Mutun, world’s largest iron ore deposit with estimated reserves of 40 billion tons @ 50% Fe. Commissioned Snowden to perform technical review & analysis , who confirmed visible outcrops, significant potential and further work is well warranted. Relief of the region is mostly flat, with an average height of 296 meters. Clearly visible massive iron ore outcrops Top: Aerial view of la Doblada, Snowden. Below: Aerial view of la Doblada, GAP.
  7. 7. South American Iron Inc. La Doblada cont. Satellite prospection and Geophysical Modeling views of la Doblada Massive Ore Body discovered: • Prospected by Geophysical Consultancy Group using High Frequency technology including Satellite prospection and Geophysical Modeling. • Discovered massive hematite iron ore body, on surface. Potential for one of the World’s largest iron ore deposits: • Potential reserves of 24 Billion Tones. • License area covers 4500 hectares comprising 180 square grids of 25 ha (500m x 500m) each. • Grids are contiguous and form a single block Next Development steps: Phase I: • Geological mapping together with associated outcrop sampling campaign. • Will provide foundation for a subsequent 43-101 compliant exploration drilling program/Scoping study. Phase II: • Pre-feasibility & feasibility study with intent to fast-track to commercial production.
  8. 8. South American Iron Inc. Sample Results Outcrops during site Visit (Snowden) Samples taken during site visit (Snowden) Lab result from la Doblada confirming 64.89 % Fe (GAP) ~ 30 cm Large visual iron ore outcrops on surface. Historical samples confirm iron content of 56-65% Fe. Lab results of limited samples taken by Snowden during site visit confirm iron ore content of 26-56% Fe. Phase I to embark on comprehensive program to lay foundation to fast track through PFS & FS.
  9. 9. South American Iron Inc. Logistics Cost Source AME Research – Iron Ore Summary from 72 mines, 22 pellet plants, 13 countries Logistics – Major cost Impact of bulk commodities Well-established Infrastructure means: Lower construction cost. Major overall capex savings. Less permitting required. No land access issues. Significantly lower risk. Shorter construction time. Faster time to production
  10. 10. South American Iron Inc. Exceptional Infrastructure Power - 6kms Photos of infrastructure taken by Snowden. Electricity is available in the local villages of ‘Santiago de Chiquitos’ and ‘Águas Calientes’, with power lines located some 6 km away from the Concession. Also the Gas Pipeline from Santa Cruz-Puerto Suarez passes about 15 km away from la Doblada. Highway is about 7 km away from la Doblada runs more or less parallel to the railroad and also connects La Doblada with Puerto Suarez at the Paraguay River. Railroad about 5 Km away at the town of Águas Calientes, connects La Doblada with Puerto Suarez for 230 km at the Paraguay River (Bolivia/Brazil border) with existing infrastructure for storage and shipment of commodities including iron ore. The Paraguay River is a well established and main transport route for commodities, including iron ore among other materials to Brazil, Paraguay, Argentina and Uruguay via Paraguay-Parana River Complex, and then on to intercontinental destinations via the Atlantic Ocean.
  11. 11. South American Iron Inc. River Ports in Bolivia Railroad at the town of Águas Calientes, connects La Doblada with Puerto Suarez/Puerto Aguirre at a distance of 230 km right at the Paraguay River on the Bolivian-Brazil border with existing infrastructure for storage and shipment of commodities including iron ore. Red arrows show transport route.
  12. 12. South American Iron Inc. Loading & Barge Convoys Barge convoys are made up of 25-30 barges depending on river conditions. Old style barges transport 1,500 tones each (37,500-45,000 tones/convoy). New style barges transport 2,600 tones each (65,000-78,000 tones/convoy). Vale and MMX, both operating in the Corumba‐Urucumiron ore fields in Brazil across from Puerto Suarez, are currently shipping more than 8million tonnes of iron ore annually utilizing barge tug convoys on the Hidrovia.
  13. 13. South American Iron Inc. Link to the Atlantic Ocean Access to the seaborne trade: La Doblada has superb, well established infrastructure access. 230kms by rail to Port Suarez (Bolivia) an important inland river port in the Santa Cruz Department of Bolivia located 10 km west of the border with Brazil . 2783kms (20 days) by river barges via the Paraguay river, a highly important shipping and trade corridor, to the Atlantic Ocean near Buenos Aires, Argentina and Montevideo, Uruguay. River Transport route shown in red and Ocean in yellow arrows Paraguay River transport is a known and tested transport route used by Majors such as Vale to transport bulk commodities including iron ore.
  14. 14. South American Iron Inc. Seaborne Trade …and onward delivery to customers in India, China, Japan, Europe...
  15. 15. South American Iron Inc. Global Demand Global Iron Ore Demand – Driven by China Forecasted global iron ore demand by 2015 is 2.1 billion tonnes/year. More than half entire demand from China
  16. 16. South American Iron Inc. Peer Group Analysis Global Iron Ore Company Comparisons Iron ore Company Country Shares o/s Price Mkt Cap EV Ownership Resource Grade Resource EV/Resource Key Operations Ticker m Local CCY US$m US$m % Mt Fe % Fe Mt US$/t Explorers/developers Australasian Resources Australia ARH AU 442.5 0.32 146 146 100% 1,605 33% 527 0.28 Brockman Resources Australia BRM AU 144.8 5.63 855 766 100% 1,630 43% 707 1.08 Centrex Metals Australia CXM AU 310.3 0.39 125 110 100% 257 31% 79 1.40 Dynasty Metals Australia DMA AU 90.9 0.19 18 15 100% 932 27% 255 0.06 Emergent Resources Australia EMG AU 68.7 0.25 18 17 50% 281 28% 77 0.22 FerrAus Australia FRS AU 249.4 0.75 196 165 100% 329 57% 186 0.89 Flinders Mines Australia FMS AU 1820.6 0.18 334 277 100% 748 55% 414 0.67 Golden West Resources Australia GWR AU 192.1 0.69 139 129 100% 148 59% 87 1.48 Iron Ore Holdings Australia IOH AU 163.3 1.76 301 283 100% 647 57% 372 0.76 Iron Road Australia IRD AU 114.7 1.02 123 119 100% 1,235 17% 208 0.57 Pluton Resources Australia PLV AU 181.7 0.90 171 163 100% 452 26% 119 1.36 Red Hill Iron Australia RHI AU 43.9 2.40 110 106 40% 169 57% 96 1.11 WPG Resources Australia WPG AU 247.3 0.76 197 181 100% 569 35% 202 0.90 Australia explorer/developer average 3,460 1.02 Strike Resources Peru SRK AU 133.5 0.36 50 6 44% 119 57% 68 0.09 Northland Resources Sweden, Finland NAUR NO 225.2 17.70 733 723 100% 459 31% 143 5.04 Afferro Mining Liberia, Cameroon AFF LN 86.3 183.50 257 262 57% 1,953 34% 667 0.39 African Iron Republic of Congo AKI AU 479.5 0.29 143 91 95% 31 56% 18 5.17 African Minerals Sierra Leone AMI LN 327.6 495.25 2,639 2,514 75% 9,594 31% 3,022 0.83 Avonlea Minerals Namibia AVZ AU 83.4 0.18 16 14 95% 495 24% 119 0.12 Baobab Resources Mozambique BAO LN 175.8 44.00 126 124 90% 43 25% 11 11.60 Bellzone Mining Guinea BZM LN 721.3 67.25 789 739 100% 3,740 23% 858 0.86 London Mining S. Leone, S. Arabia LOND LN 113.8 392.50 726 521 87% 1,997 34% 687 0.76 Sundance Resources Cameroon SDL AU 2718.7 0.46 1,311 1,231 92% 2,514 42% 1,052 1.17 Zanaga Iron Ore Republic of Congo ZIOC LN 280.4 160.00 730 730 50% 2,010 34% 680 1.07 Ex-Australia Expl./Dev. Average 7,519 2.46 Global Explorer/Developer Average 10,979 1.74 April 2011 Source: Bloomberg, GMP estimates, Company data. N – no blocking stake
  17. 17. South American Iron Inc. Valuation Scenarios Valuation Scenarios based on Peer Group and Contained Iron Scenarios Resource Size Contained Fe Company Valuation US $ million % Proven Mt @ 50% Fe Fe Mt @ $0.25/t @ $0.50/t @ $0.75/t @ $1.00/t @ $1.74/t @ $2.46/t 20 4,800 2,400 600 1,200 1,800 2,400 4,176 5,904 25 6,000 3,000 750 1,500 2,250 3,000 5,220 7,380 30 7,200 3,600 900 1,800 2,700 3,600 6,264 8,858 35 8,400 4,200 1,050 2,100 3,150 4,200 7,308 10,332 40 9,600 4,800 1,200 2,400 3,600 4,800 8,352 11,808 50 12,000 6,000 1,500 3,000 4,500 6,000 10,440 14,760 Mining activity and iron ore stockpiles at el Mutun, 250 km from la Doblada .
  18. 18. South American Iron Inc. Development Plan 2013 2014 2015 2016 2017 2018 2019 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 H1 H2 Financing Scoping Study Pre-Feasibility Study Feasibility Study Construction Development US$million Scoping Study 3 Pre-Feasibility 5 Deposit 2 Feasibility Study 7 Working Capital 2 Contingency 1 Total 20
  19. 19. South American Iron South American Iron Inc. 1 First Canadian Place 1600-100 King Street West Toronto, Ontario Canada M5X 1G5 Michael Hellenbrand Executive Chairman