Presentation may

756 views

Published on

Published in: Business, Technology
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
756
On SlideShare
0
From Embeds
0
Number of Embeds
478
Actions
Shares
0
Downloads
5
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

Presentation may

  1. 1. Premium Potash andBauxite Project Drivenby a ProvenManagement TeamTSX  :  PRK  
  2. 2. FORWARD LOOKING STATEMENTS2Certain statements in this presentation may constitute "forward-looking" statements which involveknown and unknown risks, uncertainties and other factors which may cause the actual results,performance or achievements of Potash Ridge Corporation (the "Corporation"), or industry results, tobe materially different from any future results, performance or achievements expressed or implied bysuch forward-looking statements. When used in this presentation, such statements use such wordsas "may", "would", "could", "will", "intend", "expect", "believe", "plan", "anticipate", "estimate" and othersimilar terminology. These statements reflect the Corporations current expectations regarding futureevents and operating performance and speak only as of the date of this presentation. Forward-lookingstatements involve significant risks and uncertainties, which include, but are not limited to the factorsdiscussed under “A Cautionary Note Regarding Forward Looking Statements” and "Risk Factors" inthe final prospectus of the Corporation dated November 27, 2012, and should not be read asguarantees of future performance or results, and will not necessarily be accurate indications ofwhether or not such results will be achieved. Although the forward-looking statements contained inthis presentation are based upon what management of the Corporation believes are reasonableassumptions, the Corporation cannot assure investors that actual results will be consistent with theseforward-looking statements. These forward-looking statements are made as of the date of thispresentation and are expressly qualified in their entirety by this cautionary statement. Subject toapplicable securities laws, the Corporation assumes no obligation to update or revise them to reflectnew events or circumstances.
  3. 3. A potash company focused on itsBlawn Mountain property in Utah3SOP: 680,000 tonnes per annumBauxite material: 3.3 million tonnesper annum
  4. 4. EXPERIENCED AND PROVEN MANAGEMENTOVER 80 YEARS COMBINED EXPERIENCEGuy Bentinck President & CEOChartered Accountant;20 years mining/resource experienceSherritt: CFO and SVP Capital ProjectsRoss Phillips Chief Operating Officer10 years experience in large resource andenergy sector projectsSherritt, Capital Power  Jeff Hillis Chief Financial OfficerChartered Accountant;10 years mining sector finance, including CFOof several public mining companiesIberian Minerals, Excellon, Falconbridge  Paul Hampton VP, ProjectManagementGeologist and Metallurgical Engineer;~30 years experience in design, construction,start-up and management of mineral processingfacilitiesSNC, Washington Group, Outotec4Laura Nelson VP, Government andRegulatory AffairsExtensive experience in government relations,permitting and power planning, including thesuccessful permitting of the Red Leaf oil shaleprojectRed Leaf Resources, Utah Government  
  5. 5. COMPETITIVE ADVANTAGESLarge mineral deposit containing premium-quality potash and bauxite materialStrategically located in a mining friendly jurisdiction with established infrastructure nearbyState-owned land allows for an efficient permitting processHistorical work expedites project developmentLower risk surface mining deposit; expected lowest cost producer30 year mine life, with upside potentialPEA completed: $1.3 billion NPV at 10%; 21.3% after tax IRR; excludes bauxite material revenue5
  6. 6. POTASH OVERVIEW6
  7. 7. No known substituteIncreasing world populationGrowing per capita incomeDecreasing arable landIncreasing use of biofuels~5% EXPECTED ANNUAL GROWTH IN DEMAND TO 2016POTASH:ESSENTIAL TO THE WORLD’S FOOD SUPPLY7
  8. 8. AVERAGE 47% PRICE PREMIUM OVER MOP3SULPHATE OF POTASH (SOP) IS A PREMIUM PRODUCTSulphate of Potash (SOP) Muriate of Potash (MOP)Potassium Sulphate (K2SO4) Potassium Chloride (KCl)6 million tonnes sold in 20111 55.8 million tonnes sold in 20112Potassium and sulphur are essential nutrients2 Crop quality/yield diminish as chloride builds up2Improves yield, quality, taste and enhances shelf life21Source: Fertecon 2Source: CRU 3Based on historical data8
  9. 9. USES OF SOPFruitsVegetablesNutsHorticultural PlantsTobaccoTeaDry soilsSalty soil9
  10. 10. HISTORICAL PRICE PREMIUM FOR SOP HAS RANGEDBETWEEN 30% AND 61%SOP PREMIUM PRICE TRENDS1SOP, standard grade cif NW Europe (Source: Fertilizer Week)2MOP, all grades, fob Vancouver/Portland (Source: CRU)U.S. $/tonneSOP1MOP2100  100  200  300  400  500  600  700  800  900  2006   2007   2008   2009   2010   2011   2012   2013  
  11. 11. SOP MARKET CHARACTERISTICS1Source: Fertecon, CRU11Global SOP Consumption and Commodity Price1  $0$100$200$300$400$500$600$700$800$900$1,00002,0004,0006,0008,00010,00012,0002000 2004 2008 2012 2016 2020(US$/tonne)Tonnes(000s)Global SOP ConsumptionHistorical Standard FOB NW Europe (US$/tonne SOP)Estimated Standard FOB NW Europe (US$/tonne SOP)Europe23.3%N. America8.6%China44.3%Rest ofthe World14.9%Africa4.6%Central andSouth America4.3%
  12. 12. SIGNIFICANT GROWTH POTENTIALSOP MARKET DYNAMICSLimited production and premiumprice has restricted demandSOP share of potash market:Current: ~10%Potential: >28%1Trend toward highnutrient fertilizersPotential to use SOP in typical cereal crop fertilizer blendsinstead of ammonium sulphateIndiaSOP consumption:China (pop. 1.3 billion): 1.9 million tpyIndia: (pop. 1.2 billion) 50,000 tpy (<1% of country’s potashconsumption)BrazilSOP consumption = 32,000 tpy (0.4% of total potashconsumption)Premium crops grown on 20% of planted land121Based on crops that are best suited for SOP
  13. 13. BAUXITE MATERIAL OVERVIEW13
  14. 14. Bauxite  material  suitable  for  a  Bayer  Process  •  Non-­‐tradiGonal  high-­‐grade  alumina  (51%)  resource  •  Low  iron  /  Gtanium  concentraGons  compared  to  a  tradiGonal  bauxite  •  Avoids  the  producGon  of  bauxite  residue  “red  mud”  waste    •  No  idenGfied  heavy  metals  •  Favorable  access  to  markets  via  exisGng  rail  and  port  infrastructure  14  HIGH GRADE BAUXITE MATERIAL BY-PRODUCTPotash  Ridge  bauxite  material:  •  THA  =  50.9  %    (Tri  -­‐hydrate  Alumina)  •  Quartz  =  20.6  %  (Form  of  Silica)  •  Fe2O3  =  2.58  %  (Ferrous  Oxide  <Iron>)  •  TiO2  =  1.42  %  (Titanium  Oxide)  •  P2O5  =  0.59  %  (Phosphorous  Pent-­‐oxide)  Typical  bauxite:  •  THA  =  41.66  %    (Tri  -­‐hydrate  Alumina)  •  Total  SiO2  =  7.32%  (Total  Silica)  •  Quartz  =  1.86  %  (Form  of  Silica)  •  Fe2O3  =  5.98  %  (Ferrous  Oxide  <Iron>)  •  TiO2  =  2.43  %  (Titanium  Oxide)  •  P2O5  =  0.06  %  (Phosphorous  Pent-­‐oxide)  •  TOC  =  0.19%  (Total  Organic  Carbon)  
  15. 15. GOOD TIMING FOR NEW BAUXITE15  Source:  CRU  Analysis,  Bauxite  and  Alumina  Market  Outlook,  2011      Alumina demand forecasted to rise by 6.6% per year over the next five years•  Australian infrastructure constraints•  Restrictions on Indonesian bauxite exports (2014) as the government looks to develop adomestic processing industry•  Few new politically secure regions of the world for new sources of bauxiteChinese demand growth Indian demand growthGrowing Chinese alumina refining capacity hasresulted in significant increase in bauxite demandAlumina demand in India is forecast to more thandouble to 8.5 million tonnes by 2016 from 3.8million tonnes in 2010By 2016 China is expected to account for around43% of global alumina refining capacity in 2010China imported 76% of its 30 million tonnes ofbauxite imports from IndonesiaDomestic bauxite production is expected to growbut projects have proved difficult to progress dueto local obstacles, post 2014 several projects areexpected to rely on imported bauxite
  16. 16. 16  TRANSPORTATION ADVANTAGE VS OTHERBAUXITE SOURCES TO CHINABlawnMountain,UtahBoke,GuineaTrombetas,BrazilKingston,JamaicaShipping distance to Shandong Province, China (nm) 5,744 11,128 10,815 9,051Average alumina grade 51% 40 – 60% 50 – 60% 45%Port Long Beach Conakry Aratu JamaicaBauxite  grade  comparisons:  Gove  /  Weipa,  Australia  ~50%  alumina  and  Indonesian  bauxite  ~40%  alumina  Qingdao  Los  Angeles  Jamaica  Aratu  Conakry  BLAWN  MOUNTAIN  
  17. 17. THE BLAWN MOUNTAIN PROJECT17
  18. 18. ANTICIPATED PRODUCTION BY 2016PROJECT OVERVIEW18Large alunite deposit, which is expected to beprocessed into SOP, by-product bauxite material andsulphuric acidTarget 680,000 SOP tonnes and 3.3 million bauxitematerial tonnes per year; start up by 2H-2016Historical work expedites project developmentMineral deposit to be surface minedProven process
  19. 19. ALMOST 100 YEARS OF POTASH PRODUCTIONUTAH: AN ATTRACTIVEMINING JURISDICTION1Forbes Magazine, November, 2011 2Fraser Institute, February, 2012Major resource producerExisting potash productionBest state for business1Top quartile mining jurisdiction219
  20. 20. OUR LAND ADVANTAGEState-owned landSimpler permitting processLeasehold and royalty agreements negotiatedNo known adverse environmental, socialor aboriginal issuesSufficient water nearby – rights application made20MUNICIPAL AND STATE SUPPORT OF PROJECT
  21. 21. ESTABLISHED INFRASTRUCTURE NEARBYRoads, rail and naturalgasConstruction materialsand equipment suppliersnearbySkilled labour forceAccess to ports of LosAngeles (530 miles) andHouston (1,550 miles)21
  22. 22. SOP AND ALUMINA HOSTED IN ALUNITE(K2SO4 ⋅ Al2(SO4)3 ⋅ 2Al2O3 ⋅ 6H2O)Volcanic rock mined for over 500 yearsContains alumina (Al2O3), potassium (K2O), and sulphur(SO3)Historic source of SOP and alumina in U.S. and AustraliaLong-term (30+ years) SOP and alumina production inAzerbaijan22
  23. 23. PREVIOUS WORK ACCELERATES PROJECT DEVELOPMENTEXTENSIVE DEVELOPMENT ON BLAWNMOUNTAIN COMPLETED IN 1970’s23Approx. $25 million spent(~ $100 million in today’s dollars)DrillingResource estimateFeasibility studyMine planEngineeringPermittingPilot plant: 3-year operationprocessing 11 tonnes/day•  Project ultimately shelved due to poor economic conditions in early 1980s•  Potash Ridge owns all historical data
  24. 24. SIMPLE PROVEN FLOWSHEETPotash Ridge expects the processing plant to produce:•  680,000 tonnes of SOP per annum•  3.3 million tonnes per annum of 51% alumina content bauxite material•  1.6 million tonnes of concentrated sulphuric acid per annumAluniteBeneficiationCalcinationWater Leach51% aluminacontent bauxitematerialPotash SulphateSolutionCrystalizerCompaction DryingPotash SulphateSO2 Acid Plant Sulphuric Acid24Flowsheet mirrorshistorical productionprocessesRECENT TEST WORK CONFIRMS FLOWSHEET•  Pilot scale test work scheduled to start end- April;•  Objective of pilot scale test work is process optimization•  Except to be completed pilot plant testing by end of 2013
  25. 25. HISTORIC DRILLING25320 holes drilledin 1970’s
  26. 26. NI 43-101 CONFIRMATION DRILLING26Phase 1Area 1 – 34 holes (19 core; 15 RC)Phase 2Area 1 – 38 holes (12 core; 26 RC)Area 2 – 50 holes (6 core; 44 RC)Phase 3Area 1 – 2 RC holesArea 2 – 16 RC holes140 drill holes completed  
  27. 27. Initial Mine Plan for 30 Years using NI 43-101 Compliant M&IResources  SIGNIFICANT RESOURCE IDENTIFIED1 Contained within alunite2 Using 1.00% cut-off grade3 The historic resources are not NI 43-101 compliant although reasonable methodologies were applied at the time. A qualified person has notdone sufficient work to classify, and the Corporation is not treating the estimates as current mineral resources or mineral reserves.4AreaMeasured + Indicated InferredResourcetons (000s)Alunite gradeSOP tons(000s)SOPResourcetons (000s)Alunite gradeSOP tons(000s)SOPgrade1grade1NI-43-101 Compliant 21 156,285 37.6% 9,315 15.8% 392 46.5% 24 13.1%2 464,442 35.6% 26,395 15.9% 250,769 34.7% 13,476 15.5%Total:Areas 1 & 2620,726 35.8% 35,710 15.9% 251,160 34.7% 13,500 15.5%Historic Resources 33 11,600 44.0% 987 19.3% 281,400 44.0%23,95019.3%4 51,700 36.5% 3,667 19.4% 49,200 38.0%3,64519.5%Total:Areas 3 & 463,300 37.9% 4,654 19.4% 330,600 43.1% 27,595 19.3%27
  28. 28. EXPECTED TO BE LOWEST COST SOPPRODUCER28AluniteLeachPolyhaliteLeachSalt Lakes MOP/SulphateSaltsMannheimProcessProcessMethodWorldCapacity Process Inputs ProductsAvgCost /TonneMannheim 60% ! MOP! Sulfuric Acid! Energy! SOP! HCI$550MOP andKieserite25% ! MOP! Kieserite! Energy! SOP! MagnesiumChloride$386Salt Lakes 15% ! Lake Brines! Energy! SOP! MagnesiumChloride! NaCI$300PolyhaliteLeach– ! Polyhalite! Water! Energy! SOP! Kieserite$162AluniteLeach– ! Alunite! Energy! SOP! H2SO4! Bauxite substitute$101Cash Cost by Production MethodAvg Cost/TonneProcess Method and Cost ComparisonsPOTASHRIDGEExpected In ProductionIncludes expectedand in-production data1 The cost is converted from $92 per short ton. Excludes bauxite credits.  $300$386$550$162$1011$155
  29. 29. PRELIMINARY ECONOMIC ANALYSISRESULTS29  PROJECT HIGHLIGHTSAnnual Production Rates:SOP 680,000 tonnesSulphuric Acid 1.6 million tonnesInitial Mine Plan1 30 yearsCapital Cost2 $1.075 billion1 Future planned work may expand resource base and extend life of project beyond 30 years2 Excludes third party costs: power generation ($160 million), sulphuric acid plant ($180 million) and water treatment plant ($40 million)3 Excludes potential credits related to sale of 3.3 million tonnes per annum of bauxite materialFINANCIAL HIGHLIGHTSNPV @ 10% (after tax)3 $1,331 millionUnlevered IRR (after tax)3 21.3%
  30. 30. SOP CAPITAL COST BREAKDOWN130  CAPITAL  COST:  $1.075  billion                      (25%  conTngency)  24%      SOP  Leaching,    CrystallizaGon    and  Drying  18%    CalcinaGon  17%    BeneficiaGon  41%      ConGngency    and    Indirects  1 Excludes third party costs: power generation ($160 million), sulphuric acid plant ($180 million) and water treatment plant ($40 million)  
  31. 31. OPERATING COSTS: $101/TONNE131  7%  79%    Direct  Plant  and  Mine    ProducGon  Costs    ($188M)  7%    Other    ($14M)  14%  RoyalGes  ($33M)  1  The cost is converted from $92 per short ton. Excludes bauxite credits2  750,000  tons  (SOP)  +  1.8M  tons  (sulphuric  acid)  =  2.55  million  tons  or  2.3  million  tonnes  3  Includes  10%  conGngency        Cost  Breakdown   Millions  Direct  Plant  and  Mine  Costs   $188  RoyalGes   $33  Other   $14  TOTAL:   $235  Divided  by   2.55  tons2  Cost  per  ton   $92  Cost  per  tonne   $1013  
  32. 32. CAPITAL STRUCTURE32  Millions ($)Common Shares 81.3Non-voting Common Shares 5.0Total Shares Outstanding 86.3Warrants – $ 0.50 10.7Warrants – $1.00 5.0Broker options/warrants 3.4Stock options 6.8Total Fully Diluted Shares 112.3
  33. 33. PROJECT TIMELINE33  Stage Activity 2013 2014 2015 2016 2017ConfirmationDrillingAreas 1 & 2ProcessDevelopmentMetallurgical Testing andPilot Plant (processoptimization)Permitting Project PermittingFinancing Capital RaiseEngineeringStudiesPrefeasibilityFeasibility/Mine DesignImplementationBasic EngineeringProcurementDetailed EngineeringConstructionProduction Commissioning
  34. 34. MANAGEMENT AND BOARD CURRENTLY OWN 4%STRONG BOARD WITH DIVERSE SKILLSAND LOCAL EXPERIENCERahoul Sharan, ChairmanChartered Accountant with over 30 yearsdiversified mining experienceFormer Chairman andCEO of Uranium Power CorporationNavin DaveChairman and CEO of Stat-OpsInternationalFormer Managing Partner, KPMG LLPRobert C. GrossFormer Chief of Staff to Utah GovernorFormer Senior Advisor, Coalition Authority of IraqFormer Chairman and President of First InterstateBankFormer President and CEO of Blue HealthcareBankRocco RossiExperienced business strategist andpublic company directorFormer President and COO of MGI Software Corp.Phil WilliamsDirector, Investment Banking of Dundee CapitalMarkets Inc.Former VP, Business Development PinetreeCapital and Mega Uranium Ltd.Stephen HarapiakPresident and COO Victory Nickel Inc.Former CEO, Potash Corp.34Guy BentinckPresident & CEO
  35. 35. SKILLED SERVICE PROVIDERSHazen Research:•  Pilot plant•  Metallurgical testingNorwest:•  Resource estimates•  Permitting•  Prefeasibility study•  Feasibility study•  Water rightsStoel Rives:•  Permitting•  Water rightsICPE •  Engineering35
  36. 36. COMPETITIVE ADVANTAGESLarge mineral deposit containing premium-quality potash and bauxite materialStrategically located in a mining friendly jurisdiction with established infrastructure nearbyState-owned land allows for an efficient permitting processHistorical work expedites project developmentLower risk surface mining deposit; expected lowest cost producer30 year mine life, with upside potentialPEA completed: $1.3 billion NPV at 10%; 21.3% after tax IRR; excludes bauxite material revenue36
  37. 37. CONTACT USE-mail: info@potashridge.comPhone: 416.362.8640 ext 101Website: www.potashridge.comHead office:3 Church Street, Suite 600Toronto, OntarioM5E 1M237  

×