DISCLAIMER. Competent Persons Statement

Transcription

1 FEBRUARY 2011

2 DISCLAIMER This document has been prepared as a summary only, and does not contain all information about the Company s assets and liabilities, financial position and performance, profits and losses, prospects and the rights and liabilities attaching to the Company s securities. This document should be read in conjunction with any public announcements and reports (including financial reports and disclosure documents) released by Aquia Resources Limited. The securities issued by the Company are considered speculative and there is no guarantee that they will make a return on the capital invested, that dividends will be paid on the Shares or that there will be an increase in the value of the Shares in the future. Further details on risk factors associated with the Company s operations and its securities are contained in the Company s prospectuses and other relevant announcements to the Australian Securities Exchange. Some of the statements contained in this release are forward-looking statements. Forward looking statements include but are not limited to, statements concerning estimates of tonnages, expected costs, statements relating to the continued advancement of the Company s projects and other statements which are not historical facts. When used in this document, and on other published information of the Company, the words such as aim, could, estimate, expect, intend, may, potential, should and similar expressions are forward-looking statements. Although the company believes that its expectations reflected in the forward-looking statements are reasonable, such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Various factors could cause actual results to differ from these forward-looking statements include the potential that the Company s projects may experience technical, geological, metallurgical and mechanical problems, changes in product prices and other risks not anticipated by the Company or disclosed in the Company s published material. The Company does not purport to give financial or investment advice. No account has been taken of the objectives, financial situation or needs of any recipient of this document. Recipients of this document should carefully consider whether the securities issued by the Company are an appropriate investment for them in light of their personal circumstances, including their financial and taxation position. Competent Persons Statement The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Dr Fernando Tallarico who is a member of the Association of professional Geoscientists Ontario. Dr Tallarico is a full-time employee of Aquia Resources Limited. Dr Tallarico has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration 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, Mineral Resources and Ore Reserves ( JORC Code ). Dr Tallarico consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

3 COMPANY OVERVIEW 100% OWNERSHIP OF POTASH AND PHOSPHATE PROJECTS, BRAZIL Three potentially large-scale projects located close to primary markets and infrastructure Atlantic Potash Project Adjacent to Brazil s only operating potash mine 300 drill holes and 32,000km of 2D seismic Experience in potash mine and development Drilling to commence May 2011 Mata da Corda Phosphate Project Outstanding surface results up to 23.1% P 2 O 5, Excellent mineralogical results Lucena Phosphate Project Exploration target of grade of 10-14% P 2 O 51, Drilling forecast 2 nd Qtr 2011 Strong Board, management and Highly experienced in-country technical team based in Brazil 1 The statement referring to the potential quantity and grade of the target is based on the results of historical exploration activities undertaken by CPRM during the 1960 s to 1980 s, including 47 drill holes of which 22 drill holes within the project and immediate surrounds returned mineralisation. The potential tonnage range and average grade is conceptual in nature and insufficient work has been completed to report a Mineral Resource in accordance with the JORC Code (2004). It is uncertain if further exploration work will result in the determination of a Mineral Resource.

4 EXECUTIVES AND MANAGEMENT Executives Tony Wonnacott - Non-Executive Chairman Securities Lawyer and M&A Consultant Over 15 years experience as a consultant or officer of several resource companies. Has been involved with a number of successful IPOs and M&A transactions, as well as over CAD$3 billion in capital raises Simon Taylor - Managing Director Founding Director of Aguia and geologist with 18 years exploration, development and operational experience in the resources sector. Corporate experience as a resource analyst with a major focus on the phosphate sector. Dr. Fernando Tallarico - Technical Director 19 years experience in exploration. Exploration Manager for BHP Diamond South America. Project generation in Brazil for Noranda, Falconbridge, and part of the exploration crew that discovered the Araguaia Ni- Laterite deposit. Graham Ascough - Non-Executive Director Over 21 years exploration experience evaluating resource projects globally. Includes Australian Manager for major Canadian resources house, Falconbridge Ltd (acquired by Xstrata in 2006) and on-ground experience in Brazil. Management Paulo Souza - General Manager - Potash Key engineer involved in the design and development of Vale s Carnallite Project and Pilot Plant Experienced Mining Engineer with 26 years in mine planning and operation, with Vale, Rio Tinto and others Conducted diverse projects for potash, copper, nickel and iron ore as a Certified Project Management Professional Allan Pickett - Phosphate and Fertilizer Professional 14 years with British Sulphur Consultants, the fertilizer and chemical division of CRU International Ltd Primary are of expertise is in phosphates, including industrial phosphates and phosphorus-based products and fertilizers John Sinden - Phosphate Processing Engineer Renowned consultant engineer with more than 45 years in the field of phosphate processing Considered a leading phosphate rock to acid specialist Previous work in the fertilizer manufacturing industry Thiago Bastos Bonás - Resource Geologist 6 years as Mine & Exploration Geologist working for BUNGE Fertilizantes (now Vale) for the phosphate deposits of Cajati- SP, Araxá-MG and Anitápolis-SC. 3 years as Service Manager for Gemcom of Brazil and as Resource Geologist for SRK Consulting.

5 THE OPPORTUNITY WHY BRAZIL An agricultural power house 4 th largest consumer of fertilizer but accounts for only 4% of global fertilizer production. In 2008 country accounted for 8.5% (3.2Mt) of world s P 2 O 5 and 12.9% (6.5Mt) of world s KCL consumption and growing. Brazil is an advanced economy, 11 th largest exchange globally (by market capitalisation) (Australia 10 th ) and attracts substantial investment from North America and Europe.

6 THE OPPORTUNITY CUSTOMERS, MARKETS CERRADO CROP BELT ATLANTIC POTASH MATA DA CORDA PHOSPHATE LUCENA PHOSPHATE All projects are in mining friendly jurisdictions and are located close to: Potential domestic primary customers Major fertiliser blenders Infrastructure Land position of ~ 580,000 hectares. 3 year and 5 year exclusivity periods on further phosphate and potash acquisitions in Brazil

7 Conditional Agreement to acquire 100% of PAC Announced Jan 25 th 2011

8 PROJECT HIGHLIGHTS The Potash Atlantico Project Located in the attractive Sergipe potash basin Adjacent to Brazil s only operating potash mine Project supported by 300 drill holes and 32,000 km of existing 2D seismic data Initial target resource potential of billion tonnes of carnallite at ~12% KCl grade 1 The Project Is Substantially De-Risked It will use proven technology supported by Ercosplan Close to infrastructure power, gas, road, port facilities AND FERTILISER CUSTOMERS Vale is developing a 1.2Mtpa carnallite solution mining project adjacent to the Potash Atlantico project and has recently received preliminary environmental license. Management designed and developed Vale s Carnallite Project and Pilot Plant nearby Work Underway report complete Drilling targett locations selected based on large seismic i database Drilling Environmental Licensing process in progress Drilling to commence in May 2011 Gas contract tand off-take agreements are being developed d 1. This is a conceptual resource estimate and will need exploration drilling to confirm potential size, the estimate is based on suitable size to enable commercial project economics and historical data obtained from the CPRM including over 300 drill holes and 32,000 km of 2D seismic data. The potential tonnage range and average grade is conceptual in nature and insufficient work has been completed to report a Mineral Resource in accordance with the JORC Code (2004). It is uncertain if further exploration work will result in the determination of a Mineral Resource.

9 INFRASTRUCTURE IN PLACE Aracaju Aerial View Taquari-Vassouras Mine-Vale Carnallite Pilot Plant-Vale Carnallite Pilot Plant - Vale Aracaju Port PROJECTS Power Station Jardim - CHESF Power Sub-Station Off Take Partners in Region

10 EXCEPTIONAL DISCOVERY POTENTIAL ALAGOAS Sergipe Potash Basin Potash associated with Low Gravity Regions PAC controls 44 permits ~68,700 ha VALE IS DEVELOPING A SOLUTION MINING OPERATION ON ADJACENT PROPERTY SERGIPE Alagoas Potash Basin Unexplored Basin Low Gravity Region Similar to Taquari Mine Atlantic controls 63 permits ~110,500 ha VALE PAC 100 km

11 REGIONAL GRAVITY AND DRILLING DATA Taquari-Vassouras Mine - Vale Underground / Room and Pillar 700,000t KCl pa Associated to Bull s-eyes Gravity Low Historical exploration data obtained from Brazilian Geological Survey Petroleum exploration and production data more than 300 wells analyzed Seismic data basin is well covered with public 2D seismic data (2D lines- 32,000 km) PAC Claims Cover Similar Gravity Lows With Oil Exploration Wells That Intercepted Potash Oil Exploration Wells Vale Mining Permit PAC Claims Potash Claims Generally (Talon, MBAC, MMX)

12 DRILL TARGETING TOOLS BOREHOLE ANALYSIS WELL: 1CSM 0001 SE WELL: 1RPX 0001D SE WELL: 1EC 02 SE DEPTH CARNALLITE 19 m 73 m 51 m HALITE ANHYDRITE SHALE SAND 25 m LIMESTONE TACHYDRITE CALIPER GAMMA RAY SONIC DENSITY

13 AREA 1 DRILL TARGETS

14 PROPOSED NEW WELL LOCATIONS 1 km 1 km

15 PROPOSED NEW WELL LOCATIONS Seismic Line

16 TECHNICAL REVIEW SOLUTION MINING PROCESS Solution Mining Process for Carnallite Two wells drilled ~70m apart are drilled to salt layer. Hot water (85 c) pumped into salt layer, to dissolve salt into brine. Brine extracted, and two caverns develop. Caverns merge into one large cavern. Water then pumped down through one well, and brine extracted from the second well. Each cavern lasts between 2 and 3 years. Multiple wells connected on the surface to the processing plant. Carnallite brine separated into KCl and MgCl using established technology Overburden Rock Salt Carnallite Rock Salt KCl Plant Cavern SERGIPE Key Project Metrics Target steady state production of ~1,000,000 tpa KCl Proven technology for brine production and processing Engineering studies supplied by Ercosplan Main consumables locally available natural gas and electric power Reduced time to production < 6 years including exploration Project substantially de-risked by Vale s Carnalitta Project Allows extraction of deeper potash deposits KCl horizons in Sergipe are between 1,500 and 1,800m Well positioned to dispose of residual brine off-shore Vale already permitted Rock Salt Carnallite Production Wells Dual Well Solution Mining Technique

17 MANAGEMENT WORK PLAN TIMELINE Management has prepared the timeline below for purposes of planning work around the Brazilian exploration opportunity. This timeline is not based on a detailed assessment of the project requirements and is subject to material revision when technical reports and/or feasibility studies, if any, are completed for the project. POTASH ATLANTICO PROJECT RESOURCES INVESTIGATION Analysis of available information Drilling / Analysis / Modeling 6 months (Dec 2010) 8 months (Dec 2011) ENVIRONMENTAL PERMITTING Drilling License Apr 2011 EIA-RIMA for Industrial Project 12 months (Jun 2012) Preliminary / Installation Licenses ENGINEERING STUDIES NI Final Report LP-Dec 2012 LI-Dec months (Jun 2013) Conceptual Studies Feasibility Studies 6 months (Feb 2012) 12 months (Dec 2012) Detailed Engineering Construction/Commissioning/Start-up 30 months 15 months (Jan 2014) Start-up Jun 2016

18 MATA DA CORDA INFRASTRUCTURE Located within 100km of the three largest phosphate mines in Brazil and near 32 major bulk blenders Excellent infrastructure, roads, power, water 250km west of Belo Horizonte, State capital and Aguia office On main transportation route for expanding agricultural districts of Mato Grasso Brazil

19 MATA DA CORDA NEW DISCOVERIES

20 MATA DA CORDA BLOCK 5 BLOCK 5 Favourable mineralogy. Easy access and cost effective drill testing. Potential to host a near surface large tonnage phosphate deposit.

21 LUCENA PROJECT Aguia has ~ 75,000 ha along the northern sector of the Paraiba basin within the same geological setting where the Brazilian Geological Survey (CPRM ) has discovered several phosphate deposits Limited work since the historical government program Cabedelo port facilities can be accessed via 65 km of paved roads

22 LUCENA SOUTH TARGETS CPRM discovered shallow phosphate mineralisation up to 22% P in several deposits to the west Phosphate mineralisation is hosted by a limestone unit (Gramame Formation) that extends through project towards the east. DRILLING TARGETS Desktop modelling outlines large areas for shallow drill testing. Drilling scheduled for 4 th Qtr 2010.

23 BRAZILIAN PLAYERS DATA

24 APPENDIX 1 COMMERCIAL TERMS OF ACQUISITION Acquisition of projects will occur by Aguia acquiring 100% of Potassio do Atlantico Ltda. Potassio is a 100% owned subsidiary of Potash Atlantico Corp (PAC), a private company associated within the Forbes & Manhattan Group. Commercial terms of the acquisition, which is subject to approval by Aguia shareholders, include the issue of: 20 million ordinary shares at settlement 20 million ordinary shares upon achieving proof of concept drill intersections, grade KCL 30 million ordinary shares upon achieving 100Mt mineral resource 30 million ordinary shares upon achieving 200Mt mineral resource Subject to shareholder approval, Aguia will undertake a placement of at least $15 million to fund initial working capital on the projects. Forbes & Manhattan Inc. is a private merchant bank based in Toronto, Canada with offices and operations internationally. Extremely successful track record of identifying high quality assets in the resource sector and advancing them from discovery through to production. Currently over 25 companies in the group, with a combined market capitalisation of approximately $2 billion.

25 CAPITAL STRUCTURE & CORPORATE February 2011 Post-Transaction Ordinary Shares (ASX: AGR) 60.7M 60.7M Potash Vendor Shares (12 month escrow) 20.0M Capital Raising (???$) 20.0M0M Total Shares 60.7M 100.7M Market cap $0.84) $51.0M $84.6M Cash (@ Completion) $5.0M $21.0M Enterprise Value $63.6M Unlisted Options 11.0M 12.5M Total Performance Shares Phosphate(conversion milestones: 30Mt, P 2 O 5 JORC) TtlP Total Performance Shares Potash Pt h( (conversion milestones: 100Mt, KCl JORC) 40.0M 40.0M 80.0M

26 Enquires: Simon Taylor Managing Director Telephone: Aaron Wolfe Vice President, Corporate Development, Forbes & Manhattan Telephone: