UNIQUE, WORLD CLASS GRAPHITE OPPORTUNITY

Transcription

1 UNIQUE, WORLD CLASS GRAPHITE OPPORTUNITY July 2014 Sovereign Metals Limited ASX : SVM T: F: E: info@sovereignmetals.com.au Level 9, BGC Centre, 28 The Esplanade, PERTH WA 6000 ABN:

2 All the Key Elements in Place High Growth Sector Large Flake Graphite - driven by lithium battery demand, refractories and other high end applications World Class Projects Two core projects with world class grade/flake properties plus huge unexplored potential Excellent Mining Environment Malawi has very supportive government and good infrastructure to hand Proven Successful Management Sovereign team has a great track record of success Mantra, Papillon, Sierra etc 1

3 Jumbo and Large Flake Graphite Will Attract Growing Premiums Jumbo $ 3,362 $ 2,135 $ 1,577 $ 1,726 $ 1,884 $ 1,676 $ 1,555 $ 2,596 $ 3,573 $ 6,175 Large $ 2,514 $ 1,595 $ 1,178 $ 1,192 $ 976 $ 996 $ 684 $ 811 $ 947 $ 1,165 Medium $ 2,138 $ 1,514 $ 1,025 $ 991 $ 959 $ 867 $ 521 $ 500 $ 508 $ 517 Small $ 1,375 $ 1,089 $ 855 $ 874 $ 806 $ 784 $ 476 $ 481 $ 487 $ 493 Fine $ 930 $ 689 $ 505 $ 524 $ 509 $ 493 $ 342 $ 347 $ 353 $ 359 Large flake graphite prices will likely show significant volatility By and large, jumbo flake graphite prices should move up, and may even reach an economic ceiling by What is clear is that low costs are crucial for new mines entering production, much more important than maintaining recoveries at maximum levels and the like. This will likely put a premium on projects that have high in situ grades, large flake sizes, simple mining plans and highly amenable metallurgy. Source: Stormcrow Capital Ltd (Industrial minerals experts) June 2014 Jumbo Flake (+425 μm) fraction of Duwi Concentrate 2

4 2 Excellent Core Projects plus exploration upside Duwi High grade average assays 8.3% CGT Outcropping 24km strike World class flake 64% medium-largejumbo Excellent infrastructure Initial JORC 2014 Dedza High grade average assays 10.3% CGT Saprolite soft, free dig, at surface Mapped for 24km Excellent flake 48% jumbo and large Next to M1 national highway Drilling and trenching underway Other Exploration Over 7,000km 2 of tenements 100% owned Hundreds of km of mapped graphitic gneiss, largely untested to date 3

5 Primary Graphite Target Duwi High-grade flake graphite intersected in trenching and drilling over ~2km strike length. Open along strike and at depth in all areas. Drilling and trenching underway. JORC estimate due late % high value Medium- Large-Jumbo flake. Chemical leach purification to 99.98%. 4

6 Shallow mineralisation at Duwi The next objective at Duwi is to define sufficient high grade mineralisation near surface to undertake a Scoping Study. Potentially a simple, low cost, open pit mining operation producing flotation concentrates with a large proportion of Jumbo and Large flake graphite. 5

7 Sovereign Projects have world leading Large Flake % Company Tonnes (Mt) Grade % Carbon (in-situ) Flake Size Market Cap ($m) 1 Syrah Resources (ASX: SYR) $737.8 Balama - Mozambique 1, % > 425 µm 3.3% From ASX Announcement dated 15 January µm µm 12.9% 177 µm µm 8.9% 149 µm µm 16.1% 75 µm µm 33.4% 0-75 µm 25.6% Lamboo Resources (ASX: LMB) $106.8 McIntosh - Australia % > 250 µm 5% Metallurgy Results disclosed on the Lamboo Resources s website 75 µm µm 25% 0-75 µm 70% Triton Minerals (ASX: TON) $144.1 Cobra Plains - Mozambique % No Metallurgy results reported to date Sovereign Metals (ASX: SVM) $33.0 Duwi Malawi - - > 425 µm 19.7% 300 µm µm 17.1% 150 µm µm 27.4% 75 µm µm 15.7% 0-75 µm 20.1% Dedza - Malawi - - > 297 µm 17.3% 177 µm µm 30.5% 149 µm µm 10.6% 75 µm µm 226.9% 1. Market Capitalisation: This is calculated based on the closing share price and total number of ordinary fully paid shares on issue of each as at 7 July µm 14.8% 6

8 Low cost saprolite target Dedza Saprolite hosted mineralisation mapped over 24km in total. Trenching demonstrates mineable widths of graphitic saprolite at surface over 2km at DME. Trenching underway at DMW. Saprolite met testwork returned 47% Jumbo and Large flake graphite. Considerable opex and capex advantages for saprolite. 7

9 Saprolite potential at Dedza Ongoing trenching at Dedza will further define high grade saprolite mineralisation at surface. Note hand dug trenches in soft, friable material. 8

10 Testwork flowsheets Duwi Testwork Flowsheet Dedza Testwork Flowsheet 9

11 Malawi Stable and Mining Friendly Population 16.4m GDP/capita - US$388 Limited natural resources and supportive of mining Corporate tax rate 30% Mining royalty rate is 5% Peaceful presidential election in May 5 years (Peter Mutharika) 10

12 Excellent Infrastructure Operational railway with siding located just 21km by road from Duwi links to deep water port at Nacala, Mozambique. High-capacity power line passes within 3km of Duwi. Lilongwe, the capital city of Malawi, lies just 15km to the west of Duwi. 11

13 Management Team with a Proven Track Record of Success Ian Middlemas (Chairman) Current Chairman of Papillon Resources Limited, Equatorial Resources Limited and Prairie Downs Metals Limited. Former Chairman of Mantra Resources Limited, Coalspur Mines Limited and Sierra Mining Limited. Matt Syme (Managing Director) Peter Woodman (Technical Director) Julian Stephens (Chief Geologist) Chartered Accountant with over 25 years of experience in mining and company management. Former MD of Berkeley Resources and Sierra Mining. Grew BKY from a $4m shell to over $200m by acquiring and completing initial scoping study on the Salamanca Uranium Project in Spain. Grew SRM from $5m to over $80m when sold to RTG Mining Inc. by acquiring and exploring the Mabilo Copper/Gold Project in the Philippines. Geologist with over 20 years of experience in exploration, development and operations; currently Director of WCP Resources and Equatorial Resources Limited. Formerly a Director of Papillon Resources Limited. Geologist with over 20 years experience in exploration around the world. Spent over 8 years working in Malawi with Globe Metals. Discovered and vended the Central Malawi Graphite Project to Sovereign. 12

14 Capital Structure Capital Structure * Current Shares on Issue 94,340,328 Performance Shares Class A 8,750,000 Performance Shares Class B 8,750,000 Incentive Options 6,250,000 Diluted Market Capitalisation (at $0.35) Cash Enterprise Value $39.3m ~$3.0m $36.3m * As at 7 July

15 Intensive programs underway = news flow Duwi Trenching and drilling for initial JORC estimate in Ongoing metallurgical optimisation and processing studies. Scoping Study late 2014/early Dedza Trenching and drilling for initial JORC estimate in late 2014 or early Ongoing saprolite optimisation and processing studies. Scoping Study possible early Initial discussions with potential offtake partners also planned 14

16 Contact Details Australia: Level 9, The BGC Centre 28 The Esplanade Perth WA 6000 Australia Tel: Fax: info@sovereignmetals.com.au 15

17 Disclaimer Notice & Competent Persons Statement Disclaimer Notice The material in this presentation ( material ) is not and does not constitute an offer, invitation or recommendation to subscribe for, or purchase any security in Sovereign Metals Ltd ( SVM ) nor does it form the basis of any contract or commitment. SVM makes no representation or warranty, express or implied, as to the accuracy, reliability or completeness of this material. SVM, its directors, employees, agents and consultants shall have no liability, including liability to any person by reason of negligence or negligent misstatement, for any statements, opinions, information or matters, express or implied, arising out of, contained in or derived from, or for any omissions from this material except liability under statute that cannot be excluded. Statements contained in this material, particularly those regarding possible or assumed future performance, costs, dividends, production levels or rates, prices, resources, reserves or potential growth of SVM, industry growth or other trend projections are, or may be, forward looking statements. Such statements relate to future events and expectations and, as such, involve known and unknown risks and uncertainties. Actual results and developments may differ materially from those expressed or implied by these forward looking statements depending on a variety of factors. Forward Looking Statement This release may include forward-looking statements, which may be identified by words such as "expects", "anticipates", "believes", "projects", "plans", and similar expressions. These forwardlooking statements are based on Sovereign s expectations and beliefs concerning future events. Forward looking statements are necessarily subject to risks, uncertainties and other factors, many of which are outside the control of Sovereign, which could cause actual results to differ materially from such statements. There can be no assurance that forward-looking statements will prove to be correct. Sovereign makes no undertaking to subsequently update or revise the forward-looking statements made in this release, to reflect the circumstances or events after the date of that release. Competent Persons Statement The information in this presentation that relates to Exploration Results, not including Metallurgical Testwork Results, for the Duwi and Nanzeka Prospects is extracted from the report entitled Metallurgical Testwork Confirms Significant Large Flake Potential dated 22 January The information in this report that relates to Exploration Results, not including Metallurgical Testwork Results, for the Dedza Mountain East and Chipili Prospects is extracted from the report entitled Significant New Zone of Flake Graphite Identified at Dedza dated 27 March These announcements are available to view on The information in the original ASX Announcements that related to Exploration Results, not including Metallurgical Testwork Results, was based on information compiled by Mr Peter Woodman, who is a member of the Australasian Institute of Mining and Metallurgy. Mr Woodman is a director of Sovereign Metals Limited. Mr Woodman 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 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. The Company confirms that it is not aware of any new information or data that materially affects the information including in the original market announcement. The Company confirms that the form and context in which the Competent Person s findings are presented have not been materially modified from the original market announcement. The information in this presentation that relates to Metallurgical Testwork Results, for the Dedza Prospect is extracted from the report entitled Excellent Saprolite Metallurgical Results dated 17 June This announcement is available to view on The information in the original ASX Announcement is based on information compiled by Mr Oliver Peters, M.Sc., P.Eng., MBA, who is a Member of the Professional Engineers of Ontario (PEO), a Recognised Professional Organisation (RPO) included in a list promulgated by the ASX from time to time. Mr Peters is a consultant of SGS Canada Inc. ( SGS ). SGS is engaged as a consultant by Sovereign Metals Limited. Mr Peters 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 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. The Company confirms that the form and context in which the Competent Person s findings are presented have not been materially modified from the original market announcement. The information in this presentation that relates to Metallurgical Testwork Results, for the Duwi Prospect is extracted from the report entitled Metallurgical Testwork Confirms Significant Large Flake Potential dated 22 January 2014 and is available to view on The information in the original ASX Announcement that related to Metallurgical Testwork Results was based on information compiled by Mr Michael Kenneth Rhodes, who is a Fellow of the Australian Institute of Mining and Metallurgy. Mr Rhodes is an employee of Tenova Mining & Minerals (Pty) Ltd ( Tenova ). Tenova is engaged as a consultant by Sovereign Metals Limited. Mr Rhodes 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 2012 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. The Company confirms that it is not aware of any new information or data that materially affects the information including in the original market announcement. The Company confirms that the form and context in which the Competent Person s findings are presented have not been materially modified from the original market announcement. 16