The most recent iron ore producer in the Labrador Trough. Dean Journeaux President and CEO New Millennium Iron Corp. Québec Mines

Transcription

1 The most recent iron ore producer in the Labrador Trough Dean Journeaux President and CEO New Millennium Iron Corp. Québec Mines

2 Safe Harbour Statement New Millennium Iron Corp. shall not be liable or responsible for any claim or damage, direct or indirect, special or consequential, incurred by the user arising out of the interpretation, reliance upon or other use of the information. Users should not rely on information for any purpose other than for gaining general knowledge of New Millennium Iron Corp. Although New Millennium Iron Corp. believes that its expectations reflected in these forward-looking statements are reasonable, such statements involve risks and uncertainties and no assurance can be given that actual results will be consistent with these forward-looking statements. Resources listed as historical are not currently in compliance with NI , and a qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves. The Corporation is not treating the historical estimate as current mineral resources or mineral reserves and the historical estimate should not be relied upon. 2 2

3 Overview of NML Now producing direct shipping ore Among the world s largest holders of certified iron ore resources Not just one project, but an entire iron ore district Millennium Iron Range Taconite holdings now in advanced feasibility study stage Fosse du Labrador Highly experienced management team, with strong ties to the Labrador Trough NML Office Locations 3 3

4 Vision and Expertise Dean Journeaux President & CEO, Director 40+ years experience in iron ore Former President of Met-Chem Former Project Manager of QCM Mont-Wright Bish Chanda Position at New Millennium Senior VP Marketing & Strategy Years Experience Area of Experience Moulaye Melainine Senior VP Development 25+ Mining Previous employment experience 35+ Iron ore Chief engineer: IOC Manager Mining Ops & Comptroller: SNIM, Mauritania Paul F. Wilkinson Senior VP Environmental & Social Affairs 35+ Environment & social sciences PFW & Associates Inc., Associate Director of Northern Studies: McGill University Mark Freedman CFO 17 Accounting Partner: Roll Harris & Associates Ernest Dempsey VP Investor Relations & Corporate Affairs 35+ Cathy Dornan VP Communications 20+ Rock Gagnon VP Process and Plant Engineering Iron ore sales & marketing Communication & public relations 19 Iron ore VP: Mitsubishi, IOC Cathy Dornan Public Affairs Inc., Bristol Communications Inc. Metallurgical Engineer: MetChem and COREM Stephen Fontanals Director of Operations Research 15 Iron ore Financial Controller, Wabush Mines B.K. Balakrishnan Chief Geologist 40+ Robert A. Martin Chairman of the Strategic Advisory Committee of the Board of Directors Canadian mining geology Geologist: IOC 40+ Iron ore Former President and CEO 4 4

5 Building Long-Term Growth Building Long-Term Growth DSO Direct Shipping Ore In production Taconite KéMag & LabMag deposits The Company Builder Exploration Defining the resource base A huge iron ore district, controlled by NML 5 5

6 Partner with Strategic Captive Iron Ore Need One of the world s largest steel companies Crude steel capacity of 28 mtpy with plan to increase to 40 mtpy by 2020 a respected multi-national company Committed to improving European operations, which require mtpy of iron ore Partner in DSO and Taconite projects Owns 26.5% of NML and has 3 Board members Investing in steel making and downstream processes to become a leading player in Europe Reducing raw material costs through captive inputs is key element of the improvement strategy for iron making ~ 3,700 nautical miles 6 6

7 DSO Project Structure Joint Venture Operator. 20% OWNERSHIP OF JV 80% OWNERSHIP OF JV CONTRIBUTIONS Puts 25 DSO deposits into JV Labrador Trough management and operating experience BENEFITS 20% Equity free carry up to $300 M Minimizes marketing risk Lower ocean freight cost impact on FOB pricing compared to Asian markets Receives 20% of JV cash distribution 7 CONTRIBUTIONS 100% off-take guaranteed for life of mine Arranges financing up to $300 M of project costs Finances 80% of project costs over $300 M BENEFITS High quality, captive ore from stable and proximate source Starter project that adds to growing global mining portfolio 7

8 DSO: Productivity and Quality Life-of-mine central processing complex, housed under a weather-proof structural dome. First company in Schefferville area to operate year round. 84% weight recovery with integrated plant (>90% Fe recovery) to maximize resource integration. Will yield both sinter feed and pellet feed. Superior chemistry to meet Tata Steel Europe s specifications: Fe > 64.5% and Al 2 O 3 + SiO 2 < 4.5%. Moisture <2.5% in winter. Production started in September 2012 with initial mining of ~63% Fe grade and dry screening operation. Ramp-Up Schedule : 300,000 t : 2.0 Mt : 4.2 Mtpy (nameplate capacity) : 6.0 Mtpy (planned) 8 8

9 Taconite Project: Company Builder Binding Heads of Agreement Signed with Tata Steel in March 2011 Feasibility Study in progress with completion targeted for end of 2012 LabMag* and KéMag deposits being evaluated Budget of $50 million Jointly managed and cost shared: Tata Steel 64%, NML 36% Scope under study is 22 mtpy concentrator feeding 17 mtpy pellet plants Infrastructure includes 600+ km slurry ferroduct, 270+ km transmission line and port facilities Tata Steel investment decision in Q Subject to a positive feasibility study, Tata will arrange financing up to $4.85 Billion, excess to be shared pro-rata Off-take interest in proportion to ownership *Naskapi Nation of Kawawachikamach owns 20% of LabMag 9 9

10 Taconite Project Equity Structure NML can increase Project equity to 40% 20% Equity free-carry Valued at $290 M $4.85 B CAPEX 30:70 equity-to-debt ratio Option to acquire up to an additional 16% Cost of Financing 16% Additional Equity ~$230 M based on: $4.85 B CAPEX 30:70 equity-to-debt ratio Other partner opportunities 10 4% ROFR if Tata brings in a third party Cash Flow to NML: $250 - $300 M based on 36% ownership 10

11 Taconite Project: Simple Geology Millennium Iron Range Taconite: Typical Cross-Section Magnetic taconite ore similar to that of Minnesota s Mesabi Iron Range Sedimentary ore body averaging 60 meters thick with 7 distinct stratigraphic layers Total mineral formation strike length: 37km long, 1.5 km wide Shallow, near surface, slightly dipping ore body with very low stripping ratio Minor overburden and internal waste Open pit mineable Average head grade: ±30% total Fe 11 11

12 Taconite Project: Innovative & Competitive High quality products from ~30% Fe head grade Concentrate Fe 69.8% SiO 2 2.2% BF Pellets Fe 66.4% SiO 2 2.4% DR Pellets Fe 67.8% SiO 2 1.8% High Pressure Grinding Rolls (HPGR) replace SAG mills, resulting in substantial energy savings Large scale and most technologically advanced equipment will be installed Product range capable of servicing needs of steelmakers globally Silica grade will be reduced in an upgrading circuit to produce DR grade pellets Based on pot grate tests at respected SGA lab in Germany, pellet quality was found to be comparable or even superior to other commercial grade pellets 12 12

13 Taconite Project: The Ferroduct Alternative Fine grained concentrate ideal for slurry transportation, but does not exclude the railway Indicative rail tariff is $12 - $15/t (CAPEX + OPEX) Ferroduct cost estimate is $5/t (CAPEX) + $2/t (OPEX) Low-cost solution that does not depend on the development of other projects Gives NML Taconite potential competitive advantage among North American pellet producers NML also participating in CN Caisse de Dépôt railway feasibility study in order to fully assess transportation options available 13 13

14 Taconite Project: New Dock at Port of Sept-Îles Pointe-Noire Existing Facilities - Artist s Rendering of New Dock - 50 Mtpy Initial Capacity (Commissioning in 2014) - Expandable $220 million state-of-the-art, multi-user loading dock now under construction at Sept-Îles Funding: Canadian Government 25%; Port of Sept-Îles 25%; Mining Companies - 50% NML initially investing directly for 15 Mtpy annual shipping capacity and through TSMC for 5 Mtpy -- combined access to 20 Mtpy or 40% of Phase I capacity Pointe-Noire landside terminal facilities include 3 Mt capacity stockpile 14 14

15 Taconite Project Status Environmental base line studies in progress Study Manager engaged, working with leading specialized consultants: Mining Concentrator and Upgrading Plant Slurry ferroduct Tailings, site infrastructure, electrical transmission and product storage Outotec, Espoo, Finland: State-of-the-art pelletizing technology World Steel Dynamics Inc., Englewood Cliffs, New Jersey: Market Study Discussion with potential off-takers Feasibility study to be completed by end of

16 Taconite Project Schedule Development to Production Complete Feasibility Study, jointly with Tata Steel Tata Steel investment decision Engineering, Procurement and Construction Production buildup

17 Millennium Iron Range: A Huge Iron Ore District 210 km long Millennium Iron Range is comparable to Minnesota s Mesabi Iron Range in the US Resources large enough to potentially produce for over 100 years Extensive drilling in progress to identify other major resources Over 10,000 m drilled in 2012 NML s Certified Taconite Resources Taconite Project: Exploration: Category (M tonnes) KéMag LabMag lac Ritchie Proven + Probable 2,141 3,545 Measured + Indicated 307 1,045 3,330 Inferred 1,014 1,151 1,437 Fe Grade (average) 31.3% 29.5% 30.5% 17 17

18 Conclusion Properties located in mining-friendly jurisdictions Two advanced projects in one of world s richest iron regions Experienced management team Strategic partner Tata Steel needs the ore High-value iron to supply rising global demand Strategy in place to form new partnerships 18 18

19 Thank you Ticker Symbol - TSX:NML