FIRST BAUXITE CORPORATION

Transcription

1 FIRST BAUXITE CORPORATION (FBX: TSX-V) January 2010 Yannis Tsitos, President & Director

2 Disclaimer This document contains certain forward looking statements which invoke known and unknown risks, delays, and uncertainties not under the corporation s control, which may cause actual results, performance or achievements of the corporation to be materially different from the results, performance or expectation implied by these forward looking statements & presentation slides. Figures & numbers indicated in this document are estimations made by the Company and its subsidiaries, based on current costs & prices related to the bauxite industry in Guyana in particular, and the world in general. No completed Qualified Feasibility Study as per TSX-V disclosure requirements exists for any of the Company s Bauxite Projects, to date. Company Copyright clauses are valid in this case. Content and slides from this presentation are not allowed to be copied or distributed otherwise, without the written consent of the Company. Page 2

3 Company Vision First Bauxite Corporation s (FBX: TSX-V) mission is to become the first North American Company to produce High Quality Refractory A-grade Super Calcined (RASC) Bauxite for export to European and N. American markets. FBX has commissioned a Feasibility Study (80% complete) on its high alumina raw bauxite reserves and resources in Guyana. Page 3

4 Why First Bauxite Corporation $50 - $55 million 23 km from port & 45 km from the Atlantic Ocean Basic Industry Product Strong Demand - - Constrained Supply Low Capex Rapid Development Optimum Location High Quality Ore Unique Commodity - Niche Market +/- 15 months 56% Al2O3 average raw % Al2O3 on Calcination Solid Management Results Oriented Mining Professionals Page 4

5 Global Bauxite Industry - FBX Target Markets Page 5 ALUMINUM INDUSTRY FLOW DIAGRAM ( Industrial Minerals & Rocks book Bauxite Section by V. Hill & E. Sehnke)

6 Bauxite Facts Bauxite is Alumina ore and thus the source of Aluminum Metal.. Primary Bauxite minerals are: Gibbsite Al(OH) 3 : (typical Guyana bauxite ore) soft, earthy ore which is easily open-pit mineable Boehmite γ-alo(oh) & Diaspore α-alo(oh) Bauxites classified by intended commercial application Types & Non-China World Consumption FBX Primary Product FBX other products Metallurgical: >95% of 205 MT (2008) World Prod. Refractory: 1.16 million MT (2009 est). Proppant. 760,000 MT Cement grade: 1.97 million MT Abrasive Grade: 1.16 million MT Chemical: 730,000 MT Page 6 Global Non-Met Bx consumption (2009 Est.) 6.38 million MT

7 Major Bauxite Locations Jamaica Guinea Guyana Suriname Greece India China Brazil Australia Page 7 Major Metallurgical Grade Capacity Major Non-Metallurgical Grade Capacity Major High Alumina Grade Refractory Production

8 The Refractory Calcined Bauxite Refractory A-grade Super Calcined (RASC) bauxite benchmarked after the high quality Guyanese product in 1900s. Refractory material definition:...material that is not deformed or damaged by high temperatures..., and thus being used in any pyro-metallurgical process, i.e., steel, cement, glass industries, furnaces etc. Refractory materials are used in linings for furnaces, kilns, incinerators and reactors. FBX Raw Materials Industry & Mining bauxite, alumina other oxides Refractories Industry Basic Materials Industry Raw Materials & Minerals magnesite, dolom. clay, quartz other Production of Different Types of Refractories refractory products Steel Cement Glass Petro-Chemicals Non-Ferrous Page 8

9 The Refractory Grade Calcined Bauxite Current Industry Situation Unique product: only Guyana & China currently supply the non- China world s demand for Refractory bauxite (while part of domestic consumption in India, Russia and Brazil is captive) Captive market with finite supply and strong demand. Increasing prices trend (pre global financial meltdown) Financial downturn caused lower demand (steel industry), but constraints on supply balanced the later. Page 9 World: Estimated division of refractory grade calcined bauxite production in 2008 (%)( from Calcined Bauxite Market Study by Roskill Information Services, July 09)

10 The Refractory Calcined Bauxite Current Industry Situation (continue) Chinese Govt use export quotas to limit export volume; will continue to exert upward influence on price. RASC bauxite prices of >$400 - $500 per MT. (Raw bauxite must be >60% Al2O3, very low Fe, almost no alkali) vs. $35-$50 per MT for metallurgical (MAZ) bauxite (typical raw bauxite in the range of 43%-50% alumina). China: Comparison of export quota and exports of calcined bauxite, (000t) Page 10

11 Location of First Bauxite s Projects vs. Existing Operations Page 11

12 Projects in Guyana Essequibo PGGS Bonasika ML Capital Georgetown Bonasika Mining License (376 hectares) Waratilla-Cartwright Prospecting License (4,000 hectares) Essequibo Exploration License (8,100 km 2 - optioned to Rio Tinto) Waratilla PL 150 km Part of the traditional Bauxite Coastal Belt Page 12

13 Bonasika Mining License (100%) Targeting completion of NI compliant Feasibility Study within the Q Mining License with approved Environmental Permit to mine bauxite Initial production as early as Q2/2011; annual production level of 100,000 Mt of RASC at an estimated all in production cost of US$200/Mt. Bonasika deposits, indicate (more than 500 holes drilled by FBX) a raw bauxite average grade of 56% Al 2 O a Cut-off grade of 48% Al 2 O 3 (7-9 years mine life). An average of 7.0 metres bauxite layer under 7.0 metres of soft overburden, i.e., strip ratio of 1 to 1 (Bonasika 1 deposit), 3:1 (Bonasika 5 deposit) (vs. 7:1 and higher on existing operations in Guyana) Raw ore will be washed near mine-site; washed ore would be trucked 23 Km to the calciners near the Demerara River dock site, at Sand Hill. Washed bauxite will be pelletized at Sand Hill to increase recovery, improve densification & reduce dust emissions Modern, energy efficient pressurized vertical shaft kilns will be used to sinter the pelletized bauxite feed Page 13

14 Waratilla Cartwright PL (100%) Historical drilling by ALCAN (64 holes) with historical inferred resource of 25 MT including 11.9 million MT of RASC. 10 km Potential 20+ years of feed for Calciners. 6 Recent drill holes tested one ALCAN zone: Results include intersections of: 9.3 meters of 61.3 % Al 2 O meters of 60.8 % Al 2 O 3 Resource Outline drilling commenced in Nov 09 with a recently purchased Sonic Drill. Two holes per day efficiency. Bonasika Deposits Waratilla Deposits Page 14

15 Essequibo Exploration License (JV with Rio Tinto Alcan) Existing Option & JV agreement with Rio Tinto over this license (May 2008) Rio Tinto sole-funds the next $58 million to vest at 75% in two stages (51% with the first $8m (in 4years) and 75% with the next $50m) Title Granted Sept 2007 Valid for 3 years Relinquishment requirement of 25% every year Right to apply anytime for up 20 Prospecting Licenses 6 holes drilled blind in the 1960s by DEMBA along the only existing road, intersected economic bauxite of 3.1m to 8.6m thickness and 52.96% to 58.61% alumina Historical Data compiled into modern GIS Database. Numerous known historical showings documented Current Linden Bauxite Mine Page 15

16 Corporate Strategy Deliver positive cash flow from the company s advanced projects. Positive cash flow will limit company s equity dilution. Develop Bonasika ( low hanging fruit ) as soon as feasible (within 15 months from delivery of the positive FS). Thus, occupy quickly a void that currently exist in terms of a western world producer & exporter of refractory calcined bauxite, in the form of a fully transparent public company. Move Waratilla to a Feasibility Study stage within 18 months and expand capacity / production by year 3 or earlier. Diversify products to include production of calcined bauxite used in the production of abrasives and proppants for deep oil drilling. Leverage shareholders value to the metallurgical bauxite business (high tonnage high capacity industry), via regional exploration (JV with Rio). Build further the company s resource base, by either exploration or acquisitions of additional assets. Page 16

17 The Business Plan Selective Mining parameters PHASE I Bonasika Mine Calciner : Name Plate Capacity 108,000 MTS per Annum Consists of 2 units Calciner: Planned Production Raw Bauxite mined per year 100,000 MTS per Annum 300,000 MTS p/a Mine daily production rate 1000 MTS per 300 days p/a Raw Bauxite washed per year 300,000 MTS p/a Recovered tonnage washed bauxite 200,000 MTS p/a 67 % Recovery (?) Total Washed Bauxite trucked Total bauxite to be agglomerated Total bauxite to be sintered/calcined Total tonnage Calcined bauxite produced 200,000 MTS p/a 200,000 MTS p/a 200,000 MTS 100,000 MTS 50% Calcining Loss 30% LOI (water loss) 20% dust loss (max est.??) Page 17

18 Selected Economic Forecasts Based on Scoping Study Estimates Annual RASC Production 100,000 MTS Saleable product Cost of Production all in US$200 per MTS Conservative Sale price US$400 per MTS June 2009 IM Price: US $450-$510 FOB Guyana Net Operating Profit Annual Net Cash (year 1) Bonasika Project Economics US$200 per MTS US$20 million Unadjusted Payback Period 2.5 Years 2013 Mine & Sand Hills Development CapEx Forecasts CD$m Bonasika Mine site & Wash Plant 9 Haulage form Mine site to Sand Hills 5 Sand Hill Agglomeration & Calcining Plant & Dockyard TOTAL $49 35 For 2 RCE Shaft Kilns Page 18

19 Sources & Uses of Funds Sources CD$m Uses CD$m Private Placements 10 Feasibility Study (Bonasika) 1.5 Convertible Note Placement (Pacific Road Financing) 30 Mine & Sand Hills Development CapEx 49 Debt (closer to production) 8 Financing Costs 3 Off-take (closer to production) 8 Waratilla Resourse Outline 2.5 TOTAL $56 $56 Page 19

20 Key People (1) Yannis Tsitos MSc President & Director Technical (physicist-geophysicist) and Management background (Athens, Birmingham, Edinburgh). 18 years with BHP Billiton (Dec 2007) as Business Development Manager Worked on exploration projects and business deals in 32 countries Identified, negotiated and executed in excess of 50 exploration agreements and Joint Ventures Member of Discovery Teams. Hilbert Shields MSc Chief Executive Officer & Director Technical (Geologist) and Management background (Oxford Brooks Univ., UK Univ. of Nevada., USA) Former VP of Golden Star Resources Former Director of Omai Gold Mines Ltd. Former senior member of management team of Aroaima Bauxite Mining Company Twenty eight (28) years mining & exploration experience in 14 countries including Guyana, Surinam, Venezuela, Brazil, Ghana, The Phillipines, Canada and USA. Extensive global network. Page 20

21 Demetrius (Jim) Heras Chairman & Director Over 40 years of experience as a Director of various private and public companies in the mining industry, land development and other real estate ventures. Well-known businessman and entrepreneur and during his career as an executive has raised over $100 million dollars in financings. In the mid-nineties he was Director and Chairman of the Board of St. Philips Resources Inc., and negotiated the agreement with Royal Oak Mines on the Kemess copper-gold deposit (still in operation mine) in BC, Canada, as well as the final acquisition of St. Philips Resources by Royal Oak Mines. Lee Graber Director Key People Over 35 years of relevant experience in the mining industry, including 23 years with Homestake Mining Company. Current Director of Pacific Road Capital. On BOD of various juniors. As Vice President, responsible for corporate development, Lee initiated, managed and closed 55 major acquisitions and divestment transactions totalling $9.2 Billion. Subsequent to Homestake, Lee served as Managing Director, Mergers and Acquisitions for Endeavour Financial Ltd in Vancouver advising junior resource companies, Has consulted for clients developing non-metallic mineral deposits and served as a director of resource companies in Thailand, West Africa, Russia and Canada. Page 21

22 First Bauxite Corporation (FBX: TSX-V) First Bauxite Corp. is an 2 year-old junior natural resources company listed on TSX-Venture in Dec 2007 as Academy Ventures Inc. Changed name to First Bauxite Corporation and split its stock (2 for 1) in Dec Secondary listing in Frankfurt and Berlin, Germany (under the symbol FBI) in Jan Share Capital: Issued & Outstanding: 43,798,532 shares - Fully Diluted: 60,074,364 Current Price (13 Jan 10): $ Working Treasury: C$ 4.5 million, access to US$20 million at the delivery of the FS (Pacific Road Capital, AUS/US) Deal with Rio Tinto TSX-V Approval Bonasika FS Commissioned Acquisition of GINMIN First Drilling at Bonasika Pac Road Financing Page 22

23 Gold Rock Value Comparison (rough calculation) Copper $160 per MT * $55 per MT ** Low CapEx, short project delivery times, ultra shallow mining, no chemicals used, simple mining Intensive CapEx, long project delivery times, in cases deep mining issues, environmental sensitivities High Alumina Raw Bauxite $70 per MT Calcined Bauxite $200 per MT *** Page 23 *(for a rich Au deposit with a grade at 5g/t 1oz=$1000) **(for a rich Cu porphyry with a grade of 1%Cu and 1pnd Cu = $2.50) ***(calcined bauxite tonnage = approx. 0.4 X raw bauxite tonnage)

24 Highlights - Summary Two advanced projects in Guyana. FBX controls half the Guyanese bauxite belt in terms of exploration. Option agreement / JV with Rio Tinto Alcan over the exploration ground Feasibility Study on Bonasika project commissioned; to be completed in Q1 2010; aiming for production in Q1/2011 at an initial annual production rate of 100,000 MT of RASC bauxite. Resource Outline and second FS to commence at Waratilla Project in Nov Favourable location of advanced projects. RASC bauxite will be sold FOB at our port on the Demerara river, 45kms upstream from the Atlantic ocean. Perfect position in relation to marketing of product, access to US, Europe and Asia (via the Pacific ocean). FBX will use calcining technology of 2006 (Polysius, a Maerz and ThyssenKrupp company), vs. technology of 1940s used by the Chinese producer in Guyana. FBX already in direct and indirect discussions with consumers Marketing agreements expected well before commencement of production Page 24 Unique product: only Guyana & China supply the non-china world s demand for Refractory bauxite Captive market with finite supply and strong demand. High value added product.

25 Photos... New Own Sonic Drill Logging Road to Bonasika Granular Bauxite Core Storage at Bonasika Bonasika Deposit Page 25 Bauxite on surface Sand Hills Old Docking Site on Navigable River Trench through Bauxite at Bonasika

26 Focused on Constant Growth Thank You My motto really is, Screw it, let s do it! I know many people say no or let me think about it as an almost Pavlovian response when asked a question, whether it s about something small and insignificant or big and revolutionary. Perhaps they are overcautious, or suspicious of new ideas... From Richard Branson s book: Screw it, let s do it