Developing Mineral Deposits in Mozambique - Baobab …€¦ · · 2011-09-28vanadiferous titano-magnetite mineralisation ... • At current market prices, the value per tonne of

Baobab presentation 2008

BAO-AIM

Developing Mineral Deposits in Mozambique


DISCLAIMER

The information contained in these slides and this presentation is being supplied to you by Baobab Resources Plc (the “Company”) solely for your information and may not be reproduced or redistributed in whole or in part to any other person. This document has not been approved by a person authorised under the Financial Services and Markets Act 2000 (“FSMA”) for the purposes of section 21 FSMA.These slides and this presentation do not constitute, or form part of, a prospectus relating to the Company nor do they constitute or contain any invitation or offer to any person to underwrite, subscribe for, otherwise acquire, or dispose of any shares in the Company or advise persons to do so in any jurisdiction, nor shall they, or any part of them, form the basis of or be relied on in any connection with any contract or commitment whatsoever. Recipients of these slides and/or persons attending this presentation who are considering a purchase of ordinary shares in the Company are reminded that any such purchase must be made solely on the basis of the information that the Company has officially released into the public domain. Whilst all reasonable care has been taken to ensure that the facts stated in these slides and this presentation are accurate and the forecasts, opinions and expectations contained in these slides and this presentation are fair and reasonable, the information contained in this document has not been independently verified and accordingly no representation or warranty, express or implied, is made as to the accuracy, fairness or completeness of the information or opinions contained in these slides or this presentation and no reliance should be placed on the accuracy, fairness or completeness of the information contained in these slides and this presentation. None of the Company, its shareholders or any of their respective advisers, parents or subsidiaries nor any of their respective directors, officers or employees or agents (including those of their parents or subsidiaries) accepts any liability or responsibility for any loss howsoever arising, directly or indirectly, from any use of these slides or this presentation or their contents.These slides and this presentation do not constitute a recommendation regarding the shares of the Company. Recipients of these slides and this presentation should conduct their own investigation, evaluation and analysis of the business, data and property described therein. If you are in any doubt about the information contained in these slides or this presentation, you should contact a person authorised by the Financial Services Authority who specialises in advising on securities of the kind described in these slides and presentation.Certain statements within this presentation constitute forward looking statements. Such forward looking statements involve risks and other factors which may cause the actual results, achievements or performance expressed or implied by such forward looking statements. Such risks and other factors include, but are not limited to, general economic and business conditions, changes in government regulations, currency fluctuations, the gold price, the Group’s ability to recover its reserves or develop new reserves, competition, changes in development plans and other risks. There can be no assurance that the results and events contemplated by the forward looking statements contained in this presentation will, in fact, occur. These forward-looking statements are correct or represent honestly held views only as at the date of delivery of this presentation. The company will not undertake any obligation to release publicly any revisions to these forward looking statements to reflect events, circumstances and unanticipated events occurring after the date of this presentation except as required by law or by regulatory authority. By accepting these slides and/or attending this presentation, you agree to be bound by the provisions and the limitations set out in them or imposed by them and to keep permanently confidential the information contained in these slides or this presentation or made available in connection with further enquiries to the extent such information is not made publicly available (otherwise through a breach by you of this provision).Some of the statements are the opinions of the Directors.


CORPORATE PROFILE

Baobab Resources plc Listed on AIM London1st February 2007 BAO-AIM

Baobab Resources Plc(UK)

100% Baobab Mining Services Pty Ltd(Australia)

Capitol Resources Lda(Mozambique)

Portfolio of Prospecting Licencesin Mozambique

Maputo Minerals Ltd(BVI)

100% 50%

50%

Moçambique Resources Ltd(BVI)


PROJECT PROFILE• Portfolio of 24 prospecting licences, 100% owned by the

Company, containing both advanced & grass roots projects boasting a range of commodities (~4,200km²).

KEY ASSETS:

• MUNDONGUARA COPPER / GOLD MINE• High-grade copper / gold / silver (sulphide ± oxide)• Close proximity to infrastructure• Proven strike potential• Stage 1 Resource Estimate completed

• TETE MAFIC COMPLEX IRON ORE• being explored for Bushveld-style iron ore, base & precious

metal deposits• Encouraging aeromagnetic anomalies indicate extensive

vanadiferous titano-magnetite mineralisation• Interim metallurgical results demonstrate that beneficiation

can produce a saleable product • Tete becoming major mining hub with significant

investments into infrastructure

• Focused strategy, with a pipeline of projects being rapidly assessed & advanced towards feasibility.

• Strong technical & corporate management team with working experience in Mozambique & other Southern African countries.


Capital Raisings£ 0.06m @ £0.06 Aug 06

£ 0.33m @ £0.08 Aug 06

£ 2.20m @ £0.10 Jan 07*

£ 1.77m @ £0.115 Jan 08

* AIM IPO 1st February 2007

Major ShareholdersAfrican Minerals Ltd 17.56%

R & J Superannuation Fund 11.23%

Mr Jeremy Bewick Dowler 8.01%

Mineral Securities Ltd 7.68%

Standard Bank 6.53%

Clarity Enterprises 3.61%

Share DataShares in Issue 65.1m

Share price (17/10/08) 4.5p

52 High 16p

52 Low 3.75p

Market cap. (£) 2.93m

Options 3.9m

Warrants 1.1m

Fully diluted shares in issue 70.1m

MARKET PROFILE

AdvisorsNominated Advisor Grant Thornton Corporate Finance LLC

Broker Fox-Davies Capital Limited

CPR CSA Australia Pty Ltd

Market Makers Shore Capital

Winterfloods

Fox-Davies Capital Limited


BOARD PROFILEJeremy Dowler, Chairman Non-executive Director

• Board member of various resource companies over the past 20 years.• Qualified as a Chartered Accountant.• Founding shareholder & former finance Director of Platmin Limited, an TSX and AIM listed platinum

exploration & mining company.

Brett Townsend B.Sc, Acting Managing Director• Geologist with 19 years experience in the resource industries (MAusIMM).• Senior management positions at Resource Consultants International Pty Ltd and J.O. Clough Pty Ltd.• Director of Baobab Resources since 2006.

Ben James B.Sc, Technical Director• Geologist with 14 years global experience in the mineral exploration industry (MAusIMM).• Working experience in a wide variety of geological terrains & commodities.• Formerly Exploration Manager of Baobab Resources since 2006.

Tony Walsh B.Com, MBA, CA, Non-executive Director• Chartered Accountant with Ernst & Young.• Joined the Australian Stock Exchange as a senior advisor and later Assistant Manager, Issuers.

Jonathan Beardsworth, Non-executive Director• CEO of Metals Exploration Plc. Previously was head of the London office of Standard Bank Plc’s Mining

& Metals team.• Over 12 years experience of M&A & strategic advisory assignments in the mining industry worldwide.


MOZAMBIQUE PROFILE

• Robust geological provinces with little or no historic exploration

• Stable, democratic government

• Modern Mining Act & Cadastral licensing system guaranteeing security of tenure

• Good infrastructure with major investments into transport, communications, power, agriculture, industry and mining

• Investor-friendly fiscal policies

• The Mozambican Government is firmly committed to encouraging foreign investment in developing Mozambique’s mining industry

• Flourishing mining industry with major players (inc. Vale, Riversdale Mining Ltd, Kenmare Resources Plc, BHP Billiton, Rio Tinto & Pan African Resources Plc)


TETE PROJECT


TETE PROJECT - BUSHVELD TYPE TARGETS

• Tete Mafic Complex being explored for Bushveldtype layered deposits of iron ore, PGEs, & base metals.

• Licences contain 5 known vanadiferous titano-magnetite deposits.

• Tete fast becoming a major mining hub with Vale & Riversdale active at Moatize & Benga respectively.

• Significant investments going into refurbishing existing infrastructure & developing hydro & thermal electricity schemes.

• Complex also highly prospective for hydrothermal replacement deposits of gold, copper & uranium.


TETE PROJECT – MASSAMBA GROUP (V / Ti / Magnetite)• Massamba Group comprises 4

vanadiferous titano-magnetite prospects which have experienced limited previous exploration.

• Rock chip sampling returned average grades of 49% Fe, 21% TiO2 & 0.3% V. Density measurements range from 2.9 to 5.4 g/cm3.

• Recent field work has identified additional magnetite outcrops.

• Interpretation of high resolution geophysics indicates near surface, steeply dipping, highly magnetic bodies ranging in width from 50m to 450m, over a combined strike length of +8km.

• Excellent opportunity for developing significant tonnages at a low discovery cost.


TETE PROJECT – INTERIM METALLURGICAL RESULTS

1005.421001.0210020.11000.5510070.310015000Calculated Head

11.910.1211.71.8711.937.60.90.074.144.76.4957.9NON-MAGS

50.210.8954.92.2438.731.28.80.1917.649.6253749.13000G MAGS

37.82.9933.40.549.314.590.30.7278.380.368.610293800G MAGS

dist %grade %dist %grade %dist %grade %dist %grade %dist %grade %(%)(g)

Al2O3SiO2TiO2V2O5Fe2O3Wt DIST.WEIGHTPRODUCT

STAGE 1 BENEFICIATION TEST WORK RESULTS: 106µm grind at 800 & 3000 Gauss

10012.11000.3110049.1910015000Calculated Head

11.922.50.90.044.131.286.4957.9NON-MAGS

38.718.78.80.1117.634.69253749.13000G MAGS

49.38.790.30.4178.356.1368.610293800G MAGS

dist %grade %dist %grade %dist %grade %(%)(g)

TiVFeWt DIST.WEIGHTPRODUCT

• Massamba Stage 1 beneficiation test work at a 106µm grind & 800 Gauss low intensity magnetic separation (LIMS) has produced a high mass yield concentrate assaying 56% Fe & 0.7% V2O5.

• Low concentrate grades of titanium (<9%), silica (0.5%) & other deleterious elements.

• At current market prices, the value per tonne of concentrate is estimated at US$80 iron plus vanadium credits.

• Non-magnetic residue containing 22% titanium may be a marketable byproduct.

• Improved concentrate grades are expected from Stage 2 beneficiation test work at a finer grind.


TETE - MASSAMBA DRILLING DETAIL• Stage 1 Diamond drilling to target known

prospects. Drilling will test 1.2km of +8km strike potential (Q1/Q2 2009).

* Diamond: angled 200m deep holes at 75m centres along traverses spaced 150m apart .RC: angled 100m deep holes at 50m centres along traverses spaced 600m (stage 1) & 300m (Stage 2) apart.

** width ranges estimated from outcrop mapping. Where available, the individual strike lengths are measured from outcrop mapping, otherwise an extrapolation of 100m from drill limits has been applied. An open-pit depth of 150m has been used in the calculations. The in-ground specific gravity of 4g/cm3 is based on laboratory analyses completed by Baobab.

*** width ranges estimated from the aeromagnetic modeling (discounted by ~75%). Lengths have been extrapolated 150m north and south of the individual traverses. Depth and SG values are 150m and 4g/cm3 respectively.

• Stage 2 Diamond drilling to target Monte Chimbala & southern magnetic anomaly.

47.4mt - 61.2mt1.15£558,0004,80024

9.0mt - 12.0mt0.25£93,0008004Caangua

14.4mt - 19.2mt0.4£163,0001,4007Chitongue Pequeno

24.0mt - 30.0mt0.5£302,0002,60013Chitongue Grande

Exploration Target (mt)**

Strike Length

(km)

Estimated Cost (GBP)

No. Metres

No. Holes*PROSPECT

STAGE 1 DIAMOND DRILLING

63.0mt - 90.0mt0.9£790,0246,80034Chimbala / South Zone

Exploration Target (mt)***

Strike Length

(km)

Estimated Cost (GBP)

No. Metres

No. Holes*PROSPECT

STAGE 2 DIAMOND DRILLING

• RC drilling in 2 Stages for an aggregate of 22,000m at an estimated expenditure of £1.8m.

Stage 1 Diamond drilling

Stage 2 Diamond drilling

Stage 1 RC drilling

Stage 2 RC drilling


TETE - FUTURE DIRECTIONS

● Diamond drilling 1

● Airborne geophysics/radiometrics

●Diamond drilling 2

● Metallurgical test work

●RC drilling 2

● Advanced studies

DECEMBER 2008

DECEMBER 2009

DECISION TO MINE (2010/2011)

RESOURCE ESTIMATE 1

●

RESOURCE ESTIMATE 2

●

PREFEASIBILITY STUDIES● Geotechnical / hydro● Environmental / Social● Mine design & methodology● Infrastructure, equipment & services● Financial, commercial & legal● CSR initiatives

DEVELOPMENT OF ADDITIONAL RESOURCES ●

● RC drilling 1

●Additional diamond& RC drilling


MUNDONGUARA PROJECT Mine & 2007/2008 Drilling


MUNDONGUARA - HISTORY

Massive Sulphide Secondary Ore

The tip of the iceberg

• Recorded production from 1902 to 1989 when the mine closed due to poor management

• Resources exploited over 1km of strike to depths of ~200m below surface (stope widths between 1m and 20m)

• Resource grades ranged between:

1.6% - 4.6% Cu0.15g/t - 2.99g/t Au1.00g/t - 63.0g/t Ag

• Co & Ni credits

• No analogies found to date – a new model for mineralisation

• Manica fast becoming a mining community with 5 international exploration companies working in the area including Pan African Resources Plc completing Pre-Feasibility (1.7Moz Au)


MUNDONGUARA - INFRASTRUCTURE (BEIRA CORRIDOR)

• International rail & road within 2km of mine giving excellent access to supply lines & markets.

• Abundant hydroelectric power.

• Major investments into transport, communications & power.


MRC027: 29m @ 1.5% Cu, 0.17g/t Au & 1.97g/t Ag

MUD016: 9.25m @ 1.8% Cu & 4.49g/t Ag

MUD027: 1m @ 11.5% Cu, 0.44g/t Au & 5.77g/t Ag

MUD011: 3m @ 3.9% Cu & 4.24g/t AgMUD011: 1.71m @ 2.4% Cu, 1.17g/t Au & 4.29g/t Ag

MUD009: 3m @ 2.9% Cu & 3.00g/t Ag

MUD007: 3m @ 6.1% Cu, 0.42g/t Au & 12.76g/t Ag

MUD021: 11m @ 0.9% Cu

MUD023: 5m @ 1.0% Cu & 3.80g/t Ag

MUNDONGUARA - STAGE 1 RESOURCE

• Stage 1 JORC Inferred Mineral Resource:

Granite gneiss

Ultramafic

Diorite intrusive

Exploited ore

Stage 1 resource

Drillhole pierce point

20

0m

20

0m

142.93.37.80.1830.62.31.341.0

208.12.111.10.1142.51.43.130.3

Category: Inferred Technique: Inverse Distance Squared

(Ozs x 1,000)(g/t)(Ozs x 1,000)(g/t)(tonnes x 1,000)(% Cu)(x 1,000,000)(% Cu)

Ag MetalAg gradeAu MetalAu gradeCu MetalCu GradeTonnesLower Cutoff


MUNDONGUARA - DEPTH POTENTIAL

• Down plunge continuations of high-grade zones Conceptual Target to be tested by Deeps drilling programme

• Theoretical underpinning source target

Granite gneiss

Ultramafic

Diorite intrusive

Exploited ore

Stage 1 resource

Conceptual target

Drillhole pierce point

65

0m

Seymour Prospect

* Using a 0.3% Cu lower cutoff grade extending to a maximum depth of 200m below existing development


• Phase 1 drilling & trenching outlines significant copper & gold mineralisation at Seymour Prospect, 1km west of mine:

• Mineralised porphyry outcrops located 400m west of Seymour

• Robust copper-in-soil anomalies confirm a mineralised strike length of +3km (openended to the west)

MUNDONGUARA - STRIKE POTENTIAL: WEST

Seymour ProspectSeymour West

1km1km

Granite gneiss

Olivine peridotite

Diorite intrusive

Stage 1 Resource

Mundonguara Mine

1km

Granite gneiss

Olivine peridotite

Dacite

Komatiite

Sediments

Diorite intrusive

Serpentinite

BIF

Talc shear zone

TrenchingMTR001: 20m @ 3.7%Cu & 0.82g/t Au

RC DrillingMRC032: 17m @ 2.1% CuMRC031: 3m @ 9.59g/t AuMRC034: 27m @ 0.7% Cu


MUNDONGUARA - STRIKE POTENTIAL: NORTHEAST

• Aeromagnetics identify structurally off-set continuations of mine sequence to the NE (supported by Cu in soil anomalies)

Seymour Prospect

2.5

km

Mundonguara Mine

Mine sequence continuationwith Cu in soil anomalies


MUNDONGUARA - ADDITIONAL TARGETS: Nickel & Gold

• Significant Nickel-in-soil anomalism south of Mine sequence overlying basal olivine-peridotite sequence

• Broad >0.2% Ni intercepts in RC drilling & trenching (silicate or sulphide Ni?)

• Coherent gold-in-soil anomalism associated with banded iron formation (BIF) interpreted as the fault off-set continuations of Pan African Resources’ Dot’s Luck prospect

BIF associated Au in soil anomaly


MUNDONGUARA - CORPORATE SOCIAL RESPONSIBILITY

• Environmental & social baseline studies completed at outset.

• The Company is firmly committed the retention & promotion of staff through formal & informal training & mentoring programmes.

• A culture of safety has been nurtured to ensure that every man makes it home at the end of his shift.

• The Company respects the rights and needs of the local community.

• The Company endorses the UN Millennium Development Goals & seeks to implement sustainable initiatives that will assist the local community in achieving these goals.


MUNDONGUARA - FUTURE DIRECTIONS

● Environmental & social baseline study

● Channel sampling, Trenching & soil geochemistry● Surface & Underground drilling

● Airborne geophysics/radiometrics

Ground geophysics ●

Surface drilling 2 ●

Metallurgical studies 1 ●

Mine design & methodology studies ●

Infrastructure, equipment & services studies ●

Surface drilling 3●

CSR initiatives ●

Advanced studies ●

DECEMBER 2007

DECEMBER 2008

DECISION TO MINE (2010/2011)

● RESOURCE ESTIMATE 1

DECEMBER 2009 ●RESOURCE ESTIMATE 2

Geotechnical / hydro studies ●

Financial, commercial & legal studies ●

Metallurgical studies 2 ●


SUMMARY: TETE

Work completed during 2007 / 2008 has expanded the prospectivity of the TeteProject.

Reassessment of known V-Ti-Magnetite prospects, in conjunction withaeromagnetic interpretations, indicates the potential for significant tonnages ateconomic grades.

Test work underway to determine the metallurgical characteristics of thedeposits & the economics & potential processes for recovering either avanadium product or a combination of pig iron, vanadium & titanium products.

Initial metallurgical results ate encouraging & meet the general specifications required byend-users.

Stage 1 drilling of V-Ti-Magnetite prospects planned for Q1/Q2 2009.

Tete is becoming a major investment centre with Vale & Riversdale developingcoal projects.

Existing infrastructure being refurbished & expanded: railway, port, power.


SUMMARY: MUNDONGUARA

Work completed over the past 18 months indicates that the MundonguaraSystem is significantly larger than previously anticipated, requiring anaggressive exploration effort to rapidly assess its full potential.

Potential for significant tonnages exists in 3 areas:

• down plunge extensions of exploited ore zones within the mine - drilling has confirmed continuity

• System along strike to the west - >1.5km area containing the Seymour Prospect where the Company has made significant exploration advances

• System along strike to the northeast – recently identified fault offset continuations of the mine sequence

Stage 1 JORC Inferred Resource Estimate completed:3.1Mt @ 1.4% Cu, 0.11g/t Au, & 2.1g/t Ag

Comprehensive Pre-Feasibility drilling campaign designed.


USE OF PROCEEDS

£390,000CORPORATE

£160,000ADMINISTRATION

£110,000TENURE: Surface Tax commitments

£260,000EXPLORATION: Support/salaries/vehicles/consumables

£580,000TETE: Stage 1 Diamond Drilling (drill/assay/consultants)

JulJunMayAprMarFebJanDecNov

20092008

NEWS FLOW:

Final beneficiation results

Stage 1 Resource Estimate

Additional metallurgical results

Interim drilling results 1



Drilling commences at Tete

Raising £1.5m for exploration focused on developing resources at Tete iron ore project

MUNDONGUARA: source strategic partner/additional funding to advance project towards feasibility

OTHER PROJECTS: continued systematic low cost exploration

Wet season


CONTACTS

BAOBAB RESOURCES PLCBAO-AIMwww.baobabresources.com49 Phillimore StreetFremantleWestern Australia 6160Tel: (+61) 8 9430 7151

Brett Townsend Acting Managing Director [email protected] (+61) 409 335 105

Jeremy DowlerNon-Executive Chairman [email protected] (+44) 1 372 450529

Ben JamesTechnical Director [email protected] (+61) 419 966 182

Jon Crowe Market Relations [email protected] (+61) 419 966 173

FOX-DAVIES CAPITALwww.fpcap.com

Daniel Fox-Davies [email protected] (+44) 20 7936 5220


OTHER PROJECTS


CHANGARA PROJECT – BROKEN HILL TYPE TARGETS

• Considered highly prospective for Broken Hill Type polymetallicbase & precious metal mineralisation.

• Hosts numerous occurrences & deposits of zinc, lead, manganese, iron ore, fluorite, copper & silver.

• Limited historical exploration.

• Extensive soil geochem survey underway


SUSSUNDENGA PROJECT – LODE Au TARGETS• Robust artisanal gold workings at

Bandire.

• Four discrete gold-in-soil anomalies generated by Ashanti.

• 11 RC holes drilled by Ashanti into one anomaly showed stacked gold veins dipping west & striking north into Baobab licences.

• Similar regional geology northwards through Baobab licences for 25km.

• Complete Stream Sediment Sampling coverage scheduled for 2008 (Gondwana).


SENGA SENGA PROJECT – TELFER TYPE Au-Cu TARGETS

Ore system model

• Dome structures identified, Telfer Type model applied.

• Complete Stream Sediment Sampling coverage scheduled for 2008 (Gondwana).


ANGONIA/FURANCUNGO PROJECT - EXPLORATION TARGETS

• Historic gold deposits.

• Multi element base metal anomalies generated by UNDP*.

• Quotes for airborne magnetic & radiometric surveys currently being sought.

* United Nations Development Project

Documents

Developing Mineral Deposits in Mozambique - Baobab …€¦ · · 2011-09-28vanadiferous titano-magnetite mineralisation ... • At current market prices, the value per tonne of