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Investor Presentation March 2013
Disclaimer
This presentation has been prepared by Ouro Mining Inc. (the "Company").
This presentation may not be reproduced, redistributed or passed on, directly or indirectly, to any other person, or published, in whole or in part, for any
purpose without prior written approval of the Company.
The material contained in this presentation is for information purposes only. This presentation is not an offer or invitation for subscription or purchase of, or a
recommendation in relation to, securities in the Company and neither this presentation nor anything contained in it shall form the basis of any contract or
commitment.
Any offering of any of the Company's securities to Australian persons will be subject to Australian securities laws. The distribution of this document in
jurisdictions outside of Australia may be restricted by law, and persons in to whose possession this document comes should inform themselves about, and
observe, all such restrictions. In Australia this document is only being provided to persons who are sophisticated investors, in accordance with section
708(8) of the Corporations Act 2001 ("Corporations Act") and professional investors, in accordance with section 708(11) of the Corporations Act, or to such
other persons whom it would otherwise be lawful to distribute it.
This presentation is not financial product or investment advice. It does not take into account the investment objectives, financial situation and particular
needs of any investor. Before making an investment in the Company, an investor or prospective investor should consider whether such an investment is appropriate to their particular investment needs, objectives and financial circumstances, seek legal and taxation advice as appropriate and consult a
financial adviser if necessary.
This presentation may contain forward-looking statements that are subject to risk factors associated with exploring for, developing, mining, processing and
sale of coal. Forward-looking statements include those containing such words as "anticipate", "estimates", "forecasts", "should", "could", "may", "intends",
"will", "expects", "plans" or similar expressions. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of the Company. It is believed that the expectations
reflected in these statements are reasonable but they may be affected by a range of variables and changes in underlying assumptions which could
cause actual results or trends to differ materially. The Company does not make any representation or warranty as to the accuracy of such statements or assumptions.
This presentation has been prepared by the Company based on information available to it as at January 31, 2013 and has not been independently verified. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions
and conclusions contained in this presentation. To the maximum extent permitted by law, none of the Company or its subsidiaries or affiliates or the
directors, employees, agents, representatives or advisers of any such party, nor any other person accepts any liability for any loss arising from the use of this
presentation or its contents or otherwise arising in connection with it, including without limitation, any liability arising from fault or negligence on the part of
the Company or its subsidiaries or affiliates or the directors, employees, agents, representatives or advisers of any such party.
The Company estimates its reserves and resources in accordance with the Australasian Code for Reporting of Identified Mineral Resources and Ore
Reserves 2012 Edition (JORC Code).
Ouro Mining Inc
Ouro Mining is an unlisted public company developing its 100% owned
Heavener hard coking coal project in the Arkansas Coal Basin of the USA.
The company is currently owned by:
Founder Shareholders 50%
Taurus Resources Fund 2 10%
Other Shareholders 40%
The Heavener Project is expected to produce 1.7Mtpa of product coal:
Low to mid vol hard coking coal
Mine life of at least 20 years
Underground longwall/continuous miner operation
The mine will benefit from:
Extensive existing infrastructure availability
Attractive operating costs
Low capital requirements
High quality product for the export market
Section 1
Heavener Project
Locality
The Heavener project straddles the border of Oklahoma and Arkansas
Coal occurs in the Lower Hartshorne Seam
Two 43-101 Reports already completed in 2008 and 2011
Resource of 201Mt (JORC)*
Reserve of 96 Mt (JORC) within Life of Mine Plan*
Over 300 drillholes on the tenements (29,000 metres)
Seam thickness varies from 1.3m to 5.0m, averaging 2.5m.
Seam dips 8⁰ to 16⁰ to the NNW
Little evidence of faulting in 18 km of strike length
Gas increases with depth. Will require degassing
DFS completed February 2013 (Weir International)
* Includes controlled and uncontrolled tenements as defined in WEIR Feasibility Report (2013)
Heavener Project - Summary
Resource Status
34 diamond drillholes
Geotechnical Work and Mine Design
Degassing Studies
JORC Reserve Statement
Coal washability and washplant design
2D Seismic Survey above planned mining
areas completed.
Heavener Project – 2012 Field Work Completed
Heavener Conceptual Mine Layout
Project Details
Heavener Project - Summary
Mining Method: Continuous Miner plus Longwall
Planned production rate - 1.7Mtpa of washed product coal
Estimated Costs:
Capital - US$199m
Operating Cost Ex Mine - US$80/t product
FOB Cost - US$107/t product
Heavener Project - Summary
Tenement Status
Eight coal leases totalling 3130 hectares held by Ouro Mining, Inc.
Filing Number: 1912291074
Incorporated in the State of Oklahoma, USA
Applications filed for an additional 2210 hectares adjoining above tenements
Fully permitted open cut title due to recent opencut mining by previous
owners
Permitting for underground development currently underway
The region has a good skilled workforce available
Total local and government support for project development
Excellent infrastructure and access to rail and port
Washed Coal
• Float @ 1.4 Specific Gravity (%)
• Ash (%)
• Volatile Matter (%)
• Fixed Carbon (%)
• Sulfur (%)
• kcal/kg (dry basis)
• FSI @ 1.5 S.G.
• HGI
• Coke button
Coal Quality Low to Mid-Vol Hard Coking Coal
68.6 - 86.0
6.2 – 6.9
22.8 –23.8
69.4 – 70.7
0.81 – 1.04
8,036 – 8,105
9.0
100+
8.5 to 9
Transport Infrastructure
Transport Infrastructure
Section 2
Management
Key Management Team Members
Management Team
Mr Paul Ingram (MAus IMM) -- Executive Director and CEO
Mr Edward Pitrolo (BSEM, Certified Mine Manager) – Executive Director
Mr John Fisher-Stamp (FCA, FTIA, GAICD, MIMC) – Executive Director
Mr Harry Mustard BSc (Hons) MAIG – Exploration Manager
Mr Stephen Morgan– Operations Manager
Ms Sarah Jordan – Company Secretary
Technical Advisors
Technical Advisors
Definitive Feasibility Study & JORC
Resource Work Weir International, Inc John W Sabo - Executive Vice President and Managing Director
Mining and Engineering LD Operations Pty Ltd – Mining and Design Services Peter Ross - Managing Director
Tenement Management and
Environmental Emera Corp - Oklahoma Mr Saeed Zahrai - Principal
Gas and Drainage Management GeoMet Inc – Texas Mr Scott Meyers – Senior Consultant
Boxcut Design TEE Engineering – West Virginia Mr Tim Blackburn - Principal
Metallurgical & Coal Quality A & B Mylec Pty Ltd - Queensland Mr Andy Meyers - Principal
Geological and Data Verification Hanna Consulting Services - NSW Mr Pat Hanna – Principal
– FAusIMM, CP, MMICA, MAICD, MAGMM
Professional Advisors
Advisors
Auditor and Corporate Taxation Tulsa, United States Ernst & Young
Legal and Transfer Agent Australia, Hong Kong & United States
Ashurst New York, United States
Sichenzia Ross Friedman Ference LLP
Section 3
Offer Overview &
Share Capital Structure
Private Placement Pre IPO Funding
Target Capital Raising Investors – Pre IPO Round
Offer Price Regulation S Shares of Common Stock
Shares of Common Stock on issue prior to this Offer Common Stock Share Options Granted
Number of Regulation S Shares of Common
Stock to be offered under this Offer to be completed by
30 April 2013.
Total Shares of Common Stock and Regulation S Shares of
Common Stock after Issue pursuant to the Offer:
Shares of Common Stock and Reg. S undiluted
Shares of Common Stock and Reg. S fully diluted
Offer Price for all Shares fully diluted
Equity Value fully diluted
Exercise Price of Common Stock Options outstanding1
US$15,000,000 US$0.60 277,777,777
119,990,503
25,000,000
302,777,777
422,768,280
US$0.60
US$ 255,000,000
US$0.235
1= Options terms - Taurus Option 64,280,627 at any time up to an including IPO for US$15m and Texcord Option 55,709,876 at any time up to September 20, 2016 for US$13m
Ouro Current Share Structure
Shareholders Interests:
Ewan Developments Ltd
Songqiang Chen
Taurus Resources Fund 2
Other Shareholders
Total Outstanding Common Stock and
Reg. S Common Stock
Common Stock Options Granted
Total Outstanding Common Stock and Reg.S
Common Stock on a Fully Diluted Basis
Shares %
99,247,458
99,247,458
38,444,444
40,838,417
Issued Shares
277,777,777
Options
119,990,503
Issued Shares & Options
397,768,280
24.95%
10.26%
30.17%
9.67%
100.00%
24.95%
Ouro is seeking Pre IPO Capital of US$15m to continue the underground mine
approvals process and commence earthworks.
Ouro is scheduled to continue mine development works in Q3-Q4 CY 2013
which will require an additional round of Pre IPO funding of US$25m scheduled
for completion by 31August 2013 .
Ouro directors will review Debt to Equity Structure for IPO and funding options
in Q4 2013, to commence underground and surface infrastructure works and
equipment acquisition est. US$150m.
Ouro Pre IPO US$15m Use of Funds
Pre IPO US$15m funds will be applied to the following works activities:
Mine approvals, permitting & environmental compliance
Geology & geotechnical
Mine planning, engineering and consultants
Capital equipment Earthworks, box cut & portal construction
Tenements and land acquisition
Working capital and corporate overhead
Total
US$2.1m
US$15m
US$1.7m
US$1.0m
US$7.6m
US$0.5m
US$1.6m
US$0.5m
Overview of Completion
Share Capital Structure
Equity Value pre completion – Pre IPO US$15m Round
Enterprise Value Pre IPO US$15m Round
JORC 20 Year Plan Reserve of 54 m tonnes
Implied Market Capitalisation on Completion of Pre IPO
US$15m Round
US$240,000,000
US$245,000,000
US$255,000,000
Implied Market Capitalisation on Completion of Pre IPO
US$25m Round 31 August 2013 US$335,000,000
US$450-475m Target Market Capitalisation Range and Structure on
completion of IPO Equity US$50m & Debt funding US$100m
1= Directors will consider the merits of dual listing on the HKEx post ASX IPO.
2= Directors shall consider interposing an Australian Holding Company above Ouro Mining, Inc
preceding ASX IPO.
1,2
Ouro Mining, Inc DFS Mine Plan
Projections 20 Years
Ouro Mining, Inc DFS Mine Plan
Projections 20 Years
DFS Internal Rate of Return (IRR):
Pre Tax 53% Post Tax 44%
Ouro Mining, Inc DFS Mine Plan
Projections 20 Years
Ouro Mining, Inc
Capital Intensity Comparison
Target Capital
Cap Ex Prdn Intensity
Company Project Coal Mine Type US$m mtpa A$/t
Bathurst South Buller HCC O/C Greenfield 161 2.8 66
Bathurst South Buller+ North Buller HCC O/C 185 2.8 66
Aquila Eagle Downs HCC O/C Greenfield 1,254 8.0 157
BHP Appin Area 9 HCC U/G Brownfield 804* 3.5 230
BHP Cavil Ridge HCC O/C Greenfield 3559* 5.5 647
BHP Daunia HCC/SSCC O/C Greenfield 1552* 4.5 338
Carabella Grosvenor West HCI O/C Greenfield 905 3.8 238
Cockatoo Baralaba PCI O/C Brownfield 413 2.8 150
Cokal Bumi Barito HCC O/C Greenfield 100 2.0 50
Gujurat No.1 & Wongawilli HCC U/G Brownfield 500 5.0 100
Macarthur Codrilla PCI O/C Greenfield 350 3.2 109
Whitehaven Narrabri PCI U/G Greenfield 500 6.0 83
Whitehaven Maules Creek SSCC O/C Greenfield 766 10.5 73
Whitehaven Vickery SSCC O/C Greenfield 350 4.0 88
Median 130
Ouro Heavener HCC UG Greenfield 199 1.7 112
*Converted to Australian to US dollar of 1.051 as of January 24. Source: Company reports, RBC Capital Markets estimates.
Ouro Mining, Inc
Operating Cost Comparison FOB
Company Project LT Opex*
Bathurst Buller US$90-100/t
Aquila Eagle Downs US106/t
Carabella Grosvener West US$95/t
Cockatoo Baralaba US$95/t
Cokal Bumi Barito US$76/t
Peabody Codrilla US$79/t
Whitehaven Narrabri US$45-50/t
Whitehaven Maules Creek US$56/t
Whitehaven Victory US$72/t
Ouro Heavener US$101/t* Logistics cost US$27/t.
Mine Cash cost US$58/t
*Costs based on Australian to US$ exchange rate of US0.90 cents and are quoted excluding royalties Source: Company reports, RBC Capital Markets estimates.
Ouro Mining, Inc Comps applied to
ER/JORC Reserves A$/t
Implied Enterprise Value (EV) Completion of Pre-IPO Funding- Capital Round US15M – 30 April 2013
Ouro Mining, Inc 54mt JORC reserves for 20 year mine plan applied to ASX comparables average at A$4.50/t = up to US$243m
Ouro Mining, Inc 201mt JORC resources applied to ASX comparatives average at A$1.25/t = up US251m. Ouro warrants a higher EV/JORC Resources A$/t
EV Completion of Pre IPO Funding - US255m
Comps Average = 4.5 A$/t
Comps Average = 0.66 A$/t
Ouro Mining, Inc Enterprise Value (EV) Considerations:
Ouru Mining Inc Enterprise Value
Ouro Mining, Inc ASX benchmark comps are considered to be aligned in the grouping of Bathurst BTU
comps published by RBC Capital Markets Initiation Comment – Bathurst Resources 29 January 2013 .
These comprise BTU,YAL,AQA,WHC,GNM,CZA and AKM.
Ouro Mining, Inc is considered a near term metallurgical producer targeted for first production in Q3
2013 with the commencement of gateroad Development. A JORC reserve based EV calculation is
considered appropriate which can be correlated against a risk weighted DFS NPV. The JORC Reserves
Statement independently reported by Weir International, Inc is 61mt.
Weir International DFS completed in February 2013 with NPV’s average after tax > US$500m within a
range of discount rates 10%, 12%, 15% & 18%. The funding round implies a risk weighting up to 50% to
account for critical milestones over a 18 month period - UG approvals, gateroad Development, Cap-
ex, Mine Construction and UG Mining in Q2 2014.
Ouro is expected to command a premium for export coal quality and is forecast to produce product
coal cost at US$107 per tonne FOB and revenue per tonne of +US$167 per tonne in full production
FY2017.
The Heavener Project has excellent logistics options by rail and river barge to port.
• Seed Capital Funding- May 2012
– Completed
• Private Placement – October 2012 – Completed
• Drilling, seismic and JORC resource
studies Mar-Dec 2012 - Completed
• DFS Reporting – Feb 2013
– Completed
• Pre IPO Funding – April 2013 - US$15m and August 2013 - US$25m.
• Procurement and Construction
Start-up 2013
• Commencement of Production
with Gateroad Development in Q2 2014
• IPO/Debt Funding UG and Surface
Infrastructure Q1 2014 - US$150m.
Target structure – Equity US$50m and Debt – US$100m.
Timeline