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Overview of Forsys Metals and flagship uranium project in Namibia
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FORWARD-LOOKING STATEMENTS
Investor Presentation | October 2013 | Page 2
Some of the statements contained in the following material are forward looking statements and not statement of facts. Such statements are based on the current beliefs of management, as well as assumptions based on management information currently available. Forward looking statements are subject to various risks, uncertainties and other factors that could cause actual results to differ materially from expected results. Readers must rely on their own evaluation of these uncertainties. This presentation uses the terms, “Measured Resources,” “Indicated Resources” and “Inferred Resources.” The Company advises investors that although these classification terms are recognized and required by Canadian regulations (National Instrument 43-101—Standards of Disclosure for Mineral Projects “NI43-101”), they are not recognized by the U.S. Securities and Exchange Commission. Investors are also cautioned not to assume that any part or all of the mineral deposits in these categories will ever be converted to Mineral Reserves. Investors are also cautioned that “Inferred Resources” have a great amount of uncertainty to their existence and economic feasibility. Additional information identifying the Company’s risks and uncertainties is contained in its filings available at www.sedar.com. Qualified Person Mr. Martin Hirsch, M.Sc in Geology and a member of the British IMMM, Chief Geologist for Forsys Metals Corp., is the designated Qualified Person responsible for the Company’s exploration programs. He is familiar with the methods for Quality Assurance and Quality Control specifically applicable to uranium. Mr Hirsch has sufficient experience that is relevant to the style and mineralization, type of deposit and the use of radiometrics in resource estimates as well as to the activity he is undertaking to qualify as a Qualified Person under NI 43-101.
Well positioned for positive uranium sector outlook
• Advanced, fully permitted project in
Namibia
• Large compliant Resources and
Reserves
• Strong and improving economics
• Production scheduled to
commence in Q2 2016
Investor Presentation | October 2013 | Page 4
OUR CORE FOCUS | NORASA
Significant upside potential
Investor Presentation | October 2013 | Page 5
CAPITAL STRUCTURE
40.4%
53.5%
Insiders
Institutional
Retail
6.1%
Forsys Metals Shareholder Base
Cash*: $4.0 M
Share Price*: $0. 35
12 months range: $0.33 -$0.87
Avg. volume (3 mths): 22.3
Market Cap (diluted): CAD $40.0M
Shares Outstanding*: 109.8 M
Options*: 2.7 M
Warrants*: 2.0 M
Fully Diluted*: 114.5 M
* as of June 30, 2013
Driven by demand for affordable and clean electricity
POSITIVE URANIUM FUNDEMENTALS
Investor Presentation | October 2013 | Page 6
30% nuclear power
• Global power consumption to
grow 4% every year to 2020+
• 30 nuclear power countries
expanding capacity
• 45 nuclear-free countries
looking to add nuclear power
• Driven by rising fossil fuel costs
and harmful emissions
growth
in
by 2020*
*Global Data, March 2013
URANIUM RECOVERY
UNDERWAY
557 New
reactors to
be built or
under
construction
China India Russia U.S.A
Saudi Arabia World Total
Under Construction 28 7 10 3 0 68
Planned 61 18 28 9 0 175
Proposed 118 39 18 15 16 314
Total 207 64 56 27 16 557
Operable 17 20 33 100 0 432
Growth led by
emerging
countries without
domestic supply
Investor Presentation | October 2013 | Page 7
Strong fundamentals support $70/lb
long-term analyst price forecast
DEMAND TO EXCEED SUPPLY
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
-100,000
-75,000
-50,000
-25,000
0
25,000
50,000
75,000
Net Balance World Supply World Requirements
• Annual U3O8 demand ~170M lbs
• Current production supply ~140M
lbs
• Gap filled by secondary sources will
end late 2013
• HEU Agreement between U.S. and
Russia
Investor Presentation | October 2013 | Page 8
PROVEN
URANIUM
JURISDICTION
• Pro-business, stable
democracy
• Fair and balanced tax code
• Metals: uranium, gold,
diamonds, zinc, copper and
lead
5th largest global producer
of uranium
GDP derived from
mining
9%
Investor Presentation | October 2013 | Page 9
NAMIBIA
Opportunities for further resource expansion
* Total Measured & Indicated estimate at cut-off of 100ppm for Valencia and 170ppm for
Namibplaas
• Consolidation of 3 zones: Valencia Main / Satellite Pit & Namibplaas
• Extensive mineralization near
surface
• Open pit environment
NORASA | WORLD CLASS PROJECT
U3O8
Total M&I: 96 Mlbs*
Grade: 200ppm
Investor Presentation | October 2013 | Page 10
~35km from Rio Tinto’s Rossing Mine
NORASA | IDEAL LOCATION
SWAKOPMUND
ARANDIS
NORASA URANIUM PROJECT
RIO TINTO’S ROSSING MINE
PALADIN’S LANGER HEINRICH MINE
Mine Sites
Towns
NAMIBIA
N
AREVA’S TREKKOPJE MINE
Investor Presentation | October 2013 | Page 11
EXCELLENT INFRASTRUCTURE
Water Supply
Power Supply
Roads
Buildings
• The National Desalination Task Force confirmed additional
water availability by end of 2014
• Approximating 20 million cubic metre capacity per annum
• NamPower confirmed sufficient power supply capacity
• New base-load generation is anticipated to be
commissioned in 2015
• Additional power from Mozambique
• 26 km of new access road linking Valencia mine to highway
completed in mid 2010. Internal service roads have also
been constructed
• Semi-permanent village will be established 8 km from
process plant
Investor Presentation | October 2013 | Page 12
NORASA IN PERSPECTIVE
Investor Presentation | October 2013 | Page 13
10 uranium
producers in tonnes U
3O
8
Data from the World Nuclear Association.
3386 3146 3065
2661 2289 2135 2011 1955 1903
7520
Norasa’s operating potential - a re-rating opportunity
Top
$429M* Pre-tax NPV
$35/lb* Cash Costs
* 2010 Snowden Valencia Technical Report Investor Presentation | October 2013 | Page 14
Basis for
optimization
and
consolidation
* SNOWDEN, Valencia Uranium (Pty) Ltd: Addendum to June 2009 Technical Report; Project No 696 dated January 2010
STRONG ECONOMICS
Progress through optimization and consolidation
2013 Engineering
Cost Study
Throughput 8.6M tonne/yr 11.2M tonne/yr
Production 3.3M lb/yr 4.2 M lb/yr
Process cost $/lb $23.66 $21.11
CAPEX (Plant) $241.6 MM $249.7 MM
Crushing 3-Stage 2-Stage
Milling 3 rod mills 1 SAG mill
Revenue (loM) $3.5 billion $4.5 billion
Differential NPV + $348 million
* 2013 ECS was completed by AMEC and focused on the optimization of Norasa’s project economics. Includes Namibplaas and
Valencia. See News Release: May 2, 2013 for details
Investor Presentation | October 2013 | Page 15
NORASA | Optimized / Expanded Plant*
2010 Base Case Updated to
2013 $
Permit Summary
Permit Issued By Status
Mining Licence (ML149) Ministry of Mines and Energy
Accessory Works Ministry of Mines and Energy
Environmental Clearance —Valencia Village Ministry of Environment and Tourism
Environmental Clearance Ministry of Environment and Tourism
Petroleum Consumer Installation Ministry of Mines and Energy
Desalination Ministry of Agriculture, Water & Forestry
Investor Presentation | October 2013 | Page 16
VALENCIA ZONE | FULLY PERMITTED
MANAGEMENT
An experienced team – successfully delivering projects on
time and within budget
Marcel Hilmer CEO & Exec. Director
30 years of senior management experience with global public and private organizations, specifically with international
mergers and acquisitions in Africa, Europe, Asia and Australia. A long standing member of the Institute of Chartered
Accountants in Australia. Previously, with First Quantum Minerals Limited as a business development executive.
Rowen Colman Director Finance
A Chartered Accountant with over 25 years of successful senior financial management experience in various global industries
and holds a Bachelor Degree in Commerce from the University of NSW, Australia. Previously, was the Development Director
for a major sovereign wealth fund in the Middle East and guided the fund from start-up to a global powerhouse.
Mark Frewin VP Legal Affairs &
Director
A partner at the international law firm of McCarthy Tétrault, and based in their London England office. Focuses on energy and
in particular mining and metals. Has participated in numerous international mine financings including several for companies
which do business in Africa. Mr. Frewin is also a director of the Company and of IC Potash.
Dag Kullmann General Manager &
Project Engineer
A Mining Engineer (M.Sc. University of Alberta, Canada, 1989) with over 20 years of experience in the precious, base metals,
diamonds, coal and uranium mining industry throughout Africa and within Asia and Europe. Acted as Qualified Person for
several large and small mining companies for the completion of reserve reporting and listing documentation for the JSE, AIM,
ASX and TSX.
Martin Hirsch Chief Geologist
An experienced and professionally registered Geologist with a Master’s Degree in Geology from the Johan Wolfgang-Goethe
University in Frankfurt A.M, Germany. Has more than 20 years of mining industry experience in opencast mining and
exploration project management in uranium and diamonds. Previously with Rio Tinto’s Rössing Uranium Mineas Chief
Geologist and Areva Resources Namibia.
Investor Presentation | October 2013 | Page 18
DIRECTORS
100+ years of experience in African mining
Martin R. Rowley Independent Director &
Chairman
Graduated from the University of Western Australia with a Bachelor of Commerce degree in 1975. He worked as executive
assistant to the Board of Directors of a large Australian public company from 1980 to 1984. He then established his own
resource consulting and investment company and was involved as a shareholder, Director and Chairman of a number of
Australian public resource companies before co-founding First Quantum Minerals Ltd in 1996.
Thomas Allen Independent Director
A counsel to Ogilvy Renault LLP, an international law firm based in Canada, and has extensive experience advising
numerous corporations on corporate affairs, corporate governance, corporate financings and reorganizations.
Paul Matysek Independent Director
Serves as President and Chief Executive Officer of Lithium One Inc. and Nevada Copper Corp. Has over 35 years of
exploration and development experience and has been involved in raising over $200 million for various exploration and
development projects since 1999.
Claudio Cornini Independent Director
Founder and current Executive Director of Cornhill and Harvest Ltd. (C&H). Since 2008, C&H has focused on providing
small cap and larger private companies with investment, corporate finance and M&A advisory services Prior to this,
between 2004 – 2008, He served as Chairman of AAA Bank in Milan, Italy and concurrently, from 2007 to early 2008, he
was in charge of the Network Desk at ABN AMRO in Italy.
Marcel Hilmer &
Mark Frewin
Details on previous management slide
Investor Presentation | October 2013 | Page 19
VALUATION AGAINST PEERS
Current EV and expected sector recovery
provide attractive entry point
Average: $1.04
EV
/lb
($)
Investor Presentation | October 2013 | Page 20
4.0
1.6
1.0 0.8
0.7 0.5
0.4 0.3
0.1
$0.00
$0.50
$1.00
$1.50
$2.00
$2.50
$3.00
$3.50
$4.00
DML.T KIV.V UEX.T RSC.T LAM.T MGA.T FSY.T DYL.AX BAN.T
FORSYS
INVESTMENT
SUMMARY
Investor Presentation | October 2013 | Page 21
Poised to capitalize on uranium sector recovery
Consolidated project in mining friendly jurisdiction
Strong economics and low cost environment
Advancing towards production
Fully permitted with excellent infrastructure
Experienced management team
CONTACT
INFORMATION
Investor Relations and Corporate
Services Canada
Joe Racanelli
VP, TMX Equicom
31 Adelaide Street East
Toronto, Ontario M5C 2K3
+1 416-815-0700 ext. 243
Australian Representative Office
Marcel Hilmer, CEO
18 Richardson Street
West Perth WA 6005
+61 8-9322-3549
www.forsysmetals.com
Investor Presentation | October 2013 | Page 22
LARGE COMPLIANT RESOURCE*
Investor Presentation | October 2013 | Page 24
* Based on updated Estimate of Resources – October 2013
Category Cut-Off Grades Tonnes [M] U3O8 [ppm] U308 [mlb]
Measured
Val 60ppm: Nam 100ppm 27 153 9
Val 100ppm: Nam 160ppm 17 202 7
Val 140ppm: Nam 200ppm 10 253 6
Indicated
Val 60ppm: Nam 100ppm 419 153 141
Val 100ppm: Nam 160ppm 221 197 96
Val 140ppm: Nam 200ppm 114 248 62
Measured + Indicated
Val 60ppm: Nam 100ppm 447 153 150
Val 100ppm: Nam 160ppm 237 197 103
Val 140ppm: Nam 200ppm 125 248 68
Inferred
Val 60ppm: Nam 100ppm 105 156 36
Val 100ppm: Nam 160ppm 50 198 22
Val 140ppm: Nam 200ppm 18 269 10
OPEN PIT DESIGNS
Investor Presentation | October 2013 | Page 25
Namibplaas
Valencia Main & Satellite
Namibplaas resource model displaying blocks of 170ppm plus within the updated preliminary pit outline.
Valencia resource model displaying blocks of 200ppm plus within the updated preliminary pit outline.
ENGINEERING COST STUDY
Investor Presentation | October 2013 | Page 26
AMEC released an Engineering Cost Study Report
dated May 2013. The scope of works included assessing
a number of comminution flowsheet changes,
optimizations and process plant Capex and Opex
updates. The preferred option was a two-stage crush
plus single stage SAG mill using acidic filtrate at a grind
of P80 ~600 µm. Highlights include:
• Differential NPV estimates increased by
US$348m before tax
• Opex is significantly reduced from the adjusted
2010 engineering cost study (in 2013 dollars)
• Capex for the process plant is cost-effective at
US$249.7m
• Leach residence time reduced significantly by
30%
• Increase in plant throughput from 8.7 Mt/a to
11.2 Mta
• An increase in average annual production from
3.3 Mlb to 4.2 Mlb U3O8
• Plant availability increased from 88% to 91%
• Plant block model greatly simplified.