Key Industry Drivers

• Cost

• Energy

• Environment

• Logistics

• Beneficiation

IMBS Development Strategy

As a new technology without the constraints of traditional iron-making methods, IMBS is able in its development strategy, to focus on the following areas.

The Effect of Metal at the Mine

• Currently iron ore represents more than a quarter of total seaborne cargo in terms of tonnage.

• The price of iron ore is based principally on their iron content and shipping cost.

• IMBS produces an iron product that has a significantly higher value, due to its higher iron content than iron ore.

• The transport of these higher value goods lead to reduced logistics costs.

The Net Back Effect

The Net back effect of iron ore costs at the IMBS plant in Phalaborwa:

• Current CFR Price is US$130 pt

• All logistic costs US$65 pt

• Discount received and envisaged at 10% of net back price

• Cost to IMBS is US$58 pt

• Iron ore input cost per ton of iron is US$99 at Phalaborwa

• Iron ore input cost per ton of iron is US$221 at delivered site

The benefit of the IMBS technology, which enables the manufacture at the resource point in this instance, is US$122.

The IMBS Technology Benefits

The primary energy sources of traditional integrated applications are

electricity, gas and coking coal. This tends to prescribe an operational

location close to natural gas or electricity availability, thus increasing raw

material transport distance and cost.

The IMBS technology:

• Requires relatively cheap and abundant thermal coal.

• Process energy is provided by the reaction energy recovered.

• Plant location is not dependent on electricity or gas availability.

• Supplementary electricity is only required for the auxiliary equipment.

The Competitive Advantage

• Modular Plants: o Located at the optimal supply chain point o Size the plant to the resource o Quick to cash flow via a sequential operational start up o Production line equipment fabrication o Phased capital call mitigating the risk of market change o Flexible production outputs

• Product: o SupaScrapTM is a high quality and consistent supplement for scrap metal. o 10% price premium to scrap.

• Energy: o Substantial savings due to low energy and raw material costs. o Process energy is provided by the reaction energy recovered therefore the rollout

is not dependent on electricity availability

The Resource Advantage

• Vast untapped superfine iron oxide resources exist world-wide. These are the

waste by-products of iron ore beneficiation, steel plant waste and other mineral

processing from iron ore reserves.

• Every year between 5% - 12% of iron ore production is added to the existing

superfine waste reserves.

• Current iron making technology does not allow the processing of superfine iron

oxide without major capital and operational expense to agglomerate.

• Traditional operators use more expensive coking coal as their reductant vs.

lower cost, abundant thermal coal.

• The primary energy sources of traditional integrated applications are gas and

coking coal. This tends to prescribe an operational location close to natural gas

availability, thus increasing raw material transport distance and cost.

“IMBS intends to become the leading least cost

producer of metallic iron units by operating its

unique, proprietary, patented technology.

This technology converts superfine iron ore into high

quality metallic products using low-cost thermal coal

without the expense of agglomeration.

The operation will be deployed at the optimal supply

chain point, due to the ability to utilise the energy

created in our process to meet the process energy

requirements.”

Mission Statement

The Market Opportunity

With a cash cost of production of US$200/t, the IMBS SupaScrap™ product

will sell at a premium to the ruling scrap prices currently at around US$400/t.

The IMBS Product

• The IMBS product SupaScrapTM is a low cost metallic iron in a granulate form.

• The product has both the advantage of high Fe content of scrap and the low residuals of DRI.

• The product is a a scrap supplement product for use primarily in electric steel making.

• The product can also be used in integrated steel making applications.

“With a targeted cash cost of production of US$200/t or below, the IMBS product SupaScrapTM will sell at a premium to the ruling scrap

prices currently at around US$400/t.”

The IMBS Process Flow

Company Milestones

• May 2006: IMBS is incorporated to exploit its unique patented iron-making technology.

• July 2006: Initial investment by Sir Sam Jonah and the Jonah Group

• January 2007: Completion of a pilot sized demonstration plant.

• July 2008: The IMBS technology is proven and an independent technical diligence by Coffey

Mining SA is finalised.

• May 2010: Russian steel giant Severstal subscribes for new equity capital.

• June 2010: IIBG is incorporated in Cyprus. Its function is to rollout the IMBS technology

internationally under the terms of a license agreement with IMBS.

• February 2011: Masorini Iron Beneficiation (MIB) is incorporated as a joint venture between

IMBS and the IDC to construct, own and operate the first plants in Phalaborwa, South Africa.

• October 2012: Construction of the first 50.000tpa commercial unit commences.

• July 2013: Construction of this plant is completed and commissioning has commenced.

• First half of 2014: Production from the first 50.000tpa plant is expected.

IMBS in Pictures