OGL Resources Limited Ebenezer & Bremer View Acquisition ...
Transcript of OGL Resources Limited Ebenezer & Bremer View Acquisition ...
September 2011 Jack Tan – Executive Chairman
OGL Resources Limited
Ebenezer & Bremer View Acquisition Presentation
This document has been prepared as a summary only and does not contain all information about the OGL Resources Limited (the Company) assets and liabilities, financial position and performance, profits and losses, prospects and the rights and liabilities attaching to the Company’s securities. The document should be read with any public announcements and reports released by OGL Resources Limited. The information is based on publicly available information, internally developed data and other sources. Where any option is expressed only. No warranties or representations can be made as to the origin, accuracy, completeness, or reliability of the information. Some of the statements contained in the presentation are forward looking statements. Forward looking statement information may include, but is not limited to, information with respect to the future financial and operating performance of the company or its affiliated companies statements relating to the continued advancement of the Company’s project and other statements which are not historical facts. When used in this document and other published information of the Company, the words such as “aim”, “could"," estimate”, “expect”, “may”, “potential”, “should” and similar expression are forward looking statements. Although, the Company believes that its expectation reflected in the forward looking statement area reasonable, such statements involve risk and uncertainties and no assurance can be given that actual results will be consistent with these forward looking statements. Various factors could cause actual results to differ from these forward looking statement include the potential that the Company’s projects may experience technical, geological, metallurgical and mechanical problems, changes in commodity prices, changes in government regulation, policies or legislation, unforeseen expenses, fluctuation in the exchange rate of Indonesian Rupee, Australian dollar and the United States dollar and other risks not anticipated by the Company or disclosed in the Company’s published material. The Company doesn’t not purport to give financial advice. No accounts has been taken of the objectives, financial situation or needs of any recipient of this document. Recipients of this document should carefully consider whether the securities issued by the Company are an appropriate investment for them in light of their personal circumstance, including their financial and taxation position.
Disclaimer
2
Runge Limited: The estimate of coal reserves for ML 4712, as presented in this presentation has been prepared in accordance with the guidelines of the Australasian Code for the Reporting of Mineral Resources and Ore Reserves, prepared by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australasian Institute of Geoscientists and Mineral Council of Australia, December 2004. The information in this announcement to which statement is attached that relates to the reserves of ML 4712, is based on the information reviewed by Gregory Robert Maiden, who is a member of the Australasian Institute of Mining and Metallurgy. He is full time employee of Runge Limited. Gregory Maiden has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking, to qualify as a “Competent Person’’ as defined in the 2004 edition of the Australasian Code for the Reporting of Mineral Resources and Ore Reserves. Salva Resources Pty Ltd: The estimate of coal resources for ML 4712 and MDL 172, as presented in this presentation has been prepared in accordance with the guidelines of the Australasian Code for the Reporting of Mineral Resources and Ore Reserves, prepared by the Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australasian Institute of Geoscientists and Mineral Council of Australia, December 2004. The information in this announcement to which statement is attached that relates to the resources of ML 4712 and MDL 172, is based on the information reviewed by Lyndon Pass, who is a member of the Australasian Institute of Mining and Metallurgy. He is full time employee of Salva Resources Pty Ltd. Lyndon Pass has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking, to qualify as a “Competent Person” as defined in the 2004 edition of the Australasian Code for the Reporting of Mineral Resources and Ore Reserves.
Competent Persons Statements
3
Contents Page number
Disclaimer 2
Competent Persons Statements 3
Contents 4
OGL Project Overview 5
Investment Highlights 6
Key Details of Projects 7
Historical Mining at Ebenezer 8
Ebenezer Mine (ML4712) Overview 9
Bremer View Project 13
Rail Access 15
Port Access – Multiple Options 16
Project Timeline 17
Board of Directors & Senior Management 19
Key Risks 20
Contacts 21
Contents
4
The tenements (ML4712 & MDL172) are both located in South East Queensland, near Ipswich – 80km from Port of Brisbane
Total Probable reserves of 13.7Mt and resources of 239Mt, with an exploration target of a further 80-100Mt.
The contained coal is high quality export thermal coal.
The Ebenezer mine has historic production of 33.6Mt with peak production achieved in 1994 of 3Mt ROM to produce 1.87Mt of saleable coal
Infrastructure in place - existing nearby rail line loop and under-utilised rail to the Port of Brisbane (>80km to mine site).
Power & Water - 110KV power lines and sub-station and water supply secured.
Geology well understood - Projects are located in the Walloon Coal Measures and exhibit the same geology as the nearby New Hope operating coal mines (Jeebropilly and New Oakleigh).
OGL Project Overview
5
Advanced coal projects within Queensland’s historical coal mining district
JORC coal reserves of 13.7Mt and resources of 239Mt
Geology well understood – previously mined and explored
Infrastructure in place - Discussions for access well advanced – multiple Port options available
ML (Mining Lease) and MDL (Mining Development Lease) granted – ready for mining and development
Mining to be undertaken by independent contractors who have previously mined at Ebenezer
Site infrastructure in place (Water, Power, Tailings Dam, Office)
No native title issues
OGL intends to be a near term coal producer
Phase 1 - Targeting 1Mtpa ROM to produce approximately 600ktpa exportable coal product.
Production forecast to commence within 12 months of acquisition, subject to port and rail agreements, wash plant and contracts for mining and operations.
Phase 2 – up to 2Mtpa ROM and product of 1.2Mtpa of exportable coal product
Investment Highlights
OGL JORC Compliant Coal Resources and Reserves
Tenement Licence Reserve Resource
Ebenezer ML 4712 13.7Mt Probable 24.1Mt Indicated 7.2Mt Inferred
Bremer View MDL 172 - 208.2Mt Inferred Exploration Target: 80-100Mt
6
Location
44km West of Brisbane and due west of the Ipswich township
Close proximity to New Hope’s Jeebropilly and New Oakleigh coal mine
Ebenezer covers 675ha with freehold titles
Existing JORC resources & Exploration targets
Ebenezer (ML4712) - 13.7Mt Reserve, 31.3Mt Resource
Bremer View (MDL172) - 208.2Mt Resource, 80-100Mt exploration target
Products Thermal coal (all potential export quality)
Historical production
Commenced production in 1988 and closed in 2003 due to lower prevailing coal prices (~A$37/t) – note Ebenezer was still profitable at these coal prices
Total washed thermal coal sales of 19.6Mt with peak production achieved in 1994 of 3Mt ROM to produce 1.87Mt of saleable coal at an average strip ratio of 4.4
Waste ratio Ebenezer: 5.2 bcm per ROM tonne
Mine Plan (Ebenezer) Phase 1 - 1Mtpa RoM for 600ktpa (finished product using a 60% yield)
Phase 2 - 2Mtpa RoM for 1.2Mtpa
Bremer View Expansion 208Mt Resource to support increased production profile (2 – 5Mtpa)
Rail Access Existing West Moreton railway line operated by QR National and QR
Existing rail loop to Port of Brisbane, approximately 80km away
Port Access
80km from Port of Brisbane via West Moreton railway line
Existing coal terminal operated by Queensland Bulk Handling (100%-owned subsidiary of New Hope Corporation Ltd) has current capacity of over +10Mtpa and is currently operating at a rate of ~9Mtpa
Key Details of Projects
7
First coal production occurred in 1988, with peak production achieved in 1994 of 3Mt coal mined for 1.87Mt of coal product.
Total coal mined was 33.6Mt (ROM), with total coal sales of 19.6Mt.
Thin seam selective mining from shallow coal deposits at less than 150m depth.
Majority of the remaining coal resources are at depths of 0-100m from surface.
Historically, 73% of coal sales were exports with the balance (27%) sold into the domestic market.
The mine employed more than 120 employees prior to closure.
Ebenezer Historical Production Profile
50%
52%
54%
56%
58%
60%
62%
64%
66%
68%
70%
-
500
1,000
1,500
2,000
2,500
3,000
3,500
19
89
19
90
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
'000 t Coal Mined Coal Product Yield % RHS
Historical Mining at Ebenezer
8
Location Map of Ebenezer and Bremer View Projects
Ebenezer Mine (ML4712) Overview
Resources and Reserves Summary for Ebenezer
Category Resources
(Salva Estimate)
Reserves
(Runge estimate)
Probable Reserves 13.7
Indicated Resources 24.1
Inferred Resources 7.2
Total 31.3 13.7
Coal Quality Export Grade
Domestic Grade
Newcastle Export Benchmark
Moisture % 4 4 2.3
Ash % 14 22.4 13.5
Calorific Value kcal/kg 6,700 6,000-6,200 6,760
Sulphur % 0.47 0.50 0.60
9
Proposed Base Case (Phase 1) Ebenezer Production Profile
Proposed Ebenezer Mine
Ebenezer Mine Today and Proposed Coal Pit Areas
MDL172 Bremer View
ML4712 Ebenezer
Jeebropilly Rail Loop
10
Proposed Ebenezer Mine
Coal Seam
Ebenezer Lanes Pit & Site Layout
11
Site Infrastructure
The original Ebenezer coal handling and preparation facilities (CHPP) were removed from the site and sold after the mine closed in 2003.
During operation, the rail loop was shared with Jeebropilly. The current capacity of the stockpile area used by Jeebropilly is reported to be 250,000t.
The existing tailings dam on the Ebenezer lease remains, but is likely to be filled to capacity.
OGL is assessing the purchase of a second hand wash plant for use in the re-commencement of the mining operation.
Both Ebenezer and Jeebropilly washplant were supplied water through independent underground pipelines from the tidal reach of the Bremer View River –legal easement and water supply license still in place.
The Jeebropilly mine exploits the same Walloon coals as Ebenezer.
A washplant is installed at Jeebropilly which has similar technical capabilities as those required by Ebenezer.
The feed capacity of the wash plant is around 1.8Mtpa, while Jeebropilly is currently operating at about 0.9Mtpa.
One possibility is for OGL and New Hope to sign an agreement for OGL to utilise the remaining capacity at the Jeebropilly washplant.
12
Coal Washing Jeebropilly Wash Plant
13
Project Highlights
Project covers 9,202ha of private land with extensive exploration drilling by EMC.
Bremer View is located adjacent to Ebenezer.
Coal quality appears similar to Ebenezer.
Bremer View Coal Project MDL 172 granted from 5 October 2010 to 31 May 2015.
Project contains coal seams from the Walloon Coal Measure with 2 coal sequences:
– Ebenezer (6 seam groups)
– Mt Mort (5 seam groups).
Coal Resources
Current JORC coal resources of 208Mt at Bremer View is larger than New Hope’s operating Jeebropilly Mine.
88% of coal resources are between 0-100m depth. Resource estimate based on 380 historical drill holes.
Further coal exploration target of 80-100Mt.
Resources Summary for Bremer View
Category Bremer View (Mt)
Indicated -
Inferred 208.2
Total 208.2
Bremer View Project
Location Map of Bremer View Project
380 drill holes modelled for the current 208Mt Inferred Resources
A further 77 drill holes were not modelled due to lack of coal quality data, hence noted as 80-100Mt coal Exploration Target.
Drill program of ~190 drill holes required to increase resource confidence to the Indicated category.
Location of Historical drill holes at Bremer View (Source: Salva Resources)
Bremer View Exploration Target
14
Rail Access
The existing Jeebropilly/Ebenezer rail loop to Ebenezer was historically shared with the Jeebropilly mine.
Coal was transported by a conveyor system across the road and coal was stockpiled within the loop to be loaded on to the train wagon.
The Projects are <80km by rail to the Port of Brisbane (Fisherman’s Island) and discussions are advanced with infrastructure provider regarding access and capacity on the rail line.
West Moreton Rail Corridor Jeebropilly Rail Loop
15
Existing Port capacity at the Port of Brisbane (Fishermans Island) is >10Mtpa of export thermal coal.
The coal terminal is operated by QBH, a subsidiary of New Hope.
Initial access discussions have been held with the Port of Brisbane and relevant third party infrastructure providers.
Additional options under review outside Fishermans Island
16
Fisherman Island Port
Port Access – Multiple Options
2011 2012 2013 2014
Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
Project Acquisition
Project Planning
Infrastructure Access Agreement
Resource Drilling/JORC Update
Site Infrastructure Work
Construction to commissioning of washplant/Crushers/loadings
Commencement of Production
First Coal Export
Regional MDL 172 Exploration/Development
Production Expansion Feasibility Study
Commence Production Scale Up
Proposed Project Timeline
Key next steps:
Complete project acquisition
Finalise infrastructure solutions and contractors
Community consultation and approval process (Ongoing)
17
Acquisition Overview
OGL Resources entered into an agreement with Zedemar
Holdings Pty Ltd (“Zedemar”) on 13 May 2011 to acquire its
100% owned Ebenezer Coal Mine (“Ebenezer”) under
Mining Lease 4712 (ML 4712) and Bremer View Coal Project
(“Bremer View”) under Mineral Development Licence 172
(MDL 172).
The total acquisition cost for the two projects is A$50m with
the breakdown of $40m cash and $10m worth of OGL
shares at the Public Offering price.
The acquisition is subject to successful financing for the
acquisition of the projects, and settlement is targeted for
before 31st May 2012.
OGL is undertaking a capital raising to fund the acquisition
cost.
18
NHC Coal Stockpile - Across the Road from Ebenezer Site
Mr Jack Tan Executive Chairman
Jack has more than 20 years experience in the finance, IPO and public companies. Jack is a Former Non-Exec director of Orocobre Limited, and was a founder and Exec Director of Rocklands Richfield Ltd and Norton Goldfields Limited.
TBA Managing Director/CEO
Insert detail when available
Mr Neil Stuart Non-Executive Director
Neil is a qualified senior geologist who began his career in the mining industry in 1968. Neil has worked all over the globe and developed extensive experience in a wide range of mineral commodities including coal, uranium and base metals. Neil was a founding Director of Oroplata Ltd and Rimfire Pacific Mining N.L. He is presently a Non-Exec Chairman of Bowen Energy Ltd and Non-Executive Director of Orocobre Ltd and Axiom Mining Ltd.
Mr Henry Khoo Executive Director
Henry has extensive sales, marketing and management experience in consumer and durable products in Asia Pacific. He has also been involved in project acquisitions, evaluation, company mergers and Initial Public Offerings.
Mr Robert Lees Company Secretary
Robert is a member of the Institute of Chartered Accountants in Australia and Chartered Secretaries of Australia. He has provided Company Secretarial services to small ASX-listed companies, including working on 10 IPO’s and back door listings. He is presently the Company Secretary of four publicly listed companies.
Board of Directors & Senior Management
19
Exploration & Development Risks
Exploration is a high risk activity that requires large amounts of expenditure over extended periods of time. There can be no guarantee that the planned exploration programs will lead to positive exploration results and the discovery of a commercial deposit or further, a commercial mining operation.
There is no assurance that exploration and development of the mineral interests owned by the Company, or any other projects that may be acquired by the Company in the future can be profitably exploited.
Coal Price and Exchange Rate Risk
Commodity prices fluctuate and are affected by numerous factors beyond the control of the Company. These factors include world demand for bulk, base and other metals, forward selling by producers, and production cost levels in major metal-producing regions.
Moreover, commodity prices are also affected by macroeconomic factors such as expectations regarding inflation, interest rates and global and regional demand for, and supply of, the commodity as well as general global economic conditions. These factors may have an adverse effect on the Company’s exploration, development and production activities, as well as on its ability to fund those activities.
Key Personnel Risk The Company’s success depends to a significant extent upon its key management personnel, as well
as other management and technical personnel including those employed on a contractual basis. The loss of the services of such personnel could have an adverse effect on the Company.
Key Risks
20
Contacts
Media & Investor Relations Fortbridge Consulting
Bill Kemmery Phone: +61 400 122 449 Email: [email protected]
Sydney Office
Level 6 50 Clarence Street Sydney NSW 2000 Phone: +61 2 9267 4633 Fax: +61 2 9267 4388 Email: [email protected]
Patersons Securities
Matthew Storey Phone: +61 2 8238 6224 Email: [email protected] Jonathan Pearce Phone: +61 2 8238 6218 Email: [email protected]
21