Post on 16-May-2015
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7th Mining The Territory Conference
10-12 September 2013
MT BUNDY GOLD PROJECT
NORTHERN TERRITORY
Clay Gordon
Managing Director
Recommence Mining and Processing Operations
Toms Gully
Statements and material contained in this Presentation, particularly those regarding possible or assumed future performance, production
levels or rates, resources or potential growth of Primary Gold Limited (PGO), industry growth or other trend projections are, or may be,
forward looking statements. Such statements relate to future events and expectations and, as such, involve known and unknown risks and
uncertainties. Although PGO believes that the expectations contained in any forward looking statements in this presentation are, as at the
date of this presentation, made on a reasonable basis, such statements are not guarantees of future performance and actual results and the
timing of such results may differ materially from those herein described. Factors which may impact on future performance and cause actual
results to differ materially from those contained in forward looking statements include, without limitation, changes in commodity prices,
exchange rates, PGO‟s access to capital and general and market conditions.
This presentation may describe Measured, Indicated and/or Inferred Resources. Inferred Resources have a greater amount of uncertainty as
to their existence and greater uncertainty as to their economic feasibility. It cannot be assumed that all or any part of any Inferred Resource
will ever be upgraded to a higher category. Exploration is an inherently risky proposition and investors are advised that most exploration
projects fail to identify economic resources. The Company has at present not confirmed the economic viability of any resources at the project.
The company plans further drilling programs and studies with the objective of confirmation of any deposits and ultimately completing a
feasibility study to demonstrate the economics of the resources.
The information contained in this presentation is for informational purposes only and does not constitute an offer to issue, or arrange to issue,
securities or other financial products. The information contained in this presentation is not investment or financial product advice and is not
intended to be used as the basis for making an investment decision. The presentation has been prepared without taking into account the
investment objectives, financial situation or particular needs of any particular person.
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 PGO, their directors, employees or
agents, nor any other person accepts any liability, including, without limitation, any liability arising out of fault of negligence, for any loss
arising from the use of the information contained in this presentation. In particular, no representation or warranty, express or implied is given
as to the accuracy, completeness or correctness, likelihood of achievement or reasonableness or any forecasts, prospects or returns
contained in this presentation nor is any obligation assumed to update such information. Such forecasts, prospects or returns are by their
nature subject to significant uncertainties and contingencies.
Before making an investment decision, you should consider, with or without the assistance of a financial adviser, whether an investment is
appropriate in light of your particular investment needs, objectives and financial circumstances.
Disclaimer and Important Information
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ASX Codes PGO, PGOO
Ordinary shares 72 million
Options (listed & unlisted) 42 million
Market cap (undiluted) at $0.15 ≈ $10.8 million
Cash (end of June Qtr) ≈ $1.7 million
Average daily volume ≈ 17K
Directors and Senior Management
Dale Rogers Non-Exec Chairman
Clay Gordon Managing Director
Tim Manners Non-Exec Director
Mike Hendriks Non-Exec Director
Philip Gray Non-Exec Director
Simon Durack Company Secretary
0.18
0.07
Shareholder Structure
Directors 19%
Crocodile Gold 16%
Number of shareholders 763
Top 20 shareholders 64%
Gold focus in Northern Territory, Australia
Listed March 2013
acquired Mt Bundy Gold Project
2,900 km2 under-explored tenure,
advanced projects, close to Darwin
Introducing Primary Gold
Attractive investment proposition:
$11 EV/Meas. + Indic. oz compared to peer avg. of $32/oz
$52 EV/Reserve oz compared to $382/oz avg. for Producers
Valuation of $0.40 to $0.76
Aim: self funded gold explorer and producer
Targeting first production 2014 - Toms Gully
Resources grown to 310k oz (refer to ASX announcement 3 July
2013)
Maiden Ore Reserve 175k oz Au (refer to ASX announcement 27
August 2013)
Feasibility Study completed - low capital, low total costs, rapid start-
up, fast payback (refer to ASX announcement 27 August 2013)
Current reserve supports 3 year plan targeting 65,000 p.a. at C3
costs of A$935/oz (less once-off start-up capital)
Growth potential
Toms Gully remains open, Feasibility includes $3M for extension
drilling
Rustlers Roost - JORC Resource 875k oz Au (refer to ASX
announcement 3 July 2013)
Significant greenfields exploration potential
Introducing Primary Gold
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2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Gold Price
AUD USD
Renison Consolidated
Mines Ltd
2005-Mar„07
GBS
July-Sept „08
Croc. Gold
March-August ‟10
Incl. Plant upgrade
& $2.5m diamond
drilling
Toms Gully – History
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Acquisition by PGO
March 2013
PGO
Delivers Toms
Gully Feasibility
August 2013
Company Issue Situation Solution
Carpentaria Gold
P/L (1991) Geotechnical
Initial decline access encountered difficult ground
conditions (known fault zone) on eastern side of
orebody.
Decline since been rehabilitated, now useable.
Second decline within fault corridor, good ground
conditions.
Rension Cons.
Mines Ltd (2007) Flooding
Flood prevention strategy based on max. monthly
rainfall avg. Received monthly quota in single event.
Insufficient pumping capacity.
Primary‟s strategy based on max. 24hr avg,
consequently pumping capacity is 10 times that of
Renison.
GBS & Crocodile
Gold,
(„08-10)
Poor ore grades majority of mining within (relatively) lower grade zone
combined with dilution in excess of planned.
Primary to specifically target higher grade zones &
control dilution via split-face firing of ore & waste
separately.
Toms Gully Gold Mine & Mill
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100% owned Toms Gully within Mt
Bundy Gold Project
located 100km from Darwin
Access via sealed Arnhem Highway
22kv to mine & mill
Granted mining lease
High-grade production history
115k oz at 8.2 g/t (‟88-‟08)
Significant infrastructure:
250k tpa processing plant
Open pit with 2 declines accessing
underground orebody
Decline developed 1km down
length of underground orebody
South Alligator Group: shales & siltstones of Wildman Siltstone Formation
Shallow dipping, stratiform, high-grade quartz + sulphide vein
gold grades 3 to 30g/t, distinct grade zonation
Fault bounded, 300m strike, up to 4m thick, avg 1.8m, drilled to 1.5km down dip (250m vert.)
Toms Gully - Geology
On listing, Toms Gully resource
140k oz at 8.6g/t
Grown 122% this year to 310k oz
at 9.0 g/t
Significant potential to grow
resource & increase mine life
beyond current plan
A$3m allocated to extension & infill
drilling
Toms Gully – Resources & Reserves
Long-section, looking west
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Managed by PGO executives with
major works completed by well
regarded, independent expert
consultants:
Cube Consulting - resource
estimate
Quantitative Group - reviewed
resource
Golder Associates - ore reserve
estimate
Independent Metallurgical
Operations - testwork,
processing flow sheet, capital &
operating cost estimates
Como Engineering - mill
refurbishment plan and capital
cost estimates
Toms Gully Feasibility Study
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Utilises existing mine infrastructure (twin declines)
Combination air-leg & room & pillar (85% recovery)
Minimum ore criteria - 1.2m thickness & + 6.5g/t
Dilution - 0.6m at 0.0g/t Au (approx. 35% on avg. 1.8m)
2 x twin boom jumbos, multiple faces, split-face firing
Ramping-up from July 2014 to 30ktp mth (350ktpa) over 18 month period
Ore Reserve 775kt, 5yr Feasibility total 1.4Mt
Feasibility Study – mine physicals
Toms Gully – Resources & Reserves
Plan view -
proposed
mine layout
Current capacity 250ktpa
Pre-production refurbishment (mths 1-8)
complete installation of tower mill, add gravity &
intense leach leaching (acacia)
Increased recoveries to 88%
Up-grade 350kt & 65k oz pa
Completed months 17-20. Timed to pay out of
cashflow
Increase capacity at primary mill, improve
floatation & tankage
Recoveries increase to 89.6%
Steady state production - month 22
Targeting 277k oz recovered over initial 5 year life
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Feasibility Study – mill physicals
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Targeting 350,000t at 6.9g/t
22 months to steady-state including start-up
A$19m start-up costs (incl. $2m contingency)
5 year plan, with years 1-3 in ore reserve
Ramping up to 65,000 recovered ounces gold p.a
C1 Costs: A$663/oz
C3 Costs: A$1,042/oz (A$935/oz less start-up costs)
Generating A$143 million EBITDA (at spot A$1,555/oz)
Cashflow positive – 10 months
Payback of start-up capital - 23 months
Toms Gully Feasibility Study –
Outcomes
Primary confirms that all the material
assumptions underpinning the
production target and/or forecast
financial information derived from a
production target, in the initial public
report of 27 August 2013 continue to
apply and have not materially changed.
The potential quantity and grade of an
exploration target is conceptual in
nature, there has been insufficient
exploration to determine a mineral
resource and there is no certainty that
further exploration work will result in the
determination of mineral resources or
that the production target itself will be
realised.
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Feasibility Study - Financials
Financials (AUD) Ore
Reserve
Feasibility
Study
Start-up costs A$19m A$19m
C1 A$673/oz A$663/oz
C2 A$773/oz A$767/oz
C3 A$1,145/oz A$1,052/oz
C3 (less once-off
start-up costs) A$954/oz A$935/oz
Gold price US$1,400 US$1,400
AUD-USD exchange 0.90 0.90
Revenue A$240m A$432m
EBITDA A$63m A$143m
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Toms Gully – Next 12 months
Transition to “miner” status
Dewatering: combination transfer, bore-
field, assisted evaporation & wet season
discharge
Regain access to mine - 1st ore production
Re-commission mill – 1st gold production
Cashflow positive
Preparing for:
mill upgrade, full production
Exploration (TG & MTB)
Feasibility Study – mine # 2
Mt Bundy - Resource Upside
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Project contains all key attributes of Pine Creek-style, quartz-hosted gold mineralisation:
Favourable stratigraphic units (Mount Bonnie, Burrell Creek, Koolpin).
Structural setting (anticlines and shear zones) and,
Proximity to granite intrusions (Mount Bundy, Mount Goyder intrusive).
History of success with basic
mapping and geochem techniques.
E.g. first 11 samples of outcropping
Toms Gully quartz reef averaged
9.6g/t.
Full details provided in Appendix 2
of PGO/HTI ASX announcement
of 14 November 2012
All Resources (TG, RR, Quest) have
strong surface expression.
Minimal Regional exploration since
1990‟s
Very large system deposit, drilled 1km x
400m x 250m deep.
Positive Scoping study – Bulk mining
scenario
Remains open at depth and along strike.
Shallow drill intercepts to west include
illustrate further oxide potential:
36m at 1.27g/t (from 33m) in RRC260,
and
24m at 1.24g/t (from 48m) in RRC262
Full details provided in Appendix 2 of
PGO/HTI ASX announcement of 14
November 2012
Approximately 50 strike-km remains to be
explored.
Last explored/drilled 2003
Rustlers Roost – Resource Upside
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Resource Upside – New Discoveries
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Large drill & geochemical surface databases - Mine the db!
2,700 drill holes; 180km drilling;
Rock-chips: 2,691 values; 69 values above 5g/t. max 88.2g/t Au
Soils: 42,696 values ; 2,200 values above 1.0g/t., max 159g/t Au
Full details of sampling provided in Appendix 2 of PGO/HTI ASX announcement of 14 November 2012
~ 60 targets identified but, drilling and geochem is clustered around the known deposits…
Toms Gully – surprisingly poor coverage; Priority
Rustlers Roost
Several large (to 1.5km x 400m), 100ppb soil anomalies remain to be drill tested
Rock-chips include: 26.1g/t 16.4g/t, 5.2g/t, and 4.0g/t.
~ 50km strike remains untested
Quest
Several large (to 2km x 800m), +10ppb anomalies remain to be drill tested.
Rock-chips include: 7.2g/t (and 1,600g/t Ag), 3g/t, and 3.3g/t.
MAJORITY OF PROJECT REMAINS UN-EXPLORED USING MODERN EXPLORATION TECHNIQUES
Primary Gold – Investment Summary
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Delivering on promises
Targeting first production Sept Qtr 2014 – Toms Gully
Low cost, rapid start-up, fast payback
C1 costs A$663/oz, C3 costs A$935/oz
Ramping-up to 65k ounces p.a., 5 year mine life
project cash flow: A$40million EBITDA p.a., A$143million over 5 years
Growth potential
Toms Gully remains open down dip
A$3m allocated to follow priority targets
Rustlers Roost – positive scoping study, not drilled since 2003, new geochem targets identified
Lack of regional exploration, multiple targets to follow-up
Strong and experienced Board, established credentials in gold sector
Attractive investment proposition:
$11 EV/Measured + Indicated oz compared to peer avg. of $32/oz
$52 EV/Reserve oz compared to $382/oz (avg.) for Producers
Valuation of $0.40 to $0.76 (currently trading at $0.15)
JORC Resources and Reserves
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Toms Gully - The information in this market announcement is extracted from the reports entitled July 2013 Toms Gully Resource Estimate, announced 3 July 2013 and Toms Gully Ore
Reserve Estimate Summary Report, August 2013, announced 27 August 2013. Both reports are available to view on www.primarygold.com.au. Primary Gold Limited confirms it is not
aware of any new information or data that materially affects the information in the original market announcements relating to Toms Gully mineral resources and ore reserves, that all
material assumptions and technical parameters underpinning the Toms Gully mineral resource estimate continue to apply and have not materially changed. The company confirms that the
form and context in which the Competent Person‟s findings are presented have not been materially modified from the original market announcement.
The information in this announcement that relates to exploration targets and associated exploration results are based on, and fairly represent, information and supporting documentation
compiled and prepared by Mr Clay Gordon who is a Member of The Australasian Institute of Mining and Metallurgy and Australian Institute of Geoscientists. Mr Gordon is a full-time
employee and shareholder of Primary Gold Limited. Mr Gordon has sufficient experience which is relevant to the styles of mineralisation and types of deposit under consideration and to
the activity being undertaken to qualify as a Competent Person as defined in the 2012 Edition of the „Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore
Reserves‟. Mr Gordon has provided prior written consent as to the form and context in which the Exploration Targets and the supporting information are presented in this market
announcement.
Rustlers Roost (80% PGO) - Represents Primary Gold‟s 80% interest. The information in this announcement that relates to the Rustlers Roost exploration results and Mineral Resource
is based on information reviewed and compiled by Mr Brian Fitzpatrick, who is a Member of The Australasian Institute of Mining and Metallurgy with Chartered Professional accreditation.
Mr Fitzpatrick is a full-time employee of Cube Consulting Pty Ltd and has sufficient experience which is relevant to the styles of mineralisation and types 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 Reporting of Exploration Results, Mineral Resources
and Ore Reserves‟. Mr Fitzpatrick consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.
Tonnes Grade Au Tonnes Grade Au Tonnes Grade Au
(kt) (g/t) (kOz) (kt) (g/t) (kOz) (kt) (g/t) (kOz)
Toms Gully 815 9.1 240 250 8.7 70 1,065 9.0 310
Tonnes Grade Au Tonnes Grade Au Tonnes Grade Au
(kt) (g/t) (kOz) (kt) (g/t) (kOz) (kt) (g/t) (kOz)
Rustlers Roost 19,920 0.9 573 10,320 0.9 302 30,240 0.9 875
Tonnes Grade Au Tonnes Grade Au Tonnes Grade Au
(kt) (g/t) (kOz) (kt) (g/t) (kOz) (kt) (g/t) (kOz)
Toms Gully 775 6.9 175 775 6.9 175
Ore Reserves
Proved Probable Total
Mineral
Resources
Indicated Inferred Total
Mineral
Resources
Indicated Inferred Total
Contacts
Clay Gordon Sarah Geall
Primary Gold Limited
Managing Director
+61 8 9488 8874
cgordon@primarygold.com.au
FTI Consulting
+61 8 9485 8888
sarah.geall@fticonsulting.com
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