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Investor UpdateApril 2015
For additional information contact:Johann Jacobs +61 416 125 449 [email protected]
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Disclaimer
This presentation is dated 20 April 2015 and has been prepared by King Island Scheelite Limited ABN 40 004 681 734 (Company). The entitlement offer referred to in this presentation is being made without a prospectus under section 708AA Corporations Act 2001 (Cth) (Corporations Act) (as notionally modified by ASIC Class Order 08/35) (Offer). The information in this presentation is of a general nature and does not purport to be complete, nor does it contain all the information which would be required in a prospectus prepared inaccordance with the requirements of the Corporations Act.
An investment in the Company’s shares is subject to known and unknown risks, many of which are beyond the control of the Company. In considering an investment in the Company’s shares, investors should have regard to (amongst other things) the risks outlined in this presentation.
This presentation contains statements, opinions, projections, forecasts and other material (forward looking statements), based on various assumptions. Those assumptions may or may not prove to be correct. None of the Company, its respective officers, employees, agents, advisers nor any other person named in this presentation makes any representation as to the accuracy or likelihood of fulfilment of the forward looking statements or any of the assumptions upon which they are based.
The Company may make additional announcements after the date of this presentation and throughout the period that the Offer is open that may be relevant to your consideration about whether you should participate in the Offer.
The information contained in this presentation does not take into account the investment objectives, financial situation or particular needs of any recipient and is not financial product advice. Before making an investment decision, recipients of this presentation should consider their own needs and situation and, if necessary, seek independent, professional advice.
Any opinions expressed reflect the Company’s position at the date of this presentation and are subject to change. No assurance is given by the Company that any capital raising referred to in this presentation will proceed.
To the extent permitted by law, the Company and its respective officers, employees, agents and advisers give no warranty, representation or guarantee as to the accuracy, completeness or reliability of the information contained in this presentation. Further, none of the Company and its respective officers, employees, agents and advisers accept, to the extent permitted by law, responsibility for any loss, claim, damages, costs or expenses arising out of, or in connection with, the information contained in this presentation. Any recipient of this presentation should independently satisfy themselves as to the accuracy of all information contained herein.
This presentation does not constitute an offer to sell, or a solicitation of an offer to buy, securities in the United States. WARNING: The contents of this presentation have not been reviewed by any Hong Kong regulatory authority. You are advised to exercise
caution in relation to the Offer. If you are in doubt about any contents of this presentation, you should obtain independent professional advice.
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Recent Highlights
Mineral Technologies Pty Ltd (“MT”), a member of the Downer Group (ASX:DOW), appointed as engineering contractor for the Definition Phase of the Project
Ore sorting technology being trialed with potentially significant operating cost savings and improved resource recovery
Increase in open cut mine life from 4 years to 7 years
Significant potential cost savings by introduction of hybrid power solutions
Improved confidence levels from additional drilling data
Pit has been dewatered, other than the sump, and confirmatory drill program completed
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Our Company
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Rank Shareholder Shares % of issued capital
1. Chrysalis Investments Pty Ltd 22,037,750 14.5%2. Mr Richard Willmot Chadwick + Mrs Gwenda Ann Chadwick 21,950,685 14.4%3. HFTT Pty Ltd / Mr Tony Haggarty 14,998,952 9.9%4. Mrs Catherine Morritt 13,972,014 9.2%5. Mr Giuseppe Coronica 7,692,173 5.1%6. Invia Custodian Pty Limited (Pacific Road Provident A/C) 5,766,567 3.8%7. Ranamok Pty Ltd <Ranamok Family A/C> 5,170,590 3.4%8. Hunan Nonferrous Metals Corporation Limited 4,450,000 2.9%9. Invia Custodian Pty Limited (Davies Family A/C) 3,248,288 2.1%10. Serlett Pty Ltd <Diligent Super Fund A/C> 3,118,529 2.1%
ASX: (KIS) Market Capitalisation $25.1 million @ $0.165 Shares on issue 152.0 million
Board Johann JacobsAllan DaviesChris EllisIan Morgan
Exec ChairmanNon Exec DirectorExec DirectorCompany Secretary
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KIS ORD Share Price
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Dolphin ProjectAustralia
Victoria
King Island
Tasmania
100% ownership
World class tungsten deposit
Almost all freehold land acquired
Maintaining lease and tenement ownership
Exploration Mining lease granted June 2014
Revised environmental approvals pending
Revised development approval to be sought for a 7 year mine plan
Significant infrastructure in place Definitive Feasibility Study (DFS) completed
in 2012 Value Engineering completed May 2013,
enhanced by New Development Plan April 2014 and further optimisation in February 2015
Dolphin Project
Grassy Harbour
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Appointment of Engineering Contractor Mineral Technologies Pty Ltd (“MT”), a member of the Downer Group (ASX:DOW)
was appointed as process engineering contractor for the next stage of development of the Dolphin Project
MT’s appointment followed a formal process in which expressions of interest were sought from a number of engineering firms
The contract covers finalisation of the process flow sheet and agreeing on design parameters and execution methodology
Development of design and project documentation, which will enable execution of a fixed price contract for the plant design and construction
Optimised Development Plan – February 2015F
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Optimised Development Plan ‐ cont’d
Resources and Reserves The benefits of open cut mining compared to underground mining are substantial:
• Lower overall mining costs• Higher extraction% of in‐situ WO3
• More predictable mining environment and higher productivity Our consultants are currently developing various mining plans and are focusing on
extending the life of the open cut Ore Sorting
Initial tests, utilizing X‐ray transmission (XRT) technology on a sample of Dolphin ore provided encouraging results:
• approximately 30% of low grade and barren ore was rejected with a minimal (~5%) loss in metal recovery
• the impact of utilizing this technology in this operation is significant:o Mining to a lower cut‐off grade, thereby increasing the amount of
valuable mineral recoveryo Lower processing costs per unit of WO3 productiono For the same capacity processing plant, more marketable concentrate
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Optimised Development Plan ‐ cont’d
Ore Sorting cont’d The Company has prepared a further 27 samples from recent borecores, which have
been sorted and are awaiting assay results
Power Options The Company is in discussion with two parties to replace the currently proposed
diesel generation power station with a hybrid power plant utilizing components of renewable energy (wind and solar)
If these proposals are successful, it could lead to approximately a 20% reduction in power costs over the life of the mine. Power is currently the largest single cost for the project
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Resources An updated resource statement taking into account the revised geological model
which includes ore intersections from the recent drilling program is anticipated to be released to the market during the week ending 24 April 2015. A resource estimate will also be reported for the larger 7 year open‐cut mining area. It is not anticipated that these updates will cause a material change to previously reported estimates. Mine design work required to convert these resources to reserves is in progress
Reserves As announced on 5 December 2015, based on an open‐cut mine for 4 to 5 years, the
Company’s most recent JORC 2012 compliant reserve statement indicated:• Probable reserves of 1.90 mt at 0.55% WO₃ (at 0.2% WO₃ cut‐off) for a total of
10,450 tonnes of WO₃ • An average strip ratio of 3.1 tonne for tonne
Reserves and resources
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Use of Funds$
Pay Offer Costs including legal fees, share registry costs, underwriting fees, printing, postage 100,000
Open cut mine design and engineering 150,000
Metallurgical and ore sorting test work 100,000
Prepare detailed design and specifications of plant 400,000
Initial site works 500,000
Fund overheads and general working capital requirements 616,000
Total 1,866,000
For an analysis of some of the specific risks facing the Company in the conduct of its activities, see Section 6 of the Rights Issue Information Booklet dated 20 April 2015
Risks include
General market risks Funding risk Exploration, evaluation and development Estimation Single project Commodity prices and exchange
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$1.8 million rights offer
partially underwritten plus commitments
non renounceable
issued at a 18% discount to closing share price
timetable
announce 20 April 2015 record date 24 April 2015 offer opens 29 April 2015 offer closes 8 May 2015
Capital raisingF
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complete $1.8 million capital raising
update environment and development approvals
secure off‐take arrangements
engage with potential project financiers/ partners
once the above actions have been completed, the Board will consider project approval
and, if approved, will initiate project funding
Next StepsF
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Dewatering open‐cut voidF
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Compliance Statements
The information in this presentation is extracted from the 5 December 2014 Updated Reserve Statement, which is available for viewing on the Company's website at www.kingislandscheelite.com.au.The Company confirms it is not aware of any new information or data that materially affects the information included in the original market announcement, and, in the case of estimates of Mineral Resources and Reserves, that all material assumptions and technical parameters underpinning the estimates in the relevant market announcement 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.
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Johann JacobsChairman
Level 26, 259 George StreetSydney NSW 2000
Phone: (02) 8622 1400Mobile: 0416 125 449Fax: (02) 8622 1401
Email: [email protected]
KING ISLAND SCHEELITE LIMITED
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