Shaw Stockbroking Uranium Conference

Shaw Stockbroking Uranium Conference December 2010
Disclaimer
This presentation has been prepared by Toro Energy Limited (“Toro”). The information contained in this presentation is a professional opinion only and is given in good faith. Certain information in this document has been derived from third parties and though Toro has no reason to believe that it is not accurate reliable or complete it has not been independently audited or verified by Toro
accurate, reliable or complete, it has not been independently audited or verified by Toro.
Any forward‐looking statements included in this document involve subjective judgement and analysis and are subject to uncertainties, risks and contingencies, many of which are outside the control of, and maybe unknown to, Toro. In particular, they speak only as of the date of this document, they assume the success of Toro’s strategies, and they are subject to significant regulatory, business, competitive and economic uncertainties and risks. Actual future events may vary materially from the forward looking statements and the assumptions on which the forward looking statements are based. Recipients of this document (“Recipients”)
Recipients of this document (
Recipients ) are cautioned to not place undue reliance on such forward‐looking statements.
are cautioned to not place undue reliance on such forward‐looking statements
Toro makes no representation or warranty as to the accuracy, reliability or completeness of information in this document and does not take responsibility for updating any information or correcting any error or omission which may become apparent after this document has been issued.
To the extent permitted by law, Toro and its officers, employees, related bodies corporate and agents (“Agents”) disclaim all liability, direct, indirect or consequential (and whether or not arising out of the negligence, default or lack of care of Toro and/or any of its Agents) for any loss or damage suffered co
seque t a (a d et e o ot a s g out o t e eg ge ce, de au t o ac o ca e o o o a d/o a y o ts ge ts) o a y oss o da age su e ed
by a Recipient or other persons arising out of, or in connection with, any use or reliance on this presentation or information. All amounts in A$ unless stated otherwise.
Competent Persons Statements:
The information in this report that relates to Mineral Resources at Lake Way and Centipede is based on information compiled by Mr Daniel Guibal who is a Fellow of the Australasian Institute of Mining and Metallurgy (AusIMM) Mr Guibal is a fulltime employee of SRK Consulting and has sufficient a Fellow of the Australasian Institute of Mining and Metallurgy (AusIMM). Mr Guibal
is a fulltime employee of SRK Consulting and has sufficient
experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualify as a Competent Persons as defined in the 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Guibal consents to the inclusion in this release of the matters based on his information in the form and context in which it appears.
The information in this report that relates to Mineral Resources at Dawson‐Hinkler Well is based on information compiled by S. Mann MAusIMM , S. Gatehouse MAIG and A. van der Heyden
Gatehouse
MAIG and A van der Heyden MAusIMM. Messrs Mann, Gatehouse and van der Heyden
MAusIMM Messrs Mann Gatehouse and van der Heyden have sufficient experience which is relevant to the have sufficient experience which is relevant to the
style of mineralisation and type of deposit under consideration and to the activity which they are 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 Mann is a full‐time employee of U3O8 Limited. Messrs Gatehouse and van der Heyden are employees of Hellman & Schofield Pty Ltd. Each of the above named consents to the inclusion of the information in this announcement in the form and context in which it appears.
IInformation in this presentation relating to exploration results is based on information compiled by Mr Mark McGeough BSc (Hons)
f
ti i thi
t ti
l ti t
l ti
lt i b d i f
ti
il d b M M k M G
h BS (H ) who is a Member of h i M b
f
the Australasian Institute of Mining and Metallurgy. Mr McGeough is a full‐time employee of the Company. Mr McGeough has sufficient experience, which is 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 Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr McGeough consents to the inclusion in this release of the matters based on his information in the form and context in which it appears.
The Company Corporate Evolution
Toro floats on the uranium assets of Minotaur Exploration and Oxiana
p
Resources.
4
Corporate Evolution II
Napperby ‐‐ Shallow Napperby
Shallow
calcrete uranium.
5
Corporate Evolution III
Nova Energy Projects in Nova
Energy Projects in
WA, NT, Namibia and Guinea.
6
Corporate Evolution IV
First major grass roots exploration initiative.
l ti i iti ti
Wiluna Optimisation begins.
Withdraw from Guinea
Withdraw from Guinea.
7
Corporate Evolution V
Wiluna Optimisation completed.
JV Namibia
JV Namibia.
Capital Raising.
8
Corporate Evolution VI
Withdraw from Napperby
option.
Wiluna regional consolidation – Firestrike
and Dawson‐ Hinkler acquisitions.
9
Today
Capital structure
Exchanges
Share Price (Nov 2010)
Options (unlisted)
Shareholder profile
ASX: TOE
A$0.17
21.69m
Shares
Fully Diluted Market Cap
Fully Diluted Market Cap
964.95m
A$164m
Cash (Oct 31 2010)
Debt
Enterprise Value
A$48m
Nil
A$116m
12 Month High / Low
Oz Minerals 42.5%
Minorities
57 5%
57.5%
A$0.18 / $0.07
Tenements by State
Granted km2
Applications km2
South Australia
,
5,976
0
Northern Territory
9,261
19,240
Western Australia
5,334
375
Namibia
1,323
0
21,894
19,615
Totals
10
The Wiluna Project Wiluna Uranium Project: Location
12
Wiluna Uranium Project: Footprint
13
Wiluna Uranium Project: Resources
Resource
Contained U3O8#
Grade*
As at Dec 2010
Category
Mt
ppm
% U3O8
tonnes
Mlbs
Centipede, WA
Measured
0.3
588
0.059
176
0.4
Indicated
7.7
619
0.062
4,754
10.5
Inferred
1.7
251
0.025
424
0.9
TOTAL
9.7
554
0.055
5,355
11.8
Inferred
10.5
543
0.054
5,718
12.6
TOTAL
10.5
543
0.054
,
5,718
12.6
Inferred
9.50
293
0.029
2,800
6.2
TOTAL
9.5
293
0.029
2,800
6.2
29.71
467
0.05
13,870
30.6
Lake Way, WA
Dawson‐Hinkler, WA^
WILUNA TOTAL
*200ppm cut‐off
^ subject to definitive legal documentation being executed
# Refer Competent Persons Statements, Page 2
Near Term Objectives
o
Expansion of Centipede Resource
o
Conversion of Lake Way Resource to Indicated
o
Redefinition of Dawson‐Hinkler Resource with Conditional Simulation
14
Wiluna Uranium Project: Proposal
Proposal
o
Shallow (<10m deep) open pit strip type mining of carnotite
Shallow
(<10m deep) open pit strip type mining of carnotite ore in ore in
calcrete/ sand and clays o
Selective mining 2mtpa ore with 3.8 : 1 strip ratio, including internal waste
o
Processing –– two options ‐
Processing
two options Alkaline heap leach or agitated tank leach Alkaline heap leach or agitated tank leach
followed by direct precipitation
o
Producing 1000tpa U3O8 equivalent with road/rail transport via ports of Adelaide or Darwin
o
Progressive rehabilitation
Approx
12km
15
Wiluna Uranium Project: Trial Mining
•
•
•
•
•
Ore is within hypersaline water table
Geopolymer barrier tested
Vermeer continuous miner tested
Grade control system tested
Bulk sample taken
Trial Pit completed – successfully tested proposed mining and grade control methods
16
Wiluna Uranium Project: Conceptual Mine Scheduling
Mine Scheduling
Year 1
Mining
and
Void
Year 4
Year 7
Year 2
Year 5
Waste
St k il
Stockpile
1 kilometre
Year 8
Year 3
Tailings
Storage
g
Year 6
Year 9
Rehab
17
Wiluna Uranium Project: Processing
Alkaline agitated leach
•
Direct precipitation of Direct
precipitation of
uranium from pregnant liquor
•
Processing 1.3Mtpa
•
Average head grade 668ppm U3O8
•
Recovery 86%
•
Steady state production 1000tpa U3O8
•
Leaching at 950C
•
Make up water 1 700MLpa
Make up water 1,700MLpa
•
Electricity consumption 47.5GWh pa
•
Tailings difficult to settle
Tailings difficult to settle
•
Capital cost $257M
•
Project life >10 years
Comminution
Circuit
SDU Redesolution
Vanadium Precipitation and Recoveryy
Alkaline leach (~950C)
Sodium DiUranate (SDU) Precipitation
Uranium Precipitation
Counter Current Decantation
Pregnant P
t
Liquor
Product Drying and i
d
Packing
18
Wiluna Uranium Project: Timeline
2008
Acquisition
Resource Definition
Optimisation Study
Approvals Preparation
2009
2010
2011
2012
2013




Approvals
Metallurgical Trials
Decision to Proceed with BFS

Bankable Feasibility Study
Indigenous Mining Agreement
Off‐take Agreements
Decision to Construct
Design and Construct
C
Commissioning & Production
i i i &P d i
 Completed
Target for first production ‐ 2013
19
Exploration Lake Mackay Project (WA): Theseus
Photo courtesy of Wikipedia
21
Lake Mackay Project (WA): Theseus
It was a very wet “dry” season.
22
Namibia: JV with Deep Yellow
Hole Name
Interval
(m)
U3O8
From (m)
Comments
NOVR 374
7
132
72
Langer Heinrich area
NOVR 584
2
196
79
Langer Heinrich area
NOVR 289
2
398
45
Langer Heinrich area
NOVR 312
1
484
52
Langer Heinrich area
g
NOVR 295
2
194
42
Langer Heinrich area
NOVR 348
6
149
85
Langer Heinrich area
NTNR 4
2
251
21
Alaskite area / channel
# Refer Competent Persons Statements, Page 2
23
Mt Woods (SA): Uranium Rights
Toro retains the uranium rights on OZ Minerals Ltd (OZL) exploration properties adjacent to Prominent Hill mine.
OZL are spending >$40m per annum on exploration in and around Prominent Hill.
OZL mobilising/ deploying 10 drill rigs
deploying 10 drill rigs by Christmas.
24
Looking Ahead Pipeline
Dawson-Hinkler Well*
*subject to definitive legal documentation
26
Increa
asing Risk of fin
nding this
s style
Risk
Redox / Unconformity Style
Bi i d d JV
Birrindudu
Tanami
IOCGU Targets
Mt Woods
Roxby / Acropolis
Lake Mackay
Sandstone Style
Namibia
Lake Mackay
Ngalia
Wiluna Regional
Alaskite Style
Namibia
Metasomatic Style
Palaeochannel Style (ISR)
Namibia
Lake Mackay
Reynolds Range
Sandover
Calcrete Style
Namibia
Lake Mackay
Wiluna Regional
Increasing Risk of Development
27
- Sub 100
000t
- Sub 50
000t
Increas
sing Gra
ade of U3O8
- Sub 100
0000t
Reward
Metasomatic Style
Palaeochannel Style (ISR)
Namibia
Lake Mackay
Reynolds Range
Sandover
Redox /
Unconformity
Style
Birrindudu JV
Tanami
Sandstone Style
Namibia
Lake Mackay
Ngalia
Wiluna Regional
Calcrete Style
Namibia
Lake Mackay
Wiluna Regional
- Sub
S b
1.0%
Alaskite Style
Namibia
Increasing tonnes of U3O8
IOCGU Targets
Mt Woods
Roxby /
Acropolis
Lake Mackay
- Sub
0.1%
0 1%
28
What about the uranium market?
Game changer.
CNNC Estimates of Uranium Demand in 2015 and 2020
CNNC Estimates of Uranium Demand in 2015 and 2020
25,000 20 000
20,000 15,000 2015
2020
10,000 The new “Low” projection is much higher than last years “High” projection.
5,000 ‐
2009
2010
Low Projection
L P j ti
2009
2010
High Projection
Hi h P j ti
Source: Uranium Intelligence Weekly.
29
Strategy
Toro’s strategy encompasses both
encompasses both qualitative and quantitative targets
“To become a significant sustainable uranium mining company focusing on developing a top tier exploration and
company focusing on developing a top tier exploration and production profile in the global uranium mining sector generating superior shareholder returns.”
“Significant”
 production of greater than 2.2mlb (1,000t) U
production of greater than 2 2mlb (1 000t) U3O8 pa by 2015
pa by 2015
 production of greater than 5.5mlb (2,500t) U3O8 pa by 2020
Sustainable
“Sustainable”
 a JORC Resource greater than 100mlb (45,000t) U3O8 by 2011
 a JORC Resource greater than 220mlb (100,000t) U
a JORC Resource greater than 220mlb (100 000t) U3O8 by 2015
by 2015
 managing environmental and community concerns to maximise benefits to all stakeholders
30
2011 : More Drilling!
Lake Mackay Project
Theseus Prospect IOCGU targets Lake Mackay Birrindudu JV
Complete RC Drilling y
g
Reynolds Range
Complete RC Drilling Ngalia Basin
Start Drilling 6000m
1500m
Wiluna Regional
Commence Drilling in new areas
Mt Woods
Plan to drill at Taurus target 3000m
1000m
2000m
2000m
Total Drilling Planned >15,000m
>15 000m
1000m
31
Final Word
Lake Mackay Project
Wiluna Uranium Project – progressing approvals and the BFS
drilling!and public exhibition Feasibility StudyDrilling of IOCGU targets in southern •More
ERMP submission
ERMP submission and public exhibition, Feasibility Study, Indigenous mining agreement, Indigenous mining agreement
Lake Mackay (1500m)
product marketing, project finance planning, further regional consolidation opportunities
Drilling of the Theseus Prospect (6000m)
Birrindudu JV
Complete RC Drilling (2000m)
Reynolds Range
Reynolds Range
Complete RC Drilling (2000m)
Lake Mackay – on ground early next year to expand new Theseus uranium discovery
Ngalia Basin
Start Drilling (1000m) Wiluna Regional
g
Commence Drilling in new areas (3000m)
More emphasis internationally with like‐minded production orientated groups Mt Woods
Plan to drill at Taurus target (1000m)
Exploration initiatives extensive drilling
Exploration initiatives –
extensive drilling
•
Corporate and project acquisition – continued assessment of opportunities
f
•
Market fundamentals ‐ long term uranium demand fundamentals remain strong •
•
Significant increase to construction pipeline / changes to existing country rules on nuclear
delayed new supply / production issues at existing operations / investor interest
y
pp y / p
g p
/
32
Thank You
Simon Mitchell
General Manager – Business Development
+61 407 001 645
Toro Energy Limited
Corporate Office
C
Offi
3 Boskenna Avenue NORWOOD South Australia 5067
South Australia 5067 Telephone: +61 8 8132 5600 Facsimile: +61 8 8362 6655 Email: [email protected]
Website: www.toroenergy.com.au
Appendix
Board of Directors
Dr Erica Smyth
Non‐Executive Chairman
30+ years experience in the mineral and petroleum industries
Greg Hall
Managing Director
28+ years resource sector y
experience, including uranium (Ranger, Jabiluka & Olympic Dam) and uranium marketing (ERA North America)
Derek Carter
Non‐Executive Director
John Nitschke
Non‐Executive Director
Geologist with over 30 years experience in corporate management, exploration and mining Mining engineer with 35+ years experience in the resources industry in mining operations and project management
Peter Lester
Non‐Executive Director
Extensive experience in senior operating, development and corporate roles with Newcrest, North, CRA and MIM
Andrew Coles
Non‐Executive Director
Currently CFO of OZ Minerals Ltd, previously Treasury roles at Esso, Exon
Mobile and Zinifex
Mobile and Zinifex
35
Management Team
Greg Hall
Managing Director
28+ years resource sector
28+ years resource sector experience, including uranium (Ranger, Jabiluka & Olympic Dam) and uranium marketing (ERA North America)
Todd Alder
Finance Manager
16+ years financial management experience within the Mining, Energy and Steel Manufacturing industries
Simon Mitchell
General Manager,
Business Development
20+ years international resource development expertise including 10 years as an exploration/development ggeologist
g
Richard Yeeles
Approvals and
Approvals and Community Director ‐
Wiluna
Extensive management experience in government/ community o ernment/ comm nit
relations, ex‐BHPB Olympic Dam Expansion
Mark McGeough
General Manager,
Exploration
25+ years geological & exploration expertise, including uranium
including uranium
Richard Dossor
Project Director –
Wiluna
Extensive experience in design, procurement construction of
construction of development projects 36