altona mining presentation, investor roadshow november 2013
TRANSCRIPT
altonamining.com November 2013
Corporate Presentation
Symposium Forum
November 2013
www.altonamining.com ACN 090 468 018
ASX: AOH
FSE: A2O
altonamining.com November 2013 2.
Disclaimer and JORC Compliance
What You Should Know
Find out more - This presentation is being used as a presenter’s aid with 1 information. See Altona’s other periodic
and continuous disclosure announcements lodged with the Australian Securities Exchange, which are available at
www.asx.com.au or www.altonamining.com, for more information.
Third party information - Altona does not make any representations as to the accuracy or otherwise of third party
information, including where projections are given.
Forward-looking statements - Within this presentation there may be certain forward-looking statements, opinions
and estimates. These are based on assumptions and contingencies which are subject to change without notice and
are not guarantees of future performance. Altona assumes no obligation to update such information.
Taking action - Please undertake your own evaluation of the information in this presentation and contact your
professional advisers if you wish to buy or sell Altona shares.
Competent Person Statement
The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on
information compiled by Dr Alistair Cowden BSc (Hons), PhD, MAusIMM, MAIG who is a full time employee of the
Company and 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 2012
Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Dr
Cowden has consented to the inclusion in the report of the matters based on his information in the form and context in
which it appears.
Copper Equivalence
Copper equivalence refers to production only where total revenues are expressed as copper revenues, ie. Revenue
÷copper price. It does not refer to Resources, Reserves or drill results.
altonamining.com November 2013
A sustained step change in copper markets in 2005
Post 2005 price averages: US$7,265 (US$3.30/lb)
We Believe in Copper
3.
$1,577 $1,558 $1,780
$2,868
$3,684
$6,731 $7,126
$6,952
$5,164
$7,540
$8,811
$7,958 $7,670
2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013YTD
Today
altonamining.com November 2013 4.
Growing Copper Production and Optionality
Underground copper-gold mine in Finland
Outokumpu Project Roseby Project
Development ready, 40ktpa copper
altonamining.com November 2013 5.
Corporate Snapshot
Australian institutions: 32.0%
Foreign institutions: 20.0%
Board: 8.7%
German/Swiss retail: 7.0%
Top 20: 57.0%
Major Shareholders
ASX (Australia) code: AOH
FSE (Frankfurt) code: A2O
Share price (12-11-2013): A$0.15
Average daily turnover: 0.5M shares
Shares on issue: 532M
Market capitalisation: A$80M
Debt: US$21M
Cash (01-09-2013): A$26M
Research coverage: Credit Suisse
Market Status
Source: ASX
altonamining.com November 2013 6.
Outokumpu Copper Project in Finland
I metre
Massive copper sulphide ore in development face
altonamining.com November 2013 7.
Finland is a Leading Mining Destination
Altona’s projects are in eastern Finland.
Geology is similar to other Archaean and Proterozoic terrains in Australia and Canada.
Euro zone country with a history of mining and mining equipment manufacturing, a stable tax regime (20.0%) and no royalties.
Major miners include Agnico Eagle, Anglo American and First Quantum.
altonamining.com November 2013 8.
Mill, Mine and 5 Deposits in Historic Outokumpu
Keretti mine produced 1Mt copper and 1 Moz gold from 1914 to 1989
Past or present mine
Resource
Prospect
November 2013 altonamining.com
12.
Robust Quarterly Production Performance
2012/2013 was a ramp up year and EBIT (earnings) were US$18.3 million.
* C1 cash cost calculated per Brook Hunt methodology. Cost data during commissioning period not meaningful.
0.5
0.7
0.9
1.1
1.3
1.5
1.7
1.9
2.1
2.3
2.5
-
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
Q3 FY12 Q4 FY12 Q1 FY13 Q2 FY13 Q3 FY13 Q4 FY13 Q1 FY14
US
$ / lb
* To
nn
es
By-products as Copper Equivalent Copper C1 Cost
altonamining.com November 2013 13.
Altona Among the Best ASX Copper Producers
Altona’s C1 Cash cost calculated as per Brook Hunt methodology. Refer to websites of above
companies for their calculation method. Source: September quarterly activities reports of the
respective companies, except Hillgrove which is for the quarter ended 31 July.
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
C1 Cash Cost US$ / lb September Quarter
altonamining.com November 2013 14.
Increasing Resources and Reserves
0.00
0.20
0.40
0.60
0.80
1.00
1.20
1.40
1.60
1.80
0
10000
20000
30000
40000
50000
60000
70000
80000
90000
Feasibility Study June 2012 December 2012 June 2013
Co
pp
er
Gra
de
%
Co
pp
er
Ton
ne
s
Production depletion Ore Reserves Cu t Reserve Grade
altonamining.com November 2013
Deep drilling underway to expand resources
Kylylahti Mine Open at Depth
15.
altonamining.com November 2013 16.
Outokumpu: Sustainable Growth
PRODUCTION AND GROWING
CASHFLOW
Currently 12 - 13,000tpa Cueq*, 7.6 year
life. Reserve expansion likely, targeting
700,000tpa throughput
STRATEGIC ASSET Leverage our mill and competencies in the
Nordic region
FINANCIALLY STRONG Cash in bank, no net debt and positive
cashflow
EXPLORATION UPSIDE We control a major historic copper field
POTENTIAL FOR COBALT-
NICKEL REVENUE
Storing US$50M of valuable metals in
concentrates in dams each year
* See Disclaimer.
November 2013 altonamining.com
Roseby Copper Project
Little Eva
17.
Looking north-west from Green Hills
November 2013 altonamining.com
18.
3 Elements to the Project
Little Eva: A Development Ready Project
Fully permitted with DFS completed on a simple
39,000tpa copper open pit mine and flotation plant
Major Resource Inventory
1.52Mt copper including 0.84Mt copper in deposits
within Little Eva Project tenure
Exploration
• 750km² of exploration tenure prospective for copper,
gold and zinc-lead-silver surrounds the Resources.
• 800km2 Roseby South JV with Chinalco Yunnan
leverages exploration exposure
altonamining.com November 2013
May 2012 Definitive Feasibility Study
20.
Bankable DFS by GR Engineering Services
Large, simple and well drilled resource
Straightforward open pit mining and processing for 11 years
Simple processing route
Quality copper-gold concentrate
Stable, skilled mining jurisdiction
Native title, environmental permits and mining leases all in place
A$252 million NPV
A$320 million capital cost
US$1.70/lb cash cost Ernest Henry Mine Truck
altonamining.com November 2013
DFS Update Pending
DFS costs were top of market
− Mining contractor rates down from DFS estimates
− Engineering margins down
Resource/Reserves
− Incorporate post DFS drilling at Turkey Creek, Lady Clayre and Ivy Ann
− Little Eva resource/reserve re-modelling
Outlook
− Lower operating costs
− Lower capital costs
− Longer mine life (>11 years)
21.
November 2013 altonamining.com
22.
What Next for Little Eva?
Altona needs a partner to develop Little Eva
Altona pursuing partnering, sale and corporate opportunities that flow from having a large development ready copper asset
China has bought up the Mt Isa area, eg: Shanxi Donghui A$160 million bid for copper miner Inova
A number of Chinese parties and others in the data room
Major land positions in Mt Isa
altonamining.com November 2013 23.
The Altona Advantage
PRODUCTION & CASHFLOW
De-risked copper-gold-zinc mine and mill
in Finland with strong growth profile
COPPER LEVERAGE
1.66Mt (3.7mlbs) copper and 0.76Moz
gold in resources
STRATEGIC OPTION
Little Eva copper-gold deposit nearing
decision to build / value realisation
STRONG FINANCIALS
Cash in bank, no net debt and positive
cashflow
EXPLORATION UPSIDE
We control two major copper fields
November 2013 altonamining.com
24.
2011 was a turbulent year,
2012 will be Altona’s year to shine
Termite mounds watching summer
storms at the Blackard deposit
APPENDICES
altonamining.com November 2013 25.
Little Eva is a Large Deposit
1.3km long, 20-370m wide
Drilled up to 300m deep (511 drillholes, 76km)
Large bulk IOCG style deposit similar to Ernest Henry
Strip ratio of 1.8:1 after 15Mt pre-strip
Reserve: 53Mt ore at 0.6% copper, 0.1g/t gold
Additional 6Mt reserves in 3 small satellite pits
15Mt of low grade ore stockpiled and treated at end of mine life
11 year mine life
Underground potential
November 2013 altonamining.com
26.
Luikonlahti Mill Key Facts
Status 91.5% copper recovery.
71.5% gold recovery.
Products Copper-gold concentrate
Zinc concentrate.
Sales Boliden’s Harjavalta
smelter 400km by truck,
monthly payments.
FY2013 sales US$64M.
Plant capacity Up to 700,000tpa.
Milling cost €15/tonne plus €3/tonne
concentrate transport.
Cobalt Low-grade cobalt-nickel-
copper concentrate in
storage dams
Interior Luikonlahti Mill Hall
Pebble mill 1 in action
November 2013 altonamining.com
27.
Kylylahti Mine Key Facts
Status 600,000tpa, expansion under
consideration
Mine 5.5m x 5.5m decline tunnel,
longhole open stopes with
cemented waste fill
Life of mine
average
production
Copper: 8,000tpa
Gold: 8,400ozpa
Zinc: 1,600tpa
Copper equiv: 12,000tpa
Mining cost €32/tonne including trucking
Mine life 7.6 years
Reserves 4.2Mt at 1.6% Cu, 0.7g/t Au,
0.6% Zn
Resources 7.7Mt at 1.3% Cu, 0.7g/t Au,
0.5% Zn
Luikonlahti
Mill Interior
altonamining.com November 2013 28
Outokumpu Guidance FY2014
Metric Guidance Range
Ore (tonnes) 570,000 - 625,000
Copper grade (%) 1.50 - 1.65
Copper production (tonnes) 8,000 - 8,800
Gold production (ounces) 8,400 - 9,200
C1 costs (US$/lb) 1.60 - 1.75
Production guidance increased after excellent first quarter
C1 cash cost guidance falls
Commence paying debt principal in Q3 FY2014
Capital expenditure will reduce significantly in FY2015
8,659 tonnes copper hedged to Q4 FY16 at €5,651/tonne (US$3.46/lb)
altonamining.com November 2013
Altona Overview and Objectives
A profitable 9,000ktpa copper producer at Outokumpu in Finland with by-product gold, silver and zinc (12-13,000t copper equivalent)
Considering production expansion at Outokumpu dependent on further reserve/resource growth from deep drill program
Completed Definitive Feasibility Study for the Little Eva copper project near Mt Isa, Queensland has NPV of US$250 million
Little Eva could produce 39,000tpa copper and 17,000oz of gold per year over a mine life in excess of 10 years at a C1 cash cost of US $1.73/lb
Pursuing a range of transactions to realise value / develop Roseby, with the overriding objective being to maximise value for its shareholders
29.
altonamining.com November 2013 30.
An Experienced Team
Altona Management
Jarmo Vesanto General Manager Finland
Geologist
25 years Outokumpu Oyj in Finland, Canada and Australia
6 years as Manager in Finland
Altona Board
Kevin Maloney Non-Executive Chairman, founder of The Mac Services. Extensive career in retail banking, finance and resources
Paul Hallam Non-Executive Director, formerly Director of Operations at Fortescue and EGM Development and Projects for Newcrest
Peter Ingram Non-Executive Director , 45 years mining industry experience
Steve Scudamore Non-Executive Director , 28 years as a partner at international accounting and financial services firm KPMG
Alistair Cowden Managing Director
Over 30 years experience as a geologist and mining company executive
Instrumental in listing Vulcan Resources, Rox Resources, Archaean Gold and Magnetic Minerals
Eric Hughes Chief Financial Officer
Accountant, formerly BHP Billiton
20 years experience in financial management of resources companies
10 years experience as CFO of listed companies
Iain Scott Chief Operating Officer
Metallurgist, formerly Straits, Renison
25 years experience in mining and processing
15 years experience at COO and MD levels
altonamining.com November 2013
Top 10 Shareholders (53.6%)
31.
Rank Shareholder Country No. of Shares %
1 Perpetual Investments Australia 73,422,491 13.8%
2 L1 Capital Australia 58,006,278 10.9%
3 German retail clients through
Clearstream Luxembourg Germany 38,947,372 7.3%
4 Kevin Maloney (Chairman) Australia 35,348,000 6.6%
5 Thomas Roeggla and clients Monaco 29,626,422 5.6%
6 Colonial First State - Growth Australian Australia 11,200,000 2.1%
7 Matchpoint Investment Management Hong Kong 11,114,261 2.1%
8 Finnish Industry Investment Finland 10,261,300 1.9%
9 Dr Alistair Cowden (MD) Australia 10,010,960 1.9%
10 Pareto Growth Norway 7,399,233 1.4%
altonamining.com November 2013 32.
Share Price has Outperformed other ASX Coppers
Altona commenced trading on 23 February 2010
0
50
100
150
200
250
300
350
Altona Hillgrove Ivanhoe Tiger OZ Minerals All Ordinaries
November 2013 altonamining.com
I metre
Roseby Resource Estimates
DEPOSIT
TOTAL CONTAINED
METAL MEASURED INDICATED INFERRED
Tonnes Grade Copper Gold Tonnes Grade Tonne Grade Tonnes Grade
million Cu (%)
Au (g/t)
tonnes ounces million Cu (%)
Au (g/t)
million Cu (%)
Au (g/t)
million Cu (%)
Au (g/t)
COPPER-GOLD DEPOSITS
Little Eva 100.3 0.54 0.09 538,000 271,000 36.3 0.63 0.08 41.4 0.48 0.08 22.6 0.49 0.11
Ivy Ann 7.5 0.57 0.07 43,000 17,000 5.4 0.60 0.08 2.1 0.49 0.06
Lady Clayre 14.0 0.56 0.20 78,000 85,000 3.6 0.60 0.24 10.4 0.54 0.18
Bedford 1.7 0.99 0.20 17,000 11,000 1.3 1.04 0.21 0.4 0.83 0.16
Sub-total 123.4 0.55 0.10 675,000 384,000 36.3 0.63 0.08 51.7 0.52 0.09 35.5 0.51 0.13
COPPER ONLY DEPOSITS
Blackard 76.4 0.62 475,000 27.0 0.68 6.6 0.60 42.7 0.59
Scanlan 22.2 0.65 143,000 18.4 0.65 3.8 0.60
Longamundi 10.4 0.66 69,000 10.4 0.66
Legend 17.4 0.54 94,000 17.4 0.54
Great Southern 6.0 0.61 37,000 6.0 0.61
Caroline 3.6 0.53 19,000 3.6 0.53
Charlie Brown 0.7 0.40 3,000 0.7 0.40
Sub-total 136.7 0.61 840,000 27.0 0.68 25.0 0.64 84.7 0.59
TOTAL 260.1 0.58 0.05 1,515,000 384,000 63.2 0.65 0.05 76.7 0.55 0.06 120.1 0.56 0.04
See ASX release of 26 July 2011, 19 December 2011, 23 April 2012, 3 July 2012 and 22 August 2012 for full details of resource
estimation methodology and attributions.
Note: All figures may not sum exactly due to rounding.
Little Eva is reported above a 0.2% copper lower cut-off grade, all other deposits are above 0.3% copper lower cut-off grade.
33.
November 2013 altonamining.com
Little Eva Project - Resource and Reserve Estimates
Tonnes (m)
Copper (%)
Gold (g/t)
Contained Copper
(t)
Contained Gold (oz)
RESERVES
Proven 31.2 0.64 0.08 198,000 85,000
Probable 28.1 0.53 0.10 149,000 90,000
Sub Total 59.3 0.59 0.09 347,000 174,000
Probable (stockpile) 15.3 0.18 0.06 28,000 31,000
Total 74.7 0.50 0.08 375,000 204,000
Mining Inventory 1.9 0.51 0.23 10,000 14,000
Little Eva Project reserves are drawn from Little Eva, Lady Clayre and Ivy Ann.
34.
See ASX release of 14 May 2012 for full details of Reserve estimation methodology and attribution and 26 July 2011,
19 December 2011, 23 April 2012 and 22 August 2012 for full details of Resource estimation methodology and attribution.
altonamining.com November 2013 35.
Outokumpu Resource and Reserve Estimates
Deposit Classification Tonnes
(m) Copper
(%) Gold (g/t)
Zinc (%)
Cobalt (%)
Nickel (%)
Saramäki Inferred 3.40 0.71 - 0.63 0.09 0.05
Vuonos Inferred 0.76 1.76 - 1.33 0.14 -
Hautalampi
Measured 1.03 0.47 - 0.06 0.13 0.47
Indicated 1.23 0.30 - 0.07 0.11 0.42
Inferred 0.90 0.30 - 0.10 0.10 0.40
Total 3.16 0.36 - 0.07 0.11 0.43
Riihilahti Indicated 0.14 1.69 - - 0.04 0.16
Valkeisenranta Indicated 1.54 0.29 - - 0.03 0.71
Särkiniemi Indicated 0.10 0.35 - - 0.05 0.70
Sarkalahti Inferred 0.19 0.33 - - - 1.02
TOTAL 16.98 0.93 0.31 0.44 0.15 0.26
Kylylahti Tonnes
(m) Copper
(%) Gold (g/t)
Zinc (%)
Cobalt (%)
Nickel (%)
RESOURCES
Measured 1.4 1.22 0.56 0.55 0.23 0.20
Indicated 5.4 1.44 0.72 0.54 0.25 0.20
Inferred 0.9 0.64 0.59 0.36 0.17 0.25
TOTAL 7.7 1.31 0.68 0.52 0.23 0.21
Contained metal (t) 100,670 167,850oz 40,360 18,000 15,900
RESERVES
Proven 0.6 1.51 0.75 0.66 0.25 0.15
Probable 3.5 1.62 0.73 0.62 0.27 0.17
TOTAL 4.2 1.60 0.73 0.63 0.27 0.16
Contained metal (t) 66,700 97,700oz 26,100 11,100 6,900
See ASX release of 29 August 2013 for full details as required by the 2012 Edition of the Australasian Code for Reporting of
Exploration Results, Mineral Resources and Ore Reserves (JORC Code).
November 2013 altonamining.com
Telephone: +61 8 9485 2929
Facsimile: +61 8 9486 8700
Email: [email protected]
www.altonamining.com