Carpentaria Exploration Ltd Resources and Energy Investment

Symposium - Broken Hill

May 21st 2013 We find it. We prove it. We make it possible.

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CARPENTARIA  Key  Messages  

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•  Hawsons  Iron  Project  is  a  quality  asset  set  to  stand  above  its  peers  

•  Ownership  and  JV  status  se<led    a=er  two  years  -­‐  Joint  Venture  can  focus  on  delivering  the  project    

•  Bankable  Feasibilty  Study  to  conEnue  with  $5.0  million  funding  from  Pure  Metals  potenEally  adding  great  value  to  the  project    

Disclaimer

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This  presenta,on  has  been  prepared  by  the  management  of  Carpentaria  Explora,on  Limited  (CAP)  for  the   benefit   of   analysts,   brokers   and   investors   and   not   as   specific   advice   to   any   par,cular   party   or  persons.   The   informa,on   is   based   on   publicly   available   informa,on,   internally   developed   data   and  other  sources.  Where  an  opinion  is  expressed  in  this  presenta,on,  it  is  based  on  the  assump,ons  and  limita,ons   men,oned   herein   and   is   an   expression   of   present   opinion   only.   No   warran,es   or  representa,ons  can  be  made  as  to  origin,  validity,  accuracy,  completeness,  currency  or  reliability  of  the  informa,on.  CAP    disclaims  and  excludes  all  liability  (to  the  extent  permiGed  by  law)  for  losses,  claims,  damages,  demands,  costs  and  expenses  of  whatever  nature  arising  in  any  way  out  of  or  in  connec,on  with  the   informa,on,   its  accuracy,  completeness  or  by  reason  of  reliance  by  any  person  on  any  of   it.  Where    CAP    expresses  or  implies  an  expecta,on  or  belief  as  to  the  success  of  future  explora,on  and  the   economic   viability   of   future   project   evalua,ons,   such   expecta,on   or   belief   is   expressed   in   good  faith  and  is  believed  to  have  a  reasonable  basis.  However,  such  expected  outcomes  are  subject  to  risks,  uncertain,es   and   other   factors   which   could   cause   actual   results   to   differ   materially   from   expected  future   results.   Such   risks   include,   but   are   not   limited   to,   explora,on   success,   metal   price   vola,lity,  changes   to   current   mineral   resource   es,mates   or   targets,   changes   to   assump,ons   for   capital   and  opera,ng  costs  as  well  as  poli,cal  and  opera,onal  risks  and  governmental  regula,on  outcomes.  CAP  does  not  have  any  obliga,on  to  advise  any  person  if  it  becomes  aware  of  any  inaccuracy  in  or  omission  from  any  forecast  or  to  update  such  forecast.  

CARPENTARIA  EXPLORATION    Company  Snapshot

ASX  :  CAP    CASH  10th  May  2013  A$3.8  million  ISSUED  SECURITIES  108  m  shares  MARKET  CAP.  (@  $0.24)  $26  million    Board  of  Directors  Nick  Sheard  –  Geophysicist  Bob  Hair  –  Lawyer  Bin  Cai  –  Accountant  Neil  Williams  –  Geologist  Paul  Cholakos  –  Mining  Engineer          

KEY  ASSET    Hawsons  Iron  Project  JV  –  Carpentaria  60%  BMG  in  Liq.  40%-­‐  Pure  Metals  to  acquire  

18 March 2013 4

HAWSONS  IRON  PROJECT    Key  Facts  

Studies  –  Audited  Prefeasibility  study  

completed  (ASX  release  Nov  2011-­‐  (2004  JORC  Code))  

–  BFS  underway  Aim        

–  10  to  20  Mtpa  concentrate  (69.5%  Fe)  

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JORC  Inferred  Resource    –  1.4  Billion  tonnes  for                220  Million  tonnes    con’.    –  15.5%  mass  recovery    –  69.9%Fe  and  2.50%  SiO2  

Explora:on  Target  1    –  6-­‐11    Billion  tonnes  at  14-­‐17%  mass  

recovery  69%Fe  2.5%  SiO2  (defined  by  drilling  and  assaying  all  magneEc  anomalies  combined  with  detailed  magneEc  modelling)  

1 The potential quantity and grade of the exploration targets is conceptual in nature and there has been insufficient exploration to define a Mineral Resource. It is uncertain if further exploration will result in the determination of a Mineral Resource.

HAWSONS IRON PROJECTHawsons Iron Project vs Sydney Harbour"

20  kms  

Sydney  Harbour  

Greater  Sydney  Area  

Botany    Bay  

HAWSONS  IRON  PROJECT    Key  Development  Advantages  

•  ExisEng  rail  and  port  infrastructure      •  ExisEng  power  and  water  supply      •  Transport  concept    

–  Slurry  to  rail  –  Rail  first  10Mt  –  Pipeline  for  full  producEon  –  Port  Pirie  transhipment    to  Cape  size  ships  

following  low  cost  upgrade    –  MoU’s  in  place  

•  Large  deposit  with  0.3  waste  to  ore  raEo  and  no  internal  diluEon  

•  Very  so=  siltstone  ore  –  low  cost  processing  –  Approx.  one  quarter  power  usage  of  

standard  magneEte  iron  ores  •  Grid  power  –  $0.085Kwh  •  Lower  labour  costs    •  No  NaEve  Title  –  full  access  to  project      

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Port  Pirie  Spare  Berths  

HAWSONS  IRON  PROJECT  2011-­‐2013  

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Results  

•  ConEnued  sole  funding  project    –  over  $4m  in  2  years  –  Reducing  key  risk  areas  –  processing,  

geology,    improving  viability    

•  Strengthened  the  Board  

•  NegoEated  a  deal  with  largest  shareholder  

Specific  Challenges  

•  Internal  dispute  within  JV  Partner  BMG  (40%  share)  –  no  funding  for  one  year  

•  Subsequent  LiquidaEon  of  BMG  –  Further  one  year  delay  –  almost  complete  

•  Shareholder  challenge    –  Interest  in  the  project  

HAWSONS  IRON  PROJECT  Global  Challenges  

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Volaclity  in  iron  ore  price  in  2012    

•  resulted  in  some  magneEte  projects  and  infrastructure  projects  being  shelved  

•  Hawsons  esEmated  costs  are  at  the  right  place  of  the  cost  curve  and  studies  have  conEnued  to  add  value  

HAWSONS  IRON  PROJECT  Global  Challenges  

Challenge  •  Extreme  Eghtening  in  capital  

markets  

•  CauEous  Chinese  magneEte  investment    

•  slowed  development  of  many  projects  

 

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Results  •  InvesEgaEng  lower  capital  cost  

opEons  

•  Deal  with  Pure  Metals  for  $5.0m  extra  funding  to  the  project  

Quality  of  the  Hawsons  Project  has  met  most  of  these  challenges  so  far    New  deal  with  Pure  Metals  will  maintain  project  momentum  

HAWSONS  IRON  PROJECT  Pure  Metals  Deal    

•  Pure  Metals  are  a  related  party  to  CAP  19%  shareholder  Silvergate  Capital  

•  Pure  Metals  to  complete  purchase  from  Liquidator  –  Ownership  CAP  60%,    Pure  Metals  40%  –  est.  May  31st    

•  ParEes  agree  on  work  program  

•  Then  Pure  Metals  to  :  –  Sole  Fund  $5.0  million  in  12  months  –  Pay  CAP  $1.0  million  cash    –  Pay  CAP  $2.8  million  cash  at  a  Eme  the  earlier  of  compleEon  of  

Federal  Court  proceedings  or  two  (2)  years  for  reimbursement  of  CAP  past  expenditures  

–  The  Federal  Court  has  ruled  the  sale  from  the  Liquidator  of  the  40%  interest  can  proceed  in  response  to  a  challenge  to  the  Liquidators  acEons  by  a  third  party  

–  Final  determinaEon  date  to  be  set,  however  Judge  already  ruled  “no  serious  quesEons  to  be  tried”  

HAWSONS  IRON  PROJECT  Moving  Forward  

Benefits  of  Deal  with  Pure  Metals    •  $5.0  million  to  be  spent  on  project  

 •  $3.8m  cash  to  CAP  in  a  difficult  market  without  diluEon  

•  Reduce    CAP’s  ongoing  funding  requirement  for  Hawsons  to  60%    •  Increase  project  access  to  iron  ore  end  users  and  Asian  capital  markets    •  Secure  funding  in  difficult    market  shows  confidence  in  project  

•  CAP  to  retain  majority  60%  ownership  through  above  deal    

HAWSONS  IRON  PROJECT  The  Way  Forward  

Focus  on  schedule  and  risk  •  Resource-­‐  relaEvely  low  risk  •  Processing  –  relaEvely  low  risk  

–  Proof  of  concept-­‐  small  scale  Pilot  Plant  work  recent  results  confirm  69%  Fe  achievable    within  our  cost  esEmates  

–  flexibility  to  explore  lower  cost  opEon  of  66%  Fe  vs  higher  cost  69%  Fe  opEon  

•  Mining  –  economic  opEon  found,  in-­‐pit  crush  and  convey  appears  best.  room  for  opEmisaEon    

•  EIS  guidelines  provided  and  State  Significant  Project  declared      

 

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SEM  image  of  Hawsons  Concentrate  at  an    intermediate  processing  stage  

HAWSONS  IRON  PROJECT  The  Way  Forward  –  State  Significant  Project  

•  OpEmise  producEon  rates  uElising  exisEng  infrastructure  for  Stage  1  but  maintain  project  scalability  (Stage  2)  

•  ConEnue  EIS    –  Focus  on  stakeholder  engagement  and  

associated  acEviEes  –  permiong  requirements  for  site  and  

transport  infrastructure  –  CompleEng  EIS  by  Nov.2014  –  Lodge  Mining  Lease  ApplicaEon  

•  Explore  opEons  to  accelerate  the  BFS  while  growing  shareholder  value  

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Carpentaria’s  Plan  –  Not  Sexy,  but  what  is  needed  now    

CARPENTARIA  Key  messages  

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•  Hawsons Iron Project is a quality asset set to stand above its peers

•  Ownership and JV status settled after two years - Joint Venture can focus on delivering the project

•  BFS to continue with $5.0 million funding from Pure Metals potentially adding great value to the project

Carpentaria Exploration We find it. We prove it. We make it possible. Phone: +61 7 3220 2022

To find out more, visit us at www.capex.net.au

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The  informa,on  in  this  presenta,on  that  relates  to  Explora,on  Results  and  Resources  is  based  on  informa,on  compiled  by  S.N.Sheard,  who  is  a  Fellow  of  the  Australian  Ins,tute  of  Geoscien,sts  and  has  had  sufficient  experience  which  is  relevant  to  the  style  of  mineraliza,on  and  type  of  deposit  under  considera,on  and  to  the  ac,vity  which  he  is  undertaking  to  qualify  as  a  Competent  Person  as  defined  in  the  2004  Edi,on  of  the  'Australasian  Code  for  Repor,ng  of  Explora,on  Results,  Mineral  Resources  and  Ore  Reserves'.  S.N.Sheard  is  an  employee  of  Carpentaria  and  consents  to  the  inclusion  in  the  report  of  the  maGers  based  on  his  informa,on  in  the  form  and  context  in  which  it  appears.    

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