astron corporation limited donald mineral sands project corporation limited’ domiciled in hk...
TRANSCRIPT
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Astron Corporation Limited
Donald Mineral Sands Project
March 2013
Simon Peters, Development Manager
ASX Code: ATR
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Disclaimer, Forward Looking Statements and Competent Person’s Statement
This presentation has been prepared by Astron Corporation Limited (the “Company or Astron”). It should not
be considered as an offer or invitation to subscribe for or purchase any securities in the Company or as an
inducement to make an offer or invitation with respect to those securities. No agreement to subscribe for
securities in the Company will be entered into on the basis of this presentation. This presentation contains
forecasts and forward looking information. Such forecasts, projections and information are not a guarantee of
future performance and involve unknown risks and uncertainties. Actual results and developments will almost
certainly differ materially from those expressed or implied. The Company has not audited or investigated the
accuracy or completeness of the information, statements and opinions contained in this presentation.
Accordingly, to the maximum extent permitted by applicable laws Astron makes no representation and can give
no assurance, guarantee or warranty, express or implied, as to, and take no responsibility and assume no
liability for, the authenticity, validity, accuracy, suitability or completeness of, or any errors in or omission, from
any information, statement or opinion contained in this presentation. You should not act or refrain from acting
in reliance on this presentation material. This overview does not purport to be all inclusive or to contain all
information which its recipients may require in order to make an informed assessment of the Company's
prospects. You should conduct your own investigation and perform your own analysis in order to satisfy yourself
as to the accuracy and completeness of the information, statements and opinions contained in this presentation
before making any investment decisions.
Competent Person’s Statement
The information in this report that relates to Exploration Results and Mineral Resources is based on information
compiled by Dr Boris Matveev, who is a Member of The Australian Institute of Geoscientists. Dr Matveev is a full-
time employee of Astron Ltd 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 2004 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resource
and Ore Reserves’. Dr Matveev consents to the inclusion in the report of the matters based on his information in
the form and context in which it appears.
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Presentation Agenda
Introducing Astron
Donald Mineral Sands Project, Murray Basin, Australia
Project Fit & Market Dynamics
Conclusion
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Introducing Astron
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History
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A Corporate Snapshot
Listed on ASX since 1983 – holding company ‘Astron Corporation Limited’ domiciled in HK
Dedicated focus on mineral sands mining and processing
Tier 1 Donald Project in Murray Basin, Australia
Near-term production project in Niafarang, Senegal
Approx. ~$115m of cash; no debt
25 years in China – strong presence and reputation in mineral sands processing and marketing
Operate a Chinese mineral sands trading business with close relationships to all key customers
Technology leader – significant research and technology development
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Location of Operations
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‘000
$/share A$m
Cash and term deposits
0.94 115
Donald (including water rights)
0.41 50
Niafarang
0.01 1
PPE & land use rights
0.21 26
Investments
0.02 2
Net current assets 0.03 3
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Astron Corporation Limited - Overview
Share Price Performance Financials
ASX Code ATR
Market Cap A$134m
Ordinary Shares 122m
Enterprise Value A$19m
Net Asset Value A$198m
Trading at a ~30% discount to net asset value
Shareholder Structure Asset Value Per Share*
*As at 31 December 2012
A$
Firback Finance Ltd(50%)
PT Arafua (26%)
Other Top 20shareholders (15%)
RemainingShareholders (9%)
0
500
1,000
1,500
2,000
2,500
3,000
0.600.700.800.901.001.101.201.301.401.501.60
Avg Volume Astron S&P ASX 200 (rebased)
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Donald Mineral Sands Project
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Donald Mineral Sands Project
One of the largest undeveloped deposits in the world
Next Generation Tier 1 resource
4 billion tonnes of resource at 4.8% THM
JORC reserve of 150mt
Stage 1 to produce 950ktpa of HMC; 30 year mine life
World class location – Murray Basin
Close to existing infrastructure: port, rail and road
Standard open-cut mining operation
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50km from regional city of Horsham
Skilled workforce
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World Class Location
Intergenerational resource sits within 300km from port
Road and water networks in place
300km to ports
70km to rail hub
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Astron Tenements
Historically identified strandline HM mineralisation
Known extensions of WIM deposits
5595 sq. km licenses
Held by subsidiaries Donald Mineral Sands & Sovereign Gold
Donald & Jackson two of the largest WIM type deposits in the region
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WIM Style Deposits - Geology
Geology Hosts Massive multi commodity Resource
Large, lobate, sheet-like
Laterally extensive individual heavy mineral lenses separated by barren sand
Relatively uniform grade over large areas
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Basis: Rutile price = US$1330/t FOB
Zircon price = US$2200/t FOB
Ilmenite price = US$200/t FOB
• High zircon, high-grade titania
concentrates
• High value in ground
• relative to other mining
opportunities
• relative to other feasible projects $0
$200
$400
$600
$800
$1,000
$1,200
$1,400
50% 55% 60% 65% 70% 75% 80% 85% 90% 95% 100%
% TiO2
Valu
e o
f ti
tan
ium
feed
sto
ck p
rod
ucts
Murray Basin fine
concentrates
Rutile
Synthetic
Rutile
Sulphate
Ilmenite
WIM Style Deposits - Opportunities
• Large ore tonnages
• Good grade
• Favourable assemblage
• High-quality Ti content
• Rare Earth Credits provide
multiple opportunities
Next Generation Product Supply
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Resource Geology
• 4,039Mt @ 4.8% HM Measured + Indicated + Inferred Mineral Resource *
• 461Mt @ 5.9% HM Proved + Probable Ore Reserve**
• Includes 150mt @ 5.8% HM Proved Ore Reserve
* combined Measured + Indicated + Inferred Mineral Resource at 1% HM cut-off
** calculation: tonnes below 1% HM / tonnes above 1% HM
AREA AVERAGE GRADE
HM%
RESOURCE* (MT)
AVERAGE STRIP RATIO**
2 4.5 407 1.6
3 3.7 951 0.9
ML 4.5 452 1.3
4 4.2 267 1.7
5 5.1 545 1.5
6 6.1 427 1.7
7 6.1 486 4.3
8 5.5 501 4.0
* ASX announcement dated 1 December 2011
** ASX announcement dated 15 June 2012
ML
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Previous Challenges now overcome
Secured long term high security water supply
Developed process flow with adequate recoveries based on proven technologies
Developed Hot Zircon Wash process to decrease impurities of Fe U & Th
Value Adds – Monazites and Tertiary Zircon Products
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Project Fit & Dynamics
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0.0%
2.9%
5.9%
8.8%
SFX GUN MDL MZI DRX BSE KMR SRX PFP ATR IMA ILU WTR
To
tal H
eav
y M
inera
ls (
%)
Average
Peer Comparison – Highly Competitive
18
264.6
74.9
90.3
90.0
69.1
0.8
18.7
4.7
1.6
70.2
32.2
8.1
12.6
13.4
0 50 100 150 200 250 300
Iluka Resources
Kenmare Resources
Sierra Rutile
Mineral Deposits
Base Resources
Astron
World Titanium Resources
Sheffield Resources
Pathfinder Minerals
Image Resources
Miatilda Zircon
Gunson Resources
Diatreme Resources
Mineral Commodities EV / Zircon Eq ($A/t)
Source: Bell Potter, Astron
0
200
400
600
800
1,000
1,200
1,400
1,600
MZI DRX GUN IMA SFX BSE WTR MDL ATR PFP
Sale
ab
le p
rod
ucti
on
(K
tpa)
Average
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
IMA SFX GUN DRX ATR(D)
ATR(N)
MDL WTR BSE ILU
Rev
en
ue / C
ost
(tim
es)
*ATR (stage 2)
SFX – Sheffield Resources
GUN – Gunson Resources
MDL – Mineral Deposits
MZI – Matilda Zircon
DRX – Diatreme Resources
BSE – Base Resources
KMR – Kenmare Resources
SRX – Sierra Rutile
PFP – Pathfinder Minerals
ATR – Astron Corporation
IMA – Image Resources
ILU – Iluka Resources
WTR – World Titanium Resources
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Donald’s Position & Fit
Major Comments Major Suppliers
Summary of Development Projects
F/Production
TiO2
('000t/pa) Zi
('000t/pa) Zi Ratio
Rank Zi:TiO2 Funding $Am
(D/E)
Financed
Grand Còte Senegal (Mineral Deposits JV with Eramet)
Late 2013 591 85 4 0.14 198/305
Kwale, Kenya (Base) Late 2013 330 25 5 0.08 173/140
Being Financed
Coburn (Gunson) 2014 106 40 1 0.38
Donald (Astron) 2015 340 121 2 0.36
Niafarang (Astron) 2014 82 15 3 0.18 Nil debt
Toliara Sands (WTR) 2014 407 32 5 0.08
13%
16%
12%
8% 4%
4%
43%
TiO2 units (6.5Mt)
Others
QIT
(Rio 80%)
RBM (Rio 74%)
Exxaro Kenmare
BeMax
Iluka
Astron 4%
39%
16%
13%
7%
5%
4%
3%
2% 2% 9%
Zircon (1.5Mt)
Others QIT (Rio 80%)
RBM (Rio 74%)
Exxaro
Kenmare
India
Iluka
China
Indonesia
BeMax
Astron
8%
• 8% world supply of Zircon
and 4% of Ti02
• 80% of revenue from high
value materials (Zircon and
Rutile)
• Largest new Zircon project
to come on stream
• Rio Tinto forecast titanium dioxide
market to grow 46% to 9.5Mtpa
in 2020
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• Outlook for pricing has deteriorated
• Producer inventories have increased
• Producers managing production to limited further inventory build
• Outlook for Ti02 is better than zircon
• Downstream inventories remain low
Long Term
Short Term
Market Dynamics
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• Fundamentals underlying strong zircon demand growth expectations,
in particular in China, remain intact
• Global zircon production will decline unless new resources
are brought on stream
• Titanium markets to grow 40-50% by 2020
• Growth to come from China
Long Term
Short Term
Market Dynamics
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Conclusion
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The Astron Value Proposition
Extensive history
in Chinese
marketplace –
25 year record
Active mineral
sands import and
trading business
in China
Massive resource
base
Robust long term
product demand
Robust balance
sheet
Well advanced
path to
production
Major Permits
in place with
Understand key
requirements of
customers and
Chinese market
dynamics
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For further information please contact
Simon Peters
Development Manager Email: [email protected]
Tel: +61 4 08502248
Website: www.astronlimited.com