investor presentation | blackham resources (asx:blk) | gold investment symposium 2014
DESCRIPTION
Investor presentation delivered by Blackham Resources Managing Director Bryan Dixon, at the Gold Investment Symposium held in Sydney, 8th and 9th October 2014TRANSCRIPT
BLACKHAM RESOURCES - FOCUS
Rapid expansion at BLK’s 100% owned Matilda Gold Project over thelast 2 years
Acquisition of WGP plant & infrastructure unlocks value in MatildaGold Project
4.3 Moz Au resource, 55kms of strike and 780km2 landholding
Acquisition, exploration & development cost ~ A$3/oz Au resource
Exploration focus on free-milling mineralisation
Market cap ~ A$18 Million or less than EV $4/oz gold resource
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BOARD OF DIRECTORS
Paul Murphy Independent Non-Exec Chairman
Bryan Dixon Managing Director
Alan Thom Executive Director - Development
Greg Miles Non-Executive Director
CAPITAL STRUCTURE
Market cap. @ A$0.15 A$18M
Shares on issue 118.9M
Options @ A$0.20 – A$0.35 14.1M
Cash & liquids @ 30 June 2014 A$2.0M
Debt nil
SHAREHOLDER ANALYSIS
Top 20 61%
Polo Resources Limited 17.4%
Citicorp Nominees 7.3%
HSBC Nominees 7.3%
Kingsreef Pty Ltd 5.4%
BBY Nominees 2.8%
Widerange Pty Ltd 2.3%
CORPORATE OVERVIEW
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The right address - low sovereign risk
Large, highly prospective tenement
holding in the Northern Yilgarn,
Western Australia
Regional endowment >40Moz
8Moz endowment in the expanded
Matilda project including 4Moz
production
Well positioned for new discoveries
and economic development of existing
resources
REGIONAL ENDOWMENT
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MATILDA GOLD PROJECT
Resource 40Mt @ 3.3 g/t for 4.3Moz Au – 46% at least indicated resource
4Moz of historical production
+780 km2 of tenure & 55km of mine sequence strike
All deposits within 20km of Blackham’s gold plant with existing haul roads
Little systematic regional exploration in over a decade
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Mill 1 Up to 1Mtpa
Oxide Ore
Mill 2 Circuit Up to 550,000tpaUnderground Ore
Mill 1 & 2 Circuit 1.3 Mtpa
WGP PROCESSING CIRCUIT – 100% OWNED
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JORC Resources 40Mt @ 3.3g/t for 4.3Moz Au
Mix of open pit & high grade underground ore
Land holding 780km2 – 55km of mine strike
Plant 1.3Mtpa capable of treating oxide for 80 -100kozpa1
Biox circuit capable of treating refractory ores
350 person village & established sealed airstrip and roads
Gas power station & diesel backup
Permitted borefields and infrastructure
Operating approvals and licenses
1 assumes production from the Galaxy, Matilda and Golden Age deposits. Approximately 74% of the mineral inventory
is to a measured and indicated resource category. 26% of the pit areas are inferred resource. There is a low level of
geological confidence associated with inferred mineral resources and there is no certainty that further exploration
work will result in the determination of indicated mineral resources or that the production target itself will be realized.
CONSOLIDATED MATILDA PROJECT
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Advanced Resources - Development Targets
Brown Fields
Green Fields
Matilda Extensions
Golden Age Repeats
Carroll – Prior, Williamson UG
Regent, East & West Lodes
Caledonian Trend
Mentelle, Trend, Galaxy North,
Galaxy
Matilda
Golden Age UG
Williamson
Focus on converting resources to reserves at development targets and finding new deposits in brown and green fields
DEVELOPMENT & EXPLORATION
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52,000oz Au Inferred Resource located 13kms NNW of the WGP plant
February & April drilling
9m @ 13.4 g/t from 73m incl
4m @ 27.9 g/t
2m @ 28.9 g/t from 23m
6m @ 8.82 g/t from 13m
4m @ 19.6 g/t from 37m
Historical intercepts
4m @ 11.5g/t from 56m
3m @ 11.3g/t from 4m
4m @ 12.3g/t from 6m
8m @ 9.65g/t from 72m
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GALAXY – high grade quartz reef from surface
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Open up-dip1.7m @ 11.91 g/t2.6m @ 25.40 g/t5.03m @ 11.73 g/t
Open along strike2.3m @ 15.78 g/t 2.0m @ 20.95 g/t7.8m @ 7.2 g/t 1.75m @ 11.61g/t
Open at depth7.4 m @ 7.56 g/t7.0m @ 11.61 g/t
High grade quartz reef Produced 160,000oz Au @ 9g/t Mine ready – development costs sunk
Republic Reef1.6m @ 12.7 g/t (103m)2.5m @ 8.3 g/t (312m)
Brothers Reef6m @ 4.5 g/t (194m)
0.6m @ 11.2 g/t (431m)
GOLDEN AGE U/G
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Scoping Study pits and resources at Matilda
RESOURCES Mtg/t
Au
Oz
Au
Measured0.1 2.4 9,000
Indicated 4.7 2.0 300.000
Inferred 8.2 1.7 450,000
TOTAL 13.0 1.8 760,000
Production (1987-1992):
2.2 Mt@ 2.6g/t = 181,000oz au
Mostly oxide material mined from 7 shallow
pits, generally to < 50m
Existing mining lease and previous
Notice of Intent to mine
Mining heritage agreement
Historical mining data - basis for
feasibility studies
MATILDA MINE - Near term mining opportunity
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Shallow mineralisation extends 1,000m north of the old pit & still open
M4 DEPOSIT – Recent high grade shallow results open along strike
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Historical mining:
386,000t @ 2.2g/t
Au to < 50m depth
Resource 204,000oz
with 93% < 160m
from surface
Recent high grade
shallow drill results
likely to pull the
open pit further
north
High-grade mineralisation in pit floor
Outstanding drill results:
35m @ 5.05g/t (114m) incl 12m@ 9.1g/t
7m @ 11.9g/t (244m)
UG extensions priority target
M1 DEPOSIT
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WILLIAMSON DEPOSIT – up to 40m wide
High-grade shear zones bounding monzogranite stockwork up to 40m wide, free-milling ore
High-grade mineralisation beneath current pit
Williamson Pit – mining [email protected]/t from 117m
[email protected]/t from 136m
[email protected]/t from 372m
RESOURCES Mt g/t Au Oz Au
Indicated 2.7 1.7 148,000
Inferred 3.6 1.8 202,000
TOTAL 6.3 1.7 350,000
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Large mineralised system 19km south
along strike from Wiluna – large tonnage
potential
350Koz resource - structural setting
similar to Wiluna – potential cluster of
deposits
Williamson south mineralisation extends
for 1.5km south of the pit
Carroll -Prior targets
Previous drilling identified
continuous mineralisation over 3km
Infill drilling needed to define resources
LAKE WAY & WILLIAMSON
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SIGNIFICANTLY UNDERVALUED RELATIVE TO AUSTRALIAN PEERS
UNDERVALUED RELATIVE TO AUSTRALIAN PEERS
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4.3Moz gold resource - 46% measured & indicated
Acquisition of plant with capacity for 100,000ozpa1 puts
Blackham in a new peer group
Existing plant & infrastructure minimises risk
Extending mine life to beyond 5 years of free milling ores
Production 4 months after decision to mine
Very low capital - high return opportunity for shareholders
BLACKHAM’S MATILDA VISION
1 assumes production from the Galaxy, Matilda and Golden Age deposits. Approximately 74% of the mineral inventory is to a measured and
indicated resource category. 25% of the pit areas are inferred resource. There is a low level of geological confidence associated with
inferred mineral resources and there is no certainty that further exploration work will result in the determination of indicated mineral resources
or that the production target itself will be realized. 18
This presentation includes certain statements that may be deemed ‘forward-looking statements’. All statements that refer to any future
production, resources or reserves, exploration results and events or production that Blackham Resources Ltd (‘Blackham’ or ‘the
Company’) expects to occur are forward-looking statements. Although the Company believes that the expectations in those forward-
looking statements are based upon reasonable assumptions, such statements are not a guarantee of future performance and actual
results or developments may differ materially from the outcomes. This may be due to several factors, including market prices,
exploration and exploitation success, and the continued availability of capital and financing, plus general economic, market or
business conditions. Investors are cautioned that any such statements are not guarantees of future performance, and actual results or
performance may differ materially from those projected in the forward-looking statements. The Company does not assume any
obligation to update or revise its forward-looking statements, whether as a result of new information, future events or otherwise.
The information contained in the report that relates to Exploration Target and Exploration Results, at the Matilda Gold Project is based
on information compiled or reviewed by Mr Greg Miles, who is a full-time employee of the Company. Mr Miles is a Member of the
Australian Institute of Geoscientists and has sufficient experience which is relevant to the style of mineralisation and type of deposit
under consideration and to the activity which is being undertaken to qualify as a Competent Persons as defined in the 2012 Edition of
the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Miles has given consent to the
inclusion in the report of the matters based on this information in the form and context in which it appears.
With regard to the Matilda Project Resources, the Company is not aware of any new information or data, other than that disclosed in
this report, that materially affects the information included in this report and that all material assumptions and parameters
underpinning Mineral Resource Estimates as reported in the market announcement dated 23rd of January 2014 continue to apply and
have not materially changed.
The information contained in the report that relates to Exploration Targets, Exploration Results, Mineral Resources or Ore Reserves at the
Wiluna Gold Project is based on information compiled or reviewed by Mr Greg Miles, who is a full-time employee of the Company. Mr
Miles is a Member of the Australian Institute of Geoscientists and has sufficient experience which is relevant to the style of mineralisation
and type of deposit under consideration and to the activity which is being undertaken 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 Miles has given
consent to the inclusion in the report of the matters based on this information in the form and context in which it appears.
DISCLAIMERS & IMPORTANT INFORMATION
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Bryan DixonManaging Director
Blackham Resources Ltd
T: +61 8 9322 6418 | F: +61 8 9322 6398
A: Level 2, 38 Richardson Street,
West Perth WA 6005
P: PO Box 1412, West Perth WA 6872
W: www.blackhamresources.com.au
ASX Code: BLK
Project partners:
CONTACT DETAILS
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Paul Murphy – Independent Non Executive Chairman
Mr Murphy is a former banker with extensive experience infinance, strong relationships within the banking, finance andbroking community as well as an impeccable reputation in theindustry. His banking experience extends across finance, fixedincome,
Bryan Dixon – Managing Director
Bryan’s skills and experience include project acquisition, minedevelopment and financing. Has been involved in feasibility andfinancing of 3 gold mines. Having previously worked with KPMG,Resolute Limited and Archipelago Resources Plc, he hassubstantial experience in the mining sector and themanagement of listed public companies.
Alan Thom – Executive Director - Mining Engineer
Alan, a mining engineer, has extensive mining experience. Heholds a Western Australian First Class Mine Managers Certificateand has held statutory mine and management positions forNewmont in both underground and open-pit operations atJundee and Bronzewing. Alan has managed a number ofdefinitive and bankable feasibility studies for significant resourceprojects.
Greg Miles – Non Executive Director - Geologist
Greg graduated is a geologist and has since worked in a numberof different commodities and mineral provinces across a broadportfolio of grass-roots to development projects. Professionalhighlights include involvement in the discovery of the 2.3MozCentenary Deposit at the Darlot Gold Mine in the EasternGoldfields, WA.
Mike Robbins - CFO / Company Secretary
Mr Robbins has well over 20 years resource industry experiencegathered at both operational and corporate levels, both withinAustralia and overseas.
Graham Lingard – Resident Mine Manager
Graham has over 35 yeas of experience in the mining industry inWestern Australia. Graham has worked at Wiluna since 2007including as resident manager since Aug 2013. He has previouslyworked in managerial roles in numerous gold mines in theYilgarn.
Craig Bartle – Plant & Metallurgical Manager
Craig Bartle is a metallurgist with extensive experience in theresources industry. He was a senior metallurgist at Wiluna forApex, Oxiana, and Agincourt Resources and previously workedat Beaconsfield gold mine.
Cain Fogarty – Exploration Manager
Mr Fogarty has broad experience in greenfields and near-mineexploration, having worked around Australia and internationallyon a variety of major ore deposit styles, particularly sediment-hosted base metals and orogenic gold. Previously, Mr Fogartyhas worked with Barrick Gold Corp, Equinox Minerals and CSAGlobal.
Marcus Osiejack - Resource Geologist
Marcus has expertise in a variety of underground and open pitgold operating roles with technical skills including resourcemodelling, estimation and grade control. Having previouslyworked at Lawlers, Darlot and numerous gold projects withinWestern Australia,
DIRECTORS & MANAGEMENT
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Aggressive exploration strategy to focus on new oxide and/or
free-milling high grade underground ore bodies
Rigorous feasibility study prior to a development decision
Plant can be used in its current location
Low risk process: crush, grind, gravity and CIL
Refractory circuit moth balled - possible toll treating options
Plant refurbishment to be out of debt
MATILDA STRATEGY: Free milling focus
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See ASX announcement 20th January 2014 for JORC Table 1 information.
Table 2. Wiluna Gold Project Resource Summary (JORC 2004)
Lode
Indicated Inferred Total
Mt g/t Au Koz Au Mt g/t Au Koz Au Mt g/t AuKoz Au
Henry 5 –Woodley -Bulletin
2.1 5.9 404 0.8 4.6 112 2.9 5.6 516
Burgundy -Calais
1.3 6.0 250 0.3 5.7 58 1.6 6.0 309
East Lode 1.2 5.4 213 2.6 5.5 453 3.8 5.4 667
West Lode Calvert
1.2 5.3 198 2.3 5.3 383 3.4 5.3 581
Happy Jack -Creek Shear
1.5 5.9 289 1.3 4.8 205 2.9 5.4 494
Other Deposits 0.8 4.0 109 1.3 4.1 172 2.1 4.1 281
Wiluna Total 8.2 5.6 1,465 8.6 5.0 1,384 16.7 5.3 2,848
Table 1. Matilda Gold Project Resource Summary (JORC 2012)
Mining CentreMeasured Indicated Inferred Total
Mtg/t Au
Koz Au
Mtg/t Au
Koz Au
Mtg/t Au
Koz Au
Mtg/t Au
Koz Au
Matilda Mine
0.1 2.4 9 4.7 2.0 300 8.2 1.7 450 13.0 1.8 760
Williamson Mine
2.7 1.7 150 3.6 1.7 200 6.3 1.7 350
Regent 0.7 2.5 61 3.1 2.1 210 3.9 2.2 270
Galaxy 0.6 2.9 52 0.6 2.9 52
Matilda Total 0.1 2.6 9 8.1 2.0 510 16 1.8 910 24.0 1.9 1,400
APPENDIX A: GOLD RESOURCES
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3km strike from plant to Caledonian Pit
Drilling indicates potential for open-pit
resources. Quartz hosted – free milling
Very shallow RAB drilling (~5m) &
limited RC to 60m - little surface
expression to 20m with most drilling
ineffective
Nearby historical workings at Derwent
& Monarch open pit potential
Derwent: 3m @ 50.6 g/t from 25m
Monarch: 6m @ 19.4 g/t from 44m
7m @ 7.15 from 40m
6m @ 6.2 from 20m
12m @ 5.68 from 27m
5m @ 5.01 from 20m
CALEDONIAN TREND
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GALAXY NORTH
Structural analogue to Wiluna Mine
Dextral offset fault in mafic mine sequence
Approx 2km prospective zone
This setting hosts 6Moz at Wiluna as well as
mineralisation at Regent. The target is a Wiluna-
style mine camp
Galaxy deposit possibly part of mine camp cluster
Only minor drilling – exploration hampered by thin
cover of overlying basin sediments
2km
NB. Figures at same scale
Galaxy Deposit
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Very limited drilling of high grade
down-plunge targets
Limited drilling along strike of existing pits
Pit convergence lowering stripping ratios
Further resources upgrades
Extensions of known lodes
Discovery of new lodes between pits
MATILDA MINE CENTRE
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Historical drilling identified mineralisation
up to 3km from the mine area
Strike extensions partly covered by
drainage – impediment to historical
exploration = opportunity
Mentelle trend… parallel structure?
Mentelle prospect potential resource with
Matilda characteristics
Large RAB program to test structure
Matilda extension vector also provides
bulls-eye target
Target
4m @ 13.9 g/t (64m)
M116m @ 13.9 g/t (22m)4m @ 9.51 g/t (22m)
Mentelle4m @ 13.4 g/t (boh)
MATILDA EXTENSIONS & Mentelle Shear
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Potential large tonnage, near surface, infill drilling required
Deeper drilling to identify high grade primary mineralisation
3kms of strike with continuous mineralisation
CARROLL PRIOR PROSPECTS
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700m of strike and still open
Excellent grades and widths
–steep dilatant structures
open at depth
Good continuity, robust
deposit
Additional extension drilling
down plunge required
Open
RESOURCES Tonnes g/t Au ContainedOz Au
Indicated 738,000 2.5 69,000
Inferred 3,108,000 2.1 211,000
TOTAL 3,846,000 2.2 270,000
Considerable scope to increase deposit
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ADVANCED RESOURCES – REGENT
► Long History of Production +4Moz
► Historical Oxide, Quartz, Tailings ~1Moz
► 1897 – 1924 Oxide & Quartz 186,000 oz
► 1984 – 1993 Oxide & Tailings 770,000 oz
► BIOX Fitted to Existing Oxide Plant (Com May 1993)
► 2007 Oxiana (Oz Minerals) acquires Agincourt
► 2007: Project broken up - Wiluna mine assets sold to Apex for $29.5M
► Apex spends $71M on exploration expenditure
► Minmetals Acquires Oz Minerals
► Nov 2011 Blackham acquires Matilda Gold Project for $1.4M
► Mar 2014 Blackham acquires WGP $2M upfront and $2.6M in deferred consideration
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HISTORY OF WILUNA GOLDFIELD