COPPER EXPLORATION IN CHILE: A white-hot investment opportunity Investor Presentation – May 2012
Disclaimer Disclaimer Notice This Company Profile contains certain forward – looking information and forecasts. Such forecasts, projections and information are not a guarantee of the Company’s future performance and include unknown risks and uncertainties. Accordingly, the actual results an d developments may differ from those expressed or implied. Southern Hemisphere Mining Limited (“SUH “ or “Company” ) makes no representation and can give no assurance, guarantee or w arranty, 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. Nothing in this presentation should be construed as either an offer to sell or a solicitation of an offer to buy or sell securities. You should conduct your own analysis in order to satisfy yourself as to the accuracy and completeness of the information, statements and opinion contained in this presentation. Competent Person Statement Information of a scientific or technical nature in this report was prepared under the supervision of Trevor Tennant, Managing Director of SUH who is a member of the Australasian Institute of Mining and Metallurgy. Mr. Tennant 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 per son ” as defined in the 2004 edition of the “Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves”. Mr. Tennant has reviewed and approved the information contained in this Company Profile. For further information regarding the projects, including a description of SUH’s quality assurance program, quality control m easures, the geology, samples collected and testing procedures in respect of SUH’s projects, please refer to the Technical Reports and New s Releases on the Company’s website at www.shmining.com.au. Page 2
Introduction Dual-listed international resource company: • ASX (SUH) and TSX-V (SH) Operating in Chile since 2007: • world’s largest copper producer: strong mining history • politically stable: well-developed financial & banking sector Strong portfolio of well located mineral properties: • Ten highly prospective copper-gold projects • One advanced manganese project + iron sands project Recent focus over 9 months on rapidly emerging Llahuin Copper-Gold Project: • Maiden resource of 318kt Cu, 307koz Au • Desktop Scoping Study underway on initial project producing 45-50ktpa copper • Central Hub Strategy • Outstanding potential to grow resources, boost grade and discover new deposits…. Page 3
off the Press…. Page 4
Investment Highlights Llahuin copper-gold project Maiden JORC resource – 106Mt grading 0.4% copper equivalent* Higher grades from recent drilling Strategy to aggregate regional satellite deposits to feed a centrally located plant Desktop Scoping Study underway for operation producing 45-50ktpa copper plus gold credits Chitigua copper project Very large system Discussions with major mining companies to arrange joint venture or farm-in Additional prospective copper prospects Another eight 100%-owned prospective areas Alternative development strategies being pursued involving third parties Los Pumas manganese project Preliminary assessment completed Awaiting environmental impact statement approval Page 5
Chile-based Team Page 6
Llahuin Project Location Llahuin Ideal location providing favourable logistics 250km north of Santiago and 17km south of the established mining town of Combarbala Elevation of 1,300m and just 56km from the coast and Pan American Highway Strong similarities to the Carmen de Andacollo porphyry mine, located 120km to the north of Llahuin Project Page 7
Llahuin Project Llahuin Concession Areas Four concession areas covering 772 hectares secured under favourable option arrangements in July 2011 Total consideration of US$1.875M payable comprising: • staged cash payments of US$615,000 over 12 months – US$230,000 outstanding • issue of shares to the value of US$1.2 million Central Porphyry Zone: footprint of ~400m by 450m Cerro Zone, ~1km south of the Central Porphyry, with a similar footprint Geophysics (magnetic and IP) surveys completed Page 8
Llahuin Project Llahuin Page 9 Llahuin Valley
Llahuin Project Drilling Llahuin ~ 26,500m of drilling to date: • ~17,500m of Reverse Circulation (“RC”) and • ~9,000m of Diamond Core (“DC”) Mineralisation commences at surface and remains open at depth Central Porphyry Zone drilled to a vertical depth of 150m with inclined RC drill holes at a 50m grid Vertical depth extended to 400m by DC holes drilled at a grid of 100m Cerro Zone sub-crops at surface with a vertical extent of 45m to 60m Water table encountered at 50m to 190m down-hole in most drill holes – positive for future mine development Page 10
Llahuin Project Resource Estimate Llahuin Maiden Measured and Indicated JORC resource of 106Mt grading 0.4% copper equivalent* for 318,000 tonnes of copper and 307,000 ounces of gold Additional Inferred Resource of 12.2Mt at 0.36% copper equivalent TOTAL MEASURED AND INDICATED RESOURCES Resource at 0.24% Cu cut-off Tonnes million Cu % Au g/t Mo % Cu Equ* Measured 64.9 0.32 0.09 0.007 0.42 Indicated 41.3 0.28 0.09 0.37 Not Available Measured plus Indicated 106.2 0.30 0.09 0.40 Not Available Inferred 12.2 0.27 0.06 0.008 0.36 Immediate potential to extend resource with further drilling at both the Cerro and Central Porphyry Zones and inclusion of higher grade tonnage from satellites Sedgman appointed to conduct a desktop scoping study to assess the potential for an operation targeting production of 45-50,000tpa of copper metal plus gold credits at competitive operating costs Page 11
Llahuin Project Llahuin Diamond drill core at Llahuin Page 12
Llahuin Project Llahuin Page 13
Llahuin Project Llahuin Additional drilling provided result Since completion of Maiden Resource Estimate, drilling continues at Llahuin with some exceptional diamond core results from DDH-LLA-021: 440m @ 0.75% Cu Equivalent* from 2m, includes 208m @ 1.20% Cu Equivalent from 108m *Copper Equivalent (“Equiv”) - The copper equivalent calculations represent the total metal value for each metal, multiplied by the conversion factor, summed and expressed in equivalent copper percentage. These results are exploration results only and no allowance is made for recovery losses that may occur should mining eventually result. It is the Company’s opinion that elements considered have a reasonable potential to be recovered as evidenced in similar multi-commodity mines. Copper equivalent conversion factors and long-term price assumptions used are stated below: - Copper Equivalent Formula= Cu % + Au (g/t) x 0.72662 + Mo% x 4.412 - Price Assumptions-Cu (US$3.40/lb), Au (US$1,700/oz), Mo (US$15/lb) Page 14
Llahuin Project Llahuin Page 15
Llahuin Project Benchmarking Andacollo • Llahuin demonstrates similar geological characteristics to Andacollo deposit which has a resource of 400Mt @ 0.38% Cu, 0.12g/t Au and produces ~65,000tpa of copper-gold concentrate Hot Chili • Llahuin maiden Measured and Indicated Resource compares favourably (contained metal) with Hot Chili’s Productora maiden Indicated Resource of 31Mt grading 0.8% copper equivalent Market Capitalisation • Hot Chili (ASX:HCH) and Metminco (ASX:MNC) represent the Company’s peers in South America Page 16
Llahuin Satellite Projects Llahuin Two Llahuin satellite prospects have been secured under option arrangements within 10-15km of Llahuin – La Colina 2 and Mina San Francisco Llahuin strategy provides opportunities to increase both the Llahuin resource tonnage and grade, providing additional higher grade feed to a proposed centrally located plant Page 17
La Colina 2 Satellite Reconnaissance Drilling at La Colina 2 Llahuin Page 18
La Colina 2 Satellite Concessions Llahuin Located 10km NW of Llahuin Project Exploitation licence covers an area of 259 hectares Held under 12-month Option to Purchase Agreement with Minera Fuego expiring January 2013 Total acquisition cost USD$300,000 plus 1.5% Net Smelter Royalty Reconnaissance Drilling Highlights from initial 4 RC drill program at La Colina 2 satellite prospect include: RC C2 002 20m @ 1.35% Cu Equivalent from 34m RC C2 003 70m @ 0.66% Cu Equivalent from 24m includes 16m @ 1.50% Cu Equivalent from 4m RC C2 004 28m @ 0.56% Cu Equivalent from 22m Page 19
Mina San Francisco Satellite Concessions Llahuin Located approximately 10 km NNE of Llahuin Project Exploitation licences cover an area of 75 hectares Further applications made for licences surrounding Mina San Francisco Held under 24 month Option to Purchase Agreement Total acquisition cost USD$505,000 Reconnaissance Drilling Highlights from initial 4 RC drill program at San Francisco satellite prospect include: RC SF 002 22m @ 0.66% Cu Equivalent from 10m RC SF 003 26m @ 0.53% Cu Equivalent from 128m includes RC SF 003 20m @ 1.22% Cu Equivalent from 180m Page 20
Chitigua Copper Project Chitigua Concessions Chitigua Church and Breccia exploration areas located within total 172km² Exploitation Licence area Page 21
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