Great Western Minerals Group Ltd. is developing rare earth element projects globally and is pursuing a vertically integrated business model in the rare earth industry. The company currently produces rare earth alloys through its subsidiaries and is actively developing several rare earth properties, including the former-producing Steenkampskraal Mine in South Africa, which it has an option to refurbish and bring back into production by 2012. Once in production, Steenkampskraal will supply all the rare earth material required for the company's manufacturing operations. The presentation provided an overview of the company's projects, manufacturing facilities, and strategy to become the first fully integrated rare earth producer outside of China.
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Similar a Objective Capital Rare Earth and Minor Metals Investment Summit: Focus on Rare Earths: Building the Mine to Market Strategy - Gary Billingsley
Similar a Objective Capital Rare Earth and Minor Metals Investment Summit: Focus on Rare Earths: Building the Mine to Market Strategy - Gary Billingsley (20)
Objective Capital Rare Earth and Minor Metals Investment Summit: Focus on Rare Earths: Building the Mine to Market Strategy - Gary Billingsley
1. Investment Conferences
RARE EARTHS, SPECIALITY
& MINOR METALS
INVESTMENT SUMMIT
9.55 – 10.20
Focus on Rare Earths: Building the Mine to
Market Strategy
Gary Billingsley – Exec Chairman, Great Western Minerals
THE LONDON CHAMBER OF COMMERCE AND INDUSTRY ● THURSDAY, 18 MARCH 2010
www.ObjectiveCapitalConferences.com
1
2. TSXV: GWG
OTCQX: GWMGF
Objective Capital Investment Conferences
Rare Earths, Specialty & Minor Metals
London, UK
March 2010
3. Safe Harbour Statement
• Cautionary Note On Forward-Looking Statements
• Forward-looking statements include, but are not limited to, GWMG’s continued
advancement of its mineral exploration and development programs. When using this presentation,
the words “potential”, “anticipate”, “estimate”, “forecast”, “believe”,
“expect”, “may”, “project”, “plan” and similar expressions are intended to be
among the statements to identify forward-looking statements.
• Although GWMG believes that its expectations reflected in these forward-looking
statements are reasonable, such statements involve risk and uncertainties and no assurance
can be given that actual results will be consistent with these forward-looking statements.
• Disclaimer
• GWMG shall not be liable or responsible for any claim or damage, directly or indirectly,
special or consequential, incurred by the user arising out of the interpretation,
reliance upon or other use of the information contained in this presentation.
4. Company Overview
• About Great Western Minerals Group Ltd.
• Great Western Minerals Group Ltd. is a Canadian-based company pursuing a value-added,
vertically-integrated, business model in the rare earth industry. Through its wholly-owned
subsidiaries Less Common Metals Limited, located in Birkenhead UK, and Great Western
Technologies Inc., located in Troy, Michigan, the Company produces a variety of specialty
alloys for use in the rechargeable battery, permanent magnet and aerospace industries.
• On the mining side, the Company is actively developing several earth properties globally, including
the former-producing Steenkampskraal Mine in South Africa, on which it holds an option to
refurbish and bring back into production. With Steenkampskraal in production the Company will be
able to source all the rare earth material required for its manufacturing operations internally.
5. Company Overview
• Mission
• To become the first fully
vertically integrated rare
>> 13 employees
earth elements (“REE”)
producer in North America
and a leader in the industry
outside of China
>> 8 employees
“GWTI” Troy, Michigan
>> 25 employees
Birkenhead, UK
6. Capitalization Overview
TSXV: GWG
OTCQX: GWMGF
Shares Outstanding / Fully Diluted 240.0 mm / 266.3 mm
Share Price $0.20
52 week High / Low $0.46 / $0.04
Market Cap $48 mm
Cash on hand $ 8.0 mm
Debt $ 1.8 mm
Insider Holdings / Fully Diluted 1.9% / 12.0%
Institutional Holdings 5.6%
At March 15, 2010
7. Key Personnel
Gary L. Billingsley James B. Engdahl David Kennedy
CA, P.Eng, P.Geo President, CEO C.Eng, MIMMM, Managing
Executive Chairman and Director Director, Metals And Alloys
Audrey McMillan CA Richard O. Hogan MSc. Eng.
Chief Financial Officer Vice-President, Operations
John G. Pearson Dr. Baodong Zhao, PhD
MSc. Geol., P.Geo Manager, Metallurgy
Vice-President, Exploration
8. What are Rare Earth Elements?
Periodic Table
REE=Lanthanides
[ LREE ][ HREE ]
9. Rare Earths REO Price (USD/kg)*
What are Rare Sc - Scandium $1,750.00
Y - Yttrium 10.00
Earth Elements? La - Lanthanum
Ce - Cerium
7.10
5.84
Pr - Praseodymium 27.50
• Unique group of metallic elements Nd - Neodymium 30.00
• Unique chemical, catalytic, electrical, Pm - Promethium Synthetic
magnetic, metallurgic and optical Sm - Samarium 5.50
properties Eu - Europium 497.00
• Used for wide range of applications Gd - Gadolinuim 10.89
• Neodymium, Dysprosium and Tb - Terbium 460.18
Terbium, are highest in demand Dy - Dysprosium 160.00
Ho - Holmium 35.00
Er - Erbium35.00
Tm - Thulium 790.00
Yb - Ytterbium 132.00
Lu - Lutetium 238.00
*Asian Metal-February 24, 2010
14. Industry Highlights
REEs are Critical to REEs are critical to GREEN TECHNOLOGY
Emerging Hybrid vehicles, wind power, pollution controlling catalysts,
Technologies energy efficient lighting
Strong Projected Demand: expected to increase 70% by 2014
Growth in Demand for CAGR: 15% from 2009 to 2014
REEs Strongest Sector: metal alloy and magnet applications
Supply Constraints China currently accounts for 97% of the world’s total REE production.
Imposed by China China is ACTIVELY CONTROLLING the MARKET with:
Physical quotas on mining and exports, limits on the number of exporters,
and tariffs of 15% to 25% on exports
Surge in REE Manufacturers investing in REE sources to secure supply:
Investment Activity by Mitsubishi, Sojitsu, JOGMEC, Mitsui, Toyota, etc.
End-Users
15. Company Highlights
Mine-to-Market Model •Already a DOWNSTREAM MANUFACTURER of RARE EARTH PRODUCTS
•Already supply 20% of the world demand for SmCo permanent magnet alloy
•Already supply significant quantities of NdFeB permanent magnet alloy
•Activelydeveloping several REE MINERAL PROJECTS
Speed to Market •The STEENKAMPSKRAAL MINE could be in production in 2012
•Potential to be one of the FIRST PRIMARY REE PRODUCERS outside China
Metallurgy Expertise •Have IN-HOUSE METALLURGICAL EXPERTISE from mine-to-market
16. Company Highlights
Diversified •Geographically
•Distribution of REE content
•Primary products and by-products
Supported by Large •Under LOI with Toyota Tsusho on HREE properties
Industry Players
Management Team •Highly experienced management and board, from discovery to mining to
manufacturing
17. Global Rare Earth Projects
Only a limited number of Rare Earth deposits that have 2014 production potential
Thor Lake TSX:AVL
Kvanefjeld ASX:GGG
Hoidas Lake TSXV:GWG Bayan Obo China
Mountain Pass, CA Molycorp
Dong Pao-Sojitsu/Toyota Vietnam
Nolan’s Bore ASX:ARU
Steenkampskraal TSXV:GWG
Mount Weld ASX:LYC Dubbo ASX:ALK
Potential Production by 2012 Potential Production by 2014
18. Our Project Locations
A Global REE Presence
Canada % owned LREO HREO
Hoidas Lake, SK 100% 96% 4%
Douglas River, SK 100% 0% 100%
Benjamin River, NB 100% (1) 70% 30%
USA % owned LREO HREO
Deep Sands 25% (2) 85% 15%
South Africa % owned LREO HREO
Steenkampskraal 100% (3) 92% 8%
(1) Entered into an option agreement with a third party to acquire a 100% working interest
(2) Holds a 25% interest in REE contained in a heavy mineral sands project in Utah
• Option on 100% of RE off take and ownership
19. Steenkampskraal Mine
Western Cape, South Africa
Highlights
In situ grade 16.74% TREO*
30,000 tonnes TREO contained in resource*
Full Mining License; licensed to store thorium
New order mining right conversion in progress
Will supply 100% of LCM/GWTI RE needs
Exploration permit application made
Access to local monazite sands may increase output
GWMG has option on 100% of RE and ownership
Estimated capital cost: US$30 million/2,500 tpa REO
Production in 2012 is possible
*Historic data
20. Hoidas Lake Project
Saskatchewan, Canada
Highlights
M&I resource: 2.6 million tonnes @ 2.43% TREO (1)
10km strike length/30+ RE occurrences
Less than 10% of the known zone drilled
Environmental baseline work complete
Metallurgical work based on QEMSCAN in progress
Initial transportation study complete
Target production date: 2014
Note (1) NI 43-101 compliant estimate
21. Deep Sands Project
Utah, USA
Highlights
170+ sq km of magnetite/monazite-bearing sand
Significant RE in surface sampling: to 0.8% TREO
Completed 900+ drill holes over entire property
Assaying, compilation, interpretation in progress
Target: 500 million tonnes @ 0.25% TREO
Phase II: infill drilling and 43101 resource estimate
GWMG owns 25% of RE; ROFO on 75% of RE
22. Douglas River Project
Saskatchewan, Canada
Highlights
High grade RE mineralization: 8.75% TREO
100% HREE including assays >1% Dy2O3
99% of RE in Xenotime; known recovery process
Very low radioactivity
Related to high grade U deposits?
Near Cluff Lake and Shea Creek
Under LOI with Toyota Tsusho Corp
23. Benjamin River
New Brunswick
Highlights
Close to all infrastructure near Bathurst, NB
Phosphate based-30% HREE by proportion
Initial drill program complete: analysis in progress
Under LOI with Toyota Tsusho Corporation
24. Our Projects
Balance Between LREE and HREE
Project Value REO US$/kg (1) HREO%
Douglas River 41.81 99
Benjamin River 25.05 30
Thor Lake (AVL) 26.15 20
Deep Sands 18.19 15
Hoidas Lake 16.23 4
Nolans Bore (ARU) 15.65 2
Bear Lodge (RES) 14.62 2
Mt. Weld (LYC) 14.42 2
Steenkampskraal 13.96 8
Baotou (Bao Steel) 12.26 1
Mt. Pass (Molycorp) 10.54 0
Note (1) Pricing from Asian Metal as at February 24, 2010, distributions
from publicly available data
25. Upcoming Milestones
2010
Q1 Q2 Q3 Q4
Receipt of Toyota Receipt, Compilation and
Douglas River sampling results and Phase I Exploration Interpretation Phase I Phase II Exploration
participation decision work
Receipt, Compilation and Determine Phase II
Benjamin River Interpretation Phase I exploration program from Phase II Exploration
results Phase I results
Completion of metallurgy Completion of
Hoidas Lake and transportation study pre-feasibility study
Determine Phase II
Deep Sands exploration program (if Phase II Exploration
any) from Phase I results
Receipt of converted New Finalize off-take
Steenkampskraal Order Mining Permit? arrangement; Mine Construction
arrange mine finance;
construction schedule
26. Why do we own manufacturing?
• Significant revenue multiplier in downstream operations
• Direct Relationship with end users
• Unparalleled metallurgical and marketing expertise outside of China
• Increased margins that protect the mining side from price fluctuations
• LCM established and significant producer of • GWTI sees potential in recently completed
Permanent Magnet Alloys contract for the US Department of Defense to
• Revenue in 2009 $12 million/$1.6 million develop a set of aluminum based high strength
EBITDA alloys
• Now operating close to profitability
27. What do we manufacture?
• GWTI
• Permanent magnet alloys: heat treat NdFeB
• Aluminum alloys (RE containing for aerospace industry)
• Alnico alloys for alnico permanent magnets
• NiMH battery alloys
• Hydrogen storage alloys
• NiMH battery electrodes
• Sputtering targets
• LCM
•Sm-Co permanent magnet alloy (supply 20% of world demand)
•NdFeB permanent magnet alloys
•Other magnet alloys
•Specialty metal products
28. Market Cap Comparison
Target Minerals Other Corporate Attributes Market Data
Other Value-added Prod. Facilities,
HREE LREE Rare Minerals Production Revenue, Global Customer Shares (1) Price as of Market Cap Ratio of Mkt
Metals Base, Accelerated Mining Potential, outstanding Mar 4 in C$ Cap to GWG
LOI with End-users
AVL 78,504,448 $2.54 $199,401,298 3.78
QUC 40,000,000 $2.82 $112,800,000 2.14
RES 26,339,736 $3.63 $95,613,242 1.81
GWG 240,000,000 $0.22 $52,800,000 1.00
CCE 129,917,140 $0.37 $48,069,342 0.91
UCU 86,475,198 $0.35 $30,266,320 0.57
Note (1) Shares Outstanding is based on company’s website data
29. Investment Highlights
• Potentially one of the first primary producers of
REE outside of China through our REE option
in South Africa.
• The only fully integrated mine-to-market REE
operator outside of China
• Unique blend of experience through all phases
of the REE production cycle from exploration
through manufacturing
• Already have a client base of global industrial
companies
