Published on March 4, 2014
Mindarie Mineral Sands Project: A New Beginning AJM 14th Annual Mineral Sands Conference 4-5 March 2014 Melbourne, VIC Patrick Mutz CEO Murray Zircon Pty Ltd
Murray Zircon Pty Ltd Australia’s newest mineral sands miner. 2 Copyright Murray Zircon
Murray Zircon in Australia South Australia Murray Zircon was established in June 2011 as a joint venture to redevelop the Mindarie Mineral Sands Project in South Australia 3/4/2014 3 Copyright Murray Zircon
Mindarie Mineral Sands Project Mindarie Project is located 150km east of Adelaide. Mindarie Adelaide 3/4/2014 4 Copyright Murray Zircon
Murray Zircon Pty Ltd Murray Zircon joint venture majority shareholder: Guangdong Orient Zirconic Industry Science and Technology Co., Ltd. (Orient Zirconic), a listed company in China (SHE: 002167). Joint venture minority shareholder: Initially, Australian Zircon NL, the former owner/operator of the Mindarie Project. Australian Zircon’s shareholding now owned by private investors. Murray Zircon also holds an exploration tenement portfolio covering more than 11,000 km² within the Murray Basin in South Australia. 5 Copyright Murray Zircon
Location of Murray Zircon Exploration Tenements 6 Copyright Murray Zircon
Mindarie Mineral Sands Project Redevelopment of the Mindarie Project was completed in 2012 with wet commissioning in December. Mining and processing operations more or less reached steadystate and name-plate capacity in October 2013. The product is heavy mineral concentrate (HMC) which is exported to China for separation into Zircon, Ilmenite and Rutile. 7 Copyright Murray Zircon
Mindarie Mineral Sands Project Current JORC Reserves are 58.1 million tonnes at 4.3% THM. 15 year mine-life Active exploration programme. JORC Resources recently increased by 58% to 270 million tonnes at 2.6% THM. 8 Copyright Murray Zircon
Murray Zircon Pty Ltd Orient Zirconic (China) 100% Private Investors Orient Zirconic (Australia) 65% Joint Venture Partner 35% Murray Zircon Pty Ltd 100% 100% WIM 150 Project 22/03/2012 Mindarie Project Exploration Tenements 9 Copyright Murray Zircon
Orient Zirconic (China) Guangdong Orient Zirconic Industry Science and Technology Co., Ltd (OZC), is one of China’s leading zircon processing companies and is headquartered at Shantou in Guangdong Province （about 480km northeast of Hong Kong）. OZC has the most comprehensive range of zirconium products in the world, including zirconium dioxide, zirconium oxychloride, fused zirconia, zirconia structural ceramic as well as zirconium sponge and other products. OZC is listed on the Shenzhen Stock Exchange (Code:002167) with a market capitalisation approx. RMB 4.7 Billion (A$850 million*). *Share price and exchange rate on 31/12/2013. 10 Copyright Murray Zircon
OZC Headquarters & Branch Locations in China Chaoyang Branch, Liaoning Leiyang Branch, Hunan Lechang Branch, Guangdong Yanhong Branch, Shantou, Guangdong Headquarters, Shantou, Guangdong 3/4/2014 11 Copyright Murray Zircon
3/4/2014 12 Copyright Murray Zircon
Orient Zirconic - Recent Developments New majority shareholder in March 2013; Formerly Company Chairman – Mr Chaodian Chen at 30.8% Now CNNC subsidiary at 15.7% CNNC (China National Nuclear Corporation ) is the large stateowned enterprise under the direct management of the central government. January 2014 - OZC announced the acquisition of Zhejiang Zircon Valley Sci &Tech Pty Ltd; one of China’s largest producers of zirconium oxychloride for export. February 2014 - OZC announced a merger with Hainan Wensheng High-Tech Materials Co., Ltd (Wingsheng or Winsheen); China’s biggest HMC importer and separator. 3/4/2014 13 Copyright Murray Zircon
Mindarie Project – History The Mindarie Project was originally developed by Australian Zircon Limited (ASX:AZC) in 2006. The mine commenced operations in October 2007 following the construction of a Primary Concentrator Plant (PCP) and Mineral Separation Plant (MSP). PCP MSP In October 2009 the project was placed on care & maintenance. 14 Copyright Murray Zircon
Mindarie Project – Redevelopment As part of its strategy to redevelop Mindarie, Murray Zircon proactively assumed responsibility for all remaining rehabilitation liability over previously mined areas. Rehabilitation works commenced in August 2011 and were completed in March 2012. At the same time, the Company initiated refurbishment of the PCP and associated wet plant facilities in October 2011. The Company also submitted a Program for Environmental Protection and Rehabilitation (PEPR) to the South Australian Department of Manufacturing, Innovation, Trade, Resources and Energy (DMITRE), for approval to resume mining. 15 Copyright Murray Zircon
Rehabilitation Works Area 3 Area 1 Area 2 Area 4 Area 5 Area 6a Aerial Photo: March 2011 Phased Rehabilitation Milestones Overburden Completed December 2011 Sub-soil replacement Completed February 2012 Top-soil replacement Completed March 2012 Cropping Completed April/May 2012
3/4/2014 Rehabilitated Land 17 Copyright Murray Zircon
Mindarie Project – Redevelopment Through its successful rehabilitation efforts, positive relationships were built with the local community, affected landowners as well as the government through DMITRE. NET RESULT? DMITRE approved Murray Zircon’s PEPR application and issues a licence to resume mining in April 2012; less than 1 year from the formation of the company. 18 Copyright Murray Zircon
Mindarie Redevelopment & Commissioning Primary Concentrate Plant refurbishment/upgrade activities completed in August 2012. Mining contract and product logistics contract finalised in September 2012. A newly purchased Mining Slurry Unit was installed and a new slurry pumping system was completed in November 2012. Resumption of mining commenced in October 2012 and wet commissioning of the Slurry Unit and PCP began in December. First HMC product was exported before the end of December. 19 Copyright Murray Zircon
Highlights of Operations Mining at Mindarie is via dry, open-cut method using scrapers to remove overburden and dozers to mine the ore. Typical mineral strands in the area are 150-200m wide, 10-20m deep and up to 13km long. Mining/processing design capacity is 500 dry tonnes per hour ore feed to produce 10-12K tonnes of HMC per month. Ore is slurried with water at the in-pit Slurry Unit and the slurry is pumped 3-8km to the Primary Concentration Plant (PCP). At the PCP, the heavy minerals are removed with spiral classifiers to produce a Heavy Mineral Concentrate containing typically 80-90% heavy minerals. 20 Copyright Murray Zircon
Overburden removal with scrapers Ore Slurry Unit 3/4/2014 Copyright Murray Zircon Ore mining by dozer push method 21
Highlights of Operations Only Heavy Mineral Concentrate (HMC) is produced at Mindarie. HMC is transported from Mindarie by truck approximately 200km to the port in Adelaide at 7-10 B-Double trucks per day. Transport by train is also an option but is not used at this time. At the port, HMC is currently loaded into standard shipping containers with liners for export to China. Bulk shipping is also an option but is not used at this time. In China the HMC is separated into zircon and various titanium minerals. OZC’s internal demand for zircon will support full production from the Mindarie project. 22 Copyright Murray Zircon
HMC Storage Pad 3/4/2014 23 Copyright Murray Zircon
Mindarie Project – Value Adding Vertical integration strategy: secure demand and secure supply; • Allows opportunity for synergism with downstream processing to maximize the recoverable mineral and value. Efficient mining and processing operations targeting superior mineral recovery at the lowest possible cost. Leveraging tightly scheduled ‘moving hole’ mining method to control the mining costs and achieve rapid/effective rehabilitation. Incorporating automation of pumping and processing facilities to improve production efficiencies and maximise production rate. Iterative mine optimization to minimise strip ratio and maximise total minable reserves. 24 Copyright Murray Zircon
Mineral Reserves and Resources Classified reserves estimates at variable total heavy minerals cut-off grade % % Proportion of source material within Leucoxene Rutile Ilmenite Million Total Slimes Zircon heavy mineral component Tonnes Heavy % % % % Minerals Proved Reserves Probable Reserves 24.0 34.1 4.4 4.2 10.8 11.1 23.9 19.3 6.3 6.5 5.1 4.6 62.5 66.4 Total Reserves 58.1 4.3 11.0 21.2 6.4 4.8 64.8 Classified Resource Estimates at variable total heavy minerals cut-off grades % % Proportion of source material within heavy mineral component Million Total Slimes Zircon Leucoxene Rutile Ilmenite Tonnes heavy % % % % minerals Measured Resources Indicated Resources Inferred Resources 39.5 126.2 5.3 3.6 3.1 3.3 10.4 10.1 9.0 21.4 17.8 17.0 5.8 6.6 5.1 5.1 4.6 3.9 64.4 66.3 67.2 Total Resources - OCT 2012 171.0 3.2 10.1 18.6 6.4 4.7 65.9 NEW Indicated Resources NEW Inferred Resources 73.4 25.9 1.4 2.0 10* 10* 9.0 22.7 16.9 11.3 30.5 42.1 Total Resources - OCT 2013 270.3 2.6 10* * - estimated 16.4 12.7 54.0 3/4/2014 25 Copyright Murray Zircon
Typical Mining Equipment 3/4/2014 26 Copyright Murray Zircon
3/4/2014 Slurry PumpingZircon Copyright Murray Skid 27
3/4/2014 Primary Concentration Zircon Copyright Murray Plant 28
Mining Camp 3/4/2014 Copyright Murray Zircon 29
Summary Through Murray Zircon, Orient Zirconic has made a significant investment in the mining community in South Australia. Murray Zircon has effectively demonstrated its commitment to secure and uphold its social licence to operate; Completed past mine rehabilitation liability and successfully built positive and effective community and regulatory relationships. The company has successfully completed redevelopment and commissioning of the Mindarie Project and is now South Australia’s newest mineral sands miner and the only active mining operation under majority Chinese ownership. Through its vertical integration strategy, Murray Zircon and Orient Zirconic will strive to be a successful, long-term supplier of zircon and titanium dioxide into the global markets. 30 Copyright Murray Zircon
For further information: Website: www.murrayzircon.com.au Email: firstname.lastname@example.org Patrick Mutz, CEO Murray Zircon Pty Ltd P.O. Box 3444 Level 6 West, 50 Grenfell Street Adelaide, South Australia, Australia 5000 Phone: +61 8 8410 8884 ABN: 75 147 048 744
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