Big picture - Why invest in Bushveld Minerals Limited
Bushveld Minerals Limited Snapshot
Bushveld Minerals boasts an attractive portfolio of assets organized in four focused platforms:
The company equally recognizes the risk lowering-benefits of a diversified portfolio, particularly one involving commodities with solid economic fundamentals as the need to ensure each project platform has requisite focus needed for success. Through a disciplined project development programme the company’s focus for each project entails:
- Confirming a robust resource
- Defining the economics of the project
- Developing strategic partnerships capable of accelerating projects through feasibility studies to production
We have a team that has extensive first-hand experience in early stage mineral exploration, having been responsible for several new deposit discoveries.
The Bushveld P-Q Iron & Titanium Project
The Bushveld P-Q Iron & Titanium Project (”P-Q Project”) is a multi-commodity project located 45 km north-northwest of Mokopane town in Limpopo Province, South Africa. The project hosts a JORC compliant 939 Mt vanadiferous titano-magnetite deposit (the P-Q VTM deposit) contained in a layered ore body of average 45 m thickness, along a strike of ~8 km and dipping at 18-22° to the west.
The resource, with average grades of 33% Fe, 11% TiO2 and 0.19% V2O5, can be beneficiated by simple magnetic separation at grind fraction of 500µm to produce a concentrate grading 55% Fe, 19.5% TiO2, 0.33% V2O5, with >85% recoveries. It also consists of high grade zones of up to 20m with average Fe grades of 40% Fe, 15% TiO2 which can be upgraded to 50% Fe, 18.5% TiO2 through a dense media separation process applied on a 6mm grind fraction. A key attraction of the deposit is the high TiO2 grade of its concentrate, which creates scope for economic extraction of TiO2 from a high TiO2 grading slag after smelting. Test-work and modeling work conducted on the ore showed scope for a >50% TiO2 slag after smelting.
A scoping study completed in April 2013, premised on a 5 Mtpa ROM operation to produce 2.2 Mtpa concentrate grading 55% Fe, 19.5% TiO2, 0.33% V2O5, demonstrated robust economics on the back of a US$126m capex spend, with a NPV (at 10%) of US$188m and a post tax IRR of 34%
Immediately overlying the iron ore and titanium resource is a distinct JORC compliant 442 Mt apatite resource average grading 3.6% P2O5, upgradeable to a 37% P2O5 concentrate with 53% recoveries. A scoping study on the phosphate resource is underway.
The Bushveld Vanadium Project
The Bushveld Vanadium Project is a world-class vanadium project boasting some of the best in-situ (1.48% V2O5) and in-concentrate (2.01% V2O5) vanadium grades in the world. The deposit is based on the same license area as the P-Q Iron & Titanium Project and is a layered orebody along a north-south strike and dipping at 18-22° to the west running 2 km to the east and parallel to the P-Q Iron & Titanium Project resouce.
The Bushveld Vanadium project comprises three adjacent and parallel magnetite layers – the MML layer, the MML-Hanging wall layer and the AB Zone, with JORC resource delinieated on the MML (52Mt at 45% Fe, 1.48% V2O5, 9.7% TiO2) and the MML Hanging Wall (69Mt at 29% Fe, 0.80% V2O5, 11.9% TiO2)
The Company envisages utilizing the salt roast processing flowsheet, which, with at least three operating plants processing similar ores in South Africa, is proven and well understood. A recently completed (July 2014) scoping study focussing on the MML only confirms attractive economics for the project with a modest capital expenditure requirements of US$262 million for a primary vanadium production plant producing 10,350 tons 99% V2O5 per annum from a 1 Mtpa Run-of-Mine open pit operation. The project shows a pre-tax NPV (at 10% discount rate) of US$562 million and an IRR of 36% while the numbers on a post tax basis are US$236 million and 24%. The project is well placed to be a low first quartile producer of vanadium with a cost of US$5.99/kg V2O5.
The Bushveld Vanadium project is located in an important vanadium-producing region, responsible for 26% of the world’s vanadium supply.
The project will also benefit from growing vanadium demand (estimated at ~6% pa by Roskill), underpinned by the steel sector, which accounts for 90% of vanadium consumption globally. The application of vanadium in energy storage, for example in Vanadium Redox Flow batteries which are fast gaining momentum, could create substantial demand growth for vanadium going forward.
The Mokopane Tin Project
The Mokopane Tin Project is a brownfields tin project containing 18,447 tonnes of tin with an average grade of 0.12% tin (Sn) on two adjacent deposits. It is situated on the Northern Limb of the Bushveld Complex and consists of one prospecting right (2205 PR), covering six farms with an area of approximately 13,422 ha. Within the licence area, numerous targets for open-castable disseminated tin resources have been identified, and the Company has explored and drilled two of the targets, Groenfontein and Zaaiplaats, upon which a scoping study was based and the results released in September 2014.
The scoping study incorporated a simple process design based on closed circuit multi-stage gravity separation, followed by small-scale flotation and electrostatic separation, and smelting to produce a high-purity metal. The Base Case scenario is of a 691 ktpa ROM operation producing ~700 tpa of 99.5% tin metal from 1,380 tpa of 51.4% concentrate. The required capital expenditure is low at US$16.7 million and the economics of the Project are positive showing a pre-tax NPV of US$18.0 million and post-tax NPV of US$10.0 million, as well as a pre-tax IRR of 49.8% and post-tax IRR of 34.6%.
The tin market is supported by strong fundamentals, with increasing demand and strong prices supported by a supply deficit that is expected to continue into the foreseeable future.
The Marble Hall Tin Project
Located in the Bushveld Complex, the Marble Hall Tin Project is a brownfields tin project that was historically explored by Goldfield’s in the 1980’s. Mineralisation occurs in a 1 m to 7 m thick breccia zone, and a number of boreholes have intersected significant instances of this mineralization at relatively shallow depths (<200 m). Bushveld Minerals’ technical team estimates, based on reinterpretation of Goldfields data (including historical drilling data), that there is a potential resource of up to 18,000 tonnes of contained tin at ~0.5% Sn from 3.6 million tonnes of ore.
A JORC-compliant resource is anticipated to be defined in 2015.
Lemur Resources' Imaloto Coal Project
Lemur Resources is an ASX-listed coal development company in which Bushveld Minerals holds a 57.21% majority shareholding. Lemur’s flagship project is the Imaloto Coal Project that is based in South West Madagascar. It is one of only three coal companies exploring in Madagascar, and contains a significant thermal coal resource of 136 Mt with 91.6 Mt in the Measured category.
A scoping study for the Imaloto Coal Project was released in September 2013 and showed a positive post-tax NPV of US$36 million, based on low initial capital expenditure of $12 million. There is scope for opencast mining in the first eight years of operations out of a total life-of-mine of 19 years.
Negotiations are currently underway to obtain an Independent Power Producer’s (IPP) licence that would allow Lemur to supply enough power for its operations as well as other mines in South West Madagascar. An MOU has been signed with Jirama, the Madagascan Government’s state-owned electricity company responsible for the production, transport and distribution of electricity in Madagascar.
Total shares in issue: 486,337,438
Top 10 shareholders as at 30 August 2015
SHAREHOLDER NUMBER OF ORDINARY
SHARES % OF ISSUED
1 Acacia Resources Limited 99,340,000 20.43
2 Halifax Share Dealing 43,407,139 8.93
3 Hargreaves Lansdown Asset Management 42,369,635 8.71
4 Mr Nicholas John Mallett 38,500,000 7.92
5 TD Direct Investing 25,936,214 5.33
6 Barclays Wealth Management (UK) 25,760,551 5.30
7 Riverridge Limited 25,000,000 5.14
8 Splendid Victory Group Limited 20,700,000 4.26
9 Msuna Mabu Company Limited 16,100,000 3.31
10 Jarvis Investment Management 14,512,830 2.98
Directors’ shareholding as at 30 August 2015
DIRECTOR NUMBER OF ORDINARY SHARES % OF ISSUED CAPITAL NUMBER OF OPTIONS NUMBER OF WARRANTS
Ian Watson 540,000 0.11 Nil Nil
Fortune Mojapelo 5,580,000* 1,15 Nil Nil
Geoff Sproule 1,500,000 0.31 Nil Nil
Anthony Viljoen 5,746,667* 1,18 Nil Nil
Jeremy Friedlander 1,250,000 0.26 Nil Nil
Total 14,616,667 3,01 Nil Nil
* Fortune Mojapelo and Anthony Viljoen collectively own 8,160,000 shares through their 50/50 partnership in the VM Investment Company
18-20 Le Pollet
St Peters Port
Principal Operating Address
Block A, Ground Floor
24 Fricker Road
Tel: +27 11 268 6555
Fax: +27 11 268 5170
Strand Hanson Limited
26 Mount Row
Fox Davies Capital Limited
1 Tudor Street
Legal Counsel to the Company as to Guernsey law
St Peter Port
Legal Counsel to the Company as to South Africa law
Edward Nathan Sonnenbergs
150 West Street
Capita Registrars (Guernsey) Limited
St Sampson Guernsey
Baker Tilly UK Audit LLP
25 Farringdon Street
Financial Public Relations United Kingdom:
131 Finsbury Pavement
Financial Public Relations South Africa:
P O Box 78031 Sandton 2146
Solicitors to the Company as to English law
Lewis Silkin LLP
5 Chancery Lane