Kipawa Heavy Rare Earths Deposit TSX-V: MAT

Transcription

1 Kipawa Heavy Rare Earths Deposit April 3, 2011

2 Disclaimer The information contained herein has been prepared to assist interested parties in making their own assessment of Matamec Explorations Inc. (the Company ) and does not purport to contain all of the information that an interested party may desire. In all cases, interested parties should conduct their own investigation and analysis of the Company, its assets, financial condition and prospects, and of the data set forth in this presentation. The Company does not assume any responsibility for independent verification of any of the information set forth herein, including any financial forecasts or statements about the prospects of the Company contained herein. The Company does not make any representation or warranty as to the accuracy or completeness of this presentation or the information contained in, or for any omissions from, this presentation or any other written or oral communications transmitted to the recipient in the course of its assessment of the Company. By the receipt of this presentation, the recipient acknowledges that only those particular representations and warranties, if any, which may be made to a party in a definitive written agreement regarding a transaction involving the Company if, as and when executed, and subject to such limitations and restrictions as may be specified therein, will have any legal effect. Corporate Presentation 2

3 Management and Board of Directors PRESIDENT & CEO (2003) V-P EXPLORATION (2003) SECRETARY TREASURER (2005) DIRECTOR (2009) INDEPENDENT DIRECTOR (2009) André Gauthier More than 25 years experience in the mining industry Brought in 5 properties to Matamec in 2003, including the HREE Kipawa deposit Aline Leclerc Geologist-consultant Laval St-Gelais Chartered accountant Marcel Bergeron CMA Chartered accountant Director - Strateco Resources Inc (TSX-RSC) Normand Tamaro Lawyer LL.D (specialized in intellectual property law) INDEPENDENT DIRECTOR (2010) Sylvie Prud homme Geologist Director of Investor Relations Osisko Mining Corporation (TSX-OSK) Corporate Presentation 3

4 A Strategic Committee: Advises Matamec s Board Of Directors Sean Roosen President and Chief Executive Officer of Osisko since March Since 2011, has advised Matamec regarding it s corporate strategy Robert Wares Les Heymann Raynald Vézina Mr. Wares was President and Chief Executive Officer of Osisko from August 1998 to March 2006 and has been Executive Vice-President and Chief Operating Officer of the Corporation since March A chemical engineer with over thirty five years of experience in the metallurgical and management ends of the mining industry. Has over eighteen years of experience in the production of rare earths A mining engineer with more than thirtyfive years of experience in the mining industry. Since 2011, has advised Matamec regarding the development of the Kipawa deposit Since 2008, has worked as a consultant to Matamec. Is currently directing Matamec s metallurgical testing program. Since 2008, has advised Matamec regarding the development of the Kipawa deposit. Corporate Presentation 4

5 Future Producer of Strategic Metals Future producer of Strategic Metals Small environmental footprint on the Zeus property. Matamec is evaluating options for its gold assets, particularly its Matheson JV property, along strike of the Goldcorp s high grade gold Hoyle Pond mine in the Timmins Gold Camp. Corporate Presentation 5

6 REE Market: Matamec s Niche Heavy Rare Earths 30% Amount of REE per Application Metric Ton Kilograms Grams TREO forecast production 2010f: 125, f: 185,000 25% 20% 15% 2010f 2015f 10% 5% 0% Magnets Metal Alloys Phosphors Glass Polishing Ceramics Other (Tb, Dy) (Y, Tb, Dy) Er Source: Dudley J. Kingsnorth, IMCOA, November 2010 Corporate Presentation 6

7 A Strategic Committee For Rare Earths Advises Matamec s Board Of Directors Anthony Mariano (2007) A PhD geologist, worked on the identification of eudialyte and other rare earth-bearing minerals at the Kipawa Alkalic Complex Has worked as a consultant for Matamec on the mineralogy of the Kipawa Complex since Alex Knox (2007) A MSc geologist with more than thirty four years of field experience in exploration Has worked on the Kipawa deposit from 1985 to Since 2007, has advised Matamec on the exploration for rare-earths. He will be supervising the upcoming exploration program. Les Heymann (2008) Raynald Vézina (2009) A chemical engineer with over thirty five years of experience in the metallurgical and management ends of the mining industry. Has over eighteen years of experience of the production of rare earths A mining engineer with more than thirty-five years of experience in the mining industry. Since 2008, he has worked as a consultant to Matamec. Is currently directing Matamec s metallurgical testing program. Since 2008, he has advised Matamec regarding the development of the Kipawa deposit. Corporate Presentation 7

8 Zeus Property & HREE Kipawa Deposit - Location The First Criteria for Industrial Mineral Deposits is Location Near Infrastructure In Quebec, a premier mine jurisdiction Near all weather roads Near railway Near mining towns with services Near electrical power grid Corporate Presentation 8

9 Kipawa Deposit Geology and Exploration Potential Resource Calculations Metallurgy Timeline Going to Production in 2014 Budget Corporate Presentation 9

10 Zeus Property Geology and Exploration Potential Kipawa Alkalic Complex Potential Mineralized Horizon Kipawa Deposit + Other Zones and Showings + Untested targets over 25 km strike on the property along the Kipawa Alkalic Complex Corporate Presentation 10

11 Kipawa Heavy Rare Earths Deposit: Surface Expression Logging Road 300 m of the West part of the Deposit Kipawa Deposit Deposit continuous over a distance of 1.45 kilometres Corporate Presentation 11

12 Resource Calculation: Showing Growth Potential Winter Infill Drilling Program Completed Feb. Spacing 50 X 50m Upgraded NI Resource Estimate Coming this Spring Deposit Open Laterally and at Depth Corporate Presentation 12

13 Kipawa Deposit Schematic Cross-Section SW TREO Enriched Zones 70% 20% 10% NE 37% HREE/TREE Zirconium Zone (with TREO) Heavy Rare Earth Enriched Zones: 0.62% TREO (cut-off of Dy 2 O %) 4,920,000 Indicated tonnes + 4,260,000 Inferred tonnes (January 20, 2011, NI43-101) Corporate Presentation 13

14 Indicated and Inferred NI Resources: 0.62% TREO (cut-off of Dy 2 O 0.016%) Price in Millions K tonnes Kipawa Deposit Advantage La Ce Pr Nd Sm Eu Gd Tb Dy Ho Er Tm Yb Lu Y Gross Metal Value In situ Indicated Inferred Billion USD

15 KIPAWA DEPOSIT GROSS VALUE UNRECOVERED IN THE GROUND Zone TREO ENRICHED ZONES (Cut-off of Dy 2 O %) March 21, 2011 Tonnage 4,920,000** 4,260,000** Classification Indicated t** Value in Situ (USD) Inferred t** Value in Situ (USD) Lanthanum (95$/kg*) La 4, ,000,000 3, ,000,000 Cerium (95$/kg*) Ce 8, ,500,000 7, ,000,000 Praseodymium (155$/kg*) Pr ,500, ,500,000 Neodymium (168$/kg*) Nd 4, ,000,000 3, ,000,000 Samarium (93$/kg*) Sm ,700, ,400,000 Europium (810$/kg*) Eu ,000, ,000,000 Gadolinium (128$/kg*) Gd ,200, ,400,000 Terbium (820$/kg*) Tb ,000, ,000,000 Dysprosium (512$/kg*) Dy ,200,000 1, ,000,000 Holmium (79$/kg*) Ho ,800, ,800,000 Erbium (86$/kg*) Er ,800, ,200,000 Thulium (N/A) Tm Ytterbium (N/A) Yb Lutetium (442$/kg*) Lu ,200, ,200,000 Yttrium (125$/kg*) Y 6, ,640,000 6, ,800,000 Zirconium (4.6$/kg*) Zr 43, ,600,000 43, ,000,000 4,241,040,000 3,843,300,000 *Prices from Metal-Pages, Industrial Minerals and Asian Metals, March 21, REE oxides 99% min FOB China, Y oxide % min FOB China and Zr structrural ceramic/electronic grade. 1 CNY = USD. **Source: SGS Geostat (November 29th, 2010). LREO: Light rare earths in oxides = La 2 O 3 to Nd 2 O 3. MREO: Medium rare earths in oxides = Sm 2 O 3 to Gd 2 O 3. HREO: Heavy rare earths in oxides = Tb 2 O 3 to Lu 2 O 3. Corporate Presentation 15 Corporate Presentation 15

16 Markets: Rare Earth Supply Chain Ore Mixture Oxide Metal Alloy Magnet Product Scrap/ Recycling China China produces 97%: Sichuan Mianning Mining Co Jiangxi Copper Baotou Steel Rare Earth Sichuan Hanxin Mining Japan Japan Industrial CoJapan Oil, Gas and Metals National Corp Australia Lynas exp USA Molycorp exp Etc. Canada/UK GWMG China CAS Key Laboratory of Rare Earth Chemistry and Physics Neo Materials Japan Santoku, Shin Etsu Etc. Japan Aichi Steel Corp USA Allstar Quadrant Adams Bunting Etc. GM Ford Toyota Nissan Hyundai Mitsubishi Apple LG Samsung Etc. Corporate Presentation 1 6

17 Kipawa Deposit: Ore Processing Unique in the world: simple mineralogy Recovery of 89.2% of TREO to be found in eudialyte concentrate (52% of original mass) less volume to leach = low cost Because medium grained, well-crystallized and not intergrown Corporate Presentation 17

18 Lab.recoveries 92.8% TREO in 52% of original mass Heat 89.2% TREO 81% TREO Ore Crushing Grinding Physical Concentration Cracking Leaching Solid / Liquid Separation Liquor Purification/ Precipitation Acid Water Solid Tailings Stabilization Kipawa Deposit Rare Earth Ore Processing The physical characteristics of the Kipawa ore allow for lowcost chemical extraction, which gives it a competitive edge against current rare earth producers Press releases -January 20,2011 -March 8, 2011 Solvent Extraction Raffinate or Barren Liquor Products Products Corporate Presentation 18

19 Project Timeline Development Activity Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Explora tion Zeus Kipawa Resource Update Metallurgical Tests PEA Prefeasibility Feasibility Business Plan Permitting Corporate Presentation 19 Corporate Presentation 19

20 Kipawa REE-Y-Zr Deposit: 3 Year Plan - Budget Cost and Schedule of Future Work Geology $1.970M $3.630M $1.500M 2- Engineering Studies including Mining - PEA - Pre-Feasibility - Feasibility 3- Mineral Processing and Metallurgy - Specific Testwork - Continuous Testwork - Pilot Plant - Construction 4- Environment and Permitting 5- Relation with the Community 6- Market Study $0.300M $1.100M $3.850M $1.000M $2.500M $3.750M $0.400M $0.600M $0.600M $0.150M $0.500M $0.850M Incl. in the Eng. Studies - - Total: $3.820M $8.330M $10.550M $22.700M 20 Corporate Presentation

21 2011 Exploration Program & Budget Properties Program Budget 6M$ Strategic/Critical/Green/Energy Metals 100% Zeus (REE-Y-Zr-Nb) Tansim (Li-Ta-Nb-Cs) -Kipawa Deposit -PB-PS Zone Surprise/TH/Falaise Showings -Other untested targets large coverage of the KAC -Tanco Model -Rare metals in simple and complex pegmatites Drilling Program/PEA Study Drilling Program/Trenching Mag-EM-Radiometric /Soil Sampling Surveys/Trenching Mag-Radiometric Ground Survey Prospecting/Mapping/ Trenching Drilling Program 3.820M$ 63% 0.380M$ 6% Vulcain (Ni-Cu-Co-PGM-Au) - World Class untested target identified by WMC in 2005 Gold Mag-EM-Radiometric survey 0.4M$ 7% Matheson JV - NE of the Goldcorp High Grade Hoyle Pond Mine - Basal till anomalies unexplained Wachigabau/Lespérance - Geophysical Gold Anomlies - Known gold showings Sakami - Zone 25 as compared with Goldcorp s Eloneore Deposit Valmont - Gold and massive sulphide anomalies Drilling Program 0.6M$ 10% Mag Survey 10% Drilling Program 0.6M$ Geochemical Study 0.1M$ 2% Compilation Prospecting/Mapping/Tenching 0.1M$ 2% Corporate Presentation 2 1

22 Capitalization and Cash Position Current Market Price (Apr. 1 st, 2011) $ 0.44 Price Range 52 Weeks $0.11 to $ Day VWAP $ Day VWAP $0.467 Average daily volume last 6 months 548,000 Insider Ownership 5.0% Known Institutional Ownership 25% Market Capitalization $51M Common Shares Outstanding 116M Stock Options (Average exercise price: $0.22) Warrants (Average exercise price: $0.41) Common Shares Fully Diluted 7M 15M 138 M Cash Position $7M Cash Position Fully Diluted $14.85M Corporate Presentation 22

23 Four Deposits in Alkalic Complexes in North America REE Company Heavy REE Deposits Last Development stage Completed Capital Outstanding Share Value ($) (Apr. 1) Market Capital Avalon (T: AVL) Lake Zone Pre-Feasibility (July 2010) M M$ Quest (V: QRM) B Zone PEA Study (Sept 2010) M M$ Matamec (V:MAT) Kipawa Resource Calculation: Indicated and Inferred (January 20, 2011) M M$ Ucore (V: UCU) Bokan- Dotson Ridge Resource Calculation Inferred (March 7, 2011) No Met M M$ Corporate Presentation 23

24 Summary Low Cost One of the few known HREO resources in the world with well understood and simple low cost processing solution Mining friendly location with low cost electricity Excellent access to infrastructure and mining services Open pit, low cost mining High Value Addresses worsening shortage of REE and HREE supply Highly favourable exploration potential (chance of finding more) Fits demand Timely Advanced discussions with end-users End of Chinese export of heavy rare earths in 2014/15 Undervalued Compared with its Peers Corporate Presentation 24

25 Appendix Corporate Presentation 2 5

26 Media: Recommendations and Articles Judith Chegwidden and Dudley Kingsnorth, at the Metal-Events Conference in Hong Kong, 9-11 Nov Identified five heavy rare earths projects in the world: Dubbo, Nechalacho, Strange Lake, Bokan-Dotson Ridge and Kipawa. Mr. Yasushi Watanabe (National Institute of Advanced Industrial Science and Technology) highlighted, at this same conference That the Japanese government and private sectors are looking for sources of rare earths outside of China, particularly heavy rare earths deposits. These sources must be timely, compact and inexpensive projects. John Kaiser, John Kaiser Bottom Fishing (Oct. 26 th, 2010) Recommends buying Matamec shares Because they offer the potential for 500% (or higher) gains in medium to long term time frames. Matt Gowing, Mackie Research Capital Corporation, Alternative Energy Rare Earth Industry Update (Feb. 2011) - Recommended plays- Focus on Heavy Rare Earths Matthew Gibson and Ian Parkinson, CIBC Institutional Equity Research, Metals and Minerals (March 6, 2011), Once Ignored On the Periodic Table, Don t Ignore them Now A Rare Earth Element Industry Overview Corporate Presentation 26

27 Recent Rare Earth Market Development Chinese policy changes continue to dominate the landscape Government rare earth pricing mechanism introduced and industry consolidation being pursued Clampdown on illegal mining and stricter environmental controls now in force Further significant reductions in export quotas announced 28 December 2010 (-35% H1 vs. H1 2010) Significant increase in REO prices in last 6 months, with strong price growth forecast to continue through 2015 and beyond US government to re-establish domestic REE supply chain Rare Earth and Critical Revitalization Act passed by House of Representatives in Oct High level discussions between Washington and China regarding security of rare earth supply continuing China confirms only years of HREO and MREO reserves (Oct 2010) Plans by countries including China, Japan and more recently US, to stockpile rare earths widely reported Corporate Presentation 27

28 Impact Of Chinese Controlled Market Higher Prices: Explosion of rare earth projects world wide Recycling of rare earths Reduction of rare earth consumption in current and new applications Substitution of rare earths in future technologies Elimination of rare earths in applications Lower Prices: Increase of rare earth consumption in current and new applications New applications Research and development Corporate Presentation 28

29 Rare Earths Projects for the 21st Century Source: Yasushi Watanabe, AIST, Hong Kong, Nov. 9-11, 2010 Corporate Presentation 29

30 10 Steps to Developing a Heavy Rare Earth Deposit: ( source Dudley Kingsnorth) Step 1: establish resource Step 2: understand mineralogy Step 3: scoping study Step 4-6: pilot plant Beneficiation, extraction & separation Step 7: environmental approval Step 8: letters of intent Step 9: DFS & funding Step10: engineering, procurement, construction TOTAL AVERAGE 2-5 years 1-3 years 1-3 years 2-10 years 2-4 years 2-3 years 9 years Complete Complete Advanced In Progress Matamec intends to complete these 10 steps in 7 years Corporate Presentation 30

31 Minerals That Contain Rare Earths Mineral % RE O Mineral % REO Mineral % REO Aeschynite 36 Churchite 44 Loparite (Russia) 36 Allanite (GWMG) 30 Eudialyte (Matamec) 10 Monazite (China) 71 Anatase 3 Euxenite 40 Mosandrite (Matamec) 65 Ancylite 46 Fergusonite (Avalon) 47 Parisite 64 Apatite 19 Florencite 32 Samarskite 12 Bastnasite (Molycorp) 76 Gadolinite (Quest) 52 Synchisite 51 Brannerite 6 Huanghoite 38 Thalenite 63 Britholite (Matamec) 62 Hydroxylbastnasite 75 Xenotime (China) 61 Cerianite 81 Kainosite (Quest) 38 Yttrotantalite 24 Cheralite 5 South China Clays 0.03 Minerals Presently Producing Rare Earths Corporate Presentation 31

32 . Minerals (Kipawa Deposit) Mineral Formulas Elements REO Wt % (Kogel & al., 2006) Eudialyte Na 15 (Y,Ca) 6 Fe 6 Zr 3 (Si 26,0 73 )(O,OH,H 2 O) 5 Zr, Y, HREE 10 % Mosandrite/ Yttro-titanite Kipawa Deposit: Ore Mineralogy NaCa 2 (Ca,Ce,Y) 4 Ti(Si 2 O 7 ) 2 F 5 and Y, HREE, Ti? 45 % (Mosandrite) (Y,Ca)TiSiO 5 Britholite (Ce,Y,Ca) 5 (SiO 4,PO 4 ) 3 (OH,F) Y, HREE, P 2 O 5 62 % Vlasovite Na 2 ZrSi 4 O 11 Zr Corporate Presentation 32

33 Mineralogy: Eudialyte 34% HREO + Y 2 O 3 Heavy REE Sodic Y-Fe-Zr silicate Source of HREE Average 2 to 10 mm diameter Associated with more mafic syenite Corporate Presentation 33

34 Kipawa Heavy Rare Earth Deposit - Growth Historical Drill Holes 2Mt (1990) 2009 Drill Program 39 Mt (June 4, 2010) NI Ressources: % TREO Indicated (33% HREO+Y 2 O 3 ) % TREO Inferred (35% HREO+Y 2 O 3 ) % ZrO 2 Indicated % ZrO 2 Inferred 2010 Drilling Program Update Resource Estimate Completed: 50 Mt (January 20, 2011) Winter Infill Drilling Program Completed in February Corporate Presentation 34

35 Rare Elements: Properties Properties of Rare Earth Elements Reduces Weight Emissions Energy Consumption Allows Greater Efficiency Performance Miniaturization Speed Durability Thermal Stability Corporate Presentation 3 5

36 Metals Used in Hybrid Cars La Ce Pr Nd Sm Eu Gd Tb Dy Ho Er Tm Yb Lu Y Diesel Fuel Additive Cerium Lanthanum Battery Lithium Nickel Cobalt Lanthanum Cerium Catalytic converter Platinum Rhodium Palladium Zirconium Lanthanum Cerium Iron & Steel Components Chrome Nickel Vanadium Niobium Molybdenum Manganese UV cut glass Cerium Glass and Mirrors polishing powder Cerium Lanthanum Liquid crystal displays Indium HV electric motor & generator Neodymium Praseodymium Dysprosium Terbium LED lights Gallium

37 Sustainable Development - Environmental protection programs - Small environmental footprint - Implication of the local communities from the beginning - Preferential hiring policy for locals Corporate Presentation 37

38 Environmental Impact Study: Some Areas of Interest Fish Black Bear Moose Kipawa Deposit

39 Small Environmental Footprint: Fauna 39

40 Zeus Property Surprise Showing: One of many potential areas Matamec identifies: 2 large rare earths and niobium soil anomalies in the Surprise showing area Surprise, best channelled interval: 5.3% TREO (66% of HeavyREO+Y 2 O 3 /TREO), 3.6% ZrO 2 and 3.9% Nb 2 O 5. Corporate Presentation 4 0

41 A Compact, High Quality and Low Cost Mine for 2015