SEPTEMBER 2015 METALS FOR THE FUTURE TANTALUM, NIOBIUM AND RARE EARTH ELEMENTS. TSXv:CCE / FSE:D7H /

Transcription

1 SEPTEMBER 2015 METALS FOR THE FUTURE TANTALUM, NIOBIUM AND RARE EARTH ELEMENTS TSXv:CCE / FSE:D7H /

2 Disclaimers and Cautionary Statements The information contained in this presentation is provided by Commerce Resource Corp. ( Commerce ) for informational purposes only and does not constitute an offer to issue or arrange to issue, or the solicitation of an offer to issue, securities of Commerce or other financial products. The information contained herein is not investment or financial product advice and is not intended to be used as the basis for making an investment decision. The views, opinions and advice provided in this presentation reflect those of the individual presenters, and are provided for information purposes only. The presentation has been prepared without taking into account the investment objectives, financial situation or particular needs of any particular person. No representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information, opinions and conclusions contained in this presentation. To the maximum extent permitted by law, none of Commerce nor its directors, officers, employees or agents, nor any other person accepts any liability, including, without limitation, any liability arising out of fault or negligence, for any loss arising from the use of the information contained in this presentation. Except for statements of historical fact, this presentation contains certain forward-looking information within the meaning of applicable securities laws. Forward-looking information is frequently characterized by words such as plan, expect, project, intend, believe, anticipate, estimate and other similar words, or statements that certain events or conditions may or will occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those anticipated in the forward-looking statements, including, among others, the accuracy of mineral grades and related assumptions, planned expenditures, proposed exploration and development at the Eldor Rare Earth Element Project and the Blue River Tantalum/ Niobium Project, anticipated rare earth element prices and the relationship between rare earth elements and Chinese and global demand, the anticipated timing and conclusions of drilling results, as well as those risk factors identified in Commerce s Management Discussion & Analysis for the Quarter ended January 31, 2015 and other disclosure documents available at www. sedar.com under Commerce s name. Commerce undertakes no obligation to update forward-looking information if circumstances or management s estimates or opinions should change except as required by law. The reader is cautioned not to place undue reliance on forward-looking statements. This presentation includes industry, market and competitive position data from industry journals and publications, data on websites maintained by private and public entities, including independent industry associations, general publications and other publicly available information. Commerce believes that all of these sources are reliable, but we have not independently verified any of this information and cannot guarantee its accuracy or completeness. Industry publications and surveys generally state that they have obtained information from sources believed to be reliable, but do not guarantee the accuracy and completeness of such information. Further, because certain of these organizations are industry organizations, they may present information in a manner that is more favourable to the industry than would be presented by an independent source. In addition, forecasts are often inaccurate, especially over long periods of time. References in this presentation to research reports or articles should not be construed as depicting the complete findings of the entire referenced report or article. The information in each report or article is not incorporated by reference into this presentation. Cautionary Notes regarding Technical Information This presentation includes disclosure of scientific and technical information, as well as information in relation to the calculation of resources, with respect to the Eldor Rare Earth Element Project and the Blue River Tantalum/Niobium Project. Commerce s disclosure of mineral resource information is governed by National Instrument Standards of Disclosure for Mineral Projects ( NI ) under the guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the CIM ) Standards on Mineral Resources and Mineral Reserves, adopted by the CIM Council, as may be amended from time to time by the CIM ( CIM Standards ). There can be no assurance that mineral resources will ultimately be converted into mineral reserves. Mineral resources are not mineral reserves and do not have demonstrated economic viability. Further information about the Blue River Tantalum/Niobium Project, including information relating to quality assurance and quality control procedures, is available in the NI compliant technical report dated March 18, 2015 and entitled Blue River Ta-Nb Project NI Blue River Tantalum/Niobium Project BC, Canada Project update report, a copy of which is filed under Commerce s profile on SEDAR at Further information about the Eldor Rare Earth Element Project, including information relating to quality assurance and quality control procedures, is available in the NI compliant technical report dated April 15, 2011 and entitled Technical Report Mineral Resource Estimation, Eldor Property Ashram Deposit, a copy of which is filed under Commerce s profile on SEDAR at The technical information in this presentation has been prepared in accordance with the Canadian regulatory requirements set out in NI and reviewed on behalf of the company by Mr. Darren L. Smith, M.Sc., P.Geol., of Dahrouge Geological Consulting Ltd., a Qualified Person. 2

3 Commerce Resources Corp. TWO PRINCIPAL ASSETS: Upper Fir Tantalum/Niobium Deposit British Columbia, Canada 2015 mineral resource update reaffirms 2013 resource as current Central location Good infrastructure Stable social / political jurisdiction ELDOR Ashram Rare Earth Deposit Quebec Ashram Rare Earth Deposit Quebec, Canada Positive Preliminary Economic Assessment (PEA 1 ) - $2.3 billion CAD NPV (pre-tax 2 ) - 44% IRR (pre-tax 2 ) - Payback in 2.2 years - 25 year mine life = considers 15% of known resource (in DCF model) BLUE RIVER Upper Fir Tantalum and Niobium Deposit British Columbia 1. Results of the PEA represent forward-looking information. This economic assessment is by definition preliminary in nature and it includes inferred mineral resources that are considered too speculative to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the preliminary economic assessment will be realized. Mineral resources are not mineral reserves as they do not have demonstrated economic viability. 2. The current Ashram Technical Report dated January 7, 2015 explains why no after-tax case is presented, and that a combined tax rate of around 32.5% may apply to production. 3

4 The Blue River Project Overview Tantalum and niobium deposit in British Columbia Identified current resource 100% conflict free compliant with US legislation 100% Ownership No royalties or back-in rights Land package of over 1,000 km2 249 mineral titles in good standing within the Kamloops Mining Division Attractive Location Mining-friendly south-eastern BC 250 km north of the city of Kamloops 23 km north of the town of Blue River Positive relationship with Simpcw First Nation BLUE RIVER TANTALUM-NIOBIUM PROJECT Excellent Infrastructure Road accessible CN Railway crosses claims Major paved highway BC Hydro power grid inside property Water supply in place 4

5 Blue River Tantalum-Niobium Project Strategic Positioning SEC RULING REQUIRES ALL US LISTED COMPANIES TO FILE ANNUAL PROCUREMENT REPORT ON CONFLICT MINERALS SEC Ruling (August 2012) Follows Conflict Minerals Legislation in Dodd-Frank Financial Reform bill (July 2010) Section 1502 Conflict Minerals Procurement Reports filed June 2, 2014 to SEC. ~6,000 companies filed (estimate: SEC, 2013) European Union and United Nations Advancing Similar Initiatives Contract Tantalum price up 150% ($60.00 to $ USD) Certifiable Conflict Free Material Limited 5

6 The Upper Fir Tantalum and Niobium Deposit OUTLINE OF UPPER FIR CARBONATITE TOP LEFT: Upper Fir Site / TOP RIGHT: View of North Thompson River BOTTOM LEFT: Simple Mineralogy. Demonstrated Recovery / BOTTOM RIGHT: Stored Bulk Sample Material 6

7 Upper Fir Largest of a cluster of over 25 carbonatites identified to date on the Blue River Property Average thickness 30m (range 5m to 90m) with strike length of m Simple mineralogy: pyrochlore, ferrocolumbite Amenable to industrially established flow sheet: 2-stage flotation with proven refining process Estimated recoveries 65-70% Though not yet optimized in the cleaning stages work shows range of 68%-75% for tantalum and 64%-71% for the niobium. 7

8 2015 Mineral Resource Estimate Overview Prepared by AMEC, effective March 18, 2015* Resources are supported by current Ta and Nb prices, long term prices may vary with future market activity Upper Fir Carbonatite only and does not incorporate the Fir or Bone Creek deposits Resource is based on 271 drill holes, totaling 59,110m of core CATEGORY TONNES Ta 2 O 5 (ppm) Nb 2 O 5 (ppm) Contained Ta 2 O 5 (000 s kg) Contained Nb 2 O 5 (000 s kg) INDICATED 48,410, ,610 9,560 77,810 INFERRED 5,400, ,760 1,000 9,600 Notes: Assumptions include US$381/kg Ta, US$46/kg Nb, 65.4% Ta2O5 recovery, 68.2% Nb2O5 recovery, US$27/t bulk mining cost, US$48/t selective mining cost, US$15/t process and refining cost, US$3/t G&A cost. Mineral resources are amenable to underground mining methods and have been constrained using a Stope Analyzer. An economic cut-off was based on the estimated operating costs assuming either the bulk or selective mining method. The block unit value cut-off was either US$45/t (bulk) or US$66/t (selective). No allowances were made for mining losses or external dilution; planned internal dilution within the minimum stope size is included. In situ contained oxide reported. Discrepancies in contained oxide values are due to rounding. * The previous technical report with an effective date of 21 June 2013 included results of a PEA, initially reported in The economic inputs for that mining study are considered out-dated and no longer relevant. The study is available on Sedar. 8

9 Blue River Closing Statement Offers long term security of supply through ownership in a mining friendly and stable jurisdiction Excellent infrastructure and location Deal/partner ready Once financing in place and right partner is identified, project is ready to advance 9

10 Ashram Rare Earth Deposit: Summary Summary Highlights PEA 1 - strongly positive cash flow Favourable distribution containing significant amounts of the critical and magnet feed REEs (Nd, Pr, Eu, Tb, Dy, & Y) Simple Mineralogy 3 host minerals dominate commercial processing 100% owned Located in mining-friendly Quebec World Class Mineral Resource Measured resource of 1.6M tonnes grading 1.77% TREO, Indicated resource of 28M tonnes grading 1.90% TREO and Inferred resource of 220M tonnes grading 1.88% TREO at 1.25% grade cut-off (SGS Geostat, 2012) Deposit enriched with Middle and Heavy REE s Adriana Resources Lac Otelnuk Iron Ore Deposit JAMES BAY UNGAVA PENINSULA Radisson UNGAVA BAY QUEBEC Matagami Val d Or Kuujjuaq Labrador City Fermont Québec Montreal UNITED STATES OF AMERICA Schefferville Chibougamau Adriana Resources Lac Otelnuk Iron Ore Deposit JAMES BAY Sept-Îles Commerce Resources BAY Corp. UNGAVA Ashram PENINSULA Rare Earth Deposit Radisson NEW BRUNSWICK LABRADOR QUEBEC Matagami Val d Or UNGAVA Kuujjuaq Labrador City Fermont Québec CANADA Gulf of St. Lawrence Montreal UNITED STATES OF AMERICA Schefferville Chibougamau Sept-Îles Commerce Resources Corp. Ashram Rare Earth Deposit NEW BRUNSWICK LABRADOR LEGEND CANADA Gulf of St. Lawrence LEGEND Provincial capital Railway Trans-Canada Highway Major road Provincial capital Railway Trans-Canada Highway Major road 1. Results of the PEA represent forward-looking information. This economic assessment is by definition preliminary in nature and it includes inferred mineral resources that are considered too speculative to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the preliminary economic assessment will be realized. Mineral resources are not mineral reserves as they do not have demonstrated economic viability. 10

11 Ashram Deposit: PEA 1 Overview Study based on a 4,000 t/d, open-pit operation with 0.19:1 (waste:ore) strip ratio over 25 year mine life. PEA 1 considers only 15% of the known resource (in its DCF model) Projected OPEX of $7.91 per kg REO produced Average annual production of ~16,850 tonnes REO The initial open pit will lie almost entirely with in mineralized material, centered on the MHREO Zone. NPV (pre-tax 2 ) IRR (pre-tax 2 ) 44% Discount Rate 10% Pay Back Period Mine Life Capital Expenditure Mine Type $2.32 Billion 2.25 years 25 years $763 M Open Pit The Ashram PEA is calculated Pre-tax PEA 1 indicates the potential to be one of the largest and longest operating REE producers in the world. 1. Results of the PEA represent forward-looking information. This economic assessment is by definition preliminary in nature and it includes inferred mineral resources that are considered too speculative to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the preliminary economic assessment will be realized. Mineral resources are not mineral reserves as they do not have demonstrated economic viability. The individual REO pricing assumptions are detailed in the PEA for the Ashram Deposit (effective date of January 7th, 2015) 2. The current Ashram Technical Report dated January 7, 2015 explains why no after-tax case is presented, and that a combined tax rate of around 32.5% may apply to production. 11

12 Significant Metallurgical Improvements Mineral Concentrate Achievements 44% 71% recovery with mass reduction of 97%, a +400% improvement over PEA 1. Represents upgrade ratio of 22 times starting head grade Confirmation that a high grade fluorite concentrate (94%) can be produced using the same flowsheet process as that of the rare earth minerals Physical Upgrading Ashram host minerals bastnasite, monazite and xenotime dominate commercial processing On-going simplification of beneficiation process continues Decreased costs from lower consumables through higher mass reduction (i.e. less material to process) 1. Results of the PEA represent forward-looking information. This economic assessment is by definition preliminary in nature and it includes inferred mineral resources that are considered too speculative to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the preliminary economic assessment will be realized. Mineral resources are not mineral reserves as they do not have demonstrated economic viability. 12

13 Ashram Deposit: Activity 2015, PHASE I (SPRING/WINTER) - COMPLETED 31 holes (4,146 m) infill drilling to increase resource confidence Geotechnical drilling for anticipated dyke location Geomechanical sampling for pit stability assessment Downhole OTV-ATV+ surveying for structural and geophysical analysis Hydrogeological data collection (packer testing, etc.) 1st phase of pilot plant ~1.4 tonnes of flotation concentrate produced Hydromet site visits and initial consultations 2015, PHASE II (SUMMER/FALL) - PENDING Approximately 2,000 m drilling in 15 holes Geotechnical drilling for mine site infrastructure assessment Installation of monitoring well nest equipment with potential pumping test Final comminution sample collection Remaining Qualified Person (QP) site visits 2nd phase of pilot plant: HCl leach and WHIMS - demonstration of downstream flowsheet + production of several kg of mixed RE concentrate for samples for industry Formal hydromet site selection 13

14 Management and Directors Axel Hoppe PhD. Chem. Chairman of the Board Internationally acknowledged leader in the global tantalum market Formerly Head of Technical Services and Engineering Group for H.C. Starck; the world s largest consumer of tantalum President of the Tantalum and Niobium International Study Center for the years 2002 and 2007 David Hodge CEO Veteran resource executive with over 20 years experience. Raised over $75 Million in the past 15 years. Chris Grove President Corporate Communications for Commerce Resources since Has established significant financial contacts in North America, Europe and Asia. Has been instrumental in raising over $70 million dollars for Commerce Resources over the past 10 years. Darren Smith M.Sc, P.Geol, Project Manager Project Manager for Ashram Rare Earth Project Instrumental in the discovery of the Ashram Rare Earth Project and its advancement Over eight years of experience in the mineral exploration industry Jenna Hardy M.Sc, MBA, P.Geo, Technical Services Project Manager for Blue River Tantalum/Niobium Project. Over 20 years as seasoned mining and exploration professional Jody Dahrouge B.Sc., Sp.C., P.Geol. VP Exploration, Director Instrumental in the guidance of company s exploration programs. 14

15 Structure and Market Information Symbols: TSX-V (Canada): FSE (Germany): CCE D7H Shares Outstanding: 216,462,364 Options: 7,486,908 Warrants: 13,545,136 Fully Diluted: 237,494,408 Recent Price: $ Week Range: $ $0.085 Market Cap: $19.4 M CAD Data as of SEPTEMBER 1,

16 Summary 2 Assets Positive PEA 1 for the Ashram REE Deposit Optimization of all key aspects underway Work programs contributing to a Pre-feasibility Study underway at Ashram Supply/demand imbalance growing for REE s Tantalum in Shortfall - Increased attention on conflict-free resources Ongoing discussions with potential joint-venture and off-take partners 1. Results of the PEA represent forward-looking information. This economic assessment is by definition preliminary in nature and it includes inferred mineral resources that are considered too speculative to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the preliminary economic assessment will be realized. Mineral resources are not mineral reserves as they do not have demonstrated economic viability. 16

17 Contact West Pender Street, Vancouver, BC, V6C 1H2 Canada Call: CHRIS GROVE President 17