DEVELOPING HIGH-GRADE HEAVY MINERALS IN SRI LANKA
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DEVELOPING HIGH-GRADE
HEAVY MINERALS IN SRI LANKA
Corporate Presentation \ January 2021
Disclaimer and Forward-Looking Statements
• This presentation (the “Presentation”) has been prepared by Capital Metals Plc formerly Equatorial Palm Oil Plc(“CMET” or “The Company”)
• This presentation contains general and background information about CMET’s activities current as at the date of the presentation, and (i) does not purport to be complete; and (ii) should not be
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to do so.
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Source of front cover photo: Capital Metals Limited
Corporate Presentation \ January 2021 1
Overview
Developing the Eastern Minerals Project in Sri Lanka
Shallow resource from surface: ~3m deep 17.2Mt resource & recent drilling - high grade depth extensions up to 14m
Amongst highest grade in global peer group - 17.6% Total Heavy Minerals (THM) incl ilmenite, zircon, rutile & garnet
Directors estimate a US$35m low-CAPEX operation with simple, non-chemical, processing route
Five-year operational history
Management team with substantial listed company, heavy minerals & Sri Lankan experience
RTO on AIM completed with numerous project, permitting & offtake milestones targeted for 2021
Corporate Presentation \ January 2021 2
?
Capital Structure
• Capital Metals Plc admitted to AIM via RTO on 13 January 2021 (LSE:CMET)
• RTO fundraise of £2.1m for gross cash post transaction of £2.8m
CAPITAL STRUCTURE NUMBER
Issued Share Capital 171,480,543
Shareholder Warrants 16,111,349
Broker warrants 1,083,333
Management Options (with milestones) 11,750,000
Fully Diluted 200,425,225
Vendor Lock In (75% of issued shares)
Directors & major shareholders 12 months
Other vendor shareholders 3 months
Corporate Presentation \ January 2021 3
Board & Management Team
International & local team with proven experience in heavy minerals project development
Greg Martyr / Chairman Michael Frayne / CEO Anthony Samaha / FD James Leahy / NED
• +25 years’ resource • +25 years’ technical and • Chartered Accountant with • +34 years’ experience in
investment banking commercial experience in +25 years experience in stockbroking, investment
experience resource sector accounting and corporate banking and commodities
finance
• Experienced in corporate
• Former President 500kozs • Currently a director of Geiger
strategy & executive • Experienced strategic
Americas gold producer Counter Ltd, Savannah
management. development & Financial
Resources plc and AEG plc
• Previously Global Head of • Previously Ernst & Young, Great
director to resources
Mining & Metals Advisory for companies • Former director of MRC
Central Mines Ltd, Anaconda
Standard Chartered Nickel Ltd and Asia Energy Plc • Director of AIM listed Reabold whilst Tormin Mineral Sands
(now GCM Resources Plc). Resources plc project moved from feasibility
into production
Geoffrey Brown / NED Teh Kwan Wey / NED Iranga Dunuwille / Sri Lanka Sam Quinn / Cosec
Manager
• +50 years’ experience in the • General manager (corporate) of • Significant experience in
natural resources sector KLK in Malaysia, responsible for • +18 years’ experience as administration, operation,
finance advisory and execution CFO/FD in both UK and Sri financing and promotion of
• Previously held executive roles including acquisitions, Lanka natural resource companies
in listed companies divestments, fund raising and
due diligence. • Based in Sri Lanka overseeing • Provides company secretarial
• Director of Equatorial Palm Oil
• Previously worked for Lazard in in-country activity and corporate services to a
since 2008 number of UK listed
the London Financial Advisory • Qualified Chartered
Team companies
Management Accountant
• Holds a Masters of Engineering • Trained as a corporate lawyer
from Imperial College London
Corporate Presentation \ January 2021 4
Corporate Strategy
Defined path through permitting, offtake, finance, engineering, to construction*
RTO on London AIM Mining License OfftakeProd
agreements Engineering Design
Q 3 2021
Q 3 2021
Q4 2020
H1 2021
1.
1 2 3 4 5 7 8
1.
6
1.
H1 2021
Q1 2021
Q3 2021
Q 4 2021
Commence
EIA Approval Development Study Finance
Construction
Coastal Conservation Department Geological Survey and Mines
Capital Metals Limited
(‘CCD’) Bureau (‘GSMB’)
Project finance, offtake,
Approval of EIA Issue of Industrial Mining Licence
construction, mining
(‘IML’)
* Target dates for milestones
Corporate Presentation \ January 2021 5
Eastern Minerals Project
High-Grade JORC
High-grade JORC Four Valuable Heavy Drilling and
Drilling and Resource
Resource
Mineral Resource Mineral Products Expansion
Expansion
• 17.2mt at 17.6% THM • Valuable heavy minerals • 2018 drill program proved
(ilmenite, zircon, rutile & mineralisation continues at
• > 90% THM recoveries
garnet) account for >75% depth
• Current resource only first of THM
3m from surface • Drill intersections incl.
• Low chrome ilmenite 14m at 26.3% THM &
• Low slimes 8m at 26.6% THM
Submitted
EIA has Commenced Infrastructure Simple Processing Route
• EIA with Sri Lankan • Key infrastructure in place • Low-CAPEX
authorities and ready for including Oluvil Port & road
public consultation network • Dig → Screen → Spiral
Processor → No Chemicals
• ESG, community &
stakeholder engagement
ongoing
Corporate Presentation \ January 2021 6
Regional Land Position around Initial Mining Area
Applications for Mining Licences
• 6 Industrial Mining licence (IML) applications being
submitted within the Northern Exploration Licence before
its expiry 31 October 2020
• EIA ready for 30 day public consultation period
• Issue of first IML targeted for H1 2021
Southern Exploration Licence
• IML applications planned for 2021 over existing resources
• 2 yearly licence renewal in progress as part of 31 October
licence expiry
• Potential for further exploration
9 Exploration License Applications
• 4 onshore applications for 272km2
• 5 offshore applications for 351km2
Exploration upside
• Potential for increase in resources – at depth, inland &
offshore
• Less than 5% of project area drilled to date
Mine Corporate Presentation \ January 2021 7
Project Infrastructure & Oluvil Port
Unused Oluvil
Unused Oluvil Port
Port Infrastructure in place
• 32km by road from wet plant at mine • Grid power, scheme water, sealed roads
• Unused port – construction completed in 2013 • Up to 10,000 tonnes shipping capacity
• Discussions with SLPA for port use and MSP • Port requires dredging due to long-shore drift
construction
• Access to export markets
Proposed location of Mineral Processing Plant
32km
2 x 25T trucks per
hour
Corporate Presentation \ January 2021 8
Mineral Resource & Assemblage
JORC THM ‘000t VHM % 2020
Resource THM % of
Resource 5% THM cut- VHM Product % THM of Insitu price
‘000t % Value
Category off Ore US$/t 1
Measured 5,819 19.9 1,159 Ilmenite 2 47.1 8.3 230 51
Indicated 8,602 16.6 1,432 Zircon 5.1 0.9 1,250 20
Inferred 2,791 16.0 446 Rutile 3.4 0.6 1,100 14
Total 17,212 17.6 3,037 Garnet 22.7 4.0 200 15
Source: Capital Metals Limited (JORC 2012 Resource Report) 1. Capital Metals Limited estimate
2. Ilmenite 2020 price US$/t is the estimate for ilmenite only and does not include the price for
other TiO2. The %THM, VHM% of Insitu Ore and % of Value figures for ilmenite all include
Other TiO2.
84% of resources are Measured & Indicated
Good spread of revenues across product range
Grade of 17.6% THM Sillimanite and monazite products not included
in current value
2018 drilling confirmed high grade mineralisation
below existing resource
Corporate Presentation \ January 2021 9Simple Extraction Process
No Blasting Processing
Low CAPEX near mine with
Continuous
US$35m* no chemicals
Rehabilitation
Flow Chart
Ore Mining Mine Feed Unit WET PLANT - Heavy Mineral
MINE SITE Concentrate (HMC)
Silica sand returned for
restoration
MINERAL SEPARATION PLANT (DRY PLANT - OLUVIL PORT)
(HMC) Stockpile Magnetic Electrostatic Gravity Separation
EXPORT
(OLUVIL PORT)
Bulk Ship
Container
Zircon/Rutile
Garnet
*CML estimate
Ilmenite
Corporate Presentation \ January 2021 10Mineral Processing Plants – Simple Mining
WET PLANT – MINE SITE DRY PLANT – OLUVIL PORT
Located adjacent to the mine site Mineral Separation Plant proposed to be located at Oluvil Port
Mine sand → slurry spirals by gravity – negligible slimes Separates HMC into value-added separate and saleable products
Heavy minerals separated from silica sands into Heavy Mineral High-intensity magnetics produce a magnetic concentrate and a non-
Concentrate (HMC) magnetic concentrate
Planning further product separation into ilmenite, rutile, garnet and
Products:
zircon using various techniques:
• Clean sand returned to mine void
• electrostatic
• HMC via truck to dry plant
• magnetic
• Rehabilitation within three months of mining
• particle size differences
• additional spirals
Corporate Presentation \ January 2021 11ESG - Community & Environment
Community Engagement is the
Key to Permitting
Maintain ongoing presence and
continued engagement with
community
Proposed 8 Week Rehabilitation
EIA Study ready for 30 Day International and Local Cycles
Public Consultation Period Consultants Progressive rehabilitation aligned
with mine plan
Employment
Large local workforce when
operations commence
Corporate Presentation \ January 2021 12Heavy Mineral Market
Favourable product split
Primary –Sulfate
Ilmenite 51% value
Ilmenite Rutile – 14% value
Rutile
1. • Pigment manufacture, 3. • Pigments and metals
Titanium
Titanium Dioxide
Dioxide TiO
TiO22 GDP Growth titanium slag production • Current estimate US$1,100/t
• Current estimate US$200-
• TiO2 demand grows in line with 240/t
GDP growth
• Pigment accounts for 90% of
demand
Zircon – 20% value
Zircon Garnet – 15% value
Garnet
2. • Opacifier in ceramic glazes,
refractory, foundry,
4. • Almandine garnet for
abrasives and water filters
HM value approximately US$40 per chemicals
resource tonne • Current estimate US$200/t
• Current estimate
US$1,250/t
Source: Capital Metals Limited
Corporate Presentation \ January 2021 13High Grade for High Value
Value per Resource Tonne Sand - US$/t
70
60
50
Capital Metals In situ resource value of $40 tonne
(before mining & processing)
40
30
20
10
0
I-MB CML IMA ILU ATR I-EB SFX I-SL I-PB I- SR JAY DRX BSE - I-AS BSE STA - TZTSL - SC MRC TSL KMR SAV BSE - STA STA -
MG KW WA
Source: company data
Corporate Presentation \ January 2021 14Development Strategy
Development Study & Economic Analysis planned H1 2021
• Based on all technical work completed to date
• Preliminary capex estimate US$35m
• Target 1.65mtpa steady state mining & processing operation
Project characteristics suggest low capex, high margin operation
• Resource grade & mineral assemblage value
• Dry Mining, No slimes, Metallurgical recovery
• Existing infrastructure
• Targeted IRR and cashflow margins >50%*
* Management target only – not intended to be a forecast
Corporate Presentation \ January 2021 15Investment Case
A Geologically
A Geologically Perfect Technically
Technically Simple
Simple Exploration Upside
Advantageous Deposit
Deposit Mining
Mining and Separation
Very high THM grades Environmentally friendly, low Over 95% of the project has
cost & simple mining & not been drilled and recent
processing drilling confirms increased
depth
Strong Offtake
M&A Opportunity Experienced
Strong Management T Infrastructure and
Interest Management Team Export Route
Interest from offtake Highly experienced Board Close to port, existing
companies given supply and in-country team to bring transportation links & small
constraint the mine into production senior team with large local
employment opportunities
High Re-Rate
M&A Opportunity M&A Opportunity Good
Potential Product Mix
Multiple visible development Positive market fundamentals
milestones of saleable products:
ilmenite, zircon & rutile
Corporate Presentation \ January 2021 16Appendix
170
2
4
6
8
10
12
0
2
4
6
8
10
14
16
12
I-MB CML
CML I-MB
JAY I-SL
I-SL JAY
ILU ILU
BSE - MG SFX
SFX IMA
BSE BSE - MG
I-PB I-EB
IMA I-PB
I-AS BSE
VHM- %
I-EB ATR
ATR I-AS
TSL - SC
MRC
KMR
TiO2 Grade - %
TSL - SC
TSL
KMR
SAV
TSL
I- SR
SAV
DRX
DRX
STA - TZ
I- SR
BSE - KW
STA - TZ
MRC
BSE - KW
STA
STA
STA - WA
STA - WA
0
5
10
15
20
25
30
35
40
0.0
1.0
1.5
2.0
2.5
0.5
Project Comparison - Grade and Slimes
Zircon Grade - %
Corporate Presentation \ January 2021
Slimes Content - % (Clay)
18Sri Lanka
Democratic nation of
~21.4m people
Literacy rate
Favourable fiscal and legal
92.6% China
investment parameters
among highest in South Asia
Supportive of foreign
investment, job creation
Based on English law and adding value
India
Bangladesh
Low levels of
Civil war ended in 2009 poverty
Indic Sri Lanka
Ocean
Tourism growing, high-rise apartments and commercial,
manufacturing due to low labour costs
(per-capita income US$3,853 pa)
Corporate Presentation \ January 2021 19Simple Mine Plan & Wet Plant Spirals
Mine Plan Wet Plant Spirals
Corporate Presentation \ January 2021 20Proposed Mineral Separation Plant
Corporate Presentation \ January 2021 21Bulk Sample Test Work
4 Tonne Bulk Sample
• Mulliadi sample sites
• Downer (Mineral Technologies) facility in QLD
Australia
• Clean sand with very low slimes & oversize
Exceptional Spiral Results
• 90% Total Heavy Minerals
• >98% recovery of zircon, TiO2 and monazite minerals
on two-stage spiral circuit
Overall VHM Recovery 82.5%
• Exceptional separation of magnetic / non-magnetic
components of HMC and final products
Bulk sample testing HMC on shaker table showing • Supports the use of a small, highly mobile mining and
separation at Downer (Mineral Technologies) test processing circuit
facility, QLD Australia
Source: Capital Metals Limited
Corporate Presentation \ January 2021 22Mining Fiscal Parameters
Tax, Royalty
Amount (RS)
and Export Levy
Corporate Tax – Exporters 14%
GSMB Royalty 7%
CESS Export Levy
• Ilmenite 1,650 Rs / tonne
• Rutile 2,200 Rs / tonne
• Zircon 550 Rs / tonne
Corporate Presentation \ January 2021 23Glossary
CCD Coastal Conservation Department TiO2 Titanium dioxide
Rutile >95%
CML Capital Metals Limited
Leucoxene/HiTi 70-94%
BFS Bankable Feasibility Study Altered Ilmenite 60-69%%
Ilmenite 40-60%
BVI British Virgin Islands
VHM Valuable Heavy Minerals
EIA Environmental Impact Assessment
ZrSiO4 Zircon
EL Exploration Licence
X3Y2* (SiO4)3 Garnet
GSMB Geological Survey and Mines Bureau (* where X = Ca, Mg, Fe, Mn, Y = Al, Fe, Cr)
HM Heavy Mineral Sands Rs Sri Lankan Rupees
IML Industrial Mining Licence
JORC Joint Ore Reserves Committee (JORC code)
LOM Life of Mine
TEC Technical Evaluation Committee
THM Total Heavy Minerals
Corporate Presentation \ January 2021 24Contacts
Michael Frayne / Chief Executive Officer
E: michael.frayne@capitalmetals.com
Tel: +44 (0) 207 317 6800You can also read
