Mining 2008 Resources Convention Presentation - Heemskirk

heemskirk.com

Mining 2008 Resources Convention Presentation - Heemskirk

ASX Codes: HSK & HSKG

A miner, developer, financier and investor

Corporate Update – October 2008

1 www.heemskirk.com


Important Notice & Disclaimer

ASX Codes: HSK & HSKG

The information contained in this presentation is current as at October 2008. All statements are based upon

the Company’s best information as at October 2008. This presentation includes forward-looking statements

regarding future events and the future financial performance of Heemskirk. All forward looking statements

are based on the beliefs of Heemskirk management. These statements reflect Heemskirk’s current views

with respect to future events and are subject to various risks, uncertainties and assumptions.

The Company makes no representation or gives any assurance that these statements will prove to be

accurate as future circumstances or events may differ from those which have been anticipated by the

company.

No representation or warranty, express or implied is given to the accuracy of the information or opinions

contained in this document and no liability is accepted by Heemskirk Consolidated Limited or any of its

directors, members, officers, employees, agents or advisers for any such information or opinions.

Accordingly, this information is being supplied to you, in whole or in part, for information purposes only and

not for any other purpose.

This document and the information contained in it do not constitute a prospectus and do not form any part of

an offer of, or invitation to apply for, securities in any jurisdiction.

Potential investors should not rely solely on the information contained herein prior to making any investment

decision. Investors should seek independent advice from a properly qualified advisor, giving due regard to

their own personal circumstances, prior to forming any investment decision.

2 www.heemskirk.com


Heemskirk Consolidated Limited

Primary Objective of our Mining House

ASX Codes: HSK & HSKG

Heemskirk “….generates positive cash flow growth and strategic

opportunities from direct assets or indirect investment within the mining

industry…”

Supporting Objectives

‣ Grow profits over the long term

‣ Distribute dividends

‣ Have a counter cyclical approach

‣ Benefit the community in a responsible positive manner

‣ Maintain a safe working environment

Values

‣ Open approach

‣ “can do” result driven attitude

3 www.heemskirk.com


Executive Summary

ASX Codes: HSK & HSKG

Heemskirk has operations and investments in both within and external to

Australia

Offices in four first world countries, over 70 employees, and indirectly

approximately 200+

Team with mining and finance experience

Production now on stream from new developments in Spain and

Canada, together with gold and silver output from Pajingo

On market share buy back programme initiated

A miner, developer, financier and investor

4 www.heemskirk.com


Statistical Snapshot

ASX Codes: HSK & HSKG

Listed on the Australian Stock Exchange October 2004

and is classified as a mining producer

‣ Stock Code HSK

‣ Convertible Note Code HSKG

Listed ASX shares 75 million

Market capitalisation approximately A$50-60 million

A dividend paying company

5 www.heemskirk.com


Strategic Assets / Offices

ASX Codes: HSK & HSKG

6 www.heemskirk.com


Our Evolution

ASX Codes: HSK & HSKG

7 www.heemskirk.com


Our Evolution

ASX Codes: HSK & HSKG

Strategic Assets provide sustained cash flow

Business Structure

Seed

Capital

Resource

Equity

Mining

Corporate

Finance

Strategic

Assets

Series of

Smaller

Investments

Listed Unlisted eg: GRC

Heemskirk

Canada

100%

Los Santos

Spain

100%

Pajingo

Australia

40%

8 www.heemskirk.com


Indicative Project Life

ASX Codes: HSK & HSKG

Operating Projects Time Commodities

Australia - Pajingo (40%) 5+ years plus exploration Gold & silver

Canada - Moberly 20+ years Silica products

Canada - Lethbridge 20+ years Barite, gypsum, zeolite

Spain - Los Santos 10+ years Tungsten

Spain - Los Santos 15+ years Aggregate*

*recently initiated

Ore Reserves and Resources Statement released 10 October 2008

9 www.heemskirk.com


Pajingo Gold Mine (40% HSK) - Australia

ASX Codes: HSK & HSKG

Process Plant

Source: Newmont

Pajingo is a gold operation located in central Queensland,

approximately 130km south west of Townsville

Heemskirk Consolidated and North Queensland Metals

(NQM) are in joint venture 40:60, NQM is Manager

Purchased for A$25 million (100%)

10 www.heemskirk.com


Pajingo (HSK 40% equity)

ASX Codes: HSK & HSKG

Estimated steady state production of

60,000 to 70,000 ounces of gold per

annum

Production in September quarter of

13,761 ounces of gold at A$677 per

ounce (approximately US$470 per

ounce)

Insurance through Put Options at

A$900 per oz selling at a spot price

above $900 per ounce currently

Based upon JORC compliant Mineral

Resources and Ore Reserves of

*486,000 ounces, the current

planned production is 5+ years

*March 2008

11 www.heemskirk.com


Project General Features

ASX Codes: HSK & HSKG

Well established mine operation with excellent

infrastructure and mobile fleet

Mining commenced in 1996 under Normandy

Mining and from 2002 managed by Newmont

USA following merger with Normandy Mining

Commodity and geographic diversification

Foothold asset in Australia as platform for

future growth

Australian cash flow

Region well supported from the regional centres

of Charters Towers and Townsville with quality

people and services

Source: Newmont

12 www.heemskirk.com


Pajingo Long Section

ASX Codes: HSK & HSKG

‣ Mill modifications were undertaken to adjust throughput to 300,000 tpa

‣ High grade epithermal system extending over 4kms; strong regional prospectivity

‣ 830km 2 of highly prospective exploration ground in world class epithermal gold area - this

regional address has produced over 10 million ounces of gold

13 www.heemskirk.com


Pajingo Plant

ASX Codes: HSK & HSKG

14 www.heemskirk.com


Pajingo Plant

ASX Codes: HSK & HSKG

15 www.heemskirk.com


Los Santos Tungsten Mine - Spain

ASX Codes: HSK & HSKG

Los Santos is a Tungsten

operation located in western

Spain, approximately three

hours drive from Madrid

100% owned

Product market established

Production underway

16 www.heemskirk.com


Los Santos Operations Snapshot

ASX Codes: HSK & HSKG

‣ Production Rate - 400,000 tpa ore (seven days a week)

‣ Aim to be lower quartile global operating costs

‣ LOM grade around 0.3% WO 3

‣ Open cut operation

‣ Low strip ratio (LOM 4:1)

‣ Mineralisation outcrops

‣ Operations – 10 years minimum (estimated)

17 www.heemskirk.com


Tungsten the Metal

ASX Codes: HSK & HSKG

Is the strongest of all metals – three

times harder than chrome and titanium

Highest melting temperature of all

metals (3400° C )

Is environmentally friendly

Is very heavy (density of 19.25 g/cm 3 )

Used in everyday life:

‣ Abrasives

‣ Cutting tools, tool steels & special alloys

‣ Lighting

‣ Drilling equipment

18 www.heemskirk.com


Tungsten – Los Santos a very strategic mine

ASX Codes: HSK & HSKG

Very few quality producing

mines in the Western World –

this is the third in Europe

Mines generally take several

years to bring into production

Demand remains high

No market to trade the metal for

investors – only access is via

listed producers

Strategic asset in terms of its

location, mine life and size

19 www.heemskirk.com


Tungsten Price Remains Strong

ASX Codes: HSK & HSKG

APT European free market $ per mtu

300

250

200

150

100

US$ per mtu

50

0

29/04/1999

29/04/2000

29/04/2001

29/04/2002

29/04/2003

29/04/2004

29/04/2005

29/04/2006

29/04/2007

29/04/2008

Source: Metal Bulletin

20 www.heemskirk.com


Los Santos Development / Finance Snapshot

ASX Codes: HSK & HSKG

Indicated Capex - €13 million

Acquisition August 2006 -

Construction 2007 –

commissioning early 2008

Production mid 2008

Six year offtake agreement

with Global Tungsten

Powders for 100% of

tungsten product

Drilling blast holes 1090 bench

Source: Heemskirk

21 www.heemskirk.com


LOS LOS SANTOS SUR SUR

(FIRST (FIRST PIT) PIT)

FUENTERROBLES

MINERALISATION CORRIDOR

MINERALISATION CORRIDOR

LOS SANTOS

LOS SANTOS

WASTE

CONTRACTOR

ADMINISTRATION

ADIT

CRUSHING

CRUSHING

TOP SOIL

ACCESS ROAD

ACCESS ROAD

NORTH

POWER STATION PROCESS PROCESS WATER


Los Santos Mine Map

Capa E

Los Santos

Sur

ASX Codes: HSK & HSKG

24 www.heemskirk.com


Los Santos Mining

ASX Codes: HSK & HSKG

25 www.heemskirk.com


Fine Ore Stockpile

ASX Codes: HSK & HSKG

26 www.heemskirk.com


Rod Mill

ASX Codes: HSK & HSKG

27 www.heemskirk.com


Spirals

ASX Codes: HSK & HSKG

28 www.heemskirk.com


Wilfley Tables

ASX Codes: HSK & HSKG

29 www.heemskirk.com


Loading Bag Ready for Concentrate

ASX Codes: HSK & HSKG

30 www.heemskirk.com


New Business Unit, Heemskirk Aggregates - Spain

ASX Codes: HSK & HSKG

Aggregates business approved,

equipment procured

Production anticipated to begin

in the latter part of the 2008

calendar year

Low capital costs and rapid

payback

Capital


Crusher

ASX Codes: HSK & HSKG

32 www.heemskirk.com


Industrial Minerals - Canada

ASX Codes: HSK & HSKG

Owned 100%

Industrial Minerals focus – long

life operations

Two principal operating facilities

and a regional administrative

office in Calgary, Canada

Products have established

markets

Experienced personnel

(approximately 40 people)

Key products are Barite, Silica

Products, Zeolite and Gypsum

33 www.heemskirk.com


Supplier into a Major Market

ASX Codes: HSK & HSKG

300

250

200

Alberta Oil Sands contain

175 billion barrels reserve

Low exploration risk

Massive resource – 60 years

Conventional technology

Good business jurisdiction

150

264

Heemskirk a well positioned supplier

100

179

133

50

102

80

60

0

21

Saudi Arabia

Canada

Iran

Iraq

Kuwait

Russia

United States

Source: Teck

34 www.heemskirk.com


Barytes - Lethbridge

ASX Codes: HSK & HSKG

35 www.heemskirk.com


New Developments - Canada

ASX Codes: HSK & HSKG

Leveraged into the oil and gas

services industry and to a lesser

extent, agricultural and other

industries

40% expansion of Lethbridge

facility completed end 2006

Moberly silica operation

upgrade and new silica flour

business

36 www.heemskirk.com


ASX Codes: HSK & HSKG

Closing Comments…

37 www.heemskirk.com


Project and Investment Sequence - Balanced

ASX Codes: HSK & HSKG

Exploration Evaluations Construction Production/Cash Flow

Pajingo extensions

Near Mine Evaluations

Moberly - Canada

Lethbridge - Canada

Pajingo – Qld (40%)

Los Santos - Spain

Los Santos Aggregates

Seed Capital

Moberly Si Flour

Strategic Investment Evaluation

Los Santos – Mine &

Regional 100%

Pajingo 40%

38 www.heemskirk.com


Delivered on Stated Objectives

ASX Codes: HSK & HSKG

Acquired, integrated and expanded an Industrial Minerals business which

provides cash flows

Completed investment in and construction of Los Santos Tungsten

Project, Spain producing concentrate – in 18 months

Growth in both Assets

Fully franked dividends paid – 2006 and 2007

Established a strong team of people, systems and a solid asset base for

future growth

Pajingo JV (40%) producing gold at a sound margin

Aggregates is an example of brownfields development

39 www.heemskirk.com


Continued Growth & Diversity

ASX Codes: HSK & HSKG

40 www.heemskirk.com


ASX Codes: HSK & HSKG

Appendices…

41 www.heemskirk.com


Looking Forward

ASX Codes: HSK & HSKG

An exciting year in front of us with production from the Los Santos

tungsten project, exploration, and new project initiatives

Continue to build our Canadian Industrial Minerals business, eg: grow

silica flour business, acquisitions

Pajingo aims to deliver significant exploration upside via potential gold

and silver discoveries. It’s already providing Australian production and

cash flow

Will seek to add new Strategic Assets to the Group and optimise existing

assets

Strong growth in revenue as new production comes on line in 2008

allowing us to maximise opportunities

42 www.heemskirk.com


Investment Highlights 2007

ASX Codes: HSK & HSKG

Generating cash flow and profitability from the Industrial Minerals

business in Canada which includes three mines and two processing

plants

Construction with 2008 commissioning of the Los Santos Tungsten

Project Spain

Heemskirk is highly diversified with investments in a range of countries

and a number of commodities

Three straight years of profitable growth since listing. A dividend paying

company!

Acquisition of Pajingo (40%) gives Heemskirk instant cash flow from an

Australian gold mine with significant exploration potential

43 www.heemskirk.com


Los Santos Mine Map

ASX Codes: HSK & HSKG

Los Santos

Sur

Capa E

Sector

Central

Las

Cortinas

44 www.heemskirk.com


Board Experienced in Mining & Mining Corporate Finance ASX Codes: HSK & HSKG

Bruce Kay (Chairman)

Kevin Robinson (Managing Director)

Peter Bird (Executive Director)

Lex Hansen (Non-Executive Director)

Ross Herron (Non-Executive Director)

Colin Walker (Company Secretary)

45 www.heemskirk.com


Senior Management Team

Kevin Robinson

Managing Director

ASX Codes: HSK & HSKG

Peter Bird

Executive Director

Corporate & Markets

Mark Flook

Executive GM

Investments

Jim Mitchell

Chief Operating Officer

Colin Walker

Company Secretary

Stephen Gray

Financial Controller

Simon Beardsmore

Executive GM

Heemskirk Europe

Our Strategic Asset Management includes:

‣ Alan Minty – President, Heemskirk Canada

‣ Paul Berndt – General Manager, Los Santos Operations, Spain

46 www.heemskirk.com


Supply in 2004: 56,700 tonnes (W content)

ASX Codes: HSK & HSKG

Other - 11%

CIS - 6%

China - 83%

Other CIS China

Source: ITIA

47 www.heemskirk.com


Flowsheet of Primary and Secondary Tungsten

ASX Codes: HSK & HSKG

Scheelite

Concentrate

Wolframite

Concentrate

Primary Tungsten

(concentrates)

66%

Secondary Tungsten

(scrap)

34%

Total Tungsten Demand

Final Product

90%

Loss through

dissipation & discard

66%

Scrap from used parts

24%

Scrap originated

during processing

10%

48 www.heemskirk.com


ASX Codes: HSK & HSKG

Estimated World Tungsten Reserves 7.0 million tonnes (W Content)

Other - 17%

CIS - 6%

China - 57%

South America -

4%

Canada - 12%

USA - 4%

Other CIS South America Canada USA China

Source: ITIA

49 www.heemskirk.com


ASX Codes: HSK & HSKG

50 www.heemskirk.com

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