#1KRUCIBLE METALS LTD Mineral Discovery Company ABN 12 118 788 846 ASX CODE: KRB ASX ANNOUNCEMENT 31st OCTOBER 2012 PRESENTATION - QUEENSLAND EXPLORATION COUNCIL EXPLORERS' INVESTOR FORUM Please see the attached Krucible presentation given by Allan Branch at the Queensland Exploration Council Explorers' Investor Forum held in Brisbane yesterday evening Tuesday 30th October 2012. Attached: QEC Presentation For personal use only AlBranch Allan Branch Managing Director & CEO Krucible Metals Ltd. 1/68 Railway Avenue, Railway Estate Townsville, QLD 4810 Australia T +61 (07) 4772 5880 F +61 (07) 4772 4999 Further Information: Mr Allan Branch Phone (07) 4772 5880 WEB SITE: www.kruciblemetals.com.au PO Box 499, Hyde Park Castletown, Townsville QLD 4812. Australia www.kruciblemetals.com.au E: [email protected]#2For personal use only QUEENSLAND resources COUNCIL Krucible Metals Limited Queensland Exploration Council Investment Forum Presentation 30th October, 2012 Allan Branch Managing Director and CEO Bridgette Humphries Senior Geologist Krucible Metals Limited 1/68 Railway Avenue Railway Estate Townsville, 4810 Queensland Australia Tel: +61-(0)7-4772-5880 Fax: +61-(0)7-4772-4999 [email protected] www.kruciblemetals.com.au ASX:KRB#3For personal use only 2 KRUCIBLE DISCLAIMER This presentation is an overview of the Company prepared with good intention. It is not a prospectus and offers no securities for subscription or sale in any jurisdiction, nor a securities recommendation. All information necessary for investment decisions is not contained herein and investors are encouraged to conduct their own research of Krucible Metals Ltd in conjunction with legal, tax, business and financial consultation. Krucible Metals Ltd, its directors, officers, employees and agents disclaim liability for any loss or damage suffered by reliance on information contained in this report when making investment decisions. In addition, no express or implied representation or warranty is given in relation to the completeness and sufficiency of the information, opinions or beliefs contained in this document or any other written or oral information made or to be made available to any interested party or its advisors. This presentation may refer to the intention of Krucible Metals Ltd but it does in no way intend to forecast forward looking statements or future matters for the purposes of the Corporations Act or any other law. Future events are subject to risks and uncertainties, and as such results, performance and achievements may in fact differ from those referred to in this presentation. No liability is accepted for any loss, cost or damage suffered or incurred by the reliance on the sufficiency or completeness of the information, opinions or beliefs contained forthwith. Research, evaluation and analysis of the business, data and property are encouraged before making financial investments. Any estimates, projections or opinions contained herein may involve subjective judgement, analysis and interpretation, and satisfaction of ones owns decisions should be undertaken. This report contains forward-looking statements. These forward-looking statements reflect management's current beliefs based on information currently available to management and are based on what management believes to be reasonable assumptions. A number of factors could cause actual results, or expectations to differ materially from the results expressed or implied in the forward looking statements. Information of a scientific or technical nature in this report was originally prepared under the supervision of A.J. Tony Alston, founder CEO and previous Chief Geologist of Krucible, who is a member of the Australian Institute Geoscientists and the Australian Institute of Mining and Metallurgy. Mr Alston has sufficient experience, which is relevant to the style of mineralisation and type of deposit under consideration, and to the activity he is undertaking, to qualify as a "competent person" as defined in the 2004 edition of the "Australasian Code of Reporting of Exploration Results, Mineral Resources and Ore Reserves". The technical material is ratified and updated by Bridgette Humphries, the company's Senior Geologist who also has 5 years hands-on experience in the Krucible tenements and resources. Information of a corporate or financial nature in this report has been prepared by Allan Branch the company's Managing Director and CEO. For further information please refer to reports and releases to the Australian Stock Exchange together with the Company's website At www.kruciblemetals.com#4For personal use only 3 QEC DISCLAIMER An objective of the Queensland Resources Council Ltd (trading as the Queensland Exploration Council) (the QEC) is to promote Queensland as a centre for both the financing and implementation of mineral and energy resource exploration activities. (Exploration) As a result the QEC intends to host regular functions designed to allow Queensland based companies and individuals involved in exploration (Exploration Companies) to present information on their company and projects and to network with those companies and individuals interested in either investing in or financing activity in Exploration (Investors). The functions will be known as the QEC Explorers' Investment Forums (Forums). In accepting an invitation to attend any of the Forums all persons either representing Exploration Companies or Investors automatically acknowledge that the QEC role and that of its management staff and advisors is strictly limited to that of the Forum host. In particular the QEC does NOT make recommendations regarding, nor pass any judgement on the merits or otherwise of investing in any of the Exploration Companies that present their activities or exploration results at any of the Forums. Nor does the QEC express any view, nor endorses either any of the statements made by, or information distributed by any Exploration Companies at any of the Forums. Further any statements made by the representatives of any Exploration Companies presenting at any of the Forums does not in any way represent the views of the QEC and hence the QEC makes no representation or warranty as to the fairness, accuracy or completeness of the information provided by the presenting Exploration Companies, or any opinions and conclusions or any other information which is otherwise provided to Investors at any of the Forums. To the maximum extent permitted by law, the QEC, its related bodies corporate and their officers, employees and advisers are not liable for any direct, indirect or consequential loss or damage suffered by any person or organisation (Investor) as a result of relying on this information or otherwise in connection with it. Whilst the QEC does not hold any shares in any company, the QEC acknowledges that certain members of the QEC may hold securities in some of the Company's presenting and any view that they hold regarding the merits of the Exploration Company are purely their personal view and not that of the QEC. The QEC does not receive commissions or fees from these companies in relation to advice or dealings in securities. QEC advises that each presenting Exploration Company is charged a fee equal to their share of the cost of the hire of the Forum venue for the period of the Forum, use of audio visual equipment and cost of food and beverages supplied. The QEC does not profit from the hosting of the Forums. The QEC strongly recommends that all intending Investors attending a Forum obtain independent professional advice prior to making any decision to invest in, or acquire any financial products from, any Exploration Company presenting at a Forum.#5For personal use only 4 KRUCIBLE METALS IS A COMPANY OF SUCCESSES Krucible is a company with a history of successes: 1.Successful $6m IPO in 2007 to list on ASX. 2.Successful discoveries of phosphate, rare earths and others 2008 3.Successful attraction of Director of Mines to board 2011 4.Successful mining lease application in 2012 5.Successful attraction of international CEO to management 6.Successful off-take negotiations 7.Successful phosphate JV negotiations 8.Pending rare earth negotiations 9.Imminent equity and private placements#6For personal use only 5 KRUCIBLE METALS HISTORY AND STATUS So since 2007 Krucible Metals has been a visible and interesting mineral exploration company which is intending to now mine its discoveries while continuing its exploration program: 1.Commercial resource discoveries: High grade rock phosphate 5.0m t @ = 30% Lower grade rock phosphate 19.3mt @ = 19% Heavy rare earth metals: yttrium, neodymium, dysprosium. 2.Active exploration for copper, gold, nickel, zinc, lead, molybdenum. 3.First trial mine at Korella early 2013 (Getax JV). 4.Initial discussion around mining rare earths (strategic JV). 5.Welcomes enquiries from sophisticated investors. Krucible parent company Korella phosphate project Rare earths project#7For personal use only KRUCIBLE METALS INVESTMENT OPPORTUNITY Getax Investment in our company: 1. Currently we are able to accept up to 15% investment through simple Board approval. Getax has so far taken up 3%. 2. Plan to request shareholders at Nov 30 AGM for increase to 25%. 3. Getax investment structure: 15% of 66,447,463 = 9,967,119 shares @ $0.1013 * 0.8 = $807,735.4 (10% discount off 30 day average) 4. Post equity: 9,967,119 76,414,582 = 13.04% 5. Investment Company or Group would be the largest individual shareholder of Krucible and could hold a seat on our#8For personal use only 7 KRUCIBLE METALS CAPITAL STRUCTURE Shares issued: 66,447,463 1. Share price Between $0.06 and $0.18 since 6 months of new management. Average at 26 October 2012: $0.1013. KRB Daily Line Chart [Close] ww 0.200 0.160 0.120 KRB Volume (with MA) [200] n பட October Nov Feb March May June August TS ep October ויייין 0.080 400000 2. Market capitalisation: $6,644,746.30 3. Total equity (September 2012 Balance Sheet): $5,464,794 4. NPV of Korella $83m 5. Top 20 shareholders hold 58%#9For personal use only 8 KRUCIBLE METALS RETURN ON INVESTMENT 1. Krucible believes it will begin trial mining of phosphate in early 2013 in a JV with Getax (Singapore) in a deal worth up to $43m. 2. Krucible believes it will negotiate a successful JV with a strategic rare earths company for mining of its rare earth resources in a deal sealed by a $1m injection into Krucible to continue resource definition. 3. Krucible intends to increase its exploration program and is taking equity investments into the parent company in addition to the JV's mentioned above. • Krucible Private equity ● SPP • Private placements 4. Krucible believes the investments and activities above will have a significant impact on its share price, which the company believe is under valued and has been manipulated down.#10For personal use only 9 KRUCIBLE METALS FINANCIAL PROJECTIONS Period Production (tonnes) 0 2 3 4 5 6 0 600000 600000 600000 600000 600000 600000 Total 3,600,000 Capital Cost Mine and Infrastructure Capital $42,028,125 $0 $0 $0 $0 $0 $0 $42,028,125.00 Port Capital $0 $0 $0 $0 $0 $0 $0 $0.00 Additional Capital Total Capital $42,028,125 $0 $0 $0 $0 $0 $0 $42,028,125.00 Salvage Value $0 $0 $0 $0 $0 $0 $0 $0.00 Claimable Depreciation (Straight Line) $0 $7,004,688 $7,004,688 $7,004,688 $7,004,688 $7,004,688 $7,004,688 $42,028,125.00 Operating Costs Ore Costs $0 Waste Costs $0 $2,608,696 $2,608,696 $24,000,000 $24,000,000 $2,608,696 $24,000,000 Rehabilitation Costs $0 Transport Costs $0 $7,095,000 $7,095,000 $37,740,000 $37,740,000 $7,095,000 $37,740,000 $2,608,696 $24,000,000 $7,095,000 $37,740,000 $2,608,696 $24,000,000 $7,095,000 $37,740,000 $2,608,696 $15,652,173.91 $24,000,000 $144,000,000.00 $7,095,000 $42,570,000.00 $37,740,000 $226,440,000.00 Other Costs $2,000,000 $2,000,000 $2,000,000 $2,000,000 Royalties Total Operating Costs $2,000,000 $1,639,799 $1,639,799 $75,083,495 $75,083,495 $1,639,799 $75,083,495 $2,000,000 $1,639,799 $75,083,495 $2,000,000 $1,639,799 $75,083,495 $2,000,000 $14,000,000.00 $1,639,799 $9,838,795.77 $75,083,495 $452,500,969.69 Financial Calculations Capital expenditure $42,028,125 $0 $0 $0 $0 $0 $0 $42,028,125.00 LESS Operating Cost Revenue Net Operating Surplus LESS Depreciation $0 $2,000,000 -$2,000,000 $120,000,000 $120,000,000 $75,083,495 $75,083,495 $44,916,505 $44,916,505 $120,000,000 $75,083,495 $44,916,505 $120,000,000 $75,083,495 $44,916,505 $120,000,000 $75,083,495 $44,916,505 $120,000,000 $720,000,000.00 $75,083,495 $452,500,969.69 $44,916,505 $267,499,030.31 Allowance $0 Profit for Taxation LESS Tax Payable -$2,000,000 $0 Net Cash Flow -$44,028,125 $7,004,688 $7,004,688 $37,911,818 $37,911,818 $11,373,545 $11,373,545 $33,542,960 $33,542,960 $7,004,688 $37,911,818 $11,373,545 $33,542,960 $7,004,688 $37,911,818 $11,373,545 $33,542,960 $7,004,688 $37,911,818 $11,373,545 $33,542,960 $7,004,688 $42,028,125.00 $37,911,818 $225,470,905.31 $11,373,545 $33,542,960 $68,241,271,59 $157,229,68372 Discount Factor 1.00 0.87 0.76 0.66 0.57 0.50 0.43 Discounted Cash Flow -$44,028,125 $29,167,791 $25,363,297 $22,055,041 $19,178,296 $16,676,779 $14,501,547 $82,914,625.82#11For personal use only 10 KRUCIBLE METALS RETURN ON INVESTMENT Company assets 1. Life of high grade mine 6 years 2. Total Revenues over 6 years $720m 3. Net income over 6 years $257.5m 4. Net Cash Flow $157m 5. NPV $83m 6. Life of low grade mine 12 years 7. Extension through phase 3 phosphate additions 8. Rare earth mining 9. Other exploration#12For personal use only KRUCIBLE METALS BOARD Michael Leonard (Chairman, ex Director Mines Tasmania) Dennis Lovell (Company Secretary and Finance Director) Ray Koenig (Director, Metallurgist, Project Manager for Korella Phosphate Project) Sean Kelly (Lawyer) Allan Branch (Managing Director, CEO, ex GM CRHL - AIM) Krucible has been strengthening and expanding its board and management ready for mining Korella Phosphate Pty Ltd is a wholly owned subsidiary of Krucible Metals Ltd.#13For personal use only 12 KRUCIBLE METALS MANAGEMENT AND STAFF Management led by Allan Branch (PhD MBA) International listed company corporate development specialist Sleeves rolled up, hands-on manager Industry experience, Creat Resources Holdings Limited, Minecom International, US Bureau of Mines, Colorado School of Mines Chief Administration Officer Kate Hopkins, 5 years Geological management Bridgette and Michael, 6 and 4 years Bridgette has extensive experience in the geology of the Mt Isa region Michael has a Bachelor in Commerce majoring in Marketing and Management Directors act in semi executive capacity bringing experience with: Government Metallurgy Strategic financial planning Legal Geological exploration Other staff under contract#14For personal use only KRUCIBLE METALS TENEMENTS AND PROJECTS Benefit s are participation in all of our exploration and mining activities Commodity Krucible EPM Toomba, Kamaran Downs, Pilgrim Fault, Squirrel Hills, Lukes copper/gold Plot, Cowie Mag, Merlin Tank, Tobermorey, Flemington Fault, Big Toby Creek silver/lead/zin Toomba, Squirrel Hills, Cowie Mag, GE1, GE2, Tobermorey, Stranger Creek, Toolebuc, Comet Bore, Wheelers Creek C Yttro, Coorabulka, Corella Bore (Korella), GE1, GE2, Stranger phosphate Creek, Phosphate South, Merlin Tank, Conkerberry Dam, Templeton River, Taringa Creek, Lily Hole Creek, Brumby Dam Yttro, Coorabulka, Corella Bore (Korella), Phosphate South, GE1, GE2, Conkerberry Dam, Templeton River, Taringa Creek, Lily Hole Creek, Brumby Dam REE uranium molybdenum /rhenium Gold Kamaran Downs, Pilgrim Fault, Squirrel Hills, Comet Bore Cowie Mag, Merlin Tank, Lukes Plot Conkerberry Dam, Templeton River, Taringa Creek, Lily Hole Creek, Brumby Dam Magnetite Flemington Fault#15For personal use only KRUCIBLE METALS FACILITIES 329-JBO TOWNSVILLE BODY FABRICATION 14 1/68 Railway Avenue Railway Estate Townsville, 4810 Queensland Australia Tel: +61-(0)7-4772-5880 Fax: +61-(0)7-4772-4999 [email protected] www.kruciblemetals.com.au ENTRY KRUCIBLE METALS LTD MINERAL DISCOVERY COMPANY www.knociblemetals.com.au P. 4772 5880 L4772 4999#16For personal use only 15 KRUCIBLE METALS LANDSCAPE DURING DRILLING FONTO#17For personal use only KRUCIBLE METALS PHOSPHATE PROJECTS Phosphate Occurrences in the Georgina Basin - map shows a number of Occurrences but Krucible's phosphate is next to infrastructure -22° -21° -20° P P Lady Annie P GEORGINA BASIN PP GEORGINA BASIN 139° CAMBRIAN Above Phosphate Phosphate Horizon Below Phosphate Younger Cover Younger Cambrian Inca Formation Beetle Creek Formation Mt Birnie Beds/Older Cambrian Proterozoic Basement P Phosphate Occurrence Major Prospect Major Mine 父 MAY DOWNS (Au) MOUNT ISA 357 Ardmore Phosphate Hill Mine KORELLA (P, REEN Krucible Metals الى P GEORGINA EAST SUB BASIN 16 50km AL BH.2011.112 GEBasinGeol_24112011 Georgina Basin. Geological setting and prospective phosphate stratigraphy.#18For personal use only 17 KORELLA PHOSPHATE DEPOSIT RESOURCE UPDATE: 4th September 2009 (POLYGONAL METHOD) LOWER CUT-OFF R₂O3% SiO2 TONNAGE & GRADE CaO / P,Os % (% P205) (Al2O3 + Fe2O3) 10% 19.3 million tonnes @ 19.0% P₂O 4.6 45.4 1.32 2 20% 8.3 million tonnes @ 27.3% P₂O, 3.56 26.2 1.39 2 5 25% 5.0 million tonnes @ 30.8% P₂O, 3.0 16.7 1.37 2 5#19For personal use only 62 394000m KORELLA CROSS SECTION 394100m YTTRIUM ENRICHMENT 63 78 16 m @ 1.02kg/t Y205 200 m PHOSPHATE ENRICHMENT 67m 67m 85m REFERENCE +500ppm Yttrium Lode B Cover Lower Siltstone Lode D Inca Formation Lode A Mt Birnie Beds 0 Section 7573200N Showing Anomalous Yttrium Values metres 394200m 85m Projection: Non-Earth (meters) N BH.2011.110_751 41 100#20For personal use only 392750E 7572500N 7572250N 7572000N 7571750N 7571500N 7571250N 7571000N 9 7570750N 393000E 393250E 393500E 7574000N 7573750N 7573500N 7574250N IPL Mining Lease (5543) 7573250N Preliminary pit design for Phosphate 7573000N resource at 10% 7572750N cut off Preliminary pit design for Phosphate resource at 10% cut off 393750E 394000E Om 394250E 394500E 500m Preliminary Pit Designs (Mining Associates) IPL Mining Lease (5543)#21For personal use only US Dollars per Metric Ton 22.8 58.74 94.68 Apr-1992 Apr-1993 Apr-1994 Apr-1995 Apr-1996 Apr-1997 Apr-1998 Apr-1999 Apr-2000 Apr-2001 Apr-2002 Growing Demand and Price Price of Diammonium Phosphate (DAP) Bulk FOB US Gulf Price (US$ per tonne) 1500 1200 900 600 300 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Source: FMB Weekly Phosphates Report. Updated January 26, 2012. DAP is a downstream fertilizer product manufactured from phosphate rock concentrate. 202.5 166.56 130.62 Thermal Coal (indexmundi) Interestingly, the pricing structure of phosphate has uncanny similarities to what happened to coal prices. Compare the Australian thermal coal chart at left to the phosphate chart above. Apr-2003 Apr-2004 Apr-2005 Apr-2006 Apr-2007 Apr-2008 Apr-2009 Apr-2010 Apr-2011 Apr-2012#22For personal use only 21 SCOPING STUDY & FINANCIAL MODELLING ON KORELLA PHOSPHATE DEPOSIT Scoping Study assumes achieving a production of 600,000 tpa for 6 years at and average grade of approximately 32% (3 MILLION TONNES). The aim is to convert Inferred resource to minable resource. This will be addressed in PFS. The Inferred Resource at 25% cut-off is 5MT @ 30.8% P205 At 20% cut-off the Resource is 8.3MT @ 27.3% P205 (No value has been assigned to the possible remaining material of 5.3MT @ 24.6% P205) Study assumes a relatively simple flat lying / low dipping ore body with a waste ore ratio of 9:1 Assumes rail transport to port at Townsville for product Revenues for study are based on values at $Au200/tonne, (current price??) INDICATIVE FINANCIAL FIGURES FOR 6 YEAR MINE LIFE (Assuming $Au200/tonne for phosphate rock & applying 15% discount) NPV = $Au 83 million (Break even cost approx. $Au 130/tonne) NB: The above Financial Figures are based on email and verbal estimate from outside sources and are INDICATIVE ONLY. Further work and cost estimates will be carried out in DFS to outline more definitive figures for a financial model#23For personal use only USES & MARKETS FOR YTTRIUM ✪ Yttrium primarily used in high tech industries for manufacture of; SUPER ALLOYS SUPER CONDUCTORS SUPER MAGNETS ) ) miniaturisation CERAMICS & LASER TECHNOLOGY The consumption of Yttrium (and other heavy REE) is rapidly increasing due to global emphasis on "green technology" such as hybrid cars, wind turbines and water treatment as well as expanding markets related to mobile phones, computers, TV's and defence communications A The heavy REE world market is dominated by China and their embargo on exports has resulted in strong price increases over the last 1-2 years A Prices quoted currently (6/6/11) are about; Yttrium metal Neodymium metal $170 per kilo (Yttrium powder $150 per kilo) $300 per kilo Dysprosium metal $1200 per kilo#24For personal use only 62 394000m KORELLA CROSS SECTION 394100m YTTRIUM ENRICHMENT 63 78 16 m @ 1.02kg/t Y205 200 m PHOSPHATE ENRICHMENT 67m 67m 85m REFERENCE +500ppm Yttrium Lode B Cover Lower Siltstone Lode D Inca Formation Lode A Mt Birnie Beds 0 Section 7573200N Showing Anomalous Yttrium Values metres 394200m 85m Projection: Non-Earth (meters) N BH.2011.110_751 41 100#25For personal use only 24 7580000N 392500 ME Phosphate Hill Mine Main Pit 7577.500 mN ML5543 (Incitec Pivot) EPMA15572 (KRB) 7575000 mN 7572500 mN Cross Section KRUCO344 PHMS Google 25ka3p.WOR BLU 009/66 Mining Lease Area for Korella Phosphate Operation (N.B. Smaller MLA was for bulk sampling purposes but now combined with ML90209) EPMA16548 (NQ Metals) Environmental Management Plan approved May 2012 KRB Application EPMA15572 (KRB) Mehaffey Fault Mining Lease 90209 (1577 Ha) Phosphate Corridor - Mining Lease 90208 (25Ha) Operational Mining Lease 90209 final approved on 16th August 2012 for 21 years 1km BH.2010.56 Investment to date is $2m#26For personal use only 25 Rail Loadout Facility at Phosphate Hill NO ENTRY NO ENTRY#27For personal use only Townsville Port - Panamax Ship Size Capability HALI IL KALAB HALL HALEN HALILIN MILES Sugar Terminal#28For personal use only KRUCIBLE METALS RARE EARTH PROJECTS KRUCIBLE METALS LTD - COORABULKA Svanbergite Concretionary Nodules from Coorabulka, containing strongly anomalous Heavy Rare Earth Metals NORTHERN TERRITORY QUEENSLAND 1388 Mt Isa Province Outcrop KRUCIBLE METALS LTD Ernest Henry Mt Isa Mary Kathleen (U, REE) EROMANGA BASIN Kalman (U, REE, Cu) Selwyn (Cu, Au) Cannington Yttrophosphate Hill =229 ARUNTA BLOCK (Under Cover) Korella TOKO SYNCLINE -239 Boulla Coorabulka MOUNT ISA BLOCK (Under Cover) -259 DIAMANTINA HINGE ZONE Bedourie Interpreted margin of the Mount isa Infier EROMANGA BASIN 100km The Mount Isa Inlier and Eastern Arunta Block - Structural framework and world-class mineral deposits. BH.2011.156 REEGeal Framework KRB Tenements. Mt Isa Area showing Krucible HREE Prospects (Yellow) on Government Magnetics and Geological Framework#29For personal use only KRUCIBLE METALS LTD - COORABULKA MAXIMUM VALUES FOR SVANBERGITE SAMPLES FROM PIGEONGAH WATERHOLE Element Metal Oxide (parts per million) (Kilo per tonne) Samarium 496 0.58 Yttrium 946 1.2 Neodymium 3440 4.02 Dysprosium 195 0.23 Europium 107 0.13 Gadolinium 274 0.32 Praseodymium 922 1.08 This EPM licence is due to be granted in October 2012#30For personal use only Krucible Metals Ltd Thank You