Transcript Document 7533722

LKANE EXPLORATION LTD
ABN 35 000 689 216
“The Lachlan Lives”
SMEDG
27 February 2003
CORPORATE SUMMARY
ALKANE EXPLORATION LTD
Australian Public Listed Company
100%
100%
PEAK HILL GOLD MINE
AUSTRALIAN ZIRCONIA LTD
150,000 oz gold production
DUBBO ZIRCONIA PROJECT
SULPHIDE DEVELOPMENT
+ 400,000 oz resource
Zirconia production
Yttria-Rare Earth production
Niobium-Tantalum production
EXPLORATION
WA
NSW - Lachlan Fold Belt
Nickel-Gold
Diamonds
MAJOR JOINT VENTURE
Jubilee Mines
TOMINGLEY PROJECT
- Wyoming Gold 110,000 oz ++
Gold, Nickel-Copper
Porphyry Gold-Copper,
VMS Copper-Lead-Zinc
MAJOR JOINT VENTURE
Newcrest
LKANE
NSW
PROJECT
LOCATIONS
LKANE
Regional
Geological
Setting
PARKES - NARROMINE
LKANE
Tomingley
Gold
Project
Location
LKANE
Wyoming
Drillhole
Summary
Wyoming One
LKANE
Wyoming One
LKANE
Wyoming
One
Section
3375mN
LKANE
Wyoming
One
Long Section
Drill hole with mineralisation
(Results in g/t Au)
Other drill hole
Volcaniclastic hosted hanging
wall mineralisation
"High grade" contact mineralisation
Porphyry hosted mineralisation
Alluvium
Volcaniclastic sediments
Feldspar porphyry
Fault
Geological boundary
LKANE
50mRL
Wyoming
One
50mRL
Interpretation
LKANE
Wyoming
Drillhole
Summary
Wyoming Three
LKANE
Wyoming
Three
200mRL
Interpretation
LKANE
Wyoming
Three
Idealised
Oblique Section
LKANE
TOMINGLEY GOLD PROJECT
Longitudinal Section - Wyoming
50m
LKANE
100m
200m
TOMINGLEY GOLD PROJECT
Ridgeway Section
Wyoming One Section
2001/2 drilling
2003 infill and drill
to 250m vertical depth
Potential
41 million tonnes @ 2.4g/t Au 0.75Cu 3.2M oz
LKANE
?
Tomingley Project
Aeromagnetic Images
Tomingley
Wyoming
LKANE
Peak Hill
Tomingley Gold Project
Aeromagnetic Image
T1
W4
W3
W1
LKANE
TOMINGLEY GOLD PROJECT
Development Concept - Wyoming
Target Resource
:
500,000 to 1,000,000 ounce
Target Production
:
75 - 100,000 ounce per year
Total drilling since May 2001 ~ 40,000 m in 363 aircore, RC and core holes
Total expenditure A$1.1 million
Further 15,000 m RC and core resource drilling scheduled first half 2003
5,000 m target development aircore drilling planned till June 2003
Revised resource assessment and development scenario September 2003
Further metallurgical work, environmental and pre-feasibility studies
Budget 2003 A$2.0 million
LKANE
Tomingley Gold Project
Wyoming Prospect
LKANE
Tomingley Gold Project
Wyoming Prospect
Wyoming Three
Wyoming One
LKANE
Tomingley Gold Project
Wyoming Prospect WY376
Rimas Kairaitis
Terry Ransted
LKANE
Tomingley Gold Project
Wyoming Prospect WY154D
Feldspar Porphyry
LKANE
Tomingley Gold Project
Wyoming Prospect WY154D
Altered porphyry
LKANE
Tomingley Gold Project
Wyoming Prospect WY337D
Gold in altered porphyry
LKANE
Discovery
Sequence
EL5675
Wyoming Four
WY044
3m @ 0.94g/t Au
Significant Drill Holes
WY179
60m @ 1.72g/t Au
11m @ 5.85g/t Au
Wyoming Three
WY029
16m @ 1.71g/t Au
Wyoming Two
Pre Alkane holes
Pre 2001
Alkane WY046-068
May- June 2001
WY065
14m @ 3.29g/t Au
WY031
11m @ 1.03g/t Au
WY009
9m @ 0.67g/t Au
WY376
76m @ 9.06g/t Au
Wyoming One
Alkane WY069-174
Aug 2001 - Jan 2002
Alkane WY175-324
Jun - Sep 2002
Alkane WY325-408
Oct - Jan 2002
LKANE
EL5830
McPhails
NSW
PROJECT
LOCATIONS
LKANE
PEAK HILL GOLD MINE
High Sulphidation Epithermal Gold Copper System (Ordovician)
Conventional Open Cut Mining, Agglomeration Heap Leach
Dump Leach of Oxidised Cap
Production Commenced 1996 at Capital Cost $5 million
Mined 3.385Mt @ 1.91 g/t Au and 1.499Mt @ 0.78 g/t Au
1996-2002 Output 145,000 ounces
Cash Operating Surplus $14 million
Production 2003 Estimated 5 -10,000 ounces -> cash flow~ $2m
100,000 to 500,000 ounces in sulphide deposit from 100m to 300m
Oxide mining ceased October 2002 , production continues to 2005
LKANE
PEAK HILL GOLD MINE
PIT NOV 1998
LKANE
GEOLOGY
PEAK HILL
0
3 km
LEGEND
Alteration zone
Gold ore body
Phyllite
Siltstone and sandstone
Andesitic Volcanics
LKANE
PEAK HILL
Alteration
Zonation
Mineralisation
LKANE
PEAK HILL
CROSS SECTION
PRD 2, 5, & 6
87m @ 2.53g/t Au, 0.22% Cu
0
14m @ 5.66g/t Au
0.35% Cu
100m
12m @ 5.26g/t Au
0.43% Cu
LEGEND
Major Ore Zone
(silica-sulphide)
Argillic alteration
152m @ 1.49g/t Au
0.02% Cu
214m @ 1.33g/t Au
0.22% Cu
130m @ 1.56g/t Au
0.23% Cu
Propylitic alteration
Oxide Open Pit
20m@ 4.46g/t Au
0.11% Cu
LKANE
12m @ 4.90g/t Au
0.38% Cu
DUBBO ZIRCONIA PROJECT
SUMMARY
• Project based upon large Jurassic aged alkaline volcanic complex
with highly metal enriched vertical trachyte intrusive
• One of the worlds largest zirconium, yttrium and tantalum
resources (+ 100 million tonnes) - also contains significant
niobium and rare earth elements
• Zirconium metal Zr
zirconia
ZrO2 (+HfO2)
• Niobium metal Nb
• Tantalum metal Ta
niobium pentoxide
tantalum pentoxide
Nb2O5
Ta2O5
• Yttrium metal Y
• Rare earth elements REE
yttria
rare earth oxides
Y2O3
REO’s
LKANE
DUBBO ZIRCONIA PROJECT
Project Site and Infrastructure Location
DUBBO ZIRCONIA PROJECT
photo geology
LKANE
DUBBO ZIRCONIA PROJECT
Geology
0
200
metres
LKANE
DUBBO ZIRCONIA PROJECT
RESOURCES
Measured Resource
:
35.7 million tonnes grading
1.96% Zr02, 0.04%HfO2, 0.14% Y2O3
0.46% Nb2O5, 0.03% Ta2O5
and 0.75% REO
:
37.5 million tonnes at similar grades
:
73.2 million tonnes
0 - 55 metres
Inferred Resource
55 - 100 metres
TOTAL
LKANE
185
184
190
200
200 -MY
- 190
210 MY
MY
Erosion
or explosive
Mineralised
trachyte capped
removal
bulktrachyte
of
by older of
domal
volcano
10 - 15 km
DUBBO ZIRCONIA PROJECT
Geological Model
LKANE
4. INTRUSION
OF
3. TRACHYTIC
DOMAL
PHASE
2. COMPOSITE
VOLCANO
1. BASALT
FLOWS
AND
SHEETS
MINERALISED
TRACHYTE
Trachytic tuff and lava
cone
Present
Remnant trachyte tuffs
and basalt flows
TOONGI BODY
Dowd’s Hill
10 - 15 km
DUBBO ZIRCONIA PROJECT
Geological Model
LKANE
5. EROSION
Present day land surface
Dubbo Zirconia Project
DUBBO ZIRCONIA PROJECT
ORE MINERALOGY
Zirconium
eudialyte
ZrSiO4 ± Ca, Y,
REE, H2O
Yttrium
yttrium silicates
and with Zr
YSiO4 ± REE, Be,
Fe, As, Nb
< 50mm
Niobium/
Tantalum
natroniobite
NaNbO3 + Ta
also NbFeSiO4
< 30mm
calcian
basnaesite
Ca(REE)(CO3)F
rare ancylite
Sr(REE)(CO3)H2O
Rare Earths
< 2mm - 100mm
< 100mm
LKANE
DUBBO ZIRCONIA PROJECT
PROCESS FLOW SHEET
LKANE
LKANE
DUBBO ZIRCONIA PROJECT
Mini Pilot Plant - Roaster
DUBBO ZIRCONIA PROJECT
Mini Pilot Plant - SX Circuit
DUBBO ZIRCONIA PROJECT
INDICATIVE FINANCIALS
Conceptual Project at 200,000tpa
Production - ZrO2 (+HfO2)
Y2O3 + REO :
Ta2O5/Nb2O5 :
Revenue -
:
3000tpa
1200tpa
600tpa
<8% world
<8% world
minor
$40.0 to $50.0 million
Operating Costs -
$30/32 million (base case - reducible)
Capital Costs -
$ 80.0 / 90.0 million (reducible)
PROJECT LIFE + 250 years ??
LKANE
DUBBO ZIRCONIA PROJECT
Project Site Layout
LKANE
DUBBO ZIRCONIA PROJECT
Current Summary
Advanced discussions in progress with existing major
zirconia producer
Agreement anticipated by the end of the March Quarter 2003
Incoming party to earn an interest by funding construction and
operation of demonstration pilot plant
Will provide product development technology and existing markets
Will provide access to development funding
Development decision anticipated early 2004
LKANE