an emerging coal company - australian securities exchange filean emerging coal company investor...

An Emerging Coal Company

Investor UpdateWilsons HTMMarch 2011F

or p

erso

nal u

se o

nly

Cautionary Statement

The information contained in this document (Presentation) has been prepared by NuCoal Resources NL and Doyles Creek Mining Pty Limited (Company). This Presentation does not constitute an offer or invitation to any person to subscribe for or apply for any securities in the Company.

While the information contained in this Presentation has been prepared in good faith, neither the Company or any of its shareholders, directors, officers, agents, employees or advisers give any representations or warranties (express or limited) as to the accuracy, reliability or completeness of the information in this Presentation, or of any other written or oral information made or to be made available to any interested party or its advisers (all such information being referred to as ‘Information’) and liability therefore is expressly disclaimed. Accordingly, to the full extent permitted by law, neither the Company nor any of its shareholders, directors, officers, agents, employees or advisers take any responsibility for, or will accept any liability whether direct or indirect, express or limited, contractual, tortious, statutory or otherwise, in respect of, the accuracy or completeness of the Information or for any of the opinions contained in this Presentation or for any errors, omissions or misstatements or for any loss, howsoever arising, from the use of this Presentation.

Neither the issue of this Presentation nor any part of its contents is to be taken as any form of commitment on the part of the Company to proceed with any inaccuracies in, or omissions from, this Presentation which may become apparent. The right is reserved to terminate any discussions or negotiations with any person. In no circumstances will the Company be responsible for any costs, losses or expenses incurred in connection with any appraisal or investigation of the Company. In furnishing this Presentation, the Company does not undertake or agree to any obligation to provide the recipient with access to any additional information or to update this Presentation or to correct any errors.

This Presentation should not be considered as the giving of investment advice by the Company or any of its shareholders, directors, officers, agents, employees or advisers. Each party to whom this Presentation is made available must make its own independent assessment of the Company after making such investigations and taking such advice as may be deemed necessary. In particular, any estimates or projections or opinions contained in this Presentation necessarily involve significant elements of subjective judgment, analysis and assumptions and each recipient should satisfy itself in relations to such matters.

This Presentation may include certain statements that may be deemed ‘forward‐looking statements’. All statements in this discussion, other than statements of historical facts, that address further activities and events of developments that the Company expects, are forward‐looking statements. Although the Company believes the expectations expressed in such forward‐looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results or developments may differ materially from those in the forward‐looking statements. The Company, its shareholders, directors, officers, agents, employees or advisers, do not represent, warrant or guarantee, expressly or impliedly, that the information in this Presentation is complete or accurate. To the maximum extent permitted by law, the Company disclaims any responsibility to inform any recipient of this Presentation or any matter that subsequently comes to its notice which may affect any of the information contained in this Presentation. Factors that could cause actual results to differ materially from those in forward‐looking statements include market prices, continued availability of capital and financing, and general economic, market or business conditions.

Investors are cautioned that any forward‐looking statements are not guarantees of future performance and that actual results or developments may differ materially from those projected in forward‐looking statements.

ASX Code: NCR Slide 2

For

per

sona

l use

onl

y

Corporate Strategy

Explore ‐ advance exploration, studies and approvals at the Doyles Creek project;

Develop ‐ the Doyles Creek Project (coal operation and Training Mine Facility) to generate a positive cash flow;

Acquire ‐ Expand the project portfolio to become a multi‐mine coal producer, by targeting acquisitions that allow the Board and Management team to enhance value.


For

per

sona

l use

onl

y

Snapshot


Market cap:A$302 million – S & P All Ords listed

Cash:A$31 million (at 21/3/11)

Key Project:Doyles Creek Underground Mine andTraining School(100%) Hunter Valley NSW

Management:MD : 11 years Xstrata (ex‐GMunderground operations)

Pre Feasibility Study:Commenced January 2011

Infill/upgrade drilling program underway – 3 rigs: (approx‐ 20‐25 holes)

Coal Products:Semi‐soft coking, Thermal

Total exploration drilling program to date: 19 holes completed

Industry Training Facility:Australia’s 1st – industry backedwith strong strategic partners

Capital Raise:Successful Institutional Placement ‐ $30m Feb 11

Asset acquisitive:Targeting opportunities with synergy / value add opportunity

Resource:497.7 million tonnes

For

per

sona

l use

onl

y

Location


Doyles Creek (100%) Hunter Valley NSW

• Close to major infrastructure

• Rail• Port• Workforce• University

• Within current coal region

For

per

sona

l use

onl

y

Corporate Overview


Shares on issue 644.3 million

Market cap. A$302.8million

Cash (18 Feb 2011) $31 Million

Enterprise Value $271.8 million

Options on issue nil

Share price (as at 18/3/11) A$0.47

Capital Structure Significant Shareholders

Major shareholders Equity %

Taurus Funds Management 19.5%

Pooles Australia Pty Ltd 7.5%

Sparta Group 7.4%

Aquila Resources 3.9%

ASX Code: NCR

For

per

sona

l use

onl

y

Company Journey to date


For

per

sona

l use

onl

y

Performance to Date

ASX Code: NCR Slide 8Source-RBS Morgans

Comparable Company performance on a TSR basis compared to peers over the last 12 months has been superior at 182.5%F

or p

erso

nal u

se o

nly

Key Asset – Doyles Creek


o Granted EL 7270 over 2,778 hectares December

2008 for a term of 4 years

o Independently assessed 497.7 mt JORC inferred

coal resource

o Current resource calculation on 5 mineable seams

o Coal extraction planned by underground longwall

mining methods

o Adjacent to United Collieries (Xstrata) and Wambo

Mine (Peabody Energy)

o NuCoal owns 240 hectares of land (for surface

infrastructure) over the exploration area and has a

signed agreement to purchase a further 280

hectares in 2013. This provides 520 hectares of

contiguous land across the exploration area.For

per

sona

l use

onl

y

Current Drilling


For

per

sona

l use

onl

y

Drilling Results


o Results from DCM 001 ‐ 019:

Targeted seams are similar in thickness or thicker than anticipated

Whynot Seam quality exceptional ‐ 6% av ash, CSN 4‐7, 7300kcal/kg, low moisture and sulphur

Additional Whynot coal identified due to a thicker seam section in some areas ‐ (2.3m ‐3.8m)

Whynot Seam potential to sell as ROM product (100% yield) and delay construction of CPP 8‐10 years

Multi Seam longwalling possible.

For

per

sona

l use

onl

y

Concept Study Outcomes


Draft mine plans laid out in 5 target seams

30 year mine life anticipated for single seam scenarios

Seven potential product transport corridors identified

Total capital estimated at $500m – excludes a Coal Preparation Plant for the initial 10 years

Economic modelling indicates financially robust project in excess of 20% IRR

For

per

sona

l use

onl

y

Conceptual Mine Plan ‐Whynot


For

per

sona

l use

onl

y

Path to Production


For

per

sona

l use

onl

y

2011 Milestones


April – Engineering Manager commences on project team

April ‐ Secure water licence

April ‐ Apply for Industry and Investment Concept Plan approval

May‐ Lodge Major Project Application and Preliminary Environmental Assessment (PEA) to Department of Planning

July‐ Nominate for port access with PWCS

July‐ publish updated JORC Statement including in ‐ fill results

December – Port allocation results published

December – publish updated JORC statement including in ‐ fill results

For

per

sona

l use

onl

y

Centre of Excellence


A project to establish a Centre of Excellence in:

o Mining

o Training

o Education

o Research

For

per

sona

l use

onl

y

Strategic Partnerships


Hunter Valley Training CompanyVocational education and training resources and employment

Doyles Creek Mining Pty Ltd Finance, mine management and operation and coordination of research, training and education

University of NewcastleResearch & Development, Undergraduate and Post Graduate education andplacement of students

Westpac Rescue Helicopter ServiceParamedic training, OHS training and rescue simulations

For

per

sona

l use

onl

y

Doyles Creek Mining Scholarships/Trainees/Apprentices


o Five Students from The University ofNewcastle have been selected as theinaugural recipients of the DoylesCreek Mining Scholarships in EarthSciences (Geology)

o Trainee Drillers have been employedon the drill rigs used on the project

o A trainee exploration Geologist isemployed on the project

o Five Apprentices were employedJanuary 2011, in conjunction withHunter Valley Training Company.For

per

sona

l use

onl

y

NSW – Strategic Land Use Planning


The NSW Coalition has released a Land Use Policy, to be implemented if they form Government, aimed at protecting valuable food sources, underground aquifers and existing agricultural businesses.

NuCoal has been working on a number of planning initiatives for 12 months that will dovetail into the requirements of this proposed policy ‐

A comprehensive Hydro ‐ geological Study has been underway, in conjunction with exploration drilling, since mid 2010 to understand and protect any aquifer systems in the EL area;

Agricultural land uses within the EL will be reviewed and included in any project application;

The Doyles Creek Underground project is being designed to have minimal impact on the neighbouring Thoroughbred Breeding Industry and local Community, using best practice underground mine planning techniques;

An independent legal audit of compliance to the comprehensive EL conditions has been undertaken for the Board since August 2010 and will continue to be updated quarterly.For

per

sona

l use

onl

y

Good quality resource – nearly 0.5 billion tonnes of resource – Underground proposal (long wall mining )

Potential 30 year mine life at IRR > 20% Located near major infrastructure Australian First Underground Coal Training School Company well capitalised – recent $30 million placement completed

Experienced and competent management team Pre‐feasibility and Environmental Studies underway.

Summary


For

per

sona

l use

onl

y

Competent Person StatementThe Resources estimate is based on information compiled by Dr. Ian Stone, who is a Member of the Australasian Institute of Mining and Metallurgy (102087). Dr. Stone is Manager, Geology of Palaris Mining Pty Ltd. He has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity he is undertaking to qualifyas a Competent Person, as defined in the 2004 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Dr. Stone has over 30 years experience in exploration and mining of coal deposits. Dr. Stone consents to the inclusion of this Resource Estimate in reports disclosed by the Company in the form in which it appears.

For

per

sona

l use

onl

y

APPENDIX

For

per

sona

l use

onl

y

Probity Review and EL compliance


Recent media coverage on the proposed audit of all mining Exploration Licences (EL’s) in NSW by the NSW Coalition, should it win the upcoming State election, has highlighted the Doyles Creek Underground Project currently being developed in the Hunter Valley by NuCoal Resources NL (“NuCoal” or “Company”).

In response, NuCoal’s Managing Director, Glen Lewis, said :

“NuCoal supports the Coalition’s proposed review of Exploration Licences and its recently announced Strategic Regional Land Use Policy. We believe the policy has the potential to result in appropriate strategic regional land use plans which can minimise conflicts between mining and our communities, and we are pleased that the Coalition has consulted widely to make this matter a priority after the election.

In addition, an independent probity review on the granting of this EL was conducted by O’Connor Marsden & Associates 18 months after the awarding the Licence to Doyles Creek Mining. In their report of 23 August 2010 the probity adviser stated in part:

“….it would appear that the then Minister acted within the powers afforded to him under the legislation in granting the EL to DCMP. There are a number of examples where direct allocations have been previously made by previous Ministers.” (Page 5)

“NuCoal takes the conditions of its EL very seriously, and the Company has fully complied with its obligations. In addition, our compliance with the current comprehensive EL conditions has been independently assessed by an independent law firm every three months since August 2010, in accordance with NuCoal’s internal compliance regime and this practice will continue indefinitely.”

Source: NuCoal ASX release 2/3/11

For

per

sona

l use

onl

y

80-200m

140-320m

150-350m

200-420m

240-570m

40m


For

per

sona

l use

onl

y

o 35 coal mines

o 14 producers

o 27 loading points

o 80 different brands of coal

o 34 end buyers

o 12 countries

Strategic Location – Hunter Valley


For

per

sona

l use

onl

y

Infrastructure Growth

PWCS T4 next

step


For

per

sona

l use

onl

y

Terminal Projects Updates

Source: HVCCCASX Code: NCR Slide 27

For

per

sona

l use

onl

y

Land Ownership ‐ outright or under contract

Calago Bloodstock


For

per

sona

l use

onl

y

Training Panels

Conceptual Mine Plan – West Borehole


For

per

sona

l use

onl

y

Training Panels

Conceptual Mine Plan ‐Whybrow


For

per

sona

l use

onl

y

Training Panels

Conceptual Mine Plan – Redbank Creek


For

per

sona

l use

onl

y

an emerging coal company - australian securities exchange filean emerging coal company investor...

Documents