New Nzuri Copper Research Report

Just sharing a report I helped put together on Nzuri Copper

www.lmtd.com.au

Summary:

Kalongwe Mine Development

• • 11MT at 2.7%Cu and 0.27%Co, 2.29MT at 0.57%Co (13.29MT total)
  • 80% oxide ore starting from surface, simple deposit geometry and low strip ratio.
  • 85% ownership.  Remaining 10% local partner GICC, and 5% DRC government.
  • Fully permitted in mining friendly area, close proximity to Ivanhoe project (<25km) and Kolwezi (45km)
  • Stage 1 mine: 1mtpa HMS concentrator
    • NPV10 of USD 176m (100% project) or 150m (pre-tax NZC share)
    • 9 month payback period from production start
    • Capex of USD 39m estimated
    • Minelife currently 5 years, work underway to expand to 8 years (results due in 2019)
  • Potential stage 2 project:  Heap Leach SX-EW
    • We estimate potential incremental NPV10 of USD 153m or 130m (pre tax NZC share)
    • Dependent on ongoing heap leach testing and power infrastructure coming online within 5 years for nearby Ivanhoe project
  • Definitive feasibility underway and due Q3 2017, mining to start Q3 2018
  • Reduced financing risk as key shareholder Tembo Capital (57.4%) is keen to see this through to production and cashflow

Exploration JV with Ivanhoe Mines “Fold and Thrust Belt JV”

• 334km2 of license in JV with Ivanhoe. NZC can earn up to 98% interest ( Ivanhoe can claw back up to 30%)

• • Potential for discoveries capable of supporting a standalone operation and smaller discoveries to convert to satellite pits that feed the central Kalongwe processing plant

Can expect to add roughly USD 80m to annual net cash flow to Stage 2 for every extra 1MT of 2% CuEq ore discovered during exploration.