Meeka Metals Limited

Thank you, Lawson. It’s great to be here to introduce you to our company. The business: Western Australian-focused gold producer, market cap $350 million. A projected cash position at the end of September, so the end of this month, of $50 million. And importantly, no debt and no hedging. So we retain full upside exposure to the gold price.

As I mentioned, our focus is in Western Australia. Our principal asset is the Murchison Gold Project where we began producing mid last year. Over the last two years, we’ve invested significant capital in developing and expanding that asset to deliver a stable long life, ten-year production plan. Now, importantly, I guess a point I’ll make there is when we raised money to build this mine, this asset, over the last two years, we’ve raised $135 million. We’ve subsequently invested over $170 million in building and expanding all of the support infrastructure, commencing new mines. So all of the things that we need to support that long life mining operation.

So where I’m going with this is, this last twelve months has been a period of ramping up the processing plant, getting operations set up and established, but also aggressively reinvesting that operating cash flow into the business. And we’re now at a point where that capital investment is starting to taper off. So we’ve built all of the support infrastructure, all of the mines – well, most of the mines. There’s one mine that we’re just about to commence development on this week, and I will talk to that specifically in this presentation. But we’re getting to the point where that investment phase is starting to taper and we’re transitioning to underground mining, which will deliver an improved grade profile into the processing plant.

So we’re at that point, a bit of an inflection point if you like, where over the coming months and quarters, we’re likely to see an improvement in grade into the plant and at the same time see a tapering of expenditure. Tapering of or reduction in our monthly cost profile. So that’s meaningful. That’s gonna drive an improved performance in terms of free cash flow and profitability.

We have a competitive advantage, if you like, in that we operate our underground mines with our own workforce and equipment. It’s an owner/operator arrangement that gives us increased flexibility. We feel a very strong ability to recruit, and a cost advantage in that we’re not paying contractor margins. And to that point around recruitment, we have a highly capable team in place. Not only the managerial and administration team that operate this asset, but also the underground workforce that is operating our existing underground mine and the workforce that we need for our second underground mine that’s just in the process of being developed.

And finally, an asset that we acquired, a growth opportunity if you like, an asset that we acquired in August of this year that we see an enormous amount of prospectivity from, from both resource growth in the near to medium term and then beyond that, a second operating center at Mount Holland. So combined a resource base of 1.5 million ounces. And we feel with the combination of that cash flow generating asset in the Murchison and a highly prospective growth opportunity at Mount Holland, a really compelling investment opportunity.

Our first full year as a producer, so the last twelve months, we ramped up our processing plant, commissioned that, ramped it up. Commenced development and then subsequently in the June quarter just gone, stoping production at our first underground mine. Mined a series of open pits and have now curtailed open pit mining and transitioning entirely to underground mining. And through that twelve-month period, lots going on. We mined 55,000 ounces, processed or produced just under 30,000 ounces as we ramped up the processing plant. And importantly generated meaningful operating cash flow. So just under $90 million of operating cash flow. Net profit, just over $50 million. And as I said, invested a significant amount of that operating cash flow back into the business, expanding the infrastructure, setting ourselves up for that long mine life that I spoke to.

The operating footprint is relatively compact. All of our support infrastructure is up in the north, northwestern tenements. We’ve got our accommodation village there, all of our administration infrastructure, our processing plant. All of the things that we need to administer and run our mining operations, as well as the first underground mine that we developed about twelve months ago in Andy Well. We are now just in the process of establishing our second underground mine at Turnberry, 20 kilometers to the southeast. And where we wanna be in six to eight months’ time is have that processing plant fed entirely from underground sources. So right now we’ve got a mix of existing surface stockpiles from open pit mining in combination with the material that we’re producing from Andy Well as we ramp that up. So the next six to eight months, that grade through the plant is gonna improve meaningfully with the increased volume of underground material.

Andy Well, our first underground mine, this is a mine that we accessed mid last year. Very high grade resource, 8.8 grams per ton. We’ve got half a million ounces in resource. We think that’ll grow through drilling. We’re drilling there now. What we’ve seen as we’ve opened up this mine is our productivity – as you’d expect, you open up the mine, establish more work areas, your productivity improves, and that’s certainly the case. Over the last twelve months, we’ve seen meaningful improvement in productivity. What we have in front of us over the next twelve months is we’re gonna access a number of new areas. We know from the drilling that the grade and the strike improves at depth. So that’s all in front of us.

The first twelve to eighteen months of mining is relatively shallow. We’re within that top 200 meters from surface. If you look at the cross-section on the left-hand side, that shows the loads, if you like, or the sheets of high-grade mineralization that we’re mining. There’s a series of en echelon high-grade loads. It’s a little bit easier to see in plan view on this slide. And what we’ve found as we’ve opened up, we started mining on the Wilbur lode on the western side. In the June quarter, we established access to Judy North, which is in the central part of that slide there. In the next few weeks, we’ll establish access to Susie, which is a resource to the southeast. And with that, the number of available work areas has increased meaningfully. That gives us added flexibility. That flexibility drives productivity.

Now, that’s certainly been the case with our development. Our jumbos, our development drills are achieving between 250 and 300 meters per month each, which is quite productive even in the Western Australian space. And we expect that productivity to continue and potentially improve as we open up further work areas. Now, we started stope production from this mine late in the June quarter, so we’re three months into that process. It’s similar to what we expected with development. It took us four to six months to really ramp up and get effective productivities out of the development drills. We expect that same timeline from a production perspective. So started stoping late in the June quarter. We expect over the next few months that stope production will improve meaningfully, driving an increase in high-grade material delivered to the mill. And that’s principally, as I mentioned, as we open up the mine, get a little bit more flexibility around the number of work fronts that we’ve got for producing from.

Just to give you an idea of the grades that we can expect out of this mine now. The grades that you see on the left-hand side of the slide there, that’s the full-width face grades, development grades, if you like. It includes both the ore and waste. We target an ore drive development width of 3.8 meters, so we keep it reasonably tight. Even though it’s quite narrow development, it’s larger than we would like, and it’s predominantly to get the equipment in there. From a stoping perspective, our stopes will be more in line with two meters of width. So if you look at the grades there, still reasonably good. That’s probably a worst case scenario, if you like. So if we get excess dilution over and above what we’re anticipating, that’s likely what will be delivered to the mill. But we anticipate it’s gonna be a lot tighter than that and a lot better grade than that.

Development is performing in line with the resource, which is pleasing. We’ve got a long track record of mining prior to our ownership of this asset and historical reconciliations has been slightly positive over that time. So that’s encouraging and we’re certainly seeing that as well.

Similar to the Wilbur lode, this is the Judy lode, so off to the east of Wilbur. The main point that I wanna make here is, as well as just pointing out the development grades that we’re seeing, the reserve is the high grade hundred or so meters of strike that you see on the left-hand side of the slide there. And that’s again performing as expected. But what we’re also seeing is additional material out to the north of that reserve. Now, not as high grade in places as we see in the area where the reserve is, but certainly from an incremental perspective, we’ll add value from an ounces and tons per vertical meter perspective.

The other point that I’ll make is the drilling that we’ve done in this area suggests that the grade improves at depth as well as the strike. So where we’re going from a strike length of approximately 100 meters in the upper levels that we’re mining in the top of the ore body now, that’s likely to double and in places triple to two to three hundred meters of strike. And again, this resource has had very little drilling at depth, so we expect not only resource growth, but also that continuation of high-grade material.

Now, our second underground mine, you can see in the background the development drills just working in the bottom of the pit. So we’ve been establishing the infrastructure to support this mine over the last six months. What you can’t see just off to the left-hand side of the image is all of our administration workshop infrastructure. So all of the facilities that we need to operate this mine productively and efficiently. You can see down in the bottom of the pit the development drills putting in the surface ground support. And we’ll cut the portals for this mine in the next few days and expect to be producing ore out of here early next year. Call it January of next year. Power station, all of the support infrastructure’s in place, as well as the workforce and the equipment that we need to mine this ore body.

The production plan’s relatively straightforward, top-down mining sequence. The ore body itself averages about eight meters wide. There’s areas in the central part where it’s up to fifteen to twenty meters wide, so it’s a bulk stoping type arrangement. Much broader zones of mineralization relative to what we see at our first mine at Andy Well. And the other point that I’ll make is the drilling we’re doing below the reserve. You can see those call-outs at the bottom of the slide there. Broad zones of high-grade mineralization. And that points to a significant increase in the likely reserve, or the mine life, if you like, that we’re likely to be able to recover from this asset. So drilling’s ongoing. We expect results periodically through the next three to six months as we continue to drill out those deeper extensions.

Now, our growth opportunity at Mount Holland. This is a project that we acquired in August of this year, so a couple of months ago. The reason we like this asset is the grade. The historical production, 1.2 million ounces at over five grams, that’s not a resource grade. That was actually what was recovered through the processing plant. Now we don’t own Bounty, which produced that, but we own the geology. We have tenure over the geology to the south of that. Principally, our largest resource at present is at Blue Vein, five kilometers south of Bounty. Very similar to Bounty, hosted in a banded iron unit. The banded iron has sub-parallel shearing. That shearing is what hosts the gold.

So what we see at Blue Vein is very much analogous to Bounty. And if you have a look at the comparison on the bottom left-hand side of the slide, similar strike, same style of mineralization, same host geology, just lacks that drilling at depth. And Bounty, while it only has a relatively short surface projection, one kilometer of strike, it extends down below 1.3 kilometers of depth. It’s been mined down to a kilometer. It’s got another 300 meters of resource below that. It remains open at depth.

Now, outside of Blue Vein, we have another 24 kilometers of north-south striking banded iron units. That’s the principal host I mentioned of the gold in the region. Highly prospective. And in addition to the prospective geology, it lacks meaningful exploration over the last fifteen years. So this asset has been housed within a lithium-focused business, within Wesfarmers’ SQM joint venture. They have a lithium mine in the central part of our tenure, hence we don’t have access to that. And because of that lithium focus, it hasn’t received the gold-focused work that we wanna do over the next eighteen to twenty-four months.

Specifically, on this image you see it, it’s an aeromagnetic image. The north-south striking hotter zones in that image, those are the banded iron units. They light up in the aeromag. On the left-hand side to the west of Bounty, where our principal resource is, we’ve got a twelve-kilometer zone of anomalous gold. There’s modest resource in the north, but drilling to the south of Razorback has received no follow-up work. So you’re looking at shallow, fifty to eighty-meter-deep drill holes that’s hit gold, plus one gram per tonne gold. It has never been followed up. Particularly the area around Hamlet, we view that as highly prospective. Again, sparse drilling, shallow drilling, has hit gold, has not been followed up, and that’s a function of being housed within a lithium-focused business. The core on the left, that core’s from Blue Vein, but it’s very similar to what we would expect to see at Bounty and the style of mineralization that we’d be chasing on the western side of that corridor.

So finally, if I can just point out, while there’s a modest resource over the project, Blue Vein has 250,000 ounces, reasonable grade, 2.5 grams per tonne, very little drilling. So this resource, outside of the greenfields exploration, which I mentioned, that western corridor, this resource itself has, we feel, enormous opportunity to grow. The southern portion of the resource has relatively sparse drilling below 200 meters deep. Good grades in those drill holes, but the northern part of that resource doesn’t have any meaningful drilling below 100 meters. And I mentioned Bounty, five kilometers to the north, 1.2 million ounces of production, very similar to what we see here, extends down 1.3 kilometers below surface. What’s off slide there to the right is there’s drilling further north. So the resource extent there is roughly one kilometer. But we’ve got drill holes to the north of that outside of the resource that have also hit gold. So that’s likely to grow with further drilling as well.

Now, if I can leave you with two key points. One is our existing operation in the Murchison, we’re through an intensive investment phase. The expenditure profile is starting to taper off there. In addition to that, we’re at an inflection point from a grade perspective. So we’re transitioning from open pit mining to underground mining. We have one underground mine feeding into the processing plant. In the next three to four months, we’ll start to get ore from the second underground mine that we’re just about to cut the portals on. So we’ll see an improved head grade through the plant over the next three to four months, driving an improved production profile at the same time as we’re seeing our expenditure profile diminishing. That non-recurring capital investment that we’ve made over the last eighteen to twenty-four months to establish the asset doesn’t need to be spent again. So our expenditure profile’s tapering off, and that’s gonna drive improved free cash flow, improved margin.

And then the second point that I’ll make is while there’s a modest resource, 270,000 ounces at Mount Holland, we feel that has potential to grow significantly, and certainly grow to the point that it would support a standalone development. In the next 18 to 24 months, we wanna get in there and do that drilling. Drilling’s gonna start early next year, and we think that’ll be quite impactful given a lot of those greenfields regions on the western corridor haven’t had any follow-up work in the last 15 years, and certainly no deeper drilling below those anomalous shallow RAB and air core drill results. So I’ll leave you with that. Thank you very much for your time, and appreciate it.

That was fantastic. Exciting presentation, Tim. Thank you very much.

Thank you. [audience applauding]