Avenir Makatea Pty Ltd MAKATEA PROJECT Information
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Avenir Makatea Pty Ltd MAKATEA PROJECT Information Memorandum February 2020 [Type text] Page 1 Important Information 1. This document has been prepared by Avenir Makatea Pty Limited (“Avenir Makatea” or “Company”) for the purpose of providing a company and technical overview to interested investors. None of Avenir Makatea, nor any of its related bodies corporate, their respective directors, partners, employees or advisers or any other person (“Relevant Parties”) makes any representations or warranty to, or takes responsibility for, the accuracy, reliability or completeness of the information contained in this document to the recipient of this document (“Recipient”) and nothing contained in it is or may be relied upon as, a promise or representation, whether as to the past or future. 2. The information in this document does not purport to be complete nor does it contain all the information that would be required in a disclosure statement or prospectus prepared in accordance with the Australian Corporations Act 2001 (Commonwealth). 3. This document is not a recommendation to acquire Avenir Makatea shares and has been prepared without taking into account the objectives, financial situation or needs of individuals. Before making an investment decision prospective investors should consider the appropriateness of the information having regard to their own objectives, financial situation and needs and seek appropriate advice, including financial, legal and taxation advice appropriate to their jurisdiction. Except to the extent prohibited by law, the Relevant Parties disclaim all liability that may otherwise arise due to any of this information being inaccurate or incomplete. By obtaining this document, the Recipient releases the Relevant Parties from liability to the Recipient for any loss or damage that it may suffer or incur arising directly or indirectly out of or in connection with any use of or reliance on any of this information whether such liability arises in contract, tort (including negligence) or otherwise. 4. This document contains certain “forward-looking statements”. The words “forecast”, “estimate”, “like”, “anticipate”, “project”, “opinion”, “should”, “could”, “may”, “target” and other similar expressions are intended to identify forward looking statements. Indications of, and guidance on, future earnings and financial position and performance are also forward-looking statements. You are cautioned not to place undue reliance on forward looking statements. Although due care and attention has been used in the preparation of forward looking statements, such statements, opinions and estimates are based on assumptions and contingencies that are subject to change without notice, as are statements about market and industry trends, which are based on interpretations of current market conditions. Forward looking statements including projections, guidance on future earnings and estimates are provided as a general guide only and should not be relied upon as an indication or guarantee of future performance. 5. Recipients of the document must make their own independent investigations, consideration and evaluation. By accepting this document, the Recipient agrees that if it proceeds further with its investigations, consideration or evaluation of investing in the Company it will make and rely solely upon its own investigations and inquiries and will not in any way rely upon this document. 6. This document is not and should not be considered to form any offer or an invitation to acquire Avenir Makatea shares or any other financial products, and neither this document nor any of its contents will form the basis of any contract or commitment. In particular, this document does not constitute any part of any offer to sell, or the solicitation of an offer to buy, any securities in the United States or to, or for the account or benefit of any “US person” as defined in Regulation S under the US Securities Act of 1993 (“Securities Act”). Avenir Makatea shares have not been, and will not be, registered under the Securities Act or the securities laws of any state or other jurisdiction of the United States, and may not be offered or sold in the United States or to any US person without being so registered or pursuant to an exemption from registration. 7. The potential quantity and grade of the exploration target identified herein are conceptual in nature, and there has been insufficient exploration to date to define a mineral resource in accordance with the JORC Code. Furthermore, it is uncertain if further exploration at the exploration target will result in the determination of a mineral resource. CONTENTS 1 SUMMARY ................................................................................................... 4 2 LOCATION .................................................................................................... 7 3 HISTORY OF MINING ON MAKATEA ................................................................ 11 4 GEOLOGICAL SUMMARY ............................................................................... 15 5 THE PROJECT .............................................................................................. 24 6 CORPORATE STRUCTURE ............................................................................... 28 7 Sustainable Development on MAKATEA ISLAND ............................................ 30 8 PHOSPHATE QUALITY .................................................................................. 32 9 RESOURCES ................................................................................................ 35 10 SCREENING/DRYING/PACKAGING/TRANSPORT ................................................. 36 11 MARKET .................................................................................................... 37 12 MINING/REHABILITATION ............................................................................. 38 13 Infrastructure ......................................................................................... 40 14 Definitive Feasibility Study .................................................................... 40 15 Benefits to French Polynesia .................................................................. 41 CONTACTS .......................................................................................................... 41 1 SUMMARY HIGH LIGHTS * MAKATEA – A UNIQUE PHOSPHATE/REHABILITATION/ECO-TOURISM PROJECT * HIGH GRADE PHOSPHATE * MOANA ORGANIC PHOSPHATE – OMRI CERTIFIED * HIGH VALUE ORGANIC LIMESTONE/DOLOMITE OVERLAY PHOSPHATE * LONG TERM DEMAND FOR PHOSPHATE * COMPANY HAS APPLIED FOR 50 YEAR MINING CONCESSION * BEDDED PHOSPHATE * UNMINED PHOSPHATE SAND ALSO IDENTIFIED * SIMPLE OPEN CUT MINING OPERATION * NO PROCESSING - JUST SCREENING AND DRYING * LONG LIFE * FEASIBILITY STUDY DEMONSTRATES STRONG ECONOMICS * REHABILITATION OF OLD MINED AREAS ON MAKATEA * VALUE ADDED BY BRANDING PRODUCT AND SELLING PACKAGED * INVOLVEMENT IN THE CIRCULAR ECONOMY * ECONOMIC BENEFIT TO ALL OF FRENCH POLYNESIA * EMPLOYMENT IN A COUNTRY WITH HIGH UNEMPLOYMENT * STRONG SUPPORT FROM LANDOWNERS AND GOVERNMENT * NEW MINING CODE AND FISCAL CODE FOR EXTRACTIVE INDUSTRIES 4 EXECUTIVE SUMMARY • SAS Avenir Makatea (Avenir Makatea) has since 2010 been developing a combined phosphate mining/rehabilitation/eco-tourism operation on the island of Makatea. • Makatea is 240km north east of Tahiti in French Polynesia. • Over a third of the island was mined for phosphate sand from 1906 to 1966. Over the 60 years some 11 million tonnes of phosphate sands, dug by hand, was exported to Japan, New Zealand and Australia. • Mitsui was the buyer of Makatea phosphate for Japan starting in 1920 and apart from interruption during the Pacific War was the buyer for 40 years. • Both Japanese trading houses of Mitsubishi and Mitsui have expressed strong interest in offtake agreements. French and US based fertiliser companies have also expressed interest in marketing Moana Organic Phosphate • While the island presents topographical, environmental, social and logistical challenges, the proposed combined phosphate mining/rehabilitation /ecotourism project has strong economics and local support for this development. • Makatea is elevated island with 70m cliffs, 4km by 6km, and with a chaotic karst environment with an estimated over 1 million holes ranging in depth from 1m to 45m and between 2-10m in diameter. There are interconnected fresh water filled caves/grottoes under the island. • Avenir Makatea has identified and sampled a previously unmined bedded phosphate within the already mined area and recognised a resource of 6.5 million tonnes which includes phosphate sand not recovered in the initial mining. • The proposed new mining operation will rehabilitate 600 ha of the old mining area. • Avenir Makatea was granted an Exclusive Research Permit (ERP) on 24th July 2014 for the entire old mining area on Makatea Island. The ERP covers approximately 1,036 hectares. • The Permit for 3 years was extended for a further 3 years and remains afoot. • Avenir Makatea applied in July 2016 for a Mining Concession over the previously mined area. The Mining Concession is for a period of up to 50 years. • Avenir Makatea Pty Ltd exclusively works on this project and with $3.5 m invested to date. The funds provided by project initiator Colin Randall and since 2016 also by Tony Haggarty. • SAS Avenir Makatea is a wholly owned French Polynesian subsidiary of Avenir Makatea Pty Ltd (The Company). • SAS Avenir Makatea has a French Polynesian as its Managing