Audio file

KGL Resources (ASX-KGL) - Mining & Resources Investor Webinar - November 2023 1.mp4

Transcript
00:00:04 Speaker 1

1st we are joined by KGL Resources with the ticker code KGL, a company focused on the
development of their Geo Voice Cocker project in the NT. So to tell us more today I am
joined by executive Chairman Dennis Woods. Good morning, Dennis.

00:00:21 Speaker 2

Good morning. I hope all well, alright. So yes, you're right. I'm executive chairman. I've
been with the company for eight years. Although I retired when I was 70, only got away for
eight months before I had to come back. But well and truly experienced in this particular
project and where it's heading and quite frankly, all right guys.

00:00:41 Speaker 2

The ladies? Ohh no. Alright. Well, the one that was just up there. I want to make it very clear
is please take notice of the disclaimers and forward-looking positions on that on that
notice. Obviously we're a public company and there's there's some issues there that it
really must be addressed.

00:01:01 Speaker 2

So let's forget that I want to start by just talking about Copper first, because given the
amount of time I've got the copper work, it could take miles longer. I've.

00:01:13 Speaker 2

I took this job on eight years ago because I was very well in touch and in charge or in on top
of copper production, particularly in the major mines in South in in South America, and
realised that copper was going to become very, very essential.

00:01:35 Speaker 2

Long and short of it is.

00:01:38 Speaker 2
Me and the major shareholders agreed that what we do is focus on bringing this company
into a 10 year my life with a reasonable grade if that was possible. Now what we did do is
for the last.

00:01:53 Speaker 2

Pretty well. Six years we focused on exactly that and we've boarded up to over a 10 year
mine life with an average grade of 2%.

00:02:02 Speaker 2

Now that 2% is very, very high, but the long and short of it is I'm I was correct that the
international copper producers are getting into trouble. They will be running out and they
their costs are starting to fly out the roof. What I didn't take into account.

00:02:21 Speaker 2

Is that going green the way the governments globally are going to go? Copper is even more
essential, so there's not going to be enough copper produced.

00:02:31 Speaker 2

And there's going to be a much bigger domain for copper for the government to reach their
green, their green requirements going green, requirements. Almost everything they do
requires more copper. So I'm not gonna talk about the detail if you want to. We had a 40
odd page report that I did sociated with.

00:02:51 Speaker 2

One of our announcements we've done recently on the expiration and it went to the federal
government, the federal government have really.

00:02:59 Speaker 2

So and they are currently reassessing copper as a strategic mineral and given what's
happened globally and the number of other countries, including America that have, I'm
sure the Australian Government will and given our position going forward with all our
licences that the deposits all jacked up.

00:03:20 Speaker 2

We've finished the fees. I'm sure we're going to get some help, but.

00:03:25 Speaker 2

To take our position now forward to start talking about this particular slide.
00:03:30 Speaker 2

We really do.

00:03:31 Speaker 2

Have we're in Australia, we're in the northern territories and NT, we've got all our licences,
we've got a large copper system with lots of potential and at the moment.

00:03:44 Speaker 2

23 million tonnes of copper, copper resource and it's still in the places we've been drilling
opened at depth. The high high grade copper reserve is 2.1%, which if people know what's
going on globally that's that's in fact when you look.

00:04:02 Speaker 2

At some other places, we're almost 1010 times better on on reserve on our reserve quality.

00:04:11 Speaker 2

Now we did finish a feasibility study last November and that was reasonably positive.
However, we've got been doing a lot of extra optimising on that.

00:04:22 Speaker 2

Now our site as well is highly prospective. We've got three particular areas that we're
working on now, reward bellbird and rockface.

00:04:32 Speaker 2

But frankly, they're probably very small percentage of the potential deposit, which we'll talk
about a bit later. We are employing the experienced team now or two very experienced
directors in when I took back over 18 months ago.

00:04:53 Speaker 2

And we're just employed as CFO and CEO with a lot of experience and we're getting ready
now to take the project forward. We do have a Glencore off take agreement and the great
bonus to that is that we're only trucking it to Mount Isa from where we are. So yeah,
admittedly it's a a reasonable drive, but.

00:05:13 Speaker 2

We're not having to ship it all rail. It's our carbon footprint. Because of that, simply because
of the extra grade is is very good, it's and OK and we have a very supportive investment
group.
00:05:27 Speaker 2

So just looking at how we've got to where we are, I took over early in 2016. What we've done
is focused on the copper alone. Now there has been a lead zinc mine on site and the pre
fees that was done before I turned up did have lead zinc in it. We certainly have lip sync as
a possibility, but because of the need for copper, we're focused on that.

00:05:48 Speaker 2

To be able to get the finance to be able to build the project. So we started that in 2016 by
focusing on a new deposit that I had found that.

00:05:57 Speaker 2

Face and we continued doing that. Now that took a couple of years to prove that it would
be enough before we start the infill drilling. So in that time I went and got the mining leases,
I got our EIS approved our we did approve feasibility study. We've completed our
arrangements and agreements with the traditional.

00:06:19 Speaker 2

Criticism of Central Land Council.

00:06:22 Speaker 2

We've acquired the lease around us like a Creek, which has increased our potential quite,
quite significantly. Our EIS was lodged and passed our mine management plans being
accepted. We've got our underground and surface water licences. So fundamentally
everything's being done and we finished the.

00:06:41 Speaker 2

These last November.

00:06:43 Speaker 2

What we've done since then is growing the team here and doing the optimising which
which we'll talk about in detail.

00:06:53 Speaker 2

All right, this is a quick summary of our copper resource that you'll see. I joined the
company late 2015 and quite frankly, the grades are all about 1% and you know that we we
realised the shareholders at that time which included me of course realized that that
would not be enough and be what we found at what place was suggesting.
00:07:13 Speaker 2

Look, yeah.

00:07:14 Speaker 2

So fundamentally for the next couple of years, I've focused just on it. And quite frankly, I
was really the only geologist working on it. We were pretty small team because we'd run
and the company had run out of money for the third time when I took it over and I was
underwriting the rights issue to get it going. But the long and short of it is it's worked lovely.
We're up to.

00:07:34 Speaker 2

2% now and fundamentally we did. Why a lot of the old resource out that was dropped
because of the low grade nature on it and that's helped bring the grade up. But we do now
have a 11 1/2 year mine life.

00:07:49 Speaker 2

We are targeting 30,000 tonnes of copper a year and we do have an off take with Glencore.

00:07:57 Speaker 2

This is the feasibility study highlights, of course, what to suggest you do if you're interested
that you go to our last November, our announcement on this, the long and short of it is it
does change a lot depending on where you think copper price is going to go.

00:08:13 Speaker 2

And where you think the exchange rate will go, they're both important for long and short of
it is where we did it. We did it fairly conservatively at what was predicted to be the copper
price by by the experts and the exchange rate, which is meet future demand there, which is
IRR of 40%.

00:08:33 Speaker 2

And, but the bullish price forecast at the time would have taken it to 49%.

00:08:39 Speaker 2

But the details for all of this have been made public and on our on our e-mail address, the
web address. Alright, So what we have done and you know I'm I'm very well aware it's same
as the board of what happens if you start a production construction like this.

00:08:59 Speaker 2
Company and not get it done on time.

00:09:01 Speaker 2

In delays and you only gotta look what's going on with builders in Australia and with the
governments with their infrastructure and everything that's going on, you've gotta get it
done on time. So the main purpose of the optimising that we've got into has been working
on our mine plan and the process plan, which I'll do a bit more detail on shortly, but.

00:09:21 Speaker 2

We've also got optimizing with our contract management because we're not a mining
company. We are using tier one contractors for the process plant and the mini.

00:09:32 Speaker 2

Government support we are certainly working on that when we do expect the federal
government to make copper a very strategic mineral and we've also in it looking at
increasing the the size and the greater the resource and what we have been working this
year is to bring the first two years of mining.

00:09:52 Speaker 2

Up to measured status so that we would get financed so the the real purpose for the
optimising is to to make sure we can construct it on time.

00:10:04 Speaker 2

Alright, the mine clean optimizing, so just be quick on this. We've expanded the current
minds, but we've changed the mine plan from the fees. We're no longer bringing
undergrounds in early. We're focusing on the open cups and as a consequence, I think of
reduced our mining costs. We've doubled the size of the mining.

00:10:25 Speaker 2

Equipment we're using, so we've hardly made a liver for the open cuts. So the main bigger
area of of improvement here.

00:10:32 Speaker 2

Was that I took the plant up to from 1.6 to 2,000,000 tonne a year because the open cuts
are lower grade and this will still allow us to stay at 30,000 tonnes of of copper a year. We
have optimised the flotation design which is the majority of the processing and we're using
Jameson cells from Glencore which we made in Australia.

00:10:53 Speaker 2
Which will help reinforce that. But we've also redesigned the rest of it to look at optimising
it to reduce the amount of people that are that are necessary.

00:11:03 Speaker 2

Workplace potential. That depth you can see here. This is fundamentally the downhill EMS
of rock face of the previous drilling of graves. And you know it was getting a little bit weaker
at the bottom. So but what I did do this time around is I drilled a hole 575, there are 120
meters.

00:11:23 Speaker 2

Think it was 130.

00:11:25 Speaker 2

Metres below the.

00:11:25 Speaker 2

Mine plan and it's come out about 5 metres at 2.43. The other two we drilled there come
home. One of them come home at 12 at 2.6.

00:11:35 Speaker 2

And the other one was 3.59. So obviously increasing the depth that rock faces are real
advantage and it's potentially still going deeper. So we've got an opportunity here to to
keep expanding the potential at rockface.

00:11:55 Speaker 2

Bill bird. Sorry. Yeah. Reward, as I said.

00:11:59 Speaker 2

We've expanded the open cut, we've doubled the size of the equipment, the long and short
of it is, it's our largest deposit that we've got at the moment. And The funny thing is from the
structured Jay, it's the furthest one away, which is a bit unusual, but there's still plenty of
copper resource around it and including there if you see.

00:12:19 Speaker 2

Down hole EM at Marshall deeps. The down hole EM has been fairly positive for us at tech.

00:12:24 Speaker 2
Really where? Where the copper is and it's it. In fact, it rock faces, there's superb. But we
do have plenty of chance to expand, to be more its growth, but also there's potential of
lead, zinc there as well. There's quite a large amount of lead zinc around.

00:12:41 Speaker 2

Exploration potential. Look, that's it that we call it the J. You'll see there that the just look at
the picture, it's got a 2 white squares or two lines around it. That's our two leases, the
Gerboise lease and the one I bought.

00:12:55 Speaker 2

That that funny Jay structure going down towards the middle and bending round that is all
resource that's about 14 kilometres long. You follow that Ridge around and there's a
couple of ridges about 3:00. But for most of it following that around, the Big J and copper,
pretty well outcomes at the top of all of it. Plus there's a lot of dense, a lot of.

00:13:15 Speaker 2

Density and downhill and gravity appointments underneath it. The on the left side of that
going sort of pretty well vertically, but diagonally a little bit, you'll see a big fault. That's a
massive Gerber's fault. That's actually moved 6 kilometres.

00:13:31 Speaker 2

And quite frankly, it is very responsible for what's happened in our we're at 1.7 billion year
old lease, highly metamorphosed and the one the other side of that fault, that's it sticks
probably 3500 metres out the ground and runs along the whole western edge of our our
lease that that moved.

00:13:50 Speaker 2

As I said, 6 kilometres and it's moved twice and it's period. So quite frankly, all that
structural move.

00:13:56 Speaker 2

Proof on that exploration program I have focused for eight years on the deposits. We knew
the three they're on that there now you can see the red and blue one, that's the reward one
at the halfway up the J and then down in the J, you've got one-on-one side that's bellbird
and then you've got rock face. So we have only really focused on them.

00:14:19 Speaker 2
But there is plenty of other opportunity and it, to my personal opinion, is after spending
eight years on the geology here is I think a lot of the Super stuff's gonna be at much lower
and we're actually just about to start next year. We'll be looking at some of the lower lower
opportunities.

00:14:38 Speaker 2

Alright, so a current share prices about $0.16 it had been 70 before the copper price
started to go back down and I left, we've got about 600 million shares.

00:14:52 Speaker 2

We've got a market cap getting onto 100 million.

00:14:57 Speaker 2

And the women? Sure, that is we. Normally if we're raising cash at the current level.

00:15:04 Speaker 2

And the major shelters are very, very solid and supporting most of them have been there
since this company started. And that's years before I joined it and they brought me in funny
enough and a couple of other major ones have come in since and they're all here like I am.
And that's to get this underway to actually get it producing copper because of the need for.

00:15:25 Speaker 2

The absolute definite need for copper plus the absolute potential on this site of finding
more.

00:15:32 Speaker 2

And you know, 16% of the companies institutional funds, I'm not a big Fund supporter,
although I do support Paradise a lot. They've supported me before and they're 5.6 percent
10% so owned by the directors pretty well all that's mine and KMP, the major shell.

00:15:51 Speaker 2

From a selling group from Indonesia and they've been a massive supporter of this project,
this company ever since it started. So the top 20 shareholders actually owned 76%.

00:16:02 Speaker 2

And if you look to the the graph on the left, you'll see that what has happened, which was
totally not expected and predicted, is the copper price has come down. And that's sort of
dragged down share price down with it. You can see there that the share price and copper
price are in one-on-one.

00:16:20 Speaker 1

But that was a great presentation and I would encourage.

00:16:23 Speaker 1

For our users to use the to reach out to Dennis directly, they've got further questions via the
contact details on the bottom of their ASX releases. But Dennis, thank you again for your
time.

00:16:33 Speaker 2

Thank you.