Transcription of Finance News Network Interview with Apollo Minerals Limited (ASX:AON) Chief Operating Officer, Dominic TisdellDonna Sawyer: Hello I’m Donna Sawyer from the Finance News Network and joining me from Apollo Minerals Limited
(ASX:AON) is Chief Operating Officer, Dominic Tisdell. Dominic welcome back to FNN.
Dominic Tisdell: Pleasure to be here Donna.
Donna Sawyer: Apollo Minerals is an iron based and precious metals explorer with projects locally and abroad. Where exactly are they located and which is your main focus?
Dominic Tisdell: Donna, we’ve got a portfolio of three iron ore projects, Commonwealth Hill in South Australia, Mt Oscar in Western Australia and in Gabon, we’ve got a project called Kango North on the west coast of Africa. Our base and precious metals focus is in the Gawler Craton in South Australia, a premier copper gold province.
Donna Sawyer: Let’s talk about your Commonwealth Hill project in South Australia. What is your exploration target and what have you uncovered so far?
Dominic Tisdell: We’ve only been at it, hard at work for around about two years or less than, basically since the Woomera prohibited area became open formally for exploration and mining. In that time, we’ve stated an initial iron ore exploration target of over 0.5 billion tonnes. We have our maiden JORC compliant iron ore resource of approximately 70 million tonnes. And we’re looking to develop a stage one, medium scale iron ore operation of 2.5 million tonnes per annum, based on that resource.
Donna Sawyer: You also have the Titan base and precious metals projects in South Australia. What have the results shown so far?
Dominic Tisdell: It’s a very exciting place to be. We’re essentially at the frontier of the world class iron ore copper gold province which hosts world class deposits, such as BHP’s
(ASX:BHP) Olympic Dam and Oz Minerals
(ASX:OZL) Prominent Hill copper gold mines. We believe there’s a very good chance of uncovering the next one of these large, high quality copper gold deposits. We’ve recently drilled the first target which is called Acacia East; assays are pending and should be back in the next two to three weeks. And we’re currently getting ready to drill the next target, which we call Bundi which is very very large and potentially again, a very high quality target.
Donna Sawyer: What’s scheduled next for the Bundi prospect and when would you expect to make the target drill ready?
Dominic Tisdell: Bundi – we’re working hard to get Bundi drill ready by Quarter three or at the latest, Quarter 4 this year. It’s a very large target, we’ve already finished surface sampling and it’s highly anomalous in copper. And we’ve recently completed the first past year physics to identify the shape and potentially, scale of this prospect. We’d like to complete that work over the next Quarter, so we understand its full size and potential and be ready to drill it, come Quarter three or Quarter four this year.
Donna Sawyer: Let’s talk about your Mt Oscar project in the Pilbara region of Western Australia. How do you plan to advance the project this year?
Dominic Tisdell: Mt Oscar’s a difficult project for us, but we believe is quite valuable. Effectively we have half of the Mt Oscar deposit. Our neighbours Fox Resources
(ASX:FXR) have a joint venture with a coking coal producer, who is spending over $20 million on that project. We believe our half is equally as valuable or potentially more. The Pilbara is infrastructure constrained, particularly port capacity is very limited, so we view Mt Oscar as a medium term development plan. We’ll continue studying that project, particularly its economics and prepare to bring that into production once the infrastructure is solved.
Donna Sawyer: How does the Kango North project in Gabon Africa compliment your portfolio and what are your plans for that project?
Dominic Tisdell: Kango North obviously is our only offshore project, so that’s quite a difference in terms of how we manage that project compared to our Australian projects. It took a long time to acquire that project, but we’re very happy that it’s in the portfolio. We believe it’s a very high quality project and potentially, be very low capital in operating cost. So it should be able to survive any market in any part of the commodity cycle. It is early stage exploration and we’re getting ready to do the initial JORC compliant drilling program on that, to prove up the initial resource. But we believe with time and for relatively low cost, that’ll be a very profitable project for us.
Donna Sawyer: Apollo Minerals recently inked a strategic partnership with your major shareholder, India’s third largest steel producer, Jindal Steel & Power. Tell me about the terms of that deal and what’s the significance of it?
Dominic Tisdell: Jindal’s a very sophisticated and large business; they’re capped at around about $12 billion listed on the Indian Exchanges. They’re also quite a sophisticated miner in their own right and they’re looking to acquire additional raw materials to feed into their steel making facilities. They’re very particular about product quality, and that was one of the key reasons why they’ve decided to partner with Apollo Minerals. We can produce these high quality products. Ultimately the big advantage for us is we’ve got a ready-made customer in Jindal and somebody with the financial muscle, to provide the capital to help turn the mine into a reality.
Donna Sawyer: You had an overwhelming response to your $1 million Share Purchase Plan last month. Where are you going to deploy those funds?
Dominic Tisdell: With the money coming from Jindal, which will be $10 million for effectively a little over a 50 per cent interest in the iron ore. That’ll obviously be deployed to the iron ore projects, particularly Commonwealth Hill in South Australia. We were very pleased with the response we had from the SPP. Effectively we had offers for almost $2.4 million, but the SPP was capped at $1 million. All of that money will be going into the base metals exploration, principally for the targeting and potentially drilling of the Bundi prospect.
Donna Sawyer: Finally Dominic, Apollo Minerals share price has seen a lift in the year to date. What are you expecting to drive that price through the rest of 2013?
Dominic Tisdell: Obviously it’s been a particularly different year for everybody, but we believe Apollo has performed relatively well to its peers. We believe that the catalyst this year will be the demerger of the iron ore and the base metals projects, where we should be able to achieve full value for those two different commodity classes and return a lot of that money, to our existing shareholders through In Specie share distribution.
On the project front, obviously we’ll be re-engaging with Jindal and pushing the iron ore projects ahead, starting the prefeasibility study in South Australia and doing more resource drilling. On the base metals front, obviously we’ve got a very exciting prospect in Bundi, potential for a world class copper and gold deposit there. We’ll be looking to drill that, hopefully with some great results. And there are other prospects that are earlier stage but likewise, we’ll be looking to inform the market of their potential.
Donna Sawyer: Dominic Tisdell thanks for the update to Apollo Minerals.
