Xanadu Mines
Financials:
Primary tickers: ASX:XAM, TSX:XAM
Stage of development: Exploration, Development
Primary minerals: Copper, Gold, Silver
Project to promote: Kharmagtai Copper-Gold Project
Project location: Mongolia
Website: www.xanadumines.com
Xanadu Mines Limited leverages a deep understanding of Mongolia, its people, and demonstrated technical capability, to discover & define critical minerals, currently focused on gold rich copper deposits in the South Gobi. We give investors exposure to globally significant, large-scale copper-gold-silver discoveries underpinned by low-cost inventory growth. Xanadu maintains a portfolio of advanced stage exploration through to PFS ready projects, with a dedicated focus on realising maximum valuation. Our flagship, Kharmagtai project is one of the few large scale, long-life, low-cost copper deposits globally, that will be supplying copper-gold concentrate in 5 years. In addition, Xanadu currently owns Red Mountain and is actively seeking new South Gobi battery minerals projects.
Cash: AUD5.1M (Corporate) + USD26.8M (Kharmagtai JV)
Debt: NIL
Major Shareholders:
Zijin Mining – 19%
Asia Capital & Advisors – 14%
Management Ownership – 9.2%
Map of Projects
Management Profile
Colin Moorhead – Executive Chairman and Managing Director
Mr Moorhead is an experienced industry executive with a demonstrated track record of over three decades building value in mining companies through innovation, discovery, project development and safe, efficient operations. Colin has extensive experience in development and financing significant mining projects internationally. He also has experience with global mining operations as well as experience in successful mergers & acquisitions.
A geologist by training, Colin is known for strong leadership, strategy and execution that saw him rise through the ranks from a graduate with BHP in 1987 to an executive level manager responsible for global exploration and resource development at Newcrest Mining from 2008 to 2015, a period of significant growth for the company. Colin has significant relevant experience as CEO of emerging Indonesian listed producer PT Merdeka Copper Gold Tbk, where he built and led the team that constructed and commissioned the highly successful Tujuh Bukit Gold Mine. Colin is a Fellow, Chartered Professional and Immediate Past President of AUSIMM, a graduate of AICD and Harvard Business School Advanced Management Program (AMP).
Spencer Cole – Chief Development Officer and Chief Financial Officer
Spencer is a commercial and project development executive with more than 20 years in the resources sector across multiple disciplines of commercial, financial, engineering and operations. He has held corporate, operational and commercial roles in Australia and Indonesia with ABA Resources and Newcrest Mining and in the United States with ExxonMobil and Northrop Grumman. He was formerly CFO of Xanadu Mines and previously held the positions of General Manager Commercial at ABA Resources and General Manager Project Delivery at Newcrest Mining.
Spencer holds a MBA from University of Southern California, a MS-Eng from California Polytechnic University, and a BS-Eng from University of California Davis. He is a member of CPA Australia and AusIMM.
What is your rationale for taking part in 121 Mining Investment?
Seeking to meet with investors with capacity to buy XAM on market. Well funded post Zijin Mining’s acquisition of stakes at both company and project level, with remaining A$59M cash banked in March 2023. Kharmagtai Pre Feasibility Study (PFS) and aggressive Discovery Exploration program underway, post receiving PRC approval in March 2023. Furthermore, Red Mountain discovery exploration program has drill-ready targets, where we are seeking to define a meaningful high grade shallow gold, copper, silver resource.
What recent news would you like to highlight to investors attending?
4 October 2023 – High Grade Core shaping up at White Hill
24 August 2023 – Kharmagtai Grid Connection Fully Commisioned
9 August 2023 – Further higher-grade drilling results at Stockwork Hill
31 July 2023 – Investor Quarterly Update Presentation
19 July 2023 – New High-Grade Copper-Gold Zone Emerging at White Hill
5 July 2023 – Shallow drilling confirms Kharmagtai potential
7 June 2023 – New Higher Grade Zones found in Kharmagtai Infill Drilling
23 May 2023 – High Impact Drilling Programme at Kharmagtai
13 April 2023 – Kharmagtai Pre-Feasibility drilling commences
What are your key goals in 3 months, 6 months, 12 months?
3 Months:
* Remaining infill/expansion drilling results
* Further shallow discovery drilling results
* First deep discovery drilling results
* Mineral Resource Estimate Upgrade
* Initial Optimisation results
* Sulphide (main orebody) detailed metallurgical test-work results
* On track for delivery of construction projects: camp upgrades, and core processing facility
6 Months:
* Further shallow discovery drilling results
* Further deep discovery drilling results
* Hydrological drilling program completes
* Updates on Kharmagtai PFS technical studies
* First Oxide (overlying main orebody & currently treated as mineralised waste) metallurgical test-work results
* Final Optimisation results
* Outcomes from Water Reserve study, Power Supply selection, Tailings Storage Facility (TSF) location and design, and other supporting surface infrastructure requirements expected
12 Months:
* PFS including maiden Ore Reserve completed. Targeting production growth, incorporating new capital targeting a reduction in operating cost, through multiple real upside opportunities to minimise waste, reduce emissions and add value
What do you see as the key risks and challenges facing your company at the moment and how are you overcoming these?
* Mongolia government is seeking to accelerate foreign investment, especially from mining, given its rich mineralised potential
* They are working towards a more simple, transparent and competitive mining code and policies (more akin to successfully developed mining jurisdictions such as Australia).
* Upcoming revisions to attract further investment are coming for both the Mining Code (recently reshuffled pro business parliament), Investment Law and new Investor Protection council.
* Xanadu’s Country Manager & Executive Director Ganbayar Lkhagvasuren is very well connected politically in Mongolia, and a committee member of the New Mining Code Advisory Group.
* Given the timeline for revisions to the Mining Code, we’re expecting both of Xanadu’s mining licences to be favourably impacted.
What do you think makes your company such a compelling investment?
* Following strategic partnership with Zijin, our flagship project Kharmagtai PFS is fully funded, including funding for high impact discoveries at both, Kharmagtai (in progress) and 100% owned Red Mountain (working up targets and planning to recommence drilling). Current XAM focus is Kharmagtai, with 5 diamond drill rigs drilling for new exploration discoveries (4x rigs on shallow, 1x rig on deeps), plus follow-up extensional drilling planned around the newly identified high grade core at White Hill deposit.
* PFS to optimise and enhance project has been ramped up to full activity, targeting Decision to Mine in 2024, and production in 2027
* Attractive “Go Forward”; unique opportunity to be funded all the way to Kharmagtai commercial production, with Put Option agreement, which Xanadu holds the right to Call.
* Delivery of Kharmagtai Maiden Ore Reserve targeted for 2024, following an expected upgrade in Mineral Resource beyond the current 3Mt copper & 8Moz gold (currently 50% in Indicated confidence category), with mineralisation intercepts already delivered which expand upon the current resource boundary.
* For a XAM change of control deal, a post-investment offer is required from Zijin, subject to board endorsement and subsequent XAM shareholder approval.
What are the top 3 key investor takeaways?
1. Kharmagtai copper gold project has low ESG risk, well funded to decision to mine, with first concentrate production targeted for late 2027.
2. Plenty of opportunities for discovery exploration at both projects.
3. Kharmagtai PFS targeting production growth, incorporating updated capital targeted at reducing operating cost, through multiple real upside opportunities aimed at minimising waste, reducing emissions and adding serious value.