Massart Mineral

Resources, Inc.
OFFSHORE MAGNETITE SAND MINING PROJECT
Negros Occidental, Philippines

Hongkong, January 13, 2015

2010 Area - 28,766.7

Hectares

2014 Area - 18,405 Hectares

Reserve Estimates and Projected Income

Old Exploration New Exploration
Parameters
Statement*
Permit
Permit
Total Area

28,766

18,405

1,947,701,220

1,202,348,411

Explored Area (5,000 hectares)

Resource (Black Sand) (Measured and Indicated) (Metric Tons)

3.28

Specific Gravity
% Magnetic Fraction
Total Iron Ore (Metric Tons)

Parameters
Total Area
Explored Area (5,000 hectares)
Total Iron Ore
Recoverable Iron Ore (75%)**
Estimated Buying Price (US$/MT)
(Ave. Buying Price, FOB, from 2010-2014, MGB)
Gross Value (US$)
Less - Estimated Cost @ US$30/MT (operating costs, taxes,
social,
envtal, etc)
Net Income (US$)

2.65 and 2.617

9.40 and 8.41

12.71 and 10.70

109,893,792

137,098,166

Old Exploration New Exploration

Permit
Permit

28,766

109,893,792
82,420,344
50
4,121,017,200
(2,472,610,32
0)
1,648,406,880

18,405

137,098,166
102,823,625
50
5,141,181,225
(3,084,708,735)
2,056,472,490

* Based on Philippine
Mineral Reporting Code
(PMRC) and MGB
Validation Report
** MGB Estimates

Potential of the unexplored areas

Parameters
Unexplored area @ 50% Mineable
Thickness (Assumed) (Meters)
Specific Gravity (PMRC CP Report and
MGB Validation, Average)
% Magnetic Fraction (Assumed, Average)
Resource (Black Sand) (Metric Tons) (Potential)
Total Iron Ore (Metric Tons) (Potential)

Parameters
Total Iron Ore (Estimated)
Recoverable Iron Ore (75%)
Estimated Buying Price (US$/MT) (Ave. Buying
Price,
FOB, from 2010-2014, MGB)
Gross Value (US$)
Less - Estimated Cost @ US$30/MT (operating
costs,
taxes, social, envtal, etc)
Net Income (Potential) US$

Old Exploration
Permit

11,883
10.00
3.28
8.91
3,902,377,200
347,701,809

Old Exploration
Permit

347,701,809
260,776,356
50

New
Exploration
Permit

6,703
10.00
2.60
11.71
1,742,650,00
0
204,064,315
New
Exploration
Permit

204,064,315
153,048,236
50

13,038,817,820 7,652,411,813
(4,591,447,08
(7,823,290,692)
8)
5,215,527,128 3,060,964,725

MGB Approval Process (Current)

Exploration Permit
(EP)

Conduct Exploration
Activities
Prepare PMRC
Compliant Competent
Geologist Exploration
Report

Mineral Production
Sharing
Agreement
(MPSA)

Declaration of
Mining Project
Feasibility (DMPF)

(5,000 hectares)

Validated of PMRC
Exploration Report
Secure Environmental
Compliance Certificate
(ECC)
Support of Local
Government Units
(LGU) Endorsements
Finalization of
Feasibility Study
Environmental, social,
safety and Health
Programs/Plans
Conduct of Survey
Proof of financial and
technical capabilities

EO
79

Validated PMRC
Exploration Report
PMRC Compliant
Competent Geologist
Exploration Report
Approved DMPF
ECC
Endorsements of Local
Government Units (LGU)
Approved Feasibility
Study
Environmental, social,
safety and Health
Programs/Plans
Approved Survey and
clearances

DENR Administrative Order No. 2014-06

July 24, 2014

Meeting with Sec. Juico, Arch. Gavieta with MGB Dir. Jasareno last December
2014

Allows expansion of existing MPSAs with available mineral/resource, subject to

validation by the Mining Industry Coordinating Council thru its Technical Working
Group

Recommended the integration of the EP to an existing MPSA in the area

Approval of the
Offshore Mining
Guidelines

Mineral Production
Sharing Agreement
(MPSA)
Incorporation
in the MPSA

Mining Industry
Coordinating
Council (MICC)
Validation by the MICC
Technical Working Group

Amendment of
MPSA

Massart Area

Competent Person
Geologist Final
Exploration Report
Validated PMRC
Exploration Report
ECC
Endorsement of Local
Government Units
(LGU) Approved
Feasibility Study
Approved
Environmental, social,
safety and Health
Programs/Plans
Amended Survey and
clearances
Financial and

Commercial
Operations

Estimated costs to comply EO 2014-06

Activity

Estimated
Timeframe

Costs (PhP)

Soft Costs (PhP)

Remarks

Incorporation of
Massart Exploration
Permit into an
existing MPSA

90 days

To Be Determined
(TBD)

TBD

Massart and Existing

MPSA Holder

Approval of Offshore
Mining Guidelines

90 days

TBD
Lobby costs?

As per meeting with

MGB

60 days

2,500,000

TBD

Approval and release

of ECC

after approval of Guideline

2 Million - LCI
500k support
activities

Presentation and
approval by the Mining
Industry Coordinating
Council (MICC) of the
MPSA amendment

90 days

TBD

TBD

Completion of
Declaration of Mining
Project Feasibility
(DMPF) Documents
and Approval

60 days

5,500,000

TBD

4.8M Axceltechs
700k Support
activities, filing fees,
charges

TBD

TBD

By DENR Secretary
as recommended by
MGB Director

Approval of the MPSA

Amendment

after release of ECC

TBD

Massart Philippine Group

Unresolved 2014 to 2015 Commitments and

Obligations
Exploration
Permit Renewal and Commitments
BUDGET REQUEST

DETAILS
Please note that previous
EP Application Renewal Fee (18,404.9422
calculation is only for
hectares)
14,907.831 hectares, thus the
discrepancy
Community Development and
2013-2015
Environmental Commitments
In case of the order of
EP Application for Relinquished Area
mandatory relinquishment
(3,497.1112 hectares)

AMOUNT
PhP300/ hectare

TOTAL
5,521,500

4,000,000
PhP300/ hectare
(+) Other related
Activities

2,000,000

Total

9,521,500

AMOUNT

TOTAL (PhP)

3,910,000

2014 Personnel and Consultants Obligations

BUDGET REQUEST
2014-2015 Outstanding Massart
Obligations (Advance by SJ)
Atty. Edsel Victor B. Velasco
(Legal Consultant)
AXCELTECHS, Inc.
(Technical Consultant)

DETAILS
Personnel (Sept 2014 June
2015)
February June 2015
February June 2015

PhP50,000/
month
PhP100,000/
month
Total

800,000
1,600,000
6,310,000