Sierra Morena Exploration (15 M USD)

Sierra Morena Exploration Ltd (“SME”) is an Australian company (ACN 161 147 235) incorporated on 8/11/2012.

SME is a Joint-Venture partner (51%) in Kazakhstan with Technogaz (49%) regarding re-treatment of two mining waste projects: Shymkent (slag) and Achisai (clinker).

SME wants to borrow USD 15,000,000 to pay for its 51% share in the JV (USD 7,000,000) and develop a production facility (USD 8,000,000). It will take 6 months to bring Shymkent into production at the rate of 1,000,000 tpa throughput. From 3rd quarter after funding USD 7 MM approximately are expected as free cash flow. Investment incentives enacted by Kazakhstan at the beginning of 2015 provide for 10 years’ exemption from company tax and a number of other taxes.

Using funds from cash flow from Shymkent, a second project, Achisai, will be taken to production. There are four further projects subject to the JV with Technogaz on similar terms.

SME has more retreatment projects in the pipeline in Chile, France, Spain, UK (Wales), Philippines, Australia, China, Russia, North and West Africa, Zambia.

SME has a JV in Spain regarding the “Os Biocos” ancient Roman gold mine which is said to have produced 300,000 oz of gold for its owner, the Roman Emperor, some 2,000 years ago, from digging to just 15-25 m depth, by the Roman LEGIO SEPTIMA FELIX, using just spades and shovels. Since it is a primary, not an alluvial deposit, we consider chances are high to find the primary source of the gold underneath the old pits. We target a deposit of > 1,000,000 oz of gold. Assuming a gold price of USD1,300/oz and production costs of USD 800/oz, that’s USD 500 MM profit before Spanish company tax.