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Near and Medium Term Aggregate (Gravel/Sand) Production in Canada

Highbank Resources Ltd.

Overview

Highbank Resources (TSXV:HBK) is a Canadian mineral exploration and development company. The company has a significant NI 43-101 compliant 72,000,000 ton measured and indicated aggregate deposit. The deposit lies on tide water, on the Portland Canal Inlet, 78 miles from the Port of Prince Rupert, B.C., Canada. The world class port of Prince Rupert is undergoing a massive infrastructure expansion, which now stands at $40 billion. Highbank’s Swamp Point North deposit is the largest; nearest, and has the distinct economic advantage over other aggregate producers by being able to barge product directly there.

The Company has received the necessary permits to operate and also expanded the Licenses of Occupation for a larger mining area for a total of 174 hectares. Since April 2014 the Company has completed a Convertible Debenture financing of $4 million, a Shares for Debt to cover $525,000 in contract work, and $500,000 in short-term Promissory Notes.

The site stripping is well advanced, the camp fully equipped and winterized. The barge load out facility was completed in October and material is being prepared for washing and screening once the production plant has completed its set up, and will then be ready for the initial shipment to Prince Rupert.

Investment Highlights

  • The Swamp Point aggregate deposit is 100% owned and is an advanced stage project with customer orders in place, and an NI-43-101 compliant resource
  • Swamp Point North project is fully permitted
  • Highly skilled management team with a proven track record of success
  • Recent financing places the Company in a strong cash position

Click here to read Highbank Resource’s Latest Presentation

Key Projects

Swamp Point North Project

Highbank Resources’ 100 % Swamp Point North property is unique for a mineral exploration company, as it is neither a base nor precious metal property, but rather a large aggregate rock deposit. Aggregates are fragments of rock measuring 0.08 to 80 millimeters in diameter, that when extracted from quarries, crushed, and calibrated, appear in a wide range of products, including gravel, broken gravel, and sand which are crucial for use in concrete and asphalt.

Highbank-Resources-Construction

View from off-shore with the first section of conveyor installed

HBK-Loadout

The Swamp Point North deposit is a NI 43-101 compliant multi-million ton sand and gravel deposit (measured: 33 million tons, 72 million tons measured & indicated). It is estimated that processing costs will be low with minimal crushing followed by screening, and washing to meet client specifications. The major portion of the production cost lies in shipping, which is still considerably less than road transportation. As the deposit lies on the year round ice free Portland Canal inlet, barging to Prince Rupert is not a restriction. Using barges to ship the material directly from the property, the short distance to Prince Rupert gives the company a distinct economic advantage over its competition.

The company’s business model includes, a project manager operating the mining operations, with Highbank owning 100% of the equipment on site, contracting the barging operations, and delivering processed bulk product to the end-user. Highbank is completing an aggressive two year development strategy to achieve full production for the next one or even two decades.

Highbank Resources Prince Rupert Port

Port of Prince Rupert

Highbank-Resources-Grassy-Point

Area Map Showing Swamp Point Location

With an enormous market less than 100 miles from our deposit, Highbank Resources Swamp Point North project has the potential to become an important source of revenue. Becoming a self-financing exploration company without need of further diluting the stock through public offerings would be of obvious benefit to shareholders.

The Company recently received acceptance of the Notice of Work and Mine Permit for the extraction of up to 1,000,000 tonnes of aggregate over 4 years. Highbank expects to make application next year for expanded production from the property in anticipation of increased construction activity in the area.

With the recently announced $25 Billion “Pacific Gateway Transportation Strategy” and compounded by the $1.3 Billion (Government of Canada) expansion to the Port of Prince Rupert including Ridley Island rail and utility corridor, Ridley coal terminal expansion, Fairview container terminal expansion, Watson Island development, Westview’s wood pellet terminal, etc., the market for Highbank’s aggregates is very promising . In addition Canpotex recently announced their intention to construct a potash terminal in Prince Rupert. Add to this the potential of two LNG facilities (one proposed site on Ridley Island & a second on nearby Lelu Island); and two or more LNG facilities proposed for Grassy Point (35 miles south of Highbank’s deposit), as well as gas pipelines from northeast British Columbia with nearby routes to the LNG facilities, the aggregate requirements keep growing. Also in nearby Kitimat, B.C., Canada, a $3.3 Billion Rio Tinto expansion of the Alcan Smelter and the recent David Blacks, $25 Billion Refinery proposed for 25 miles north of Kitimat adds to an aggregate demand never heard of for the Pacific Northwest.

In April 2012, British Columbia’s Energy Minister- Rich Coleman, announced that the provincial government had received four “new major international LNG project proposals”, all in the Prince Rupert area. The construction of these massive LNG plants will require vast amounts of construction aggregates throughout their build. In October 2014, the BC Government announced the final tax and royalty structure applicable to LNG operations in the area, which appears favourably inclined to ensuring growth in the area.

Summary

Highbank Resources Ltd. is a Vancouver, B.C. headquartered mineral exploration company with an advanced stage aggregate deposit near the Port of Prince Rupert, British Columbia. Because of the huge transportation costs involved in the aggregate business, the Company’s property is strategically located on tidewater, and can use barges to deliver material directly to the Port of Prince Rupert, and other nearby points proposed for LNG facilities.

The Company has recently received the Notice of Work and Mining Permits for both the sand and gravel quarry area, and the barge loading foreshore tenures. The projects proximity to Asian markets may also be a substantial competitive advantage. The Company already has a 150,000 ton aggregate order in place and has bid supplying aggregate to a number of other multi-million dollar projects in the area. The amount of construction that will be starting next year should be sufficient to ensure continued operation for the Swamp Point North plant for the next decade.

Management

Victor N. Bryant – CEO, President & Director
Over 40 years in the mining industry in various capacities such as operations and project engineer, plant manager, senior process metallurgist, and mil/concentrator superintendent. A Metallurgical Consultant,  recently Vice President & Senior Metallurgist for Micon International Limited (June 2005 and 2011), and prior ten years with Flour Daniel consulting on projects for PT Newmont in Indonesia; Phelps Dodge and Asarco in South Peru; BHP in Santiago, Chile; Cyprus Corp in Arizona and Peru, and numerous other worldwide projects.  Prior to Flour Daniel he worked for Billiton International Metals Ltd., Granges Exploration, Sherritt Gordon, Placer Development Ltd., Noranda Mines Ltd. and Angle American Corporation.

Gary Musil – Secretary, CFO, and Director
Gary Musil has more than 30 years of management and financial consulting experience and has served as an officer and director on numerous public companies since 1988. This experience has resulted in his overseeing the financial aspects and expenditures on exploration projects in Peru, Chile, Eastern Europe (Slovak Republic), and British Columbia, Ontario, Quebec and New Brunswick (Canada). Prior to this, he was employed for 15 years with Dickenson Mines Ltd. and Kam-Kotia Mines Ltd. as a Controller for the producing silver/lead/zinc mine in the interior of British Columbia Canada.

Luard J. Manning, P.Eng. – Director
Life Member B.C. Professional Engineers and CIMM. Over 50 years mining experience, and a mining consultant practicing out of Vancouver, B.C. as President of L.J. Manning and Associates since 1967, He has extensive personal expertise in operating underground mines, and has operated small open pit operations. Mr. Manning has supervised and critiqued engineering designs for both surface and underground deposits with emphasis on the effects of design on operating economics. Most notably, completed feasibility studies for Brandywine operation of Northair Mines; the Ruth Vermont project for Columbia River Mines; and the Rabbit Lake open pit project for Gulf Minerals Canada Ltd. He has work experience in Canada, Latin America, and the U.S.A., and has reviewed properties in England and Australia.  He has been a director and officer of several public companies.

Stan Spletzer – Vice President of Aggregate Operations
Mr. Spletzer brings to the Company 30 years of contracting experience working with enterprises such as Canfor and Houston Forest Products, and the B.C. Ministry of Forests. The basis of these contracts (durations up to 13 years) range from logging, aggregate and road building, silviculture (mechanical site preparation), and various other levels of construction and forestry related jobs. These contracts involved managing as many as 90 employees. He has worked with First Nations in Northern B.C. employing up to 20 band members for 9 years.

James Place – P.Geo. – Director
A registered professional geoscientist with more than 25 years of experience in the aggregate and engineering fields. He has worked on all phases of aggregate projects from exploration and planning through to testing, development, marketing, production and reclamation through northern and coastal British Columbia. Mr. Place has held positions with government, engineering companys, and environmental consulting companies (ie. Levelton Consultants Ltd, and ECL Environment Solutions).

William (Bill) Loucks, CPA, CA, CFP – Director
Mr. Loucks, received his Bachelor of Science degree from the University of Guelph in 1978. He qualified as a Chartered Accountant in 1981, and joined Collins Barrow CK, LLP in 1989. He is current the Managing Partner of the Chatham-Kent practice. In addition to providing audit, accounting and tax services, bill is responsible for overseeing the delivery of consulting services.