MINERAL COMMODITIES LTD — Investor Presentation 2012

Oct 7, 2012

Investor Presentation

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October 2012

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Disclaimer
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This document has been prepared by Mineral Commodities Ltd (MRC) and comprises written materials/slides for a presentation concerning MRC. This is not a prospectus, disclosure document or offering document.

This document is for information purposes only and does not constitute or form part of any offer or invitation to acquire, sell or otherwise dispose of, or issue, or any solicitation of any offer to sell or otherwise dispose of, purchase or subscribe for, any securities, nor does it constitute investment advice, nor shall it or any part of it nor the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision.

Certain statements in this presentation are forward looking statements. You can identify these statements by the fact that they �������������������������������� �����������������������������������������������������������������������������������������������������������������������������rward looking statements speak only as at the date of this presentation. These statements are based on current expectations and beliefs and, by their nature, are subject to a number of known and unknown risks and uncertainties that could cause the actual results, performances and achievements to differ materially from any expected future results, performance or achievements expressed or implied by such forward looking statements.

No representation, warranty or assurance (express or implied) is given or made by MRC that the forward looking statements contained in this presentation are accurate, complete, reliable or adequate or that they will be achieved or prove to be correct. Except for any statutory liability which cannot be excluded, each of MRC, its related companies and their respective officers, employees and advisers expressly disclaim any responsibility for the accuracy or completeness of the forward looking statements and exclude all liability whatsoever (including negligence) for any direct or indirect loss or damage which may be suffered by any person as a consequence of any information in this presentation or any error or omission therefrom.

Subject to any continuing obligation under applicable law or any relevant listing rules of the ASX, MRC disclaims any obligation or undertaking to disseminate any updates or revisions to any forward looking statements in these materials to reflect any change in expectations in relation to any forward looking statements or any change in events, conditions or circumstances on which any statement is based. Nothing in these materials shall under any circumstances create an implication that there has been no change in the affairs of MRC since the date of this presentation.

The information which relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Mr Allen Maynard, who is a �����������������������������������������������������������������������������������������������������������������������������lur������������������ independent consultant to the Company. Mr Maynard is the Director and principal geologist of Al Maynard & Associates Pty Ltd and has over 30 years of exploration and mining experience in a variety of mineral deposit styles. Mr Maynard has sufficient experience which is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the �����������������������������������������������������������������������������������������������������������������������������. Mr Maynard consents to inclusion in the report of the matters based on this information in the form and context in which it appears .

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Contents
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Overview of Mineral Commodities (MRC)

Tormin Project

Other MRC Interests:

Xolobeni Project Petro Ventures

Annexures:

Mineral Sands Industry Fundamentals Board & Senior Management Profiles Petro Ventures Overview

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Overview and History of MRC

Capital Structure

• �Over the last 10 years, MRC has been focused on investing in South African mineral sands projects

• �Existing South African assets

• �50% ownership of Tormin project

• �56% ownership of Xolobeni project

• Ordinary Shares: 153.4 million

• Listed Options: 57.4 million

• Cash of A$0.11 million in cash as of 30 June 2012 with a further A$0.96 million realised from the disposal of marketable securities in September 2012

Board of Directors and Senior Management

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Shareholder Structure
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• Mark Caruso � Executive Chairman

• Joseph Caruso � Director

• Peter Torre � Company Secretary / Director

• Andrew Lashbrooke

• Gavin Kelman

• Directors / Insiders 14.4%

• Mirabaud Invest. 11.5% Management

• M & G Invest. 7.2% Management

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Australia
Others
30% 34%
13%
23%
Asia
UK
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• Additional directors will be appointed to meet the future scope of activities and scale expected

Source : Orient Capital, 1 July, 2011

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Tormin Project: Resources
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     - Tormin is an active beach deposits located between the low and high water mark

  - Substantial zircon-rich beach resource on West Coast of South Africa

• Namibia � Definitive Feasibility Study nominal throughput capacity of 1.2Mtpa producing 47.8Kt of concentrate per annum grading up to 81% Zircon and 11.6% Rutile

  • Expected mine life of 3 - 5 years

• Upside potential through further

• Tormin exploration, replenishment and permit expansion

Cape Town

• The heavy minerals (HM) present in order of abundance are Garnet, Ilmenite, Zircon and Rutile

• The beach has been mined for diamonds by the TransHex Group (THG)

• THG completed several phases of drilling and bulk sampling between 1989 and 1991 and, based on that work and feasibility study, defined the Tormin resource in 1992 as follows:

Tormin Area	Resource Status	Tonnes (Mt)	% HM	% Ilm	% Rutile	% Zircon	% Garnet
Total	Inferred	4.9	42.3	9.2	0.6	2.6	22.3

• THG provided MRC with copies of its reports, drilling and bulk sampling

• ����������������������������������������������� commensurate with current standards

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Tormin Project: Resources (ctd)
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• ���������������������������������������������� of the southern beaches in 2002 and 2011 enabled the Company to establish a JORC compliant resource statement of 2.7Mt grading 49.4% HM:

Tormin Resource Statement

	Tonnes (Mt)	HM (%)	Zircon (% in HM )	Rutile (% in HM)	Ilmenite (% in HM)	Garnet (% in HM)
Inferred	2.7	49.4%	6.9%	1.4%	21.4%	51.2%

• While the test work since 1989 has substantially confirmed the THG resource statement, additional work is planned to prove this and upgrade the THG resource to JORC standards

• The Exploration Target for Tormin on which the life of mine is planned is therefore 5Mt grading as follows:

% HM	% Ilmenite	% Rutile	% Zircon	% Garnet
41.3	13.6	0.7	3.4	18.3

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Tormin Project: Life of Mine
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• The established geology of the region confirms an HMrich offshore zone as the source of beach deposits

• � The highly dynamic coastline serves to replenish the beaches by transporting sediment from deeper waters

• MRC has been granted a prospecting right for the offshore area adjacent to the mining area

• The offshore prospecting area extends 1km out to sea from the low-water mark

• Replenishment and / or exploitation of this area could at least double the expected life of mine

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Tormin Project: Production
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• Given the considerations of a dynamic beach environment and the potential for adverse weather conditions or unusually high tides, planned access to the beach has been conservatively estimated at 65%

• Two skid-mounted PBCs have been sized to treat 125 tph each. At these feed rates ROM is planned at 1.18Mtpa

• The PBCs will reject most of the silica and non-valuable HMs on the beach, produce a primary concentrate of 500Ktpa (106 tph) recovering >95% of the zircon and rutile

• The SCP will process the primary concentrate at 64tp, producing 47.8 Ktpa of non-magnetic concentrate, >125 Ktpa ilmenite concentrate and 134 Ktpa of garnet concentrate

• The non-mag concentrate will grade 81% Zircon and 11.59% Rutile, representing 93% and 71% recovery respectively

• Garnet recovery is only 44.7% due to the +180 micron grading requirement

• Ilmenite will require additional processing through a dry plant. Output has therefore been extrapolated from the non-mag and Garnet production

• Co-processing Garnet and Ilmenite will enhance the yield of these productions and increase non-mag recovery from the dry plant

Summary Production Table	Unit	Per Annum	5 Year Total
Tonnes ROM Ore Mined	000's tns	1,181	5,000
Grade Zircon (average)	% Zircon	3.42%	2.55%
Grade Rutile (average)	% Rutile	0.70%	0.54%
Grade Ilmenite (average)	% Ilmenite	11.9%	8.5%
Grade Garnet (average)	% Garnet	18.30%	16.4%
Zircon/Rutile Concentrate Produced	000's tns	47.8	180.0
Zircon in Zircon Rutile Concentrate	000's tns	38.7	145.8
Rutile in Zircon Rutile Concentrate	000's tns	5.5	20.9
Ilmenite Concentrate Produced	�����tns	>125	545.0
Garnet Concentrate Produced	000's tns	134	545.1
Garnet in Garnet Concentrate %	% Garnet	71.2%	71.2%

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Tormin Project: Logistics
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Namakwa
Sands SCP
Namakwa
Sands MSP
Tormin
Saldanha Bay
Cape Town
Blastrite
Tormin
THG
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• Tormin is based on the west coast of South Africa, approx 400km north of Cape Town by road and 40km west of the town of Lutzville

• Access to the tenement is by sealed road to Lutzville and gravel road to the site

• Approved beach access is from the north via privately owned farms over which access has been secured by MRC

• The deposit is approx 40km south ������������������������������� SCP and 30km from its MSP

• �������������������������������� approx the same distance from Tormin as the TNS MSP

• National roads link the project to the Cape Town and Saldanha Bay deep water harbours

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Tormin Project: Processing
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GARNET AND
ILMENITE
STOCKPILES
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Primary Beach Concentrator (PBC)

• Mining with gravel pump mounted on excavator boom

• Trommel screen removes any oversize material

• Gravity separation in a spiral circuit produces a heavy mineral pre-concentrate

• Pre-concentrate is trucked to the Secondary Concentrator Plant

• All beach modules are skid-mounted and highly mobile

Secondary Concentrator Plant (SCP)

• The pre-concentrate is upgraded further by gravity separation on spirals

• Wet magnetic separators remove Magnetite, Ilmenite and Garnet

• The Zircon-Rutile rich non-magnetics can be upgraded further on shaking tables (not planned initially)

• The final Zircon-Rutile concentrate is water washed, filtered and bagged

• Tailings are re-deposited on the beach for dispersal by excavator and incoming tide

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Tormin Project: Local Capability
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• MRC has concluded an MOU with Blastrite to provide mining, processing, procurement, warehousing, logistics, human resource management, financial administration, IT and regulatory compliance for Tormin and MRC

• ������������������������������������������������ industrial minerals for the local surface preparation industry

• ������������������������������������������������ company operates 9 other processing and distribution facilities in the country, including wet and dry heavy mineral concentration plants adjacent to Tormin

• ��������������������������������������������������� provide MRC with an established and proven infrastructure at a lower cost than the Company would be able to achieve as a stand-alone entity

• MRC has also appointed Andrew Lashbrooke, who is resident in South Africa, as its Chief Executive

• Andrew will manage the development and ������������������������������������������������� ����������������������������������������������

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Tormin Project: Economic Summary
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Financial Summary	Unit	Per Annum	Life of Mine
Sales Indicators
Zircon Rutile Concentrate	USD/tn bag CIF	USD 1,527.74	USD 1,527.74
Garnet Product	USD/tn	USD 15.00	USD 15.00
Ilmenite Product	USD/tn	USD 150.00	USD 150.00
RAND/USD Exchange Rate	RAND/USD	8.2	8.2
Zircon Rutile Concentrate Revenue	USD 000's	USD 73,123	USD 275,021
Garnet Concentrate Revenue	USD 000's	USD 1,450	USD 5,908
Ilmenite Product Revenue	USD 000's	USD 15,069	USD 64,743
Revenue Total	USD000's	USD 89,642	USD 345,672
Cost per Tonne of ROM Ore
Direct Production Cash Costs	USD/ROM Ore	USD 12.40	USD 12.92
Total Operating Costs	USD/ROM Ore	USD 23.01	USD 23.85
Cost per Tonne of Concentrate Sold
Direct Production Cash Costs	USD/tn concentrate	USD 51.99	USD 53.01
Total Operating Costs	USD/tn concentrate	USD 96.56	USD 103.09
Profit Indicators
Earnings Before Int, Tax, Depr & Amort	EBITDA USD 000's	USD 62,460	USD 226,427
Cashflow Indicators
Capital Expenditure excluding owners Costs	USD 000's		USD 20,000
Cashflow Generated/(Consumed) from Ops	USD 000's	USD 41,606	USD 226,427
Financial Statistics		Unit	Life of Mine
Net Present Value @ 10%		��������	USD 94,831
Internal Rate of Return		%	97.74%
Payback (from commencement of production)		years	0.5

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Tormin Project: Sensitivity Analysis
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Description	Zircon Rutile USD/ZAR Ilmenite WACC Inflation
Positive	5% 5% -5% 5% -1% -1%
Best Case	10% 10% -10% 10% -2% -2%
Negative	-5% -5% 5% -5% 1% 1%
Worst Case	-10% -10% 10% -10% 2% 2%

� Tormin is economically attractive with an:

• IRR of 97.74%

• NPV of US$94.8m

• Payback of < 6 months

• With total production cash costs at less than 50% of expected revenue, the project is largely insensitive to capital or operating costs variations

• Primary drivers are the commodity price of Zircon and the ZAR: USD exchange rate

• However, a 10% reduction in the price of Zircon would be offset by a 5% devaluation in the ZAR

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Tormin Project: Capital and Operating Costs
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Capital Expenditure

• Core estimates from the Definitive Feasibility Study, engineering in-house data and incountry costs have provided a capital cost requirement of A$16m to produce the nonmag and Garnet concentrates

• Similar assessments indicate an additional A$4m to co-produce a dry Ilmenite product with Blastrite

Capital Cost Summary	Sub-Total (US$)	Contingency (US$)	Total (US$)
Owners Costs	$2,250,000	$250,000	$2,500,000
Indirects	$1,350,000	$150,000	$1,500,000
Construction Indirects	$8,250,000	$750,000	$9,000,000
EPCM	$2,750,000	$250,000	$3,000,000
Total (inc EPCM)	$14,600,000	$1,400,000	$16,000,000

Operating Expenditure

• Operating costs have been established in the same manner as Capital

• Total cash costs (including administration, shipping and other on-costs) per tonne of ore mined are estimated at US$18.22

• Pure mining and processing costs on the same basis are significantly lower at an industry leading US$7.97/t

• Total costs per tonne of non-mag concentrate (i.e expected CIF cost to major Chinese ports) are expected to be US$450.41

• Including Garnet and Ilmenite reduces total costs per ton of concentrate sold to A$96.56/t

• Accordingly, even on a base case the total project break-even at an operating level extremely low relative to current market prices

• For these reasons, Tormin is largely insensitive to capital or operating cost changes (see further below)

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Tormin Project: Administrative
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Regulatory

• All major regulatory approvals for Tormin have been obtained. These include:

• Mining Rights

• Land Use Rights

• Water Use Rights

• Environmental Approvals (DMR and NEMA)

• National Nuclear Regulator

• Only the final zoning departure for the SCP remains outstanding. This is in process and is not a critical path item as mining can commence without it

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Management and Financial Control

• MRC has agreed to provide Blue Bantry, its 50% BEE partner in Tormin, with advance access to the benefits Blue Bantry would expect to receive from Tormin

• The advance, totalling approximately AUD$1.75M has been structured as a loan payable no later than 31 December 2012, subject to the successful capital raising for the development of Tormin

• Blue Bantry will repay the loan from distributions that it will receive in the future from Tormin

• In addition to providing an immediate positive benefit to the AmaDiba Community who are the traditional landowners of ������������������������������������Xolobeni Project, the terms of the loan and associated agreements concluded between the parties will also provide MRC with complete management control of Tormin and access to the majority of the cash flows from the project which MRC requires to arrange the project finance and operate Tormin

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Xolobeni Project
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• 10th largest heavy mineral deposit in the world

• Pre-feasibility study indicates the project is economically viable with a ~25 year mine life

• MRC was granted Prospecting Rights on 4 blocks. Renewed in February 2012 for a further 3 years

• Conditional Mining Licence on the Kwanyana block was revoked in May 2011

• As the timeframe for MRC to address the outstanding issues was too short, the Mining Right application was withdrawn and a new Prospecting Right application submitted

• Prospecting works programme over three years to show project can be sustainably developed:

• Collection of baseline environmental data, including ground and surface water, estuaries, flora and fauna, and soil fertility and migration

• Collection of socio-economic data, including traffic, noise and air quality

• Environmental impact assessment of proposed operations would be completed thereafter

• Review and Approval process to take approximately 5 years

Xolobeni Resource Statement

	Tonnes (Mt)	HM (%)	Ilmenite (% in HM )
Measured	224	5.7%	54.5%
Indicated	104	4.1%	53.7%
Inferred	18	2.3%	69.6%
Total	346	5.0%	54.0%

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• Strategic location on East Coast of South Africa � tenements covering ~2,900 hectares

• Total resource of 346Mt Johannesburg

• grading 5.00% HM, containing 9.3Mt of Ilmenite

• � Pre-feasibility study also indicates rutile and zircon Durban potential Xolobeni

• All products meet market specifications

• Approximately A$0.5m allowed per annum over this period to complete application

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Petro Ventures
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• MRC has a circa 10%investment in Petro Ventures

� Petro Ventures is an E & P company with strategic oil & gas working interests in Romania , Hungary , The Netherlands and France

• ���������������������-strategic and Petro Ventures is also looking to divest of its interests

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• Based on the implied valuations of the Petro Ventures assets provided by its advisors, MRC would expect to realise between US$5m and US$10m from the disposals

• The sale process is expected to be concluded before the end of 2012

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Annexures
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Attractive Industry Fundamentals
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Zircon

• The mineral sands industry generally involves two product chains:

• Supply of Titanium raw materials, largely used to produce Titanium dioxide (TiO2) pigment with small amounts used in the production of Titanium metal sector; and

• Supply of Zircon sand to a number of industries, dominated by the ceramics sector (80%)

• The supply/demand dynamics of the feedstocks sector have changed considerably during the last 12 months, influenced by a number of factors, but specifically:

• Lack of development of, or investigation into, new projects due to reduced investor interest and mediocre financial returns from feedstock producers

• The financial crisis resulted in the curtailment of global production to match the considerable fall in demand

• ���������������������������������������������������������� without considering additional supply from potential new projects that have yet to receive formal approval to proceed, the global supply/demand balance is likely to grow into progressively larger deficits

• This is expected to occur throughout the remainder of the decade as underlying demand for Zircon continues to grow uninterrupted while the supply base declines

Zircon Supply and Demand Outlook to 2015F

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Source: TZ Minerals International Pty Ltd: Mineral Sands Annual Review 2011

Source: TZ Minerals International Pty Ltd: Mineral Sands Annual Review 2011

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Titanium Dioxide Industry: Ilmenite, Leucoxene, Rutile and Synthetic Rutile

• Titanium dioxide pigment is primarily used in the production of surface finishes which impart opacity, brightness and whiteness

• Production is primarily through the sulfate process and the chloride process. The sulfate process has been widely dispersed, but chloride technology is protected by a small group of producers

• Demand is driven mainly through the paint / coatings sector which accounts for 56% of the global consumption and the plastics sector which consume ~25%

• Supply is controlled by the big 5 producers who enjoy relatively strong ability to dictate the prices

• The industry outlook is positive due to demand recovery post the financial crisis and the inability of pigment producers to ramp up capacity causing supply shortages and rampant price increases

• Industry experts believe the shortage of feedstock will continue to act as a supply chain bottleneck over the next few years

Supply / Demand Balances for All Titanium Feedstocks: 2008�2013

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Nominal US$/t FOB	Old New 2012	Old New 2013	Old New 2014	Old New 2015	Old New 2016	Old New LT
Rutile Synthetic Rutile Chloride Slag Sulfate Slag Ilmenite Zircon	2 400 2 500 2 050 2 125 1 750 1 750 1 400 1 400 315 315 2 400 2 500	2 300 2 600 2 000 2 200 1 800 1 850 1 450 1 500 325 350 2 300 2 300	2 200 2 400 1 800 2 000 1 600 1 675 1 275 1 350 315 325 2 000 2 000	1 800 2 000 1 500 1 700 1 300 1 350 1 050 1 100 275 300 1 600 1 600	1 200 1 500 1 000 1 250 950 1 050 775 825 225 275 1 500 1 500	1 200 1 200 1 000 1 000 875 875 700 700 210 250 1 500 1 500

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Board of Directors
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Mark Victor Caruso - Executive Chairman

• Mark Caruso has extensive experience in mining, earthmoving and civil engineering. Most recently Mark served as Chairman of Allied Gold plc, a Pacific Ring gold producer, during which time he raised over US$550m to develop its operations in Papua New Guinea and the Solomon Islands and oversaw the successful sale of Allied Gold in September 2012 at a 92% premium. Mark has been a Director of MRC since September 2000

Joseph Anthony Caruso - Director

• Joe Caruso is a Director of Zurich Bay Holdings and Construction Manager of Simto Australia, both of which are involved in mining, earthmoving, civil engineering, and construction. Joe has considerable experience in managing and administering engineering, mining, raw materials production operations, earthmoving and related infrastructure and services contracts. He has been a Director of MRC since September 2000 and served as Chairman until August 2012

Peter Torre � Director and Company Secretary

• Peter Torre was appointed Company Secretary of MRC in July 2006 and as a Director in April 2010. Peter is a Chartered Accountant, a Chartered Secretary and a member of the Australian Institute of Company Directors. He was previously a partner of an internationally affiliated firm of Chartered Accountants and is currently the Company Secretary of several ASX listed companies and a Director of Neo Resources and Mission New Energy

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Senior Management
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Andrew Lashbrooke

� Andrew Lashbrooke is a qualified attorney with a career spanning investment banking, manufacture of FMCG products as well as processing and distributing industrial minerals. Andrew is the Chief Executive of Blastrite. He has been supporting MRC in South Africa for the past 18 months and played a significant role in the finalization and approval of the mining rights and environmental approvals for Tormin

Gavin Kelman

• Gavin Kelman is a qualified Chartered Accountant. Prior to his involvement with industrial minerals processing and production for the last 8 years, Gavin served in various financial roles in the IT and

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construction industries. He is also the Finance Director of Blastrite

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Petro Ventures Overview
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• ������������������������������������������������������������������������������������������������������� ���������������������������������������������������������������������������������������������������� retains 20.6%. In 2011 Petrom accounted for almost all domestic oil production and around half of domestic natural gas production. State-��������������������������������������������������������������������

• Despite this, Romania has been a net importer of oil and natural gas for over half of its oil consumption and around a quarter of its natural gas consumption

• Efforts to increase upstream activity have led the government to attract foreign oil companies to the country. As a result, exploration has shifted to offshore opportunities in the Black Sea and unconventional opportunities onshore

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• The Romanian section of the Black Sea remains relatively unexplored, with only the Petrom-operated Lebada area fields on-stream. In recent years, a handful of gas discoveries have been made offshore, including Ana in 2007 and the deepwater Domino in 2012

• Nine offshore blocks are currently licensed to nine different companies, including Sterling Resources, Melrose Resources and ExxonMobil

Source: RBC Capital Markets, September 2012

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Petro Ventures Overview (ctd)
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Source: RBC Capital Markets, September 2012

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