BUSINESS PLAN
CRYSTAL MINING CORPORATION
20380 Stevens Creek Blvd.
Suite 108, Cupertino, CA 95014
Tel. #: 386-479-5823
Email: [email protected]
Web: www.crystalminingcorp.com
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I. TABLE OF CONTENTS
I
Table of Contents…………………………………………………………………………………………..……
2
II
Forward Looking Statements………………………………………………………………………………
3
III
Executive Summary…………………………………………………………………………………………….
4
IV
General Company Description……………………………………………………………………………..
4
V
Products and Services………………………………………………………………………………………….
7
VI
Marketing Plan……………………………………………………………………………………………………
8
VII
Operational Plan…………………………………………………………………………………………………
13
VIII
Management and Organization………………………………………………………………………….
15
IX
Personal Finances………………………………………………………………………………………………..
17
X
Start Up Expenses and Capitalization…………………………………………………………………..
18
XI
Financial Planning……………………………………………………………………………………………….
18
XII
Appendices…………………………………………………………………………………………………………..
25
Table 1. Estimated Gold Ore Production……………………………………………………………….….
25
Figure 1. Pictures of Machines and Equipment to be used………………………………………….
25
Figure 2. Typical Flow Chart of Gold Ore Process………………………………………………………..
27
Table 2. List of Machines and Equipment Needed (Conversion rate 1 USD = PhP 45)…..
27
Table 3. Chamber of Mines of the Philippines operating in Mindanao………………………..
28
Figure 3. Map of Davao Province……………………………………………………………………………….
29
Table 4. Mining Industry Statistics……>>……………………………………………………………………
30
Table 5. Metallic Mineral Production………………………………………………………………………….
31
Table 6. Philippine Gold Production Comparison………………………………………………………
32
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II. FORWARD - LOOKING STATEMENTS
This presentation contains certain statements that may constitute “forward-looking
statements” within the meaning of Section 21E of the United States Securities and Exchange
Commission Act of 1934 and a forward looking information within the meaning applicable
securities legislation. All statement in this presentation, other than the statement of
historical fact, that address events or developments that the Company expect to occur, are
forward looking statements. Forward looking statements that are not historical facts and are
generally, but not always, identified by words “expects”, “plans”, “anticipates”, “believes”,
“intends”, ”estimates”, ”projects”, “potential”, “suggests”, and similar expressions, or that
events or conditions “will”, “would”, ”may”, ”could”, or “should”, occur. Forward-looking
statement in this presentation includes statements regarding the timing and nature of future
exploration programs and projections, which are, in part, dependent on results from those
exploration programs.
Forward looking statements involved known and unknown risks, uncertainties, assumptions,
and other factors, that may cause the actual results, performance or achievements express or
implied by the forward-looking statements. These statements are based on a number of
assumptions based on the general market conditions, timing and receipts of regulatory
approvals, the ability of the Company and other relevant parties to satisfy regulatory
requirements, the availability of financing for proposed transactions and programs on
reasonable terms, and the ability of third-party service providers to deliver services in a
timely manner.
Factors that could cause the actual result to differ materially from those in forward-looking
statements include market prices, results of exploration, availability of capital and financing
on acceptable terms, inability to obtain required regulatory approvals, and market conditions
and general business, economic, competitive, political and social conditions. Although the
Company has attempted to identify important factors that could cause actual results to differ
from those express or implied in forward-looking statements, there maybe other factors
which cause actual results to differ. Accordingly, readers should not place undue reliance on
forward-looking statements. Forward-looking statements contained herein are made as of
the date of this presentation, and the Company disclaims any obligation to update these
forward-looking statements, whether as a result of new information, future event or results,
or otherwise, except as required by applicable securities laws.
The description of this presentation zone does not intend to imply that any economically
estimates of reserves or resources exist on the proposal. Similarly, although projected
features of the presentation are interpreted to show similarities of nearby processing plant
owned by third parties, this should not be interpreted to mean that the processing plant has,
or that it will, generate similar outcome. Significant steps have to be undertaken to fully
understand before any meaningful resource calculation can be completed.
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III. THE EXECUTIVE SUMMARY
When I wrote down this summary in the middle of September, gold then was valued at
$1,270.00 per troy ounce (31.10gms). With gold prices trending up, there has never been a
much exciting time for me and CRYSTAL MINING CORPORATION to invest in the gold industry
business. Gold for the past decades has remained the most stable investment EVER; dating
back more than 10 years ago when gold was only $300.00 per ounce. With the current
recession in the United States and around the globe, there is only one projection for gold to
follow and that is UP. It has been projected that starting next year gold prices will be valued
at $1,500.00 per troy ounce and will eventually go up as high as $2000/troy ounces by year
end 2012. And that is why we, at CRYSTAL MINING CORPORATION has fully committed
ourselves to succeed in making this company a leader in gold mining industry in the next 5
years.
We will cautiously start the construction of our first gold ore processing plant starting March
2011 with a target completion date by June 30, 2011. Region 11 (Davao and Compostela
Valley), Philippines has been chosen due to the fact that gold mining has been ongoing since
the 1980’s and has been known as the gold center in the country. To date more than
326,084.68 kilos has been mined with aggregate total of more than 13 trillion dollars in
today’s value.
This organization is seeking a financial investment of $500,000.00 from various private
entities who are interested in the Gold Mining Industry.
It is expected and projected that Capitalization would be paid back in 15 months or less from
initial operation of the plant and that company’s debt would be nil by then. Sales revenue
would reach more than $ 1,000,000.00 by December 2012. Profits are presented below to
further understand the business opportunity and how as an investor generally able to
capitalize and capture a higher Return on Investment (ROI).
IV. GENERAL COMPANY DESCRIPTION
The Philippines is situated along a well-defined belt of volcanoes called the Circum-Pacific Rim
of Fire where the process of volcanism and plate convergence resulted in the formation of
abundant and important metallic mineral deposits of gold, copper, iron, chromite, nickel,
cobalt and platinum.
The Philippines is considered as one of the countries most endowed with metallic resources
in the world with over $1 Trillion untapped mineral deposits; once fully developed would be
ten times its annual Gross Domestic Product (GDP). The country has overwhelming trilliondollar resources. The Philippines ranks in the top 6 for gold, nickel, copper and chromite and
has the potential to be top 10 largest mining power in the world. While the country has
enormous untapped resources, only 1.4% of about 9 million hectares of land, identifies as
having rich mineral deposits, have been explored and covered by mining permits.
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Common metallic minerals extracted in the Philippines:
CATEGORY
Precious Metals
Base Metals
Iron & Ferro-Alloy Metals
MINERALS
% OF TOTAL VALUE**
Gold
Silver
Copper
Nickel
Chromite
48.07
0.26
6.78
16.36
0.12
** based on 2008 Gross Production Value of USD 1.84 Billion
Market Opportunities
2008 total exports of minerals & mineral products: $2,482 million
Export destination countries: Hong Kong, China, Australia, Japan and other trading
partners in Asia, North America and Europe
Concentrate off-take negotiations
Philippine Advantages
Natural Resources
9 million hectares are high potential sites for copper, gold, nickel and chromite
Only 1.4% covered by mining permits
Ore reserves:
ORE
Gold
Copper
Nickel
Chromite
Iron
Aluminum
2005 RESERVES MT
3,056,947,159
2,968,064,616
953,670,162
18,744,685
410,637,010
292,010,410
CRYSTAL MINING CORPORATION is a newly established venture company whose main
objective is to process, explore, and mine valuable gold. Incorporated in the United States on
October 07, 2010, the company is set to launch in the Philippines its first gold mining
processing plant by March 2011. Negotiations and dialogues at the moment have been ongoing with a Chinese counterpart to supply needed machineries in processing these gold ores.
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Our mission is simple: To be a leader in the exploration, production and processing of gold by
providing the highest quality of service using the most advance technology, with high grade of
efficiency at the most competitive price.
Our Goal is straightforward:
Phase I Project
a. To build CRYSTAL MINING PROCESSING PLANT for the processing of gold ore by
March 2011 within 20 to 30 km radius of Tagum City, Philippines, known as the center
of gold trading.
b. To be able to process a minimum but not limited to 10,000MT (metric tons=1000kg)
of gold ore during the first year of operation beginning upon completion of Crystal
Mining Processing Plant by June 2011.
Phase II Project
a. Increase company gold ore processing capacity rate to a minimum but not limited
to 15,000 MT (metric tons) by the first quarter of 2012.
b. Explore additional 1 to 2 tenement sites for gold production within the second and
third quarter of 2011 at Region 11, Philippines.
Phase III Project
a. To be able to secure, extract and process its own gold by July 2012 to at least 2
tenement sites with minimum but not limited to an annual gold production capacity of
5000 troy ounces (1 troy oz=31.1034gms).
b. Expand gold exploration drilling sites to achieve minable gold reserves of more than
30,000 troy ounces and be able to increase gold production but not limited to 7,50010,000 troy ounces starting January 2013.
c. Double extraction capacity of gold ore to 30,000MT per annum by 2013.
CRYSTAL MINING CORPORATION believes that customer satisfaction is a valuable tool in
providing small scale miners the needed extraction rate for gold ore. In region 11, roughly
40,000 small scale miners have been accounted with 26,876 registered at the provincial
capitol of Davao. Of the 40,000 small scale miners, fourteen thousand (14,000+) plus
unregistered are unaccounted and beyond the guise of the government’s detection.
According to the report, 322,512MT daily productions in gold ore is being mined from
registered miners alone not accounting the bulk of production produced by the unregistered
small scale miners. Previous year registered a total of 117,716,880MT annual gold ore
production had been mined within Region 11 (Table 1).
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The demand in processing these gold ores is so high that according to small scale miners
themselves, they have to wait more than a month before processing their ore into pure gold.
The amount of gold ores to process are in abundance and the backlog is long enough, that
small scale miners are willing to pay additional fee ranging from 15% to 30% on top of the
actual processing cost to speed up its production time.
With the introduction of highly sophisticated machineries, Crystal Mining Corporation will be
positioned better against local competition that currently manufactures gold mining
equipment with 70-80% extraction rate. With Mr. Marlove F. Socorro’s skills and experience
with these machineries, plus his invaluable presence in the area, would greatly serve as an
important asset in stirring the company towards the right direction in fulfilling our visions and
goals to the fullest.
CRYSTAL MINING CORPORATION has chosen Nevada as its primary base due to its friendly
atmosphere for investors. Among which are the following:
No Corporate Income Tax
No Taxes on Corporate Shares
No Franchise Tax
No Personal Income Tax
No I.R.S. Information Sharing Agreement
Nominal Annual Fees
Minimal Reporting and Disclosure Requirements
Stockholders are not Public Record
V. PRODUCT AND SERVICES
Extraction of gold from an ore is of vital importance for business especially when you are
classified as small scale miners (miners with investment less than $1M and do not use
detonations, and large machineries). The higher the extraction rate is, the higher the
likelihood that they will avail services from gold processing plant that have the highest
extraction capacity rate. For them, building a processing plant is somewhat a surmountable
project to accomplish. Recent survey in the region has shown that majority of the processing
plants in nearby towns of Tagum City, Davao Oriental, Compostela Valley, Davao del
Norte have an extraction capacity rate of only 70-80% for 95% of the 11,287 existing plants.
Majority of the miners are using locally manufactured products and machineries that use less
sophisticated technology. Crystal Mining Corporation machineries will address this need and
will be able to offer small scale miners an alternative extraction capacity rate far superior
than what the current trend is. With current extraction capacity rate of 98% efficiency, and
minimal wastage, Crystal Mining Plant will set a new trend in becoming the new force in gold
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ore processing in the area and beyond. Competition will be present without a doubt, but with
the existing waiting period time of one (1) month or more before any gold ore from small
scale miners can be processed, Crystal Mining Corporation has more than enough to process
and will definitely be a better alternative than majority of the existing players. The demand is
so high that our annual production goal of 10,000MT minimum would hardly touch the
current backlog time and overall market in general.
Crystal Mining Plant will consist of the following: Jaw Crusher, Cone Ball Mill, Conveyor,
Vibration Feeder, Ore Bins, Cyclone, DSM, Leaching tanks, Slurry pump, Steel balls, Structure
(office/laboratory) and a GenSet
VI. MARKETING PLAN
According to the data released by Davao Provincial Government Mining Bureau; Region 11,
Davao, Philippines’ annual gold ore processing accounts for 117,716,880 metric tons for large
and small scale miners. The data also included 11,287 existing processing plant with a total of
26,876 registered small scale miners with about 14,000 plus unregistered and unaccounted.
Philippine Metallic Mineral Production as from January to June of 2010 produced a total of
18,865 kilos of gold amounting to almost $700M. The data further compare previous year
production of 16,875 kilos which is about 12% growth rate year to year bi-annual report.
MGB Metallic Mineral Production
Of the 117,716,880 metric tons gold ore mined in 2009, CRYSTAL MINING CORPORATION will
aggressively grab less than 1.5% of the small miners market which is around 65 million metric
tons with a minimum targeted annual production capacity rate of 10,000 metric tons. For the
last six (6) years since former president Gloria Macapagal Arroyo opened Philippines as
mining haven, the Department of Environment and Natural Resources (DENR) data has shown
that production in gold ore has steadily grown an average of 10-15% per year. It has been
projected that in the next 5 years an average of 10-15% will be experienced as more and
more gold mining companies are signing up for gold mining activity. Apex Mining (28%
owned by Canadian firm), North Davao Mining Corporation, Cadan Resources Corporation
(40% Canadian owned), Philsaga Mining Corporation and Asiaticus Management Corporations
are among the companies operating within the region. Table 3 shows the Chamber of Mines
in the Philippines operating in Mindanao.
This is a huge opportunity to pass, hence CRYSTAL MINING CORPORATION was formed to
address the growing needs and demand in the Region and beyond. Even though initial capital
cost is quiet substantial in terms during the start up phase, projections has been made to turn
the company into profitability within 15 months or less. Marketing the company as a new
force in gold ore processing would not be a big problem considering that small scale miners
will always look for a much better extraction rate and therefore clientele acceptance and
company recognition would be easy.
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CRYSTAL MINING CORPORATION has adopted the latest technology in gold ore extraction and
is poised to capture the needed 30 ton per day minimum goal. The Jaw crusher alone will be
able to crush gold ore in a rapid sequence with immense crushing power devouring anything
into pieces. With average 10 tons per hour capacity, it will ensure the CRYSTAL MINING
PLANT’S ability to catch up production under downtime circumstances and other need to
basis. To date Marlove F. Socorro is trying to secure a contract from small scale miners who
will be interested in processing their gold ore at the highest extraction rate. On the other
hand, our Chinese counterpart has already submitted their price quotations for the
machineries to be delivered at CIF prices. Once financing is funded we will then proceed with
the procurement of the listed machineries.
Skilled and experienced chemist, expert engineers whose competency in their own field is
without question would be hired during the operation with the rest of the employees to be at
least high school graduates as their credentials.
Government taxation mandates that all company involve in mining will be charge a value
added tax of fifteen (15%) percent on all gold mining activities. These percentages will then
be charged to the miners which will be added to the $70.00 processing fee per metric tons of
gold ore.
PRODUCT
CRYSTAL MINING PLANT will offer excellent services to the small scale miners continuously,
day to day, year round according to the contract. The product itself involves architecturally
designed, structured plant to make sure that work flow is free from discrepancies,
inadequacies and anomalies. Once a customer realized that Crystal Mining Processing Plant
has one of the highest extraction rate capacity, a paradigm shift will be experienced in which
small scale miners themselves will be lining up to have their gold process at our processing
plant. They would understand the value of having a higher extraction rate i.e., higher return
on their investment and more money in their pockets.
CRYSTAL MINING PLANT ADVANTAGES AND BENEFITS
FEATURES
98% Extraction Capacity
Rate for Gold Ore
ADVANTAGE
BENEFITS
Beats majority of the
competition
More monetary unit for the
miners.
Jaw crusher capacity 10
ton/hr
Enables to speed up
Guaranteed production will
production when necessary
be finish as scheduled
24/7 working plant
Continued job performance Guaranteed delivery of gold
on time
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Security Driven
Imported and
sophisticated machineries
Stable working environment
High level of customer
with minimal disruption
satisfaction and assurances
Minimal down time
Continued production and
services
CUSTOMERS
Small scale miners shall be our main target groups of clientele. These miners will be the one
responsible with the mining of gold ore themselves. Our job is to facilitate faster production
of their gold ore. Once their gold ore arrives at our facility, a coordinator will assist them in an
orderly manner beginning with right receiving up to disposal and markings of their gold ores.
Deliveries will be in 20 tonnage size trucks with proper coordination ahead of time to lessen
and minimize traffic congestion within the perimeter. Customers usually send their own
security to watch over their gold ore and making sure that in the end, there will be no gold
anomalies. As part of our company’s service of transparency, video cameras and cctv
monitors will be installed around the vicinity during processing period to enhance fair and
balance at all levels with our core customers. In addition a laboratory assay will be conducted
prior to processing the gold ores, this is done to ensure a fair and square processing results.
COMPETITION
Large groups of gold mining industry process their own mine; therefore our major
competition would be small scale miners themselves who already have existing plants in the
area. Since the major breakthrough in gold ore extraction has been rated at 98%; only less
than 2% of the small scale miners have upgraded using this advance technology. This will be a
great opportunity for Crystal Mining Corporation to seize these favorable circumstances and
the timing has never been this precise and more exact.
Delivery of gold ore to our sites would be a challenge and the company has proposed of up to
fifteen (15) days backlog job processing shall be accepted. Contracts from small scale miners
would be needed to secure the continuous processing of gold ore on a daily bases. Roads to
our site must be accessible and large enough to accommodate traffic for heavy trucks during
delivery. A center for customers shall be established for waiting time with television and
drinks readily available. For all services rendered, there would be a no refund policy. A
thorough prepayment agreement will be printed and agreed upon before any services can be
started.
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NICHE
Without a doubt the 98% extraction capacity rate would be the driving force for CRYSTAL
MINING CORPORATION. This feature will serve as a beacon for small miners to harvest their
labor using the highest quality of gold extractor there is. The rarity of this idiosyncrasy or
feature within the area, will serve immensely advantageous for CRYSTAL MINING PLANT and
its machineries in pivoting and positioning our company as the NEW FORCE and LEADER in
the extraction of gold ore industry.
STRATEGY AND PROMOTION
Prior to building and completion of CRYSTAL MINING PLANT, contracts for securing the
30MT/day capacity would be signed before its first foundation is even laid. This will be
accomplished by spreading the information through direct meeting with the small scale
mining owners themselves and at the same time dissemination of information through
leaflet sampling. Rough terrain and mountainous site will be encountered while conducting
and scouting our clienteles and it is a must that a reliable 4x4 vehicle shall be
leased/purchased. Advertising using the local paper and media will be a need be process. A
logo design will be made after the incorporation. Business cards and letterhead will follow
thereafter.
Upon signing a 2 to 5 year contract with our clients, a tour to the plant will be offered after
the completion of CRYSTAL MINING PLANT to make sure that our clienteles will feel secure
and protected for their vested interest and that their business is ours as well. We want to
project an image of business professionals who look after their own success. CRYSTAL
MINING CORPORATION will further serve its clients as a trusted ally, providing them with
excellent service reliably and with utmost transparency.
Promotional Budget:
Transportation/Gas
Leaflets
Business Cards/Letterheads
Total Promotional Expenses
$ 33,333.00
500.00
300.00
$ 34,133.00
PRICING
In gold ore production, current processing fee is standard; however, several miners or
investors who does not operate or have their own processing plant are willing and
11
prepared to add up additional 15 to 30% on top of the existing processing fee.
Proposed pricing shall be $ 70.00 per MT with $ 80.00 per MT as secondary price
depending on the demand and needs of clienteles.
Such steps and/or decisions of the miners are done to ensure that there would be
continued liquidity of finances for operational purposes.
This is also done internally with the processing plant for certainty that ores are
processed on time.
Services and extraction rate capability will play as the most important aspect in our
plant.
Miners at times doesn’t mind high processing fee as long as their ores are processed
on time and with highest extraction rate possible.
PROPOSED LOCATION
Location for Crystal Mining Plant shall be chosen according to proximity location from small
scale miners. Viability of transportation roads and electricity as well as water utilities shall be
considered in order to run the company with ease. The plan is to have this site within
proximity of competition thereby increasing its visibility to would be customers. Convenient
parking spaces shall be provided to accommodate large and small vehicle enough for the
operation.
DISTRIBUTION CHANNELS
CRYSTAL MINING CORPORATION has set to operate one mining site for now contingent to the
needs of the area. Mr. Marlove F. Socorro and the upcoming Assistant Manager shall be in
charge of the direct acquisition of clienteles. Our services shall be available for small scale
miners within and in nearby areas . Contracts shall be signed accordingly per our company’s
by laws and regulations in agreement with our clienteles.
SALES FORECAST
Sales of CRYSTAL MINING CORPORATION for the first year of operation shall be from the
Contract between the company and the Small Scale Miners. It is expected and targeted that
30Metric tons a day of Gold Ore shall be processed with $70-$80 dollar shall be charged as
service fee.
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QUARTERLY SALES PROJECTION
(July 2011-September, 2011)
Month of Operation
At $70.00 per Metric
Ton
At $80.00 per Metric
Ton
Sales Ranges
1. July
$58,380
$66,720
$58,380-66,720
2. August
$58,380
$66,720
$58,380-66,720
3. September
$58,380
$66,720
$58,380-66,720
$175,140.00
$200,160.00
$175,140-$200,160
Quarter Total:
ANNUAL SALES PROJECTION
(July 01, 2011 - June 30, 2012)
Description
At $70.00 per Metric
Ton
At $80.00 per Metric
Ton
Sales Ranges
Annual operation
$700,000.00
$800,000.00
$700,000-$800,000
VII. OPERATIONAL PLAN
Once CRYSTAL MINING PLANT is completed before June 30, 2011, we will conduct a series of
test of its machineries for optimal functioning before any services from our clienteles shall be
accepted. Operation and dry run shall begin July 01, 2011 and shall operate 24/7, Sunday to
Saturday, 365 days, with two allotted days reserve every month for maintenance and
downtime.
Production:
Products will be delivered to the plant using a 20 tonner capacity truck in a 40 to 50kg
used sack container.
Processing will be done on a first come first served basis.
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Prior and before processing is done, assay analysis will be conducted (for a fee) to
ensure clients of fair processing and give them idea of how much amount of gold is to
be expected.
As mentioned above, we can make the operation 5 days a week 24hrs operation or an
option to operate during weekends as the need and circumstances dictates.
Location:
Site location will be established near the center of trading for customer’s convenience.
An area not less than 1 hectare and no more than 2 hectares will be leased
approximately 20 to 30 km radius of Tagum City. Electricity should be readily available
and roads should be passable to big trucks.
The plant will consist of the processing plant itself with minimum of 3 CIP tanks, mini
laboratory for assay analysis, firing area, mini office, provision for canteen and the
large portion will be allotted for stockyard. Perimeter fence will cover the whole plant
for security purposes using tin sheets roofing.
Legal Environment:
Barangay permits, municipal permits, Building permits (for plant construction) and
ECC (Environmental Compliance Certificate from DENR) are the basic documents
needed before construction approval.
Other business permits will be needed upon application of the above mentioned
requirements.
We will out-source the preparation of the above mentioned requirements. Normally,
and based on our interview and research, it will take 30 to 60 days processing of these
requirements
MONTHLY PERSONNEL SALARY
Manpower
General Worker
Supervisor
Asst. Mgr
Engineer
Chemist
Security
General Manager
Qty
12
6
1
1
1
4
1
Total
26
Unit Price
178.00
267.00
667.00
556.00
667.00
178.00
1,000.00
$
3,513.00
Total Price
2,136.00
1,602.00
667.00
556.00
667.00
712.00
1,000.00
$
14
7,340.00
QUARTERLY PERSONNEL SALARY PROJECTION
Total Number of Personnel
Amount in Dollar
26
$22,020
ANNUAL PERSONNEL SALARY PROJECTION
Total Number of Personnel
Amount in Dollar
26
$88,080.00
General workers need not be graduates. All of them will engage in manual labor so
they need to be strong and physically fit
Supervisor- should have at least experience in the processing of ore or have worked in
a processing plant before
Asst Manager – College grad and loyalty should be unquestionable
Engineer – Electrical is the competence
Chemist – Knowledge in basic assay and routine analysis
VIII. MANAGEMENT AND ORGANIZATION
SYLVESTRE C. YGAY IV – President and Board Member
Graduated at University of Perpetual as Bachelors Degree and consistent Dean’s Lister
in 1993, President senior batch.
Joined Bristol Myers Squibb in 1996 as Territory Manager and an awardee of Rookie of
the Year having achieved more than 150% YTD performance during his first year stint
with the company. As a pharmaceutical representative and territory manager, he was
a consistent performer that made him become a member of Elite Performers within
Bristol Myers Squibb known as Presidential Awardee for having consistently achieved
a Year to Date performance of more than 100% for more than 3 consecutive years.
Former Owner and General Store Manager of La Pharmacia 1999. A small company
involved in buying and selling of pharmaceutical products both wholesale and retail
merchandise.
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Currently a Registered nurse with Charge Nurse Position at Kaiser Permanente, Santa
Clara.
Superintendent and Head representative of The Church of God (7th day) Salinas, CA.
Married to a devoted and lovely wife Josephine with three (3) beautiful children
namely Matt, Sophia, and Sam.
MARLOVE F. SOCORRO – Country Manager/Plant Manager and Chairman of the Board
Graduated at the University of the Philippines Los Banos with a Degree of Bachelor of
Science in Agriculture in 1996
Currently handles the position of a Business Development Officer for a local company
engaged in the sales of various Mining equipment and design and construction of
Processing Plant in Mindanao Area.
Hired by the Petbowe Group of Companies in 2007 in the capacity of Sales Manager.
As the head of the newly established business unit, was expected to develop and
design methods and systems to increase product line thereby opening new
opportunities for the company and the business unit. He is likewise responsible for
the formulation, development, execution and maintenance of marketing strategies,
organizational planning strategies and market research. He identified and developed
other farm input products thus, increasing company product line and creating new
market opportunities to various areas and territory. Further, he developed and
executed creative marketing ideas that ultimately meet company objectives and/or
goals. Revised company guidelines regarding credit policies and implemented thru
gradual conversion of credit-terms to cash basis for all new customers.
Also joined Ajinomoto Philippines Corporation in 1999 as the Chief Agriculturist of the
company. Developed and implemented strategic promotional activities both shortterm and long-term propaganda for product awareness in the market. He was
consistently awarded an annual evaluation of a VERY SATISFACTORY rating from the
first year of service until closure of the company. Awarded and granted by Ajinomoto
Philippines Corporation through the Japan International Cooperation Agency (JICA) a
technical training in Japan regarding EXPERIMENTAL CULTIVATION AND FERTILIZER
APPLICATION TECHNIQUES FOR SUGARCANE. A record holder in the company having
a 1,400+% increase in sales in the assigned territory during the first year of service.
Member in good standing of the National Range Officers Institute in the Philippines as
Chief Range Officer and the Philippine Practical Shooting Association
Married to Weng with only 1 child Clarissa Denise
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ADONIS T. ALAGASI – Asst Manager
Graduated at the University of the Philippines at Los Banos with the Degree of
Bachelor of Science in Agriculture in 1996
Currently holds a position of Business Manager- South Luzon Area at Bioseed AgroChemicals.
Vacant – Electrical Engineer
Competence in Electrical
Vacant – Chemist
Competence in Assay and routine Analysis
IX. PERSONAL FINANCES
SYLVESTRE C. YGAY IV
As of ending 2009 W-4, Mr. Sylvestre C. Ygay IV has filled a joint annual gross income of
$165,000.00 with his wife Josephine R. Ygay. He currently owns GMC Yukon 2003 and Honda
Odyssey 2001. His wife currently in school for Associate degree in nursing and is expected to
finish by 2013. The rest of personal finance shall be divulged upon request.
MARLOVE F. SOCORRO
Spouses Marlove F. Socorro and Lowena N. Socorro registered an annual income for 2009
amounting to $ 73,989.34. They were both then engage in the operation of a convenience
store in Dasmarinas City Cavite where a separate house and lot is also located. Currently, his
spouse is managing and operating a restaurant in Davao City. All relevant and pertinent
information such as other properties and bank finances shall be divulged upon request
17
X. START UP EXPENSES AND CAPITALIZATION
CRYSTAL MINING CORPORATION is at the Pre-Construction Phase of its financial project
preposition. Since planning this strategic concept, the following expenses had been incurred
as listed below and it is expected that half of the allotted $500,000 investment capitalization
would be needed before any operation would be started. Financial Meetings for potential
investors will be conducted in a series of business presentations and meetings. Capitalization
shall be a very important aspect in raising the first half, if not all of its needed projection
amount.
PRE-CONSTRUCTION PHASE (October-December 2010)
Registration and Paper works
Financial Statement and Bookkeeping
Survey and On-site view
Transportation Procurement
Land Lease (6 months advance payment)
Leaflets/Ads
Miscellaneous/Contingency (20%)
$
3,500.00
500.00
5,000.00
33,333.00
2,000.00
500.00
8,300.00
TOTAL EXPENSES
$
53,133.00
YTD EXPENSES ENDING DEC 2010
$
53,133.00
XI. FINANCIAL PLANNING
CRYSTAL MINING CORPORATION’S goal financially is to settle its debt as quickly as possible in
record time and provide a positive cash flow. Keeping a healthy and strong financial balance
to its shareholders is of utmost importance. The following data below illustrates how we are
going to meticulously accomplish this. All processing services as explained previously would
not be process unless payment is made ahead of time. Any advance payment of services
provided by the company shall be accepted within specified time frame as stipulated in the
contract between Crystal Mining Corporation and its clienteles. Machineries will be paid half
ahead as well as construction with the rest of the outstanding balances be paid upon
completion or delivery.
18
ACQUISITION PHASE (January 2011-March 2011)
Equipment and Machineries Down payment/(+Electrical
$
Transformer)
Construction Planning and Design /Structure
Leaflets
Business Cards
Miscellaneous /Contingency (20%)
TOTAL EXPENSES
76,889.00
22,222.00
500.00
300.00
19,982.00
119,893.00
PLUS: CARRY OVER EXPENSES FROM YTD 2010
$
53,133.00
TOTAL EXPENSES TO DATE
$
173,026.00
CONSTRUCTION PHASE (April 2011-June 2011)
Construction Process
Manpower Orientation & Training
Financial Report Expenses
Miscellaneous Expenses
$
22,222.00
7,338.00
500.00
6,912.00
TOTAL EXPENSES
$
36,972.00
TOTAL YTD EXPENSES
$
209,998.00
OPERATIONAL PHASE (July 2011-September 2011)
Equipment and Machineries other half payment
Materials Expenses (Chemicals,Maint,Electricity, Comm,
$
76,889.00
32,235.00
22,014.00
1,000.00
900.00
Food/Entertainment, Diesel)
Manpower Expenses
Transportation Expenses
Rental Expenses
TOTAL EXPENSES
$
133,038.00
YTD EXPENSES
$
343,036.00
19
RUNNING PHASE (October-December 2011)
Material Expenses (Monthly budget x 3)
Manpower Expenses
Exploration Expenses
Transportation Expenses
Rental Expenses
$
32,235.00
22,014.00
20,000.00
1,000.00
900.00
TOTAL EXPENSES
$
76,149.00
YTD EXPENSES
$
419,185.00
MONTHLY BREAKDOWN OF EXPENSES DURING THE OPERATION
(EXCLUSIVE OF MONTHLY TAXES)
Manpower
Qty
Unit Price
Total Price
General Worker
Supervisor
Asst. Mgr
Engineer
Chemist
Security
General Manager
12
6
1
1
1
4
1
178.00
267.00
667.00
556.00
667.00
178.00
1,000.00
2,136.00
1,602.00
667.00
556.00
667.00
712.00
1,000.00
Subtotal
26
3,513.00
$
7,340.00
Materials, Maintenance Expenses
Diesel Gas (liters)
Electricity
Communication
Chemicals
Maintenance
Food/Entertainment
Subtotal
650
1
1
1
1
1
520.00
3,334.00
445.00
2,667.00
2,223.00
1,556.00
$
Transportation
Rental Expenses
10,745.00
1,000.00
300.00
TOTAL MONTHLY EXPENSES
$
20
19,385.00
SALES FORECAST VS EXPENDITURES
MONTHLY SALES FORECAST VS EXPENDITURES
TARGET: 834MT
$70.00
$80.00
SALES
58,380.00
66,720.00
EXPENSES(Monthly Expenses + 12% Tax from Sales)
26,391.00
27,391.00
POTENTIAL INCOME
31,989.00
39,329.00
QUARTERLY SALES FORECAST VS EXPENDITURES
TARGET: 2500MT
$70.00
$80.00
175,000.00
200,000.00
EXPENSES (Monthly Expenses + 12% Tax from Sales)
79,155.00
82,155.00
POTENTIAL INCOME
95,845.00
117,845.00
SALES
ANNUAL SALES FORECAST VS. EXPENDITURES
TARGET: 10,000 MT
$70.00
$80.00
SALES
700,000.00
800,000.00
EXPENSES (Monthly Expenses + 12% Tax from Sales)
316,620.00
328,620.00
POTENTIAL INCOME
383,380.00
471,380.00
Above data has shown that CRYSTAL MINING CORPORATION projected sales forecast vs.
expenditures enables the company to pay capital investment by record breaking of (15)
months using the $70/MT valuation for sales revenue commencing July 2011. Its expansion
plan to increase processing capacity rate to 15,000MT by January 2012, would decrease its
liabilities settlement by less than 12 months. Financial assistance is needed at this point to
21
extend terms of agreement into a 3-5 year period or more in order to maximize its ability to
expand and grow into multi-million dollar revenue generating company by 2012 and beyond.
CRYSTAL MINING CORPORATION has aggressively plan to increase its gold ore processing
capacity to a minimum of 15,000MT per annum starting January 2012, a 50% increase
capacity. Considering the enormousity of the market, this future production is only peg at 2%
fraction of the total market share. The following data below would be the potential
generating income and expenditure projections. Material expenditures would increase by
about 50% amounting to $16,118.00 per month, however, manpower will only increased by
20% or less amounting to $8,808.00 per month. Upgrade on the continuous ball mill and
acquisition of 2 additional CIP tanks will be of prime priority in order to achieve a 50MT
capacity rate or more per day with. This will allow the company to accept more contracts in a
more harmonious fashion with ability to function at 72MT/day at full capacity. This will
ensure CRYSTAL MINING PLANT to finish its contract in record time all the time.
2012 MONTHLY SALES FORECAST VS EXPENDITURE
TARGET:1250MT
$70.00
$80.00
SALES
87,500.00
100,000.00
EXPENSES (Monthly Expenses + 12% Tax from Sales)
36,726.00
38,226.00
POTENTIAL INCOME
50,774.00
61,774.00
2012 QUARTERLY SALES FORECAST VS. EXPENDITURES
TARGET: 3,750 MT
$70.00
$80.00
SALES
262,500.00
300,000.00
EXPENSES (Monthly Expenses + 12% Tax from Sales)
110,177.00
114,677.00
POTENTIAL INCOME
152,323.00
185,323.00
22
ANNUAL SALES FORECAST VS EXPENDITURES
ENDING DECEMBER 31,2012
TARGET: 15,000MT
$70.00
$80.00
1,050,000.00
1,200,000.00
EXPENSES (Monthly Expenses + 12% Tax from Sales)
440,706.00
458,706.00
POTENTIAL INCOME
609,294.00
741,294.00
SALES
THE BREAK EVEN ANALYSIS DATA
The following data analysis below depicts a picture of CRYSTAL MINING CORPORATION’S
ability to reach a break even point. Considering that initial production will commence July
2011, it is expected that by the end of March 2012, the company will be able to provide a
positive cash flow amounting to $83,128.00 quarter ending by then. Payments for loan shall
be dependent upon the amount of interest we will incur during the process.
BREAK EVEN DATA ANALYSIS
JULY 2011-SEPT.2011
SALES REVENUE
175,000.00
LESS:
YTD EXPENSES
343,046.00
YTD PROFIT LOSS
(YPL)
(168,046.00)
BREAK EVEN DATA ANALYSIS
OCT.2011-DEC.2011
SALES REVENUE
175,000.00
LESS:
YPL JULY-SEPT.’11 + YTD EXPENSES (OCT-DEC. ‘11)
244,195.00
YTD PROFIT LOSS (YPL)
(69,195.00)
23
BREAK EVEN DATA ANALYSIS
JAN- MARCH 2012
SALES REVENUE
262,500.00
LESS:
YPL OCT-DEC ‘11 + YTD EXPENSES PER QTR 2012
179,372.00
YTD PROFIT (POSITIVE CASH FLOW)
83,128.00
BREAK EVEN ANALYSIS
APRIL-JUNE 2012
SALES REVENUE
262,500.00
CASH FLOW
83,128.00
345,628.00
LESS:
YTD EXPENSES
110,177.00
ANNUAL INTEREST AT 10%
YTD Profit
50,000.00
160,177.00
185,451.00
These break even analyses data shows that CRYSTAL MINING CORPORATION will definitely
able to post a positive profit within fifteen (15) months or less from the day of operation. It is
expected that $185,451.00 will be achieved from henceforth as positive cash flow and it is
expected that by the end December 2012 profit of $490,097.00 or more
($185,451.00+$152,323.00 3Q’12+$152,323.00 4Q’12) will be realized and that company will
be debt free
Legend:
Sales
Expenses/Loss
Profit/Income
24
XI. APPENDICES
Table 1. Estimated Gold Ore Production
Area
Coverage No of small
miners
Region
11
26,876
Ave Daily Ore
Production
(tons)
Total Daily
Production
Existing
Processing Plant
Potential Client
Miners
Ore
12
322,512
11,287
15,589
187,068
Total Annual Ore Production
Available Ore
117,716,880
68,279,820
tons of ore
tons of ore
Figure 1. Pictures of Machines and Equipment to be used
Jaw Crusher model PE 200x300 (10tons/hour)
Conveyor with Belt TD 500x9000
Cone Ball Mill YMQ 900x2100 (1 – 1.5tons/hour)
Vibration Feeder GZ3
25
Cyclone
CIP/Leaching Tanks (12x16)
GenSet (Cummins 100 Kva)
26
Figure 2. Typical Flow Chart of Gold Ore Process
Table 2. List of Machines and Equipment Needed (Conversion rate 1 USD = PhP 45)
Description
Ball mill
Jaw Crusher
Conveyor
Compressor
Vibration Feeder
Ore Bins
Cyclone
DSM
Leaching Tank
Slurry Pump
Steel Ball
Generator
Structure
Electrical (100 KVA
Transformer)
Service Vehicle (brand new)
Contingency
Model
YMQ900x2100
PE200x300
TD500x9000
90CFM
SZ300
30 ton
local
local
100 kva
4x4
Quantity
1
1
2
1
1
2
1
1
3
1
4000
1
Unit Price
31,111.11
6,222.22
3,111.11
2,333.33
3,555.56
2,000.00
1,555.56
1,222.22
12,222.22
3,555.56
1.56
17,777.78
subtotal
Amount USD
31,111.11
6,222.22
6,222.22
2,333.33
3,555.56
4,000.00
1,555.56
1,222.22
36,666.67
3,555.56
6,222.22
17,777.78
$
120,444.44
1
44,444.44
44,444.44
1
1
1
33,333.33
33,333.33
22,222.22
subtotal
TOTAL
33,333.33
33,333.33
22,222.22
133,333.33
253,777.78
$
$
27
Table 3. Chamber of Mines of the Philippines operating in Mindanao
CHAMBER OF MINES OF THE PHILIPPINES
Room 809 Ortigas Bldg., Ortigas Avenue, Pasig City 1605 Philippines * Tel.Nos. (632) 635-4123 to 24; 635-4159*Fax No.:(632) 635-4160
* E-mail:[email protected] * Website: http://www.chamberofmines.com.ph
DIRECTORY OF MEMBERS
Company
and Minesite
Location
Address
Tel. No(s).
E-Mail Address
Products
REGULAR MEMBERS
1
Asiaticus Management Corp.
(Davao Oriental) (Australia)
255 Chino Roces Avenue,
Makati City
2
Benguet Corporation
(Baguio, Zambales, Bataan, Davao
& Apayao)
7/F Universal Re Bldg.,
corner Perea St., 106 Paseo De
Roxas, Makati City
3
Philsaga Mining Corp.
(Davao and Agusan Del Sur)
Duratrak Compound, JP Laurel Ave.
Bajada, Davao City
812-9784
892-6611
892-9401
816-1346
Copper, gold,
silver
and nickel
Copper, gold,
silver,
nickel
812-1380
752-0717
(082) 222-8046
(082) 221-0121
(082) 222-1096
867-8086
810-0111
848-2199
[email protected]
Gold
ASSOCIATE MEMBERS - METALLIC (Exploration Companies)
1
2
3
Apex Mining Co., Inc.
(Compostela Valley, Davao)(UK)
Indophil Services International
Pty. Ltd. (Leyte, Camarines Norte,
Davao,
Dumaguete) (Australia)
Philippine Mining Development
Corporation (Davao)
Unit 1704 17th Flr. Prestige Tower
Condominium, Emerald Ave.
Ortigas Center, Pasig City
706-2803 to 06
706-2804
3rd Level, L&F Bldg. ,107 Aguirre
St., Legaspi Village, Makati City
752-1440 to 43
752-1446
Unit 2904-B, West Tower, Philippine
Stock Exchange Centre,
Ortigas Center, Pasig City
706-1630 to 38
706-1630 to 31
Gold & Silver
Gold, copper &
all
other minerals
[email protected]
Gold & copper
PROFESSIONAL MEMBERS
1
Mindanao Assn. of Mining
Engineers (MAEM)
Lybird St., Del Rosario Heights
Subd., Lanang, Davao City
(082) 233-2859
(082) 233-2859
28
Figure 3. Map of Davao Province
29
Table 4. Mining Industry Statistics as of March 2010 (Source: Mines and Geosciences Bureau official
website at http://www.mgb.gov.ph/
30
Table 5. Metallic Mineral Production Comparison (Jan – June 2009 vs. Jan – June 2010)
PHILIPPINE METALLIC MINERAL PRODUCTION
January-June 2010 vs. January-June 2009
As of August 2010
Mineral Commodity
PRECIOUS METALS
Gold
Silver
BASE METALS
Copper Concentrate
Copper Metal Equivalent
Nickel Concentrate
Nickel Content of
Concentrate
Nickel Direct Shipping
Ore
Nickel Content of Ore
*Total Nickel Content of
Ore & Concentrate
Chromite
Zinc
TOTAL
Unit
Used
JAN-JUN, 2010
Quantity
Value
KGS.
KGS.
18,865
20,192
DMT
MT
DMT
MT
110,532
27,397
14,444
8,203
DMT
5,435,162
MT
MT
69,889
78,091
DMT
DMT
5,882
8,992
31,287,345,738
30,773,119,719
514,226,019
18,539,443,792
7,385,933,297
3,947,626,000
6,963,215,207
JAN-JUN, 2009
Quantity
Value
16,875
14,644
87,687
21,362
12,890
7,119
2,984,793
22,565,646,716
22,288,764,680
276,882,036
10,360,183,456
4,332,028,724
3,618,895,000
2,237,931,201
59,966
67,085
49,674,105
192,995,182
49,826,789,530
5,528
10,659
% Change
Qty
Value
12
38
26
28
12
15
82
39
38
86
79
70
9
211
17
49,029,039
122,299,492
32,925,830,172
6
(16)
1
58
51
Source: Website: www.denr.gov.ph Department of Natural Resources- Mines and Geosciences Bureau
http://www.mgb.gov.ph
31
Table 6. Philippine Gold Production (Jan – June 2009 vs. Jan – June 2010)
PHILIPPINE GOLD PRODUCTION
Quantity: In kilograms
Value: In Philippine Peso
Name Of Producer
PRIMARY PRODUCERS
Philippine Gold
Processing & Refining
Corporation/FILMINER
A
Philsaga Mining Corp
Lepanto Cons. Mining
Corporation
APEX Mining Comp Inc.
Benguet Corporation
Johnson Gold Mining
Corporation
Lepanto Cons. Mining
Corporation
Various Small Scale
Mines (SSM) based on
Purchases of Bangko
Sentral Ng Pilipinas
SECONDARY
PRODUCERS
Philex Mining Corp.
Rapu-Rapu Processing
Inc./Rapu Rapu
Minerals Inc.
TVI Resources Dev't
Phil. Inc.
Carmen Copper
Corporation
TOTAL
Project Name
Masbate Gold
Project
Banahaw Gold
Project
Victoria Gold
Project
APEX Maco
Operation
Acupan Contract
Mining Project
Paracale Gold
Project
Teresa Gold
Project
Gold Purchases
of BSP from
SSM*
Padcal Copper
Project
Rapu-Rapu
Polymetallic
Project
Canatuan Mining
Project
Toledo Copper
Project
Qty
JAN-JUN, 2010
Value
Qty
JAN - JUN, 2009
Value
% Change
Qty
Value
16,731
2,479
27,424,683,159
4,107,668,303
14,342
327
19,112,693,754
470,764,236
17
657
43
773
1,559
2,728,478,891
896
1,284,493,342
74
112
358
607,650,859
460
649,301,043
(22)
(6)
353
594,830,516
265
374,800,375
33
59
41
68,899,491
31
43,199,554
32
59
13
16,592,286
15
17,170,703
(14)
(3)
0
0
56
79,109,514
11,929
19,300,562,813
12,293
16,193,854,987
(3)
19
2,134
3,348,436,560
2,533
3,176,070,926
(16)
5
1,590
2,454,926,462
2,030
2,584,201,421
(22)
(5)
326
523,227,084
292
292,791,874
12
79
111
191,224,973
82
113,043,743
36
69
107
179,058,040
129
186,033,889
(18)
(4)
18,865
30,773,119,719
16,875
22,288,764,680
12
38
*Less purchases from Acupan SSM Project, Banahaw Gold Project and Diwalwal Projects
Source: Website: www.denr.gov.ph Department of Natural Resources- Mines and Geosciences Bureau
http://www.mgb.gov.ph
32