Paladin Energy Ltd · ASX:PDN
Paladin Energy — Australian Uranium and Rare Earths Conference 2013
29 slides from Paladin Energy's conference presentation, Jul 17, 2013
Slide 1: Uranium Mining - An Industry in Crisis
Langer Heinrich Mining Operation URANIUM MINING - AN INDUSTRY IN CRISIS John Borshoff, Managing Director/CEO Australian Uranium and Rare Earths Conference 16-17 July 2013
Slide 2: Uranium outlook
Uranium outlook Company status & highlights Operations update Paladin outlook 1
Slide 3: World Nuclear Capacity – June 2013
World Nuclear Capacity – June 2013 “Fukushima is behind us” Demand is confirmed Current Under Planned Proposed Nuclear Construction Capacity Reactors / 435 68 162 316 (Capacity) (371.9GWe) (71.2GWe) (183.0GWe) (358.7GWe) Countries 30 13 28 37 China 17 28 49 120 (14.0GWe) (30.6GWe) (56.0GWe) (123.0GW
Slide 4: Industry Situation Unsustainable
Industry Situation Unsustainable When you have a situation 1. Demand essentially sorted and quantified post Fukushima. 2. Current low prices make it impossible to achieve 2020 supply target. Supply industry in disarray. 3. Effective moratorium in place unless the critical US$70/lb threshold is achie
Slide 5: Supply/Demand Unbalanced
Supply/Demand Unbalanced supply shortfall will widen A supply shortage is unavoidable post 2013-14 Long lead times will severely limit achieving 2020 supply targets — average lead time to full production 6 to 9 years — insufficient projects able to bring sufficient new production online rapidly Pric
Slide 6: Supply Growth Uncertainty
Supply Growth Uncertainty The impossible challenge : Primary supply will have to increase by circa 90Mlb U3O8 pa to meet 2020 requirements (in 7 years) In previous 7-year period (2005 – 2012), production increased only by 48Mlb, and Kazakhstan accounted for ~40Mlb NO OTHER “KAZATOMPROM” OR PALADIN O
Slide 7: Project Development Costs
Project Development Costs Significant CAPEX blowout over the past 8 years US$ per Annual lb Production $250 Forecast $200 Actual $150 $100 $50 $0 Design 2007/8 LHU 2011 2012 LHU Husab Toro Mkuju Criteria Stage 1 + 2 Kayelekera Stage 3 Capital $170M $300M $170M $2.5B $280M $700M Capacity 3.7Mlb/a 3.3
Slide 8: Presentation Outline
Presentation Outline Uranium outlook Company status & highlights Operations update Paladin outlook 7
Slide 9: Disclaimer and Notes for JORC and NI 43-101 Mineral Resources and Ore Reserves
Disclaimer and Notes for JORC and NI 43- 101 Mineral Resources and Ore Reserves This presentation includes certain statements that may be deemed “forward-looking statements”. All statements in this presentation, other than statements of historical facts, that address future production, reserve or re
Slide 10: Quarterly/Annual Highlights
Quarterly/Annual Highlights Safety Maintained low Lost Time Injury Frequency Rate June Qtr – US$107M/2.33Mlb at US$46.22 Sales Annual (FY13) - US$408M/8.25Mlb at US$49.82/lb average Quarterly combined production 2.142Mlb Production FY13 production 8.255Mlb (97% of total design capacity) Production o
Slide 11: Paladin – Turning Vision Into Reality
Paladin – Turning Vision Into Reality LHM construction LHM production (Mlb) Clear commitment KM construction KM production (Mlb) Steady growth, now at 8.0Mlb-8.5MIb pa capacity Annual growth 20%- Applied new process 8.2 - 8.70 40% over 6 years of 8.26 technology 6.89 Developing the production
Slide 12: Current Price Will Not Incentivise New Production
Current Price Will Not Incentivise New Production Paladin decision to proceed with construction Global Financial Crisis Fukushima Disaster - 1 1 - 11
Slide 13: Geographically Diverse Project Pipeline
Geographically Diverse Project Pipeline 12
Slide 14: Uranium outlook
Uranium outlook Company status & highlights Operations update Paladin outlook 13
Slide 15: Langer Heinrich Project
Langer Heinrich Project Three successful production capacity Design Criteria Stage 2 Stage 3 Actual Design FY13 expansions completed: Ore Throughput 2.5Mtpa 3.5Mtpa 3.54Mtpa — 5.2Mlb with Stage 3 starting mid 2012 — currently producing above design Leach Throughput 1.5Mtpa 2.1Mtpa 1.99Mtpa Ore Feed
Slide 16: Langer Heinrich Quarterly Production
Langer Heinrich Quarterly Production Stage 3 Capacity 15
Slide 17: Kayelekera Project
Kayelekera Project Production capacity of 3.3Mlb U3O8 pa Design Criteria Design Actual FY13 Ore Throughput 1.5Mtpa 1.3Mtpa Achieved 97% nameplate in June 2013 quarter Ore Feed Grade 1150ppm 1143ppm First modern resin-in-pulp (RIP) uranium Recovery 87% 84.6% processing facility U3O8 Production 3.3Mlb
Slide 18: Kayelekera Quarterly Production
Kayelekera Quarterly Production KM Quarterly Production and Feed Grade Design Capacity 16 days planned maintenance1 1 Equates to 135,000lb reduced production 17
Slide 19: Uranium outlook
Uranium outlook Company status & highlights Operations update Paladin outlook 18
Slide 20: Strategic Initiative
Strategic Initiative The Paladin platform becoming increasingly more attractive as uranium supply stagnates Key objectives from the strategic initiatives - unlock value from Paladin’s extensive uranium asset base and accomplishments - utilise current platform for future growth leverage with the assi
Slide 21: Positioned for the Future
Positioned for the Future First phase of growth complete — 8.5Mlb of installed production capacity — pipeline established Site cost and corporate overhead reduction well advanced Continuation of optimisation and innovation — production innovation and optimisation for continued unit cost reduction —
Slide 22: Key Takeaways
Key Takeaways Uranium specialist company with demonstrated achievements — only company in world outside Kazatomprom to have delivered new uranium mines — has established a strong and positive reputation in industry Mining — installed nameplate capacity of 8.5Mlb pa — operations de-risked with improv
Slide 23: Paladin Energy Ltd Contact Details
Paladin Energy Ltd Contact Details Head Office Level 4, 502 Hay Street Subiaco Western Australia 6008 PO Box 201, Subiaco Western Australia 6904 Telephone: +61 (0) 8 9381 4366 Facsimile: +61 (0) 8 9381 4978 Email: [email protected] Website: www.paladinenergy.com.au Investor Relations Team
Slide 24: Paladin - A Modern Uranium Company
Paladin - A Modern Uranium Company Uranium specialist company with demonstrated achievements — employs 1,800 staff and contractors — top 10 producer in the world — founded 1994, head office in Perth Mining X — mines in Namibia and Malawi — installed production capacity of 8.5Mlb U3O8 pa — operations
Slide 25: Company Status and Highlights
Company Status and Highlights Safety Performance - - continued high safety performance Kayelekera achieved a milestone 459 days LTI free to end June 2013 X Operational Highlights - combined production for FY13 8.255Mlb, up 19.8% on previous year - positive June quarter results Sustainable Cost Savin
Slide 26: Nuclear Outlook Positive
Nuclear Outlook Positive key drivers Japan – sorting out schedule for re-starts Liberal Democratic Party (LDP) elected Dec 2012 reversed 2040 phase out policy – LDP expected to win upper house July 2013. Unique opportunity to accelerate reactors starts Paladin’s detailed assessment of Japanese react
Slide 27: Major Global Uranium Mining Companies
Major Global Uranium Mining Companies industry unprepared to deal with the supply challenge Government (vertically integrated) agencies: (3) — — — ARMZ (UUU included) Areva CGNPC ] battling growth ] have stumbled with new projects ] new miner – risks associated X Government (mining companies only) a
Slide 28: Paladin – Positioned for Advantage
Paladin – Positioned for Advantage Why Paladin is positioned to take advantage of the current outlook? Unique intellectual property — experienced and committed management team X — technical team with the capability to develop new projects in challenging and complex environments — sector leader in te
Slide 29: Conclusion
Conclusion Paladin on track to continue solid production results – FY14 guidance 8.2-8.7Mlb Focused on further cost rationalisation X Production optimisation through innovation to improve efficiency Strategic initiatives to reduce debt and strengthen the balance sheet Paladin’s pipeline projects – r
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