Neometals Ltd · ASX:NMT
Neometals — Macquarie West Australian Forum 2016
46 slides from Neometals's conference presentation, Oct 12, 2016
Slide 1: Investor Presentation
For personal use only Investor Presentation ASX Code: NMT October 2016 1
Slide 2: Disclaimer
2 Disclaimer For personal use only Summary information: This document has been prepared by Neometals Ltd (“Neometals” or “the Company”) to provide summary information about the Company and its associated entities and their activities current as at the date of this document. The information contained
Slide 3: Our Strategy
Our Strategy For personal use only To generate multiple, long-term cashflow streams that we can share with our shareholders 2 cent unfranked div – April ‘16 A$5M/5% on market buyback 2 cent unfranked div – Aug ‘16 3
Slide 4: Corporate Details
Corporate Details For personal use only ASX CODE: NMT OTC:RDRUY 12 MONTH SHARE PRICE Last close (10‐Oct‐2016) A$ 0.335 60 Shares on issue m 563 50 40 Market capitalisation A$m 189 30 Net Cash (30‐June‐2016) A$m 79.2* 20 Listed Investments A$m 13.6 10 0 DIRECTORS/MANAGEMENT Jul-15 Oct-15 Jan-16 Apr-1
Slide 5: Operating structure
Operating structure For personal use only Neometals Ltd (ASX:NMT) LITHIUM TITANIUM 13.8% 70% 100% 100% 42% Reed 43.1% 30% 30% Reed Hannans Alphamet Australian Industrial Mineral Advanced Ltd Management Titanium Minerals Resources Ltd Materials (ASX:HNR) Pty Ltd Pty Ltd Pty Ltd Pty Ltd 43.1% 25% Ganf
Slide 6: For personal use only
6 For personal use only + = + =
Slide 7: Demand Fundamentals
Demand Fundamentals For personal use only + = 7
Slide 8: Demand Growth - Electric Vehicles
Demand Growth - Electric Vehicles For personal use only + = 8
Slide 9: Demand Growth – Stationary Storage
Demand Growth – Stationary Storage For personal use only + = 9
Slide 10: Demand Fundamentals – Price Inelasticity
Demand Fundamentals – Price Inelasticity For personal use only + = 10
Slide 11: Supply Fundamentals – Elastic
Supply Fundamentals – Elastic For personal use only Oligopoly – 3 brine and 2 hard rock converters (incl Ganfeng) control +80% world production. SQM, ALB,FMC, Tianqi, Ganfeng all increasing supply Brines have larger Capex/longer lead times than hard rock + = 11
Slide 12: Strong demand – constrained supply
Strong demand – constrained supply For personal use only + = 12
Slide 13: Lithium Concentrate Prices
Lithium Concentrate Prices For personal use only
Slide 14: LT Demand Fundamentals
LT Demand Fundamentals For personal use only + = 14
Slide 15: Mt Marion Lithium Project
For personal use only Mt Marion Lithium Project 13.8% Neometals Ltd 43.1% Ganfeng Lithium 43.1% and Operator Mineral Resources Ltd (ASX:MIN) + = 15
Slide 16: Strong Operating Partner
Strong Operating Partner For personal use only Australia’s largest contract minerals processor Operate mine-to-port on BOO basis No upfront capital cost to NMT Certainty of construction and production timing Minimum production levels (~50ktpa LCE) Fixed rate mining and processing costs
Slide 17: Strong Offtake Partner
Strong Offtake Partner For personal use only China’s leading, most profitable lithium producer Life-of-Mine, Take-or-pay Offtake Agreement At Market Price with floor price protection US$20M Letter of Credit (100% payment on shipping) Ability for MIN/Neometals to take equity share of produc
Slide 18: Flythrough
For personal use only 18 Flythrough + =
Slide 19: Mt Marion Resource – July '16
Mt Marion Resource – July ‘16 60.5 Mt @ 1.36% Li2O at 0.3% Li2O cut-off For personal use only Figure may not sum due to rounding Significant figures do not imply an added level of precision + = 19
Slide 20: Mining - Deposit
Mining - Deposit 1 For personal use only + = 20
Slide 21: Site layout
For personal use only 21 Site layout + =
Slide 22: Crushing & Screening - Fully Commissioned
Crushing & Screening - Fully Commissioned For personal use only + = 22
Slide 23: Beneficiation – Coarse Circuit complete
Beneficiation – Coarse Circuit complete For personal use only Site works commenced Nov’15 World’s largest hard rock concentrator built from scratch in <12 months despite +40 days lost to rain. 26 August 31 July + = 23
Slide 24: Beneficiation – Commissioning commenced
Beneficiation – Commissioning commenced For personal use only 12 September First feed- 28 September + = 24
Slide 25: Project milestones
Project milestones For personal use only Commence Commission First Commission Crushing Coarse Shipment Fines Circuit Circuit Q2 CY16 End Sep 16 Nov 16 Q1 CY17 New Drill Updated Maiden Resource Results Resource Reserve July 2016 Oct 2016 Oct 2016 Nov 2016 + = 25
Slide 26: Downstream processing – Lithium Hydroxide (LiOH)
For personal use only Downstream processing Lithium Hydroxide (LiOH)
Slide 27: Strategy
For personal use only Strategy
Slide 28: New Commercialisation Plan
New Commercialisation Plan For personal use only • Locate plant in Goldfields to minimise transport, 7t concentrates needed for 1t of Lithium Hydroxide • Utilise local workforce, reagents and energy infrastructure • Use Conventional Sulfate/Caustic Flowsheet used by leading Chinese Converters • Remo
Slide 29: Own low-cost Patented Technology
Own low-cost Patented Technology 70% NMT: 30% MIN For personal use only + = 29
Slide 30: Own low-cost Patented Technology
Own low-cost Patented Technology For personal use only + = 30
Slide 31: Own low-cost Patented Technology
Own low-cost Patented Technology For personal use only + = 31
Slide 32: Feasibility Study - Financial Metrics
Feasibility Study - Financial Metrics For personal use only FS Life of Plant (LOP) 20 years Pre-production Capital cost US$ 158 million** [1 Average Annual Pre-tax Net Cashflow US$ 82 million Pre-tax Internal Rate of Return 51% Pre-tax NPV (12% real discount rate) US$ 481 million Payback of capital
Slide 33: Barrambie Titanium Project
For personal use only Barrambie Titanium Project 100% Neometals + = 33
Slide 34: Titanium Fundamentals
Titanium Fundamentals For personal use only + = 34 Sources: Company Reports
Slide 35: Titanium Fundamentals
Titanium Fundamentals For personal use only + = 35 Sources: Company Reports
Slide 36: Licenced low-cost Technology
Licenced low-cost Technology For personal use only Competitors Input Price US$1,000/t X1.2t Final Final Chlorination Product ROM Chlorination Product Rutile & Purification Fine Ore/Con & Purification Fine Pigment Pigment Cost Cost US$1,214/t US$2,100 - US$572/t 2,300/t Mini-pilot scale testing in
Slide 37: Licenced low-cost Technology
Licenced low-cost Technology For personal use only + = 37
Slide 38: High Quality Resource
High Quality Resource For personal use only 1 2 +150Mt 47Mt @ 3 @34% TiO2 22% TiO2 18% Lac Tio Barrambie* Tellnes * Mineral Resource Estimate (JORC2012) on page 29 + = 38 Sources: Company Reports
Slide 39: Pre-feasibility Study - Financial Metrics
Pre-feasibility Study - Financial Metrics (*) For personal use only Life of Mine (LOM) 19.6 years Pre-production Capital cost [1 A$ 549 million (excluding EPCM and Contingency) Average Annual Pre-tax Net Cashflow A$ 123 million Pre-tax Internal Rate of Return 21% Pre-tax NPV (12% real discount rate)
Slide 40: Commercialisation Plan
Commercialisation Plan For personal use only Pilot Scale Completed Beneficiation Definitive Final Pre-feasibility & Hydromet Feasibility Investment Study Test work * Study * Decision * Aug 2015 FY 2017 FY 2018 Attract JV Partner (*) Subject to Board Approval + = 40
Slide 41: Investment Proposition
For personal use only 41 Investment Proposition + = 41
Slide 42: Lithium : Cash and cashflow
Lithium : Cash and cashflow For personal use only 03 02 Potential to further expand 01 13.8% share of production and/or ~A$66M plus Production + increased cashflows from new production + value-add through conversion to commencing level-400,000tpa LiOH Q4-2016 + = 42
Slide 43: Titanium : A growth story for 2017
Titanium : A growth story for 2017 For personal use only 03 01 02 Demonstrate Pigment Quality Demonstrated Technical + Demonstrated Economic + & Obtain Strong Partners Feasibility Viability to Commercialise + = 43
Slide 44: Thank you
For personal use only Thank you www.neometals.com.au + = 44
Slide 45: Mineral Resource Estimate – Mt Marion
Mineral Resource Estimate for the Mt Marion Lithium deposit, as at July 2016, for a block cut‐off grade of 0.3% Li2O For personal use only Classification Deposit Tonnes (Mt) Li2O % Fe % Indicated Area 1,2,2W 18.5 1.38 1.09 Area 4 0.9 1.24 1.03 Area 6 7.0 1.22 1.09 Indicated Total 26.4 1.33 1.09 Infe
Slide 46: Mineral Resource Estimate – Barrambie
Mineral Resource Estimate for the Barrambie Ti‐V deposit, as at September 2015, for a block cut‐off grade of 15% TiO2 For personal use only Density TiO2 V2O5 Fe2O3 Al2O3 SiO2 Classification Zone Oxidation MTonnes (t/m3) (%) (%) (%) (%) (%) Eastern Oxide 18.7 2.82 23.29 0.59 42.93 10.70 16.36 Transit