Paladin Energy Ltd · ASX:PDN
Paladin Energy — Shareholder Meeting (November 2012)
41 slides from Paladin Energy's shareholder meeting presentation, Nov 22, 2012
Slide 1: Vision into Well Positioned Outcome
Vision into Well Positioned Outcome John Borshoff, Managing Director/CEO Alan Rule, CFO Mark Chalmers Chalmers, EGM Production 22 November 2012, Annual General Meeting
Slide 2: 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 3: Presentation Outline
Presentation O tli Outline Vision turned into well positioned outcome Market Outlook Company Status Project Update Update, Mark Chalmers Financial Review, Alan Rule Conclusions 3
Slide 4: Undue Negative Sentiment
Undue Negative Sentiment demand growth still intact Demand: 200-240Mlb uranium (mining and secondary) by 2020 Fukushima Operable Reactors 436 443 432 433 436 Source: World Nuclear Association November 2012 4
Slide 5: Supply Misunderstood
Supply Misunderstood key trends/weak underbelly 180 Paladin Need: 200–220Mlb of mine supply by 2020 160 Kazatomprom Operated (Growth Since 2004) 140 Kazatomprom Operated (Pre-2004 Production) bs U3O8 Global (ex. Kazatomprom & Paladin) 120 100 uction Mlb 80 Includes all the majors • Cameco 60 Produ •
Slide 6: Supply - Replacement
Supply - Replacement Forecast for existing sources of uranium: Production at existing mines will slow slow, decreasing by at least 20Mlb/year U3O8 in 2020 compared to 2012 levels Available secondary supplies decrease by at least another 15 Mlb/year by 2020 on expiry of the HEU agreement and the slow
Slide 7: Fact Sheet – Supply
Fact Sheet – Supply Second supply/demand study (first in September 2011) by Paladin team Over 80 deposits assessed (with high familiarity in most) Paladin has been in construction mode for 8 years (no other company has this experience) and has successfully developed 2 mines. This offers unique insig
Slide 8: Incentive Price - Hurdles for Supply
Incentive Price - Hurdles for Supply A serious SUPPLY crisis is brewing: Lack of economic incentive and financing to develop new projects — even at $80/lb in 2014 and $100/lb in 2016 and higher prices beyond (as below), new sources of production won’t have sufficient time to react due to lack of inv
Slide 9: Supply Growth at a Standstill
Supply Growth at a Standstill A serious SUPPLY crisis is brewing: Supply from new mines significantly constrained by 3 major factors: — over and above huge incentive price constraints the technical and political/regulatory risks are also constraining project development across the globe These risks
Slide 10: If Supply Growth was a Train it would look like this wreck
If Supply Growth was a Train it would look like this wreck 10
Slide 11: Presentation Outline
Presentation O tli Outline Market Outlook Company Status Project Update Financial Review Conclusions 11
Slide 12: Paladin – Ticking All The Boxes
Paladin – Ticking All The Boxes Mi i Mining operations ti achieving hi i nameplate l t (guidance ( id held) h ld) Production innovation and optimisation underway Cost cutting measures gaining traction (US$60-80M) First part of strategic initiatives completed with Long Term Contract and prepayment pa
Slide 13: Paladin Vision (2004) - Explorer to Miner
Paladin Vision (2004) - Explorer to Miner staged growth – clear targets Establish the right skill and expertise base Provide sufficient capital to grow 2004 2005 2006 2007 2008 2009 2010 2011 2012 Production Langer Heinrich BFS Construction 2.6Mlb Stage 1 p.a. Project Development Capability Langer H
Slide 14: Paladin – has built a mining house
Paladin – has built a mining house Paladin has built 2 mines & completed 2 expansions investing US$750M Expansion 2 Expansion 3 LHM Construction LHM Production KM Construction KM Production U3O8 Mlb CY Production 0.8 2.4 3.1 5.4 5.9 7.8 2005 2006 2007 2008 2009 2010 2011 2012 Clear commitment Steady
Slide 15: Paladin – Building a Project Pipeline in parallel
Paladin – Building a Project Pipeline in parallel p Paladin has built 2 mines & completed 2 expansions investing US$750M Paladin has invested $1.5B in its project pipeline 600 LHM Construction LHM Production KM Construction KM Production 500 Pre-2005 Resource Base 500M Organic Resource Growth Aurora
Slide 16: A Solid Platform and Well Positioned
A Solid Platform and Well Positioned Paladin’s premium for strategic value is based on four key drivers: A portfolio of early-life cycle, Unique industry position technologically advanced advanced, as the only significant non non- mining operations Producing Industry aligned pure play producer Mines
Slide 17: Globally Significant Asset Base
Globally Significant Asset Base Actively developing in the world’s premier uranium regions Assets in Production 17
Slide 18: Paladin Supply Train – fast, modern & relevant
Paladin Supply Train – fast, modern & relevant 18
Slide 19: Presentation Outline
Presentation O tli Outline Market Outlook Company Status Project Update Financial Review Conclusions 19
Slide 20: Operations Highlights
Operations Highlights Safety Maintained low Lost Time Injury Frequency Rate of 1.0 Combined p production on Target g for guidance g of Production 8.0Mlb pa to 8.5Mlb pa Proven production ability of 5.2Mlb 5 2Mlb pa (nameplate or LHM greater) Proven ability to process lower grades (<800ppm) Consisten
Slide 21: Langer Heinrich Today
Langer Heinrich Today : + — P , d .. . “% | RAP OY Oy LANGER HEINRICH URANIUM (PTY) LTD 21
Slide 22: Langer Heinrich Project Overview
Langer Heinrich Project Overview Three successful production capacity Design Criteria Stage 2 Stage 3 expansions complete: Ore Throughput 2.5Mtpa 3.5Mtpa — 2.6Mlb (Stage 1) – 2008 Leach 1.5Mtpa 2.1Mtpa — 3.7Mlb (Stage 2) – late 2009 Throughput — 5 2Mlb (Stage 3) – early 2012 5.2Mlb O Feed Ore F d Gr
Slide 23: Langer Heinrich: Operational Update
Langer Heinrich: Operational Update Consistently producing at or above Stage 3 nameplate rate — two full quarters now at Stage 3 rates — feed of 754ppm for September quarter was a solid outcome and was 10.2% lower than June quarter feed grades — recoveries solid at 86.8% which is above design of 85%
Slide 24: Langer Heinrich Production
Langer Heinrich Production LHM Quarterly Q arterl Production Prod ction & Feed Grade 1400 1,200 1200 000) 1,000 oduction (0 1000 ade (ppm) 800 800 600 600 U₃O₈ Pro Gra 400 400 200 Jul-Sep 1290 Oct-Dec 1193 Jan-Mar 1052 Apr-Jun 1322 200 796 650 674 686 693 655 842 928 927 900 933 896 849 0 - Jul-Sep
Slide 25: Training in Namibia
Training in Namibia National Plant Operator training programme developed — jointly developed and accredited by National Training Authority — accepted by all mines in Namibia as standard 2013 IIntern t P Programme — 12 month development programme for young graduates — bridge experience gap required f
Slide 26: Establishing New Businesses in Namibia
Establishing New Businesses in Namibia Established numerous new businesses in Namibia since start up H l d expand Helped d smaller ll truly t l Namibian N ibi businesses b i Example 1: Erongo Scaffolding (14 people) Example E l 2: 2 Uibasen Uib Cl Cleaning i S Services i (32 people l att LHM but b t
Slide 27: Kayelekera Project Overview
Kayelekera Project Overview Production capacity of 3.3Mlb U3O8 pa Design Criteria Ore Throughput 1 5Mtpa 1.5Mtpa Project ramp-up complete and running at Leach Throughput 1.5Mtpa or near nameplate Ore Feed Grade 1100ppm Recovery 87% First modern resin-in-pulp uranium processing facility U3O8 Producti
Slide 28: Kayelekera: Operational Update
Kayelekera: Operational Update Reduced p production in September p 12 quarter q due to annual planned p maintenance shutdown — planned shutdown equated to 135,000lb reduced production — on an available operating day basis the plant achieved 94% of design rate Acid plant producing above design capabi
Slide 29: Kayelekera Quarterly Production
Kayelekera Quarterly Production KM Quarterly Production and Grade Profile 7 day industrial action² 16 days planned Plant shutdown maintenance3 750 for 6 weeks¹ 1,400 1 200 1,200 600 on (000lb) 1,000 Grade (ppm) 450 800 O₈ Productio 300 600 400 150 200 U₃O 74 145 229 515 463 534 606 566 396 632 725 7
Slide 30: Government & Community Relations
Government & Community Relations Paladin has spent some US$15.8M on Corporate Social Responsibility (CSR) projects in local communities during the past four years when obligation in the Development Agreement was US$10M. Garnet Halliday Karonga Water Supply Project – US$9.3M US$9 3M commitment School
Slide 31: Kayelekera: Malawian Business Influence
Kayelekera: Malawian Business Influence Reagent g Supply pp y — Diesel — Lime — Sulphur Transportation/Equipment — 11 companies i providing idi up tto 20 vehicles hi l or machines hi Local Food Purchases — 26 suppliers – 23 are based in Karonga – three in Lilongwe — 70% of all purchases are Malawi b
Slide 32: Employee Training Workshops
Employee Training Workshops 32
Slide 33: Presentation Outline
Presentation O tli Outline Market Outlook Company Status Project Update Financial Review Conclusions 33
Slide 34: Financial Review
Financial Review 2012 financial performance Financing activities in 2012 Debt reduction Cost optimisation programme 34
Slide 35: Presentation Outline
Presentation O tli Outline Market Outlook Company Status Project Update Financial Review Conclusions 35
Slide 36: Strong Growth - period of optimisation/efficiency building
Strong Growth - period of optimisation/efficiency building delivered and future growth anticipated Also period of parallel project Growth potential pipeline establishment (only if uranium price >$85/lb) 16.00 Development / Ramp-up Optimisation Growth (Price Dependent) 14.00 duction (Mlb)) 12.00 Curr
Slide 37: 12 Month Share Price Performance
12 Month Share Price Performance keyy events Paladin well positioned to advantage from looming supply shortage Supply shortage looming 37
Slide 38: Focus for the next phase
Focus for the next phase Operational innovation and optimisation Cost rationalisation Low capital intensity Debt reduction Maintain readiness for next growth phase (pipeline projects) Strategic g initiatives ongoing g g Improve Paladin share price 38
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Slide 40: Proxy Votes
Proxy Votes 1,638 proxies received representing 41.54% of the issued capital For Against Abstain Open usable* Resolution 1 Remuneration Report 318,560,460 27,206,523 2,994,171 1,810,429 Resolution R l ti 2 Re‐election of Donald Shumka as Director 348,787,932 9,014,338 4,449,323 1,819,571 Resolution
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