BCI Minerals Ltd · ASX:BCI
BCI Minerals — Investor Presentation (February 2021)
27 slides from BCI Minerals's investor presentation, Feb 12, 2021
Slide 1: Developing the Multi-Generational Mardie Salt & Potash Project
Developing the Multi-Generational Mardie Salt & Potash Project Corporate Presentation 12 February 2021 ASX:BCI www.bciminerals.com.au
Slide 2: Important Notices
Important Notices Not an Offer of Securities This document has been prepared by BCI Minerals Limited ABN 21 120 646 924 (“BCI”) and is provided for information purposes only. This document does not constitute or contain an offer, invitation, solicitation or recommendation with respect to the purchas
Slide 3: BCI Overview
BCI Overview IRON VALLEY MARDIE SALT & ROYALTIES POTASH PROJECT ▪ ~$210M market cap1 ▪ ~$80M cash and zero debt2 Record 1H FY21 Tier 1: 100-year project EBITDA of $17M BCI SHARE PRICE BCI PERFORMANCE RELATIVE TO PEERS 0.40 7 250% MinRes 0.35 6 200% Kalium 0.30 Share Price ($) Performance 5 Salt Lake
Slide 4: Why Salt and SOP?
Why Salt and SOP? Strong growth markets Stable pricing +30%; +50Mtpa1 SALT Salt & SOP prices less cyclical than ▪ >10,000 products derived from salt ASIAN Iron Ore; Copper and Nickel (PVC, alumina, glass, paper, water DEMAND purification) (2030) ▪ Asian market size of ~160Mtpa salt 160% ▪ Insufficie
Slide 5: Australian Salt & SOP Landscape
Australian Salt & SOP Landscape Mardie: ideal location to produce high-purity salt and SOP Western Australia – Salt and SOP Projects ▪ Pilbara has ideal climate to produce high purity salt – High temperature, high wind, low rainfall, low humidity – Proven salt production region since the 1960’s ▪ Fi
Slide 6: Mardie – A Tier 1 Project
Mardie – A Tier 1 Project Large scale, low cost and long operating life 3. QUALITY 5. STRONG 1. LARGE SCALE 2. SUSTAINABLE 4. LOW COST PRODUCTS CASHFLOWS ▪ Largest salt project ▪▪ 100-year 100-year life life ▪▪ High High purity purity salt salt ▪▪ Lowest Lowest quartile quartile ▪▪ ~$20Bn ~$20Bn cas
Slide 7: Feasibility Study Design
Feasibility Study Design DFS completed in June 2020 with positive results Project Layout SITE CONDITIONS ▪ 100km2 clay soils – ideal to retain water ▪ High net evaporation rates (~10mm/day) PRODUCTION ▪ 9 evaporation ponds ▪ 34 salt and 18 SOP crystallisers ▪ Salt wash plant producing 4.4Mtpa salt >
Slide 8: Mardie Scale will be Globally Significant
Mardie Scale will be Globally Significant Third largest solar salt project globally1 Project footprint vs Sydney/Perth Salt Capacity (Mtpa) 0 1 2 3 4 5 6 7 8 Parramatta Guerrero Negro [Mexico] Manly Hajipir [India] Sydney Mardie Salt/SOP Project [WA] 4.4Mtpa Salt Dampier [WA] Sydney Heads Hub-Pak [P
Slide 9: Final Detailed Design Underway
Final Detailed Design Underway Multiple industry experts involved – low residual construction risk at FID 1. MAIN SEAWATER PUMP STATION 2. SALT WASH PLANT 3. SOP PROCESS PLANT 4. PORT / TRANSHIPPER 9
Slide 10: Early Construction Works Underway
Early Construction Works Underway Establish key infrastructure to accelerate Mardie development Geotechnical Drilling and Surveys Mardie Road 1. Major roads 5 1 2. Accommodation village 3. Trial pond earthworks Trial Pond 3 4 4. Support infrastructure Village – Communications – Fuel storage Mardie 2
Slide 11: Large Scale Trial Pond
Large Scale Trial Pond Test wall designs and construction Trial Pond (March 2021 to June 2021) to test INSERT constructability of evaporation pond wall types: 1. Trafficable outer seawall Future Pond 7 2. Non-trafficable pond separation wall 3. Non-trafficable pond dividing wall 4. Levee embankment
Slide 12: Salt and SOP Pilot Plants
Salt and SOP Pilot Plants 1. SALT PILOT PLANT (UNDER CONSTRUCTION) 2. MARDIE SALT PLANT (ARTIST’S IMPRESSION) 3. SOP PILOT PLANT (AS PLANNED) 4. MARDIE SOP PLANT (ARTIST’S IMPRESSION) 12
Slide 13: Positive Stakeholder & Approval Progress
Positive Stakeholder & Approval Progress Native title in place; Approvals and tenure on track for 1H 2021 Government ▪ Major Project Status (Federal) - one of 20 in Australia ▪ Lead Agency Status (WA) ▪ NAIF loan approval (Federal) - $450M is largest in WA Environment ▪ 3 years of surveys completed
Slide 14: Long Term Stakeholder and Public Benefits
Long Term Stakeholder and Public Benefits 1. BENEFITS TO WA & AUSTRALIA1 ▪ Corporate taxes: >$6Bn ▪ State royalties: >$600M ▪ Native title payments >$150M 6. SECONDARY PROCESSING 2. SIGNIFICANT EMPLOYMENT ▪ Australian first to produce OPPORTUNITIES commercial SOP from seawater ▪ 500 construction job
Slide 15: Strong Customer Support
Strong Customer Support MOUs covering a significant proportion of initial sales ▪ 13 Salt non-binding MOUs signed throughout Asia TARGET MARKETS SALT (4.4MTPA) covering >100% of first 3 years’ salt production China Japan South Korea Taiwan Other ▪ 2 SOP non-binding MOUs signed covering 65% of 10% fi
Slide 16: Attractive Financials
Attractive Financials Strong financial metrics over a 60 year life1 FINANCIALS5 CAPITAL COST (A$780M) ▪ NPV7: A$1,197M ▪ ~A$580M direct capex ▪ ~A$200M indirects and contingency ▪ EBITDA: A$197Mpa (Salt 65%; SOP 35%) ▪ IRR: 15.3% OPERATING COST (60 year average) ▪ Salt A$20.30/t FOB2 ▪ SOP A$310/t F
Slide 17: Salt Cost Curve – Contestable Market
Salt Cost Curve1 – Contestable Market2 Mardie will be a low cost supplier of salt into Asia ▪ Mardie will be cost competitive with all Australian salt operations – only salt project able to ship with large vessels ▪ When SOP margin treated as a by-product credit, Mardie becomes one of the lowest cos
Slide 18: Funding Strategy Advanced
Funding Strategy Advanced NAIF loan approved; positive engagement from banks Funding Requirement ~$1 billion ($780M capex plus working capital, debt interest and funding costs) ~65% ~35% ▪ NAIF1: Positive BCI Minerals ▪ Equity: Corporate Debt Equity Investment Limited level investment is Decision fo
Slide 19: Next 6-months
Next 6-months Early construction; approvals and funding 2021 Q1 Q2 Q3 FID1 EQUITY RAISE EPA POSITIVE COMPLETE REFERRAL TENURE & APPROVALS SECURED BANK DEBT APPROVALS EARLY CONSTRUCTION EARLY WORKS POND COMMENCE CONSTRUCTION COMMENCE 1Final Investment Decision 19
Slide 20: Long Term Project Schedule
Long Term Project Schedule 2021 2022 2023 2024 2025 Q1 | Q2 | Q3 | Q4 Q1 | Q2 | Q3 | Q4 Q1 | Q2 | Q3 | Q4 Q1 | Q2 | Q3 | Q4 H1 | H2 PONDS CRYSTALLISERS GROW SALT INVENTORY FIRST SALT CONSTRUCTION SALT PLANT ON SHIP START OPERATIONS START GROW SOP INVENTORY SOP PLANT FIRST SOP PORT ON SHIP 20
Slide 21: Why Invest in BCI?
Why Invest in BCI? Strong Iron Valley earnings and significant Mardie upside potential CURRENT VALUATION MARDIE POTENTIAL ▪ Salt & SOP growth ▪ Low enterprise value markets of ~$130M ▪ Tier 1 – sustainable, ▪ Record Iron Valley large scale, low cost & royalties long life ▪ ~$80M cash; no debt ▪ ~$20
Slide 22: Appendix
BCI Mnersts Appendix
Slide 23: Iron Valley Mine
Iron Valley Mine Strong royalty payments to BCI ▪ Quarterly royalty earnings from operating agreement with Mineral Resources Ltd ▪ ~7Mtpa production1; 82Mt Reserves2 ▪ Potential mine life of ~10 years ▪ 50% lump ore; 59% Fe average ▪ Since first production in 2014: – BCI received revenue: $290M – BC
Slide 24: Mardie – Site Activity
Mardie – Site Activity 1. EXPANSION OF EXISTING CAMP FROM 36 TO 80 BEDS 2. ONGOING EVAPORATION TRIALS 3. GEOTECHNICAL TEST PIT FOR FEED 4. RAW SALT HARVESTING FOR SALT PILOT PLANT 24
Slide 25: Board
Board Brian O’Donnell Alwyn Vorster NON-EXECUTIVE CHAIRMAN MANAGING DIRECTOR ➢ Banking and investment background ➢ Geology, Mining and MBA degrees ➢ Director, Finance and Investments - ➢ Kumba; Rio Tinto; Iron Ore Holdings Australian Capital Equity (ACE) ➢ Geology; Mining; Marketing, Business ➢ Nume
Slide 26: Executive Team / Key Personnel
Executive Team / Key Personnel Alwyn Vorster Sam Bennett Tony Chamberlain MANAGING DIRECTOR PROJECT DIRECTOR CHIEF OPERATING OFFICER ➢ Geology, Mining and MBA degrees ➢ Civil engineering degree ➢ Chemistry/Metallurgy degrees (PhD) ➢ Kumba; Rio Tinto; Iron Ore Holdings ➢ Fortescue; Roy Hill ➢ WMC; BH
Slide 27: T +61 8 6311 3400 E [email protected] W www.bciminerals.com.au
T +61 8 6311 3400 Level 2 GPO Box E [email protected] 1 Altona Street 2811West Perth W www.bciminerals.com.au West Perth WA 6005 WA 6872