Iluka Resources Limited · ASX:ILU
Iluka Resources — JP Morgan Investor Conference 2003
16 slides from Iluka Resources's conference presentation, November 2003
Slide 1: Maximising value in the Murray Basin
ILUKA Presentation to JP Morgan Investor Conference Maximising value in the Murray Basin Mike Folwell - Managing Director Iluka Resources Limited Sydney - November 2003
Slide 2: Iluka's current operations
Iluka’s current operations ILUKA Virginia Florida/Georgia mineral sands Mining area-c CRL operations Mid West coal mining South West Narama interest Coal Murray Basin Mining area-c royalty proposed mineral sands operation
Slide 3: Iluka's market position
Iluka’s market position ILUKA Major player in global TiO2 Total Market Zircon Total Market mineral sands based Share 2002 Share 2002 on: 11% 22% 2% ! technical selling 32% 2% 33% skills 6% ! customer relationships 10% 3% ! reliable supply 3% 20% ! mineral 3% 4% 7% 12% 11% 6% assemblage 2% 11% ! prod
Slide 4: Why focus on the Murray Basin?
Why focus on the Murray Basin? ILUKA The attraction of the Murray Basin as a new mineral sands province is based on: ! existing resources estimate of 120 mt Heavy Namakwa Minerals Richards Bay ! high margin production Resource (Mt) Iluka WA potential Murray Basin ! potential for further exploration
Slide 5: Murray Basin development status mid 2002
Murray Basin development status mid 2002 ILUKA Bemax-Ginkgo Southern Titanium Mindarie Project MBT-Birthday Gift MBT-Karra Cylinder Adelaide MBT-Wemen Iluka-KWR Legend B a s in M in e ra ls H o ld in g s N L C o n s o lid a te d B ro k e n H ill L td Ilu k a R e s o u rc e s L td M u rra y B a s in
Slide 6: Murray Basin rationalisation
Murray Basin rationalisation ILUKA ! Late 2002 Iluka completed a $140m takeover of Basin Minerals ! Takeover rationale based on: ! combining Iluka’s KWR project with Douglas to create a high margin long life project ! synergies from eliminating duplicated infrastructure ! long-term operational savin
Slide 7: Iluka interests post-takeover
Iluka interests post-takeover ILUKA Iluka post-takeover ! control of both Douglas & KWR projects ! 34,000+ sq km exploration portfolio ! access to approx 70-80% of current identified value in the Murray Basin Iluka Iluka Other Tenure Parks Iluka Development Projects Other Projects
Slide 8: Post-takeover activities
Post-takeover activities ILUKA !In late 2002 Iluka completed a review of Basin’s DFS - findings ! 10+ years of resources and stand alone value confirmed ! additional technical work required (to meet Iluka PFS criteria) !Pre-feasibility study (PFS) for Douglas completed in H1 2003 !Opportunities to o
Slide 9: Douglas PFS findings
Douglas PFS findings ILUKA ! Total capex requirement revised to A$190 million to reflect ! requirement for additional engineering and infrastructure ! modifications to the concentrator and MSP ! land and water rights acquisition costs ! Construction and first production schedule revised to reflect !
Slide 10: Douglas project – approvals status
Douglas project – approvals status ILUKA ! Mineral separation plant ! planning approval process completed ! Environment Management Committee established as part of the planning approval – monitoring & compliance role ! Glenelg Water Authority planning approval for waste water treatment facility ! Do
Slide 11: Current Murray Basin schedule
Current Murray Basin schedule ILUKA ! Subject to the completion of the Douglas DFS - end Q1 2004 ! final investment decision early Q2 2004 ! mine construction starting Q2 2004 ! full scale mining/wet concentrator operations - Q1 2005 ! major MSP construction work starting Q2 2004 ! MSP commissioning
Slide 12: Expected production profile – Douglas and KWR
Expected production profile –Douglas and KWR ILUKA Average annual production* 2005 -2006 2007 -2015 Rutile 54,000 tonnes 154,000 tonnes Zircon 64,000 tonnes 96,000 tonnes Wet magnetic HMC (mainly ilmenite) 200,000 tonnes 500,000 tonnes * First 10 yrs production only – current expected combined mine
Slide 13: Where does the Murray Basin fit in Iluka's plans
Where does the Murray Basin fit in Iluka’s plans ILUKA ! Iluka is facing a major challenge with the forecast decline in grades and assembly in WA ! However we are in a position to be able to more than offset this impact through ! the MnM program to reduce costs and enhance margins, and ! the success
Slide 14: Source of growth in high TiO2 content production
Source of growth in high TiO2 content production ILUKA ! Murray Basin rutile production will underpin growth in Iluka’s high TiO2 content production, starting in 2005 ! Further growth potential available through the upgrading of Murray Basin ilmenite and further exploration success Indicative high T
Slide 15: Key to stabilising zircon production
Key to stabilising zircon production ILUKA ! Decline in MW zircon offset by new Murray Basin and incremental USA production ! Expect Group zircon production to be stabilised at current levels ! Potential for zircon exploration upside not yet factored in Indicative Zircon production profile by operat
Slide 16: Concluding comments
Concluding comments ILUKA ! The acquisition of Basin Minerals in 2002 plus KWR provided the scale and opportunity to develop a new long-term, high margin project ! The Douglas project has since been subjected to the rigors of the Iluka project management system resulting in !a better understanding o