Pls Group Limited · ASX:PLS
Pls — Pilbara Minerals — Investor Presentation (May 2018)
51 slides from Pls's investor presentation, May 29, 2018
Slide 1: Powering a Sustainable Energy Future
ASX Code: PLS Powering a Sustainable Energy Future Corporate Presentation - May 2018 @PilbaraMinerals @KenBPilbara pilbaraminerals
Slide 2: Important Notices and Competent Person’s Statement
Important Notices and Competent Person’s Statement Not an Offer of Securities This document has been independently prepared by Pilbara Minerals Limited (“Pilbara”) and is dated 29/05/2018. This document is provided for informational purposes and does not constitute or contain an offer, invitation, s
Slide 3: Important Notices and Competent Person’s Statement
Important Notices and Competent Person’s Statement Not Financial Product Advice This document does not constitute financial product advice or take into account your investment objectives, taxation situation, financial situation or needs. This document consists purely of factual information and does
Slide 4: Company Overview
Company Overview Lithium Markets Pilgangoora Stage 1 Project Pilgangoora Stage 2 Project Summary 4
Slide 5: Pilbara Minerals – Overview
Pilbara Minerals – Overview ► Pilgangoora is located in the Pilbara region of Western Australia, a proven mining jurisdiction 120km south of Port Hedland with established transport and port infrastructure ► 100% ownership interest in the world-class Pilgangoora Lithium-Tantalum Project ► One of the
Slide 6: Pilgangoora – Delivering on Project Execution
Pilgangoora – Pilbara Minerals, Delivering on Project Execution Stage 1 Stage 2 Near- PFS (2Mtpa term Resource DFS (2Mtpa) Project and 4/5Mtpa) Production Growth Complete Production Complete Growth to Imminent 5Mtpa Resource Estimation Project Definition Detailed Design and Project Delivery / Produc
Slide 7: A Key Supplier to Global Lithium Markets
Pilbara Minerals – A Key Supplier to Global Lithium Markets Over 110kt (LCE basis) of offtake sold to outstanding project partners: - Scale - Quality - Excellent Technology - Experience, Battery Grade Materials 7
Slide 8: A Key Supplier to Global Lithium Markets
Pilbara Minerals – A Key Supplier to Global Lithium Markets Pilbara Minerals Mining SC 6.0 Stage 1 Stage 2 300kt-350ktpa 500kt-550ktpa Stage 1 ≈43Ktpa LCE Spodumene Production 2018 2020 Stage 1+2 >110ktpa LCE Ganfeng Great Wall Motors POSCO Spodumene Offtakers General Lithium Ganfeng 75ktpa + 75ktpa
Slide 9: Lithium Markets
Company Overview Lithium Markets Pilgangoora Stage 1 Project Pilgangoora Stage 2 Project Summary 9
Slide 10: Lithium Growth - Batteries are the Key Driver
Lithium Growth - Batteries are the Key Driver The way we Generate, Use, Distribute and Store energy is changing. Lithium Ion rapidly becoming the dominant rechargeable battery technology. Electric Vehicle uptake driving the growth in demand, followed by energy storage. The Lithium-ion Battery is the
Slide 11: China Market Overview - 2017 Snapshot
China Market Overview - 2017 Snapshot (Lithium Carbonate Equilavent) Domestic Production +17kt3 Imports +193kt1 ►Spodumene (118kt)1 LOCAL PRODUCTION3: Exports +19kt1 ►DSO (36kt)1 ► Brine (≈12kt) ►Lithium Chemicals (39kt)1 ► Spodumene (≈5kt) ►Lithium Carbonate (1kt)1 Consumption (120-140kt)3,4 LC ►Li
Slide 12: Lithium Consumption Outlook (Kt LCE)
Independent research groups, struggling to keep pace with demand growth Major upgrades in demand growth driven by realisation as to market scale and economics of battery application Battery Other 1,800 3.7 X Increased lithium use driven by bigger battery application / requirements: 1,600 168 1,400 1
Slide 13: Lithium raw materials - Key Ingredient of the Battery Supply Chain
Lithium raw materials - The Key Ingredient of the Improved Battery Supply Chain ► Lithium raw materials are the vital ingredient for lithium battery Battery Supply Chain technology Lithium raw materials ► Lithium is sourced predominantly from: Spodumene Mine - Hard Rock Spodumene Concentrate Lithium
Slide 14: Global Investment is Skewing Towards Hard-Rock Sourced Supply
Global Investment is Skewing Towards Hard-Rock Sourced Supply Albemarle – 60% of the capacity expansions are in hard-rock sourced Hydroxide capacity. The global majors are undertaking major investments in hard-rock capacity expansion, driven by: ▪ Significant demand for lithium in hydroxide, as high
Slide 15: Spodumene Price Outcomes
Spodumene Price Outcomes Recent domestic sales of spodumene within China report very strong pricing. 8,276.25 yuan/t = ≈US$1,314/t (delivered, VAT inc.). Ganfeng settled US$960/t (delivered, VAT exc.) for the balance of 2018 calendar year with Mineral Resources / Neometals. Strong demand for run-of-
Slide 16: Pilgangoora Stage 1 Project
Company Overview Lithium Markets Pilgangoora Stage 1 Project Pilgangoora Stage 2 Project Summary 16
Slide 17: Monster DSO Project - Layout
Monster DSO Project - Layout Monster Pit Pit Ramp Waste Dump Mining Overview Mining Progress DSO ore skyway To Plant Skyway ROM Haul Road Loop Water Cart turnaround 2 Meg Turkeys Nest Loading High Grade Pit Overview Mining 17
Slide 18: DSO Project - Update
DSO Project - Update Mining Progress DSO ore skyway Loading High Grade Pit Overview 18
Slide 19: Stage 1 – 2Mtpa Processing Overview
Stage 1 – 2Mtpa Processing Overview Stage 1 ► DFS completed in September 2016; subsequent update to reflect higher ore reserve (80.3Mt) further enhances project economics ► 41 year project life based on 80.3Mt reserve ► LOM average annual production: ► approximately 320ktpa of 6% spodumene concentra
Slide 20: Pilgangoora Project – Overview
Pilgangoora Project – Overview Site overview, as at 14 February 2018 Plant site, as at 16 April 2018 20
Slide 21: Pilgangoora Project – Construction Progress
Pilgangoora Project – Construction Progress Overview Expanded Camp Facilities Process Plant Mining Central 21
Slide 22: Pilgangoora – Quality Product Streams
Pilgangoora – Quality Product Streams Testwork and now pilot scale metallurgical programs deliver outstanding results and demonstrate the class of the Pilgangoora project as a large-scale, low cost supplier of quality lithium raw materials: ► Chemical Grade concentrates, Genuine 6% Lithia (SC6.0) –
Slide 23: Pilgangoora Stage 2 Project
Company Overview Lithium Markets Pilgangoora Stage 1 Project Pilgangoora Stage 2 Project Summary 23
Slide 24: Stage 2 – 5Mtpa Expansion Overview (PFS Results)
Stage 2 – 5Mtpa Expansion Overview (PFS Results) ► Modest incremental capital to expand to 5Mtpa of AUD 207m ► LOM average annual production, after Stage 1 and 2 production ramp-up: ► approximately 800ktpa of 6% spodumene concentrates, and ► approximately 780,000lbs of tantalite in concentrate ► Min
Slide 25: 5Mtpa Expansion - Project Delivery Schedule
5Mtpa Expansion - Project Delivery Schedule 25
Slide 26: Summary - Investment Highlights
Summary - Investment Highlights Outstanding Rapid pathway Ideally placed to Low-cost and high Significant project economics Offtake and full through capitalize on quality lithium resource scale and and ability to Stage 1 project construction and robust lithium products grade substantially grow fundi
Slide 27: Supplementary Information
Supplementary Information 27
Slide 28: Board of Directors
Board of Directors Non-Executive Highly experienced company director and former solicitor with over 30 years’ professional experience. Currently Tony Kiernan Chairman Chairman and a non-executive director of several ASX-listed resource companies. Mining Engineer with over 2 years’ experience includi
Slide 29: Pilgangoora Project Partners
Lithium Market Pilgangoora Project Partners Pilgangoora Project 29
Slide 30: Leverage to Lithium Ion Battery Materials
Leverage to Lithium Ion Battery Materials ► The leverage to Lithium Ion battery materials sits with Lithium ► Massive market growth required in lithium raw materials to contribute to growth in battery industry: ► 250% supply growth to 2025 ► >500% supply growth to 2030 ► It’s often said that there i
Slide 31: Massive expansion of Lithium ion battery making capacity underway
Massive expansion of Lithium ion battery making capacity underway More than USD20bn of committed investment expected to result in new battery manufacturing expansions that will increase global production capacity significantly and drive production costs down 31 Source: Benchmark Mineral Intelligence
Slide 32: Lithium Raw Material Prices – Grade Differential
Lithium Raw Material Prices – Grade Differential Lithium Carbonate ≈99% Technical Grade Lithium Carbonate ≥99.5% Battery Grade Price Variance – Battery Grade vs Technical Grade over recent history Minimum - +USD$1,200/tonne Maximum - +USD$3,500/tonne Upgrading an ‘Industrial or Technical Grade’ prod
Slide 33: Lithium Raw Material Prices – Grade Differential
Lithium Raw Material Prices – Grade Differential Battery grade materials trading at higher levels for the best part of 2 years, driven by: ▪ Significant demand ▪ Premium for product quality ▪ Includes markets ex China Sources: China Domestic Price, Asian Metals (exc. VAT) China Import Price, Impexp
Slide 34: Global Cost Curve – Product Grade Matters
Global Cost Curve – Product Grade Matters…… Global cost curves are not ‘normalised’ for Battery Grade specifications, i.e. ≥99.5% purity lithium carbonate By far, the majority of brine production does not meet Battery Grade specifications and therefore has to have more money spent on it to achieve t
Slide 35: Roskill Upgrades Lithium Outlook (Kt LCE)
Independent research group, Roskill, significantly upgrades Lithium Outlook Significantly increased outlook driven by Li-Ion Battery demand in Electric Vehicles Battery Other 1,800 Increased lithium use driven by EV battery requirements: 1,600 168 1,400 e-Buses PHEV & BEV HEV e-motorcycles 1,466 ~20
Slide 36: Transition to Electric Vehicles – Exponential Adoption Curve
Transition to Electric Vehicles – Exponential Adoption Curve 2025 Forecast EV Penetration Rates Roskill’s forecast scenarios for sales of EV’s (GWh) LCE Demand in Li-ion batteries (% of total vehicle sales) 4,000 10 x growth from 83kt Assumed performance gains in batteries could reduce 3,367 17% 3,5
Slide 37: Pilgangoora Project Partners
Lithium Market Pilgangoora Project Partners Pilgangoora Project 37
Slide 38: Ganfeng Lithium - China’s Largest Fully Integrated Lithium Company
Ganfeng Lithium - China’s Largest Fully Integrated Lithium Company ► Established in 2000 in Jiangxi Province, China, Ganfeng Lithium has a capacity of around 35,000tpa of LCE and produces lithium carbonate, lithium hydroxide, lithium metals, butyl lithium, and a number of other lithium compounds ► G
Slide 39: Ganfeng Lithium – a Major Producer of Lithium Chemicals in China
Ganfeng Lithium – a Major Producer of Lithium Chemicals in China ► Listed on NEEQ, Beijing, Code No: 837358 with a market capitalisation of RMB 2.6Bn (USD ~410m) ► Currently produces 8,000tpa of Lithium Carbonate (LC) & 2,000tpa of High Purity LC 4N (99.99%) ► Recently commissioned 5,000tpa of Lithi
Slide 40: Great Wall Motors - China’s largest SUV and pickup manufacturer
Great Wall Motors - China’s largest SUV and pickup manufacturer • Listed on the Hong Kong & Shanghai Stock Exchanges • Market capitalisation of RMB 120Bn ~US$19Bn • >60,000 employees and produces ~1 Million vehicles per year from 4 vehicle manufacturing bases. • SUVs sold under the “Haval” brand (87
Slide 41: Stage 2 Off-take and Associated Funding
Stage 2, 5Mtpa Expansion Project – Off-take and Associated Funding POSCO agreements announced on 28 February 2018 close out the remaining uncommitted Stage 2 production ► Binding offtake agreement for an initial 80,000tpa of 6% spodumene concentrate from Stage 2 production for the Pilgangoora Life o
Slide 42: Strategic Downstream JV with POSCO
Strategic Downstream JV with POSCO • Pilbara Minerals to be a 30% participant in a Downstream Joint Venture (DSJV) with POSCO (at Pilbara’s election), to develop and operate a 30,000tpa LCE lithium carbonate/ lithium hydroxide Pilbara Minerals POSCO conversion plant in South Korea • POSCO is a finan
Slide 43: Pilgangoora Project Partners
Lithium Market Pilgangoora Project Partners Pilgangoora Project 43
Slide 44: Resources & Reserves
Resources & Reserves JORC Mineral Resources: 29 May 2018 Category Tonnage Li2O (%) Ta2O5 Fe2O3 (%) Li2O (T) Ta2O5 (Mt) (ppm) (Mlbs) Measured 22.1 1.41 146 0.44 311,000 7.1 Indicated 107.0 1.31 119 0.58 1,435,000 28.0 Inferred 84.2 1.27 105 0.71 1,071,000 19.4 Total 213.3 1.32 116 0.69 2,818,000 54.6
Slide 45: Pilgangoora – a globally significant hard rock lithium resource
Pilgangoora – a globally significant hard rock lithium resource PILBARA MINERAL S Note: Tantalum adjusted resource size at Pilgangoora includes consideration of the spodumene equivalent revenue of tantalum by-product recovered and attributable to Pilbara Minerals over the LOM. Source: Published reso
Slide 46: Pilgangoora – Straightforward Open Pit Mining Development
Pilgangoora – Mining a Straightforward Open Pit Mining Development ► Measured, Indicated and Inferred Resources of 213.3Mt @ 1.32% Li2O and 116ppm Ta2O5 containing 1,952,000 tonnes Li2O, and including 44Mlbs Ta2O5 (Mineral Resource Update ASX release dated 25 January 2017) ► Ore Reserve of 80.3Mt @
Slide 47: Pilgangoora – Processing
Pilgangoora – Processing ► Industry standard processing flowsheet ► Spodumene concentrate produced at three mines in Western Australia ► 2-stage heavy media separation ► Gravity separation, tantalite recovery ► Grinding leading to oxide flotation ► Low/High intensity magnetic separation ► High grade
Slide 48: Pilgangoora – Mine to Ship Contracted Logistics Chain
Pilgangoora – Mine to Ship Contracted Logistics Chain Proposed ► Road transport from mine site to Wedgefield Storage Facility Loading – Rotabox ► 127km via Great Northern Highway utilising double road trains ► Product storage at Wedgefield and loaded into shipping containers ► Transport from Wedgefi
Slide 49: Project Highlights – 5Mtpa
Project Highlights – 5Mtpa (inclusive of Stage 1 and Stage 2) Metric Unit PFS 5Mtpa Life of Mine (LOM) Years 17 LOM Ore Mined Mt 80.4 LOM Waste Mined Mt 310.1 LOM Strip Ratio (waste:ore) 3.85 Plant Feed Rate Mtpa 4.67 Average Lithium Head Grade % 1.26 Average Lithium Recovery % 75.0 Average Tantalum
Slide 50: Stage 2 – 5Mtpa Expansion
Stage 2 – 5Mtpa Expansion ► DFS now in progress and on track for completion by mid-2018, paving the way for a Final Investment Decision (FID) in Q3 2018, start of construction by Q4 2018 and commissioning from Q4 2019. ► The 5Mtpa expansion of Pilgangoora will position Pilbara Minerals to meet the s
Slide 51: Powering a Sustainable Energy Future
ASX Code: PLS Powering a Sustainable Energy Future Corporate Presentation - May 2018 @PilbaraMinerals @KenBPilbara pilbaraminerals