Perpetual Resources Ltd. · ASX:PEC
Perpetual Resources — Investor Presentation (October 2021)
35 slides from Perpetual Resources's investor presentation, Oct 7, 2021
Slide 1: Beharra. The Midwest's leading high grade silica sand project
Beharra. The Midwest’s leading high grade silica sand project. ASX: PEC Corporate Presentation, October 2021
Slide 2: Disclaimer
Disclaimer This presentation contains summary information about Perpetual Resources Ltd (Perpetual) and is current as of 6th October 2021. The information in this presentation is of a general nature and does not purport to be complete nor does it contain all of the information a prospective investor
Slide 3: Competent Persons Statement
Competent Persons Statement The information in this report that relates to the March 2020 Exploration information for the Beharra Project is based on information compiled and fairly represented by Mr Colin Ross Hastings, who is a Member of the Australasian Institute of Mining and Metallurgy and cons
Slide 4: Perpetual Resources: Investment Highlights
Perpetual Resources: Investment Highlights 100% owner of Highly supportive Led by an PFS demonstrates Beharra PFS Outcomes Base case the Beharra high commodity market experienced a long-life project Post-Tax NPV (ungeared) $231m grade silica sand backdrop provides Board and team with compelling proj
Slide 5: Corporate Snapshot
Corporate Snapshot Julian Babarczy Robert Benussi Managing Director Brett Grosvenor Non-Executive Director George Karafotias Non-Executive Director Executive Chairman ASX Code PEC Share Price (as at 6 October 2021) $0.115 Ordinary Shares 492.2m PEC Share Price Relative to Peers Options (5m at 4.5¢,
Slide 6: Project Portfolio
Project Portfolio Four discrete Project Hubs – all located proximal to established infrastructure. Beharra1 – the focus • Pre-feasibility study completed with compelling economics • Post tax NPV (ungeared): $231m • Post tax IRR (ungeared): 55% • Initial Capex: $39m • Mining License application grant
Slide 7: We give such little thought to it... sand and gravel build the foundations
“We give such little thought to it… But sand and gravel build the foundations of our economies.” United Nations Report on Sand and Sustainability, 2019 7
Slide 8: Sand Facts
Sand Facts “The global rate of sand use — which has tripled over the past two decades partially as “We just think a result of surging urbanization — that sand is far exceeds the natural rate at everywhere. We never “For construction which sand is being replenished thought we would run alone, the wor
Slide 9: What is Silica Sand Used For?
What is Silica Sand Used For? Glass - Architectural - PV solar cell glass covers - Smartphones - Tablets - Automotive - Fiberglass - Container Packaging Building products - Quartz surfaces - Roofing shingles Foundry sands - Automotive & Manufacturing Fillers & Extenders Chemicals Construction Sands
Slide 10: Asia Pacific: The Fastest Growing Silica Sand Market in the World
Asia Pacific: The Fastest Growing Silica Sand Market in the World APAC Silica Sand Market Value (US$m) APAC Sales Volume (mtpa) 9,000 180 8,000 40mtpa of extra high 160 quality silica sand is Market growth of needed in 7,000 US$3b is up for APAC grabs 6,000 140 5,000 120 4,000 3,000 100 2015 2016 20
Slide 11: Relative Size of End Markets
Relative Size of PEC focus industry End Markets Other Abrasives 4% 5% Filtration • The Asian glass industry is the largest and highest growth for high grade 10% silica sand • The PV solar panel glass cover industry is experiencing exponential growth • These markets are Perpetual’s focus • Initial be
Slide 12: Perpetual's Target Markets are the Biggest and Fastest Growing in Asia
Perpetual’s Target Markets are the Biggest and Fastest Growing in Asia 70 68mt 52.5 Million 45mt PEC metric tons focus 35 31mt 17.5 15mt 9mt 6mt 2% CAGR 3% CAGR 5% CAGR 5% CAGR 3% CAGR 5% CAGR Other Abrasives Filtration Hydraulic Fracturing Foundry Total Asia Glass Industry 12 Source: IMARC Group, R
Slide 13: Australia: An Established Silica Sand Exporter
Australia: An Sth Korea AUS 68% ROW 32% Established Silica China Japan Sand Exporter AUS 48% AUS 70% ROW 52% ROW 30% • Australia exports around 5mtpa of high grade silica sand* • 2.5-3.0mtpa from Cape Flattery • 1.0-1.5mtpa from Western Australia • Balance from various mines throughout Australia • C
Slide 14: Structural Change in Price Has Been Underway for a Decade
Structural Change in Price Has Been Underway for a Decade US$ Price/ton for 150-200ppm Fe₂O₃ Silica Sand US$ Price/ton for 200-300ppm Fe₂O₃ Silica Sand 220 100 180 80 140 60 100 40 60 20 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 Japan Korea C
Slide 15: How Silica Sand is Priced
How Silica Sand Fe₂O₃ is Priced Higher price Ultra clear / PV solar Silica sand is like iron ore, where various cover glass specifications are priced with reference to a key attribute (in this case, silicon dioxide) with price 100ppm adjustments related to impurity content. Clear / float To service
Slide 16: Beharra: High Grade Silica Sands
Beharra: High Grade Silica Sands LOCATION Approximately 100km south of Geraldton, comprising a north- south striking exploration licence covering an area of about 49 km2 SCALE The project lies within the northern part of the Perth Basin and contains a 13km strike length of high grade silica sand RES
Slide 17: Project Economics
Project Economics Capital Expenditure Cost (A$) Wet Processing Plant $19.1m On Site Infrastructure $3.5M Perpetual’s strategy is to operate with maximum flexibility, Off-Site Infrastructure (Bore field, site access roads) $9.3m aiming to be able to respond to the expected positive Indirect Costs (PC
Slide 18: What Makes Beharra Special
What Makes Simple geology • Clearly defined horizons of white and Superior metallurgy* • Lowest known impurity profile Beharra yellow sand • Selective mining expected to be in the Midwest • Potential for premium product pricing Special straightforward 100% 90% white sand >50% reduction • White sand
Slide 19: PFS Production Process
PFS Production Process • Simple flow sheet design due to straight forward metallurgy • Packaged plant sweet spot - 250t per hour planned • Flow sheet to be optimised based on current metallurgical testing Typical sand plant showing various product streams being produced 19 Note: For further informat
Slide 20: White Sand Potential
White Sand Potential • White sand only processing seen as a potentially significant project optimisation scenario • A single 300kg sample of white only sand was tested by IHC Robbins in April 2021, showing significant reductions in the key impurity Fe203 February 2021 PFS April 2021 White Sand Test
Slide 21: DSO White Sand Potential
DSO White Simple DSO Flow Sheet Sand Potential • PEC received unsolicited approach from previously announced offtake party for sales of Direct-Shipping-Ore (DSO) white sand from Beharra. • Offtake party undertook metallurgical testwork and achieved a further material reduction in Fe2O3 from Beharra
Slide 22: Tier 1 Infrastructure Regional
Tier 1 Infrastructure Regional Beharra is one hour by high quality road to Geraldton Port, underpinning the economic viability of Beharra. RAV7.3 – PBS Super Triple 22
Slide 23: Tier 1 Infrastructure In Practise
Tier 1 Infrastructure In Practise MINE SITE BRAND HW Y GERALDTON PORT INTERSECTION Sealed highway to Internal haul road Narngalu Bulk to Mt Adams Rd Storage Facility MT ADAMS RD NARNGALU Short haul to Geraldton Port for Mt Adams Rd connects APAC export directly to the sealed Brand Highway 23
Slide 24: Strong Stakeholder and Approval Progress
Strong Stakeholder and Approval Progress Perpetual is earning its “social licence” to operate at Beharra COMMUNITY • Strong working relationships with Traditional Owner groups • All key Native Title Agreements in place • Local engagement well progressed ENVIRONMENT • Level 2 Environmental Studies un
Slide 25: Beharra Market Entry Strategy
Beharra Market Entry Strategy • Perpetual has secured multiple MOU’s for offtake – Yaoguo Solar Science & Technology Co - 250K tons p.a. – Guangdong Qingyuan New Material Technology Co - 400K tons p.a. – C&D Logistics Group Co - 600K tons p.a. • Perpetual has had overwhelming interest and is in disc
Slide 26: Future Opportunities for Enhancement
Future Opportunities Potential for Enhancement simplifying of the metallurgical flowsheet to lower Direct port capital and access as part of operating costs Freight Mid West Ports alternatives expansion project DSO such as Road + production Rail or Rail scenario being only Dry mining Selective inves
Slide 27: Beharra Study Update
Beharra Study Update Data utilised Original PFS PFS Update to be DSO Scoping Study (White and yellow sand) Followed by DFS Commenced • Confirmed strong (White sand only) (White sand only) economics and outstanding • Pending outcome of • Based on credible project returns current bulk metallurgical in
Slide 28: Beharra Development Timeline
Beharra Development Timeline 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23 3Q23 4Q23 White Sand Met Work Offtake Discussions Environmental Studies Statutory Environmental Approvals DSO Scoping Study PFS Update Definitive Feasibility Study Decision to Fund ★★★ Order Long Lead Items Construction / Install C
Slide 29: Conclusion
Conclusion The Mid West Region’s Strong project Located on doorstep Strong study team Experienced Board and Rapidly advancing lowest impurity silica economics to APAC, the world’s and consultants Leadership Team project sand project fastest growing market • The Mid-West Region’s • 1.5mtpa silica san
Slide 30: Julian Babarczy
Julian Babarczy Executive Chairman Robert Benussi Managing Director robert.b@pecsilica.com +61 410 415 335 Perpetual Resources Ltd 223 Liverpool St, Darlinghurst NSW 2010 www.perpetualresourceslimited.com.au
Slide 31: Beharra: Environmental Approvals
APPEN DIX Beharra: STAGE 1 (s.38) Environmental studies currently completed and/ Environmental Referral of a proposal to the EPA April 2022 or underway in support of approvals process: Approvals STAGE 2 (s.38A - s.39B) • Flora and Vegetation EPA to decide whether to May/June • Terrestrial Fauna asse
Slide 32: Silica Sand: An Overview
APPEN DIX Silica Sand: An Overview Most sand deposits are unsuitable for industrial applications due to chemical composition, grain size and shape, impurity profile and access to an economic logistics solution. What is Silica Sand Silica Sand Properties Silica Sand Impurities Geology Importance Logi
Slide 33: Why is sand in short supply?
APPEN DIX Why is sand in We Are Running short supply? Out of Sand The Economist The Good Stuff A global sand crisis no A sand one is talking about it shortage? 33 Vince Beiser, TedX CNBC
Slide 34: Project Reserves/Resources
APPEN DIX Project Reserves/Resources Beharra Indicated Mineral Resource February 20211 Sand Volume (Mm3) Density Tonnes (Mt) SiO2% AI2O3% TiO2% Fe2O3% LOI% Yellow 8.1 1.64 13.2 98.2 0.50 0.23 0.23 0.51 White 76.7 1.64 125.8 98.6 0.41 0.36 0.23 0.21 Total 84.8 1.64 139.0 98.6 0.42 0.35 0.23 0.24 Note
Slide 35: Project Study Team and Stakeholders Beharra
APPEN DIX Project Study Team and Stakeholders Beharra Project 35
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