Arafura Rare Earths Limited · ASX:ARU
Arafura Rare Earths — Arafura Resources — Shareholder Meeting (November 2013)
19 slides from Arafura Rare Earths's shareholder meeting presentation, Nov 22, 2013
Slide 1: Annual General Meeting Presentation
For personal use only ANNUAL GENERAL MEETING PRESENTATION November 2013 Arafura Resources Limited (ASX: ARU)
Slide 2: Disclaimer
DISCLAIMER For personal use only Important Notice This presentation contains certain statements which may constitute “forward-looking statements.” Such statements are only expectations or beliefs and are subject to inherent risks and uncertainties which could cause actual values, results or performa
Slide 3: Agenda
AGENDA For personal use only 1. Chairman’s Address 2. Formal Business 3. Managing Director’s Report 4. Questions and Answers Arafura Resources Limited (ASX: ARU) 3
Slide 4: Mr Ian Kowalick, Chairman
For personal use only Mr Ian Kowalick Chairman Arafura Resources Limited (ASX: ARU) 4
Slide 5: Formal Business
For personal use only Formal Business Arafura Resources Limited (ASX: ARU) 5
Slide 6: Resolutions
RESOLUTIONS For personal use only Accounts and Reports – To receive and consider the consolidated financial statements of the Company and its controlled entities for the year ended 30 June 2013 and the reports of the Directors and auditors for the financial year ended 30 June 2013. Resolution 1 Remu
Slide 7: Mr Gavin Lockyer, Managing Director
For personal use only Mr Gavin Lockyer Managing Director Arafura Resources Limited (ASX: ARU) 7
Slide 8: Share Price Impacted by Global Markets
SHARE PRICE IMPACTED BY GLOBAL MARKETS For personal use only ARU vs ASX Small Resources Index Small Small cap cap resource resource index index (XJR) (XSR)--rebalanced rebalancedto to100 100 ARU shareprice - rebalanced to 100 120 Farm-in secured with JORC Ore Reserves Ark over Mt Porter established
Slide 9: Nolans Bore Ore Reserves
NOLANS BORE ORE RESERVES For personal use only Tonnes Rare Earths Tonnes Phosphate Uranium % Reserves (million) % REO REO % P2O5 U3O8 Probable 24 2.8 672,000 12 0.02 Ore Reserves support a 22-year mine life Amenable to low-cost open cut mining & standard beneficiation techniques 95% conversion rate
Slide 10: Optimistic Outlook for Rare Earth Markets
OPTIMISTIC OUTLOOK FOR RARE EARTH MARKETS For personal use only Growth Rare Earth Industry outlook to 2020 sectors markets Government policy & decrease in battery pack prices expected to drive 10% Hybrid electric Magnet motor industry growth in NdPr magnets and 7% for La. EV’s expected to be 7% of v
Slide 11: Key Elements to Achieving Commercialisation
KEY ELEMENTS TO ACHIEVING COMMERCIALISATION For personal use only Introductions by 2014-2016 Financing linked to off-take Shenghe Resources Engineering 2014 Sovereign debt facilities Offshore procurement and Financing Relationships with ECE, Other strategic relationships Construction Shenghe Resourc
Slide 12: Nolans Project Base Case – A Recap
NOLANS PROJECT BASE CASE – A RECAP For personal use only Established in August 2012 The Base Case reinforced the Project economics over 20 years strong commercial appeal of NPV of A$4.3 billion (10% discount rate) the Nolans Project IRR of 30% (after tax & capital payback) A number of initiatives ar
Slide 13: Project Optimisation – Process Recovery
PROJECT OPTIMISATION – 2013-2014 Project PROCESS RECOVERY Optimisation For personal use only Beneficiation August 2012 November 2013 Total RE Recovery 61% 85% RE Upgrade 1.7 2 Mass Recovery 41% 42% Rare Earth Extraction & Separation LRE Recovery 83% 92% SEG Recovery 86% 81% HRE Recovery 75% 43% Y Re
Slide 14: Project Optimisation – Capital Costs
PROJECT OPTIMISATION – 2013-2014 Project CAPITAL COSTS Optimisation For personal use only August 2012 November 2013 Mine & Concentrator $346m $361m Transport & Logistics $230m $30m RE Complex1,2 $1,336m $1,113m Total CAPEX $1,912m $1,504m 1August 2012 Base Case: RE Complex located in Whyalla 2Novemb
Slide 15: Project Optimisation – Operating Costs
PROJECT OPTIMISATION – 2013-2014 Project OPERATING COSTS Optimisation For personal use only August 2012 November 2013 Total OPEX $20.55/kg REO $17.10/kg REO Process improvements and/or plant reconfiguration/relocation has resulted in: 39% decrease in mineral concentrate processed - Higher grade and
Slide 16: Engineering & Construction Timeline
ENGINEERING & 2014-2016 Engineering CONSTRUCTION TIMELINE and Construction For personal use only Current engineering and design at +/-25% to be completed by June 2014 Detailed engineering 2014-2015 Construction 2015-2016 Finalisation of Chinese Beneficiation Optimisation Studies mid-2014 Scope prepa
Slide 17: Financing & Offtake Partners
FINANCING & 2014 Financing & OFFTAKE PARTNERS Off-take Agreements For personal use only ECE (East China Mineral Exploration & Development Bureau) Major shareholder (24.86%) & long-term strategic partner for Arafura (since 2009) Shenghe Resources Holding Co. (Shanghai Stock Exchange-listed) MOU execu
Slide 18: Outlook & Next Steps
OUTLOOK & NEXT STEPS For personal use only Demand for rare earths remains strong – forecast to grow ~6-7% annually, driven by the growth in clean technology (magnets) and technology innovation Future pricing will be influenced by global supply trends Arafura positioned to become the next major rare
Slide 19: Thank You
For personal use only THANK YOU Questions? Arafura Resources Limited (ASX: ARU)
Arafura Resources — Shareholder Meeting (November 2013) on 6ix