South Star Battery Metals Corp · TSXV:STS
South Star Battery Metals — Investor Presentation (September 2021)
27 slides from South Star Battery Metals's investor presentation, September 2021
Slide 1: Santa Cruz Graphite Project: Road To Production in 2022
TSXV: STS | OTCQB: STSBF Santa Cruz Graphite Project Road To Production in 2022 July 2019 Corporate Presentation “Fundamental Value in a Premier Battery Metals Jurisdiction” Corporate Presentation: September 2021
Slide 2: Cautionary and Forward-Looking Statements
Cautionary and Forward-Looking Statements This presentation includes certain statements that constitute “forward-looking statements”, and the extent any forward-looking statements constitute future-oriented financial information or “forward-looking information” within the meaning of applicable secur
Slide 3: South Star Mining Highlights
South Star Mining Highlights Key Company Highlights • Management team with proven track record of taking projects into production & operations in Brazil • Plant construction planned for H2 2021 • Current market capitalization only 2.5% of project NPV (pre-financing) • Strong graphite demand in Brazi
Slide 4: Santa Cruz Graphite Project Advantages
Santa Cruz Graphite Project Advantages KEY PROJECT HIGHLIGHTS Santa Cruz project situated in second largest flake graphite LARGE & producing district in the world EXTRA-LARGE “The larger the flake size, • 14% of global production in 2018 graphite flakes the higher the price!” GEOLOGY, EXPLORATION &
Slide 5: STS Share Information
STS Share Information Stock Information as of August 30, 2021 Cap Table (000s)* Total Outstanding 77,419 Warrants @ $0.06 5,600 (Exp 05/2024) Warrants @ $0.15 25,015 (Exp 02/2024) Options @ $0.15 90 (Exp 06/2024) Options @ $0.30 900 (Exp 05/2022) Options @ $0.45 600 (Exp 07/2023) Options @ 0.055 2,6
Slide 6: Corporate Structure
Corporate Structure • South Star Battery Metals Corp. is a public company traded on the Toronto Venture Stock Exchange under South Star Battery the symbol STS and on the OTCQB under symbol Metals Corp. STSBF. (TSXV: STS) • Brasil Graphite Corp. is a wholly owned subsidiary incorporated in the Cayman
Slide 7: Leadership Team
Leadership Team BOARD OF DIRECTORS Dave McMillan Chairman Priscila Costa Richard Pearce Eric Allison Dan Wilton Marc Leduc Exec. Director Exec. Director Lima Indep. Director Indep. Director Indep. Director MANAGEMENT Richard Pearce President & CEO CHF Capital Eric Allison Samantha Shorter Markets Bu
Slide 8: Investment Highlights
Investment Highlights Phase 1 Construction Ready Mining Friendly District Open Pit Mining & No Drill & Blast With 80 + years of graphite production With Low Strip Ratio Simple, Proven Flowsheet Experienced Management & Technology Proven Mine & Plant Builders Simple Operations Excellent Infrastructur
Slide 9: Investment Highlights
Investment Highlights Phase 1 Derisked All licenses & Stepping Low OPEX Proven tested permits are valid into production Low in proven producing process circuit & up-to-date in phases environmental risk district MIDDLE Low Low capital geological risk intensity LOW HIGH PROJECT RISK Established utilit
Slide 10: Santa Cruz Graphite Project
Santa Cruz Graphite Project Phase 1 Construction Ready INFRASTRUCTURE COMPETITIVE ADVANTAGES Excellent Infrastructure Major port Experienced Power, gas, 1.3km water all of Ilheus is 270km away via workforce from paved within 5km paved federal nearby highway highways TSXV: STS | OTCQB: STSBF www.sout
Slide 11: ESG & Sustainability
ESG & Sustainability ESG & Sustainable Production is part of our Corporate DNA ENVIRONMENTAL + SOCIAL + GOVERNANCE ✓ Renewable sources provide 80% of ✓ First major industry in the region ✓ Review, evaluate and update Brazilian energy generation ✓ Committed to responsible, equitable regularly governa
Slide 12: Global Markets
Global Markets Projected Large Increase in Graphite Demand • Brazil has large internal demand for natural graphite (80-90kt/p.a.) • Graphite has many uses outside of battery metals • High tech, graphene, military, etc… • Natural graphite has advantages over synthetic: • Lower cost • Smaller environm
Slide 13: Global Markets
Global Markets Graphite Demand is in a Perfect Storm 2018 to 2050 For Battery Metals Supply 2050 Demand Kt Growth % (t) Aluminum 5,583 Graphite 494% Lithium 488% Graphite 4,590 Cobalt 460% Nickel 2,268 Indium 231% Copper 1,378 Vanadium 189% Lead 781 Nickel 99% Manganese 694 Silver 56% Cobalt 644 Neo
Slide 14: Global Battery Market
Global Battery Market Brazil - Premier Battery Metals Jurisdictions • Brazil is largest graphite producer of high-quality graphite outside of China with 80+ years of continuous production and 3rd most important country in EV Battery Supply Chain. Graphite Supply 2020 EV Supply Chain Ranking by Count
Slide 15: Santa Cruz World-Class Flake Sizes
Santa Cruz World-Class Flake Sizes Representative Santa Cruz Graphite Project Flake Percentage +80 Mesh Concentrates Mesh Size (#) Distribution %Cg 30# 4% 95% 50# 32% 95% 80# 27% 97% 140# 17% 97% -140# 20% 97% Recovery 88% +50 mesh with 98% Cg and +99.9% Cg concentrates were also produced during tes
Slide 16: 2019 Santa Cruz Update Resource Estimate
2019 Santa Cruz Update Resource Estimate* The 2019 updated Resource Estimate shows strong geologic potential and continuity of high-quality graphite mineralization in friable, easily mined, weathered materials. New areas with at-surface mineralization were discovered, and the deposit is open both al
Slide 17: 2020 Santa Cruz Preliminary Feasibility Study
2020 Santa Cruz Preliminary Feasibility Study* The financial analysis in 2020 PFS shows very favourable and robust results that highlight the Santa Cruz Project’s advantages in Santa Cruz Graphite the graphite sector. Mineral Reserves Summary* Key Financial Results Mineral In-situ Post-tax NPV5% US$
Slide 18: STS Value Proposition
STS Value Proposition • Currently Undervalued When Compared to Peer Group Enterprise Value / T of Cg Enterprise Value as % of NPV TSXV: STS | OTCQB: STSBF www.southstarbatterymetals.com 18
Slide 19: STS Value Proposition
STS Value Proposition • Low CAPEX and First Quartile OPEX In a District with 80+ Years of Continuous Operations Capital Intensity US$/T of Capacity OPEX US$/T TSXV: STS | OTCQB: STSBF www.southstarbatterymetals.com 19
Slide 20: STS Value Proposition: CAPEX vs IRR
STS Value Proposition • Low CAPEX and High Return on Investments CAPEX vs IRR (ATAX) 450 ZEN 400 GPH Net Present Value 350 per Share 300 NOU MNS CAPEX - US$M 250 LLG Outstanding: C$2.52 Fully Diluted: C$2.13 200 SRG RNU EGR FMS 150 WWR NGC TON BEM BKT 100 NEXT GPX LML 50 VRC STS - 0.0% 20.0% 40.0% 6
Slide 21: STS Value Proposition: Study Phase vs Market Cap
STS Value Proposition • Compelling Value Proposition with Construction Ready Project Study Phase Vs. Market Cap 1000 NOU TLG Market Cap (Log $M Xchange Currency) EGR MNS NEXT WWR SVM 100 BKT FMS GPH WKT BAT CY GRAT SRG RNU VRC NG LMR CVE HXG BSM BEM GEM 10 EGA LION SJL STS Ph 1&2 STS Ph 1 1 0 TR 1 P
Slide 22: Why South Star?
Why South Star? Near-term graphite producer with responsible and sustainable production, committed to tangible, long-term benefits for employees, communities, and stakeholders. ✓ PFS NI43-101 & updated Santa Cruz Resource Time ✓ Expanding demand in Project ✓ Pilot plant testing Brazil completed ✓ Gr
Slide 23: Contact
TSXV: STS | OTCQB: STSBF For more information, please contact: Richard Pearce CEO/President CHF Capital Markets (Canada IR) Iryna Zheliasko, Manager Phone: 416 868 1079 x 229 Email: iryna@chfir.com RBMG – RB Milestone Group LLC (IR US) Trevor Brucato, Managing Director Email: southstar@rbmilestone.c
Slide 24: Appendix 1 - Phase 1 Project Details (5,000 tpy Pilot Plant)
APPENDIX 1 - PHASE 1 PROJECT DETAILS (5,000 TPY PILOT PLANT) 20 Year Mine Life with Terminal Value TSXV: STS | OTCQB: STSBF www.southstarbatterymetals.com 24
Slide 25: Path to Production – Macro Schedule
Path to Production – Macro Schedule 2021 Key Milestones ▪ Secure Offtake/Supply Agreement ▪ Complete Debt/Equity Finance for Phase 1 ▪ Begin Construction within 2-3 months of financing ▪ 10-12 month construction schedule TSXV: STS | OTCQB: STSBF www.southstarbatterymetals.com 25
Slide 26: Phase 1 – Licensing & Permitting
PHASE 1 – LICENSING & PERMITTING • Environmental Permit Approved for 4 Years • Mining License Approved for 3 Years by ANM on Dec 31, 2020 • Phase 1 Operations are fully licensed • Permits and licenses can be renewed TSXV: STS | OTCQB: STSBF www.southstarbatterymetals.com 26
Slide 27: Phase 1 – Robust Financial Metrics & Potential Returns
PHASE 1 – ROBUST FINANCIAL METRICS & POTENTIAL RETURNS • 12-month Construction Schedule • Currently Trading at 4% of Phase 1 NPV or 2% of Phase 1+2 NPV • Target Valuation in 24-36 Months • C$50M = US$36M • Conservative Approach to Valuation • Comparables (6-8x EBITDA) • 75% Phase 1 NPV or 44% of Pha
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