Slide 1: Company Presentation cover announcement
For personal use only 9 February 2011 Com panies Announcem ent Off ice Via El ectronic L odge ment COMPANY PRESENTATION Please find attached a copy of the presentation that will be made by Peninsula Energy Limited’s Executive Chairman Gus Simpson at the Indaba Mining Conference in Cape Town, South A
Slide 2: Indaba 2011 Presentation
For personal use only INDABA 2011 PRESENTATION John Simpson (Gus) Executive Chairman February 2011
Slide 3: Disclaimer
Disclaimer For personal use only This presentation is provided on the basis that the Company nor its representatives make any warranty (express or implied) as to the accuracy, reliability, relevance or completeness of the material contained in the Presentation and nothing contained in the Presentati
Slide 4: Competent Person
Competent Person For personal use only The information in this presentation that relates to Exploration E ploration Results, Res lts Mineral Resources Reso rces and Ore Reserves Reser es is based on information compiled by Mr Alf Gillman. Mr Gillman is a Fellow of the Australian Institute of Mining
Slide 5: Investment Highlights
Investment Highlights For personal use only • Emerging uranium producer listed on the (ASX:PEN) with established project pipeline • p 33mlbs JORC Compliant Resource and g growing g • Exploration potential 185–295mlbs U3O8 between Wyoming and Karoo • Targeting production of 1.5mlbs U3O8 p.a. 2012 fro
Slide 6: Corporate
Corporate For personal use only SharePrice Share Price PEN – Daily Line Chart (Close) Shares Shareson onissue issue 2065m 2082m XJO – Daily Line Chart (Close) PEN – Simple MA (20) (Close) Share Share price price $0.10 $0.10 Market Marketcapitalisation capitalisation $207m $210m Cash Cash balance bal
Slide 7: Uranium Assets
Uranium Assets For personal use only 33mlbs JORC Compliant Resource U3O8 13 project areas with drill-defined mineralisation 95 – 145mlbs U3O8 Potential Average project grades up to 1,250ppm eU3O8 618 km2 land holding 7 project areas Exploration potential in quality uranium provinces Lance, Wyoming K
Slide 8: Business Plan
Business Plan For personal use only • Planning to commence ISR production at Ross Ross, Wyoming in 2012 building to 1.5mlbs U3O8 p.a. (Plant capacity 3mlbs p.a.) U d Underpin i balance b l sheet h t with ith profit fit from f Wyoming W i • Develop p conventional mining g and milling g operation p at
Slide 9: Directors and Management
Directors and Management For personal use only Board of Directors • Executive Chairman Gus Simpson Strong leadership, corporate and project management skills • Exec. Director (Finance & Ops) Malcolm James Strong corporate project mgmt. and financing experience • Technical Director Dr Alan Marlow PhD
Slide 10: Uranium Demand
Uranium Demand For personal use only REGION Reactor Units and Market Demand Forecasts Anticipated p byy Region g # of U308 # of U308 # of U308 # of U308 Reactor Demand Reactor Demand Reactor Demand Reactor Demand Units mlbs pa Units mlbs pa Units mlbs pa Units mlbs pa 2010 2015 2020 2030 North Ameri
Slide 11: Uranium Supply
Uranium Supply For personal use only • Kazakhstan ISL U3O8 Production Increases: 2000, 5mlbs 2008, 18mlbs 2009, 36mlbs 2010, 40mlbs restrained spot price but all production has been purchased • Megatons to Megawatts program – Uranium recovery from nuclear weapons ends in 2013 24mlbs – ENDS 10
Slide 12: Future Uranium Supply Issues
Future Uranium Supply Issues For personal use only • Further Kazak production expansion UNLIKELY • Cigar Lake development delay due to mine flooding (October 2006 / August 2008); Production was to be 2007, now 2013/2014 at earliest UNLIKELY • Olympic Dam expansion ~$9-30Bn DELAYED INDEFINITELY • Mid
Slide 13: Uranium Price Projections
Uranium Price Projections For personal use only $120 $100 $ $80 US$/lb U3O8 $60 U $40 Historic $20 Future Composite Price Scenario $0 00 01 02 03 04 05 06 07 08 09 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 20 200 200 200 200 200 200 200 200 200 200 202 Composite Price Projection, UxC Uranium
Slide 14: USA Uranium
For personal use only USA Uranium 13
Slide 15: Wyoming Uranium
Wyoming Uranium For personal use only C rrentl Licenced Currently Christensen‐Irigaray Sweetwater Lance Project Smith Ranch‐Highland In Permitting Ross Hank & Nichols Jab & Antelope Moore Ranch Lost Creek (draft) 14
Slide 16: Lance Projects – Mineral Potential
Lance Projects – Mineral Potential For personal use only • Explored by Nubeth JV 1971-1984 1971 1984 – 5,400 drill holes – Trial ISR for 8 months • 22 roll fronts e extend tend for a combined linear strike length of 190 miles (305 km) • 13 project areas with drill defined mineralisation 15
Slide 17: Lance Projects – Exploration Potential & JORC Resource
Lance Projects – Exploration Potential & JORC Resource For personal use only Exploration Tonnes Grade U3O8 Potential (M) (ppm U3O8) (mlbs) Range From To From To From To Total 117.7 134.7 360 500 95 145 Resource Tonnes Grade U3O8 Category (M) (ppm U3O8) (mlbs) Measured* 3.7 472 3.8 Indicated* 7.0 434
Slide 18: Ross Permit Area
Ross Permit Area For personal use only Ross Permit Tonnes Grade U3O8 Area (ppm U3O8) (lbs) Measured 2,354,081 482 2,499,711 Indicated 3,052,008 476 3,201,719 Inferred 115,962 450 115,044 Total 5,522,051 478 5,816,474 • In advanced permitting • Permit application submitted December 2010 • Baseline en
Slide 19: Ross P.A. – Geology Fly Through
Ross P.A. – Geology Fly Through For personal use only 18
Slide 20: Lance Projects – Development Model
Lance Projects – Development Model For personal use only • 32 9mlbs U3O8 JORC compliant resource 32.9mlbs Resource Tonnes Grade U3O8 Category (M) (ppm U3O8) (mlbs) M Measured d 37 3.7 472 3.8 3 8 Indicated 7.0 434 6.7 Inferred 22.6 450 22.5 Total 33.3 449 32.9 • To build a 1.5mlbs per year ISR opera
Slide 21: In-Situ Recovery – Process
In-Situ Recovery – Process For personal use only Process • Groundwater combined with oxygen and bicarbonate and circulated through deposit via injection and recovery wells • Oxygen enriched water moves through aquifer and dissolves in-situ uranium • Uranium enriched solution is pumped to surface and
Slide 22: Worldwide ISR Mining Jurisdiction
Worldwide ISR Mining Jurisdiction For personal use only 36% of global uranium production is from ISR/ISL method 21
Slide 23: Lance Projects - Schedule
Lance Projects - Schedule For personal use only 2009 2010 2011 2012 Permitting Resource Definition Scoping study/ PFS / DFS Construction Commissioning Production Expanded Resource Drilling 22
Slide 24: Lance – Pre-Feasibility Study
Lance – Pre Pre-Feasibility Feasibility Study For personal use only US$ per lb US$ / Year • ISR mining i i with ith Revenue $65-$75 $112 million centralised plant • 1.5mlbs p.a. U3O8 Operating cash cost (C1) $13.5 $13 5 $20 million • Uranium grade 507ppm Royalties & Tax $7.9 $12 million U 3O 8 Total
Slide 25: Project Status – Met. Testing
Project Status – Met. Testing For personal use only The agitation Th i i l leach h testing i shows h R Ross uranium i l leaches h very well ll at low concentrations of bicarbonate and oxidant in the lixivant • An average g of all samples p resulted in better than 80% leaching g of uranium • Testing
Slide 26: Project Status – Permitting
Project Status – Permitting For personal use only Mine p permitting g on schedule Deep Disposal Wells • DDW feasibility study completed • License application lodged NRC Source Material Licence • Technical reports p completed p • Environmental reports completed • License application lodged WDEQ Permi
Slide 27: Project Status – DFS
Project Status – DFS For personal use only • Colorado-based global mining engineering consultants Lyntek Inc • The DFS 80% complete and will be finished by March 2011,, on schedule • Lyntek has delivered second iteration of plant design and completing the third round of metallurgical testing • Proce
Slide 28: Project Status – Funding
Project Status – Funding For personal use only • Appointed Rockbury to coordinate the project funding process – Gerard Holden – past MD Barclays Global • Debt – discussions with banking groups underway – likely to involve ˜ 60% debt • Equity – potential involvement of strategic partner – discussions
Slide 29: Project Status – Uranium Sales
Project Status – Uranium Sales For personal use only • Discussions ongoing with utilities, brokers, and trading houses • Company assessing various EOI from these groups • Company p y has responded p to RFP’s from three US power utilities and is currently negotiating terms • Sales contracts in final
Slide 30: Karoo Projects – South Africa
Karoo Projects – South Africa For personal use only • 6pproject j g 1,986 km2 in areas covering the Karoo basin • The Karoo is one of the main areas of focus for uranium exploration in RSA • Significant associated molybdenum mineralisation 29
Slide 31: Karoo – Regional Geology
Karoo – Regional Geology For personal use only Poortjie Teekloof Member Formation Moordenaars// Loxton Members Abrahamskraal Davidskolk Formation Member Stratigraphic Column 7-Feb-11 30
Slide 32: Karoo Projects – Mineral Discovery
Karoo Projects – Mineral Discovery For personal use only • 1970’s JCI and Union Carbide drilled 1,300 drill holes delineated three mineral deposits on three of the of the projects • 2008 Radiometric and magnetic survey over 6 sites - 392 uranium occurrences • 2008 Underlying geology and topography i
Slide 33: Karoo Projects – Exploration Potential and Historic Mineralisation
Karoo Projects – Exploration Potential and Historic Mineralisation For personal use only Exploration Tonnes Grade U3O8 Potential (M) (ppm U3O8) (mlbs) Range From To From To From To Total 36.0 60.0 1,200 1,400 90 150 Historic Grade U3O8 Mineralisation Tonnes (ppm U3O8) ( (mlbs) ) Site 22 860,000 1,48
Slide 34: Site Uranium Potential
Site 29 Uranium Potential For personal use only B • 108km2 of Prospective Poortjie Sandstone • 308 holes drilled by A A Union Carbide • Drill-defined 600,000 lbs U3O8 at 1,107 1 107 ppm • Numerous un-tested uranium occurrences and channel systems 0 1.25 2.5 5 Kilometers • Current drilling confirming
Slide 35: Site January 2011 Drill Program
Site 29 January 2011 Drill Program For personal use only High grade intersections confirmed 34
Slide 36: Site Uranium Potential
Site 22 Uranium Potential For personal use only • 23 kilometers of prospective strike 2.8mlbs U3O8 at 1,480ppm • 120 km2 of prospective Poortjie Sandstone • 707 percussion holes drilled by JCI • GT7 2.8mlbs drill- defined U3O8 • Amenable to open- pit mining • Numerous un un-tested tested U3O8 occurr
Slide 37: Site Uranium Potential
Site 22 Uranium Potential For personal use only • multiple stacked uranium-bearing channels • >15mlbs U3O8 potential •3,500m
Slide 38: Site Uranium Potential
Site 45 Uranium Potential For personal use only • Prospective p Davidskolk Member • 432 holes Drilled by JCI • Drill-defined mineralisation amenable to open-pit mining 4.8mlbs U3O8 • Numerous un-tested uranium occurrences • Potential for >15mlbs U3O8 open pit adit access Cross Section 7-Feb-11 37
Slide 39: Site Uranium Potential
Site 45 Uranium Potential For personal use only 25km • DK2 basal sandstone • drill intersections • DK2 resource channel • DK3 upper sandstone • drill intersections • DK3 resource channel • anomalous surface samples • potential 15mlbs U3O8 7-Feb-11 38
Slide 40: Karoo Projects – Development Model
Karoo Projects – Development De elopment Model For personal use only • Multiple open-pits; with central processing facility at Beaufort West • Conventional mining & milling operation • All sites within road-hauling distance • Planning production in 2016/2017 • Continue to delineate > 120mlbs of uran
Slide 41: Karoo Projects – Project Schedule
Karoo Projects – Project Schedule For personal use only 2010 2011 2012 2013 2014 2015 2016 2017 Resource Definition (JORC conversion) Internal Conceptual Study Ext. Scoping study PFS/BFS Constr ction Construction Commissioning Production Expanded Resource Ongoing Drilling 40
Slide 42: Karoo Projects – Conceptual Study
Karoo Projects – Conceptual Study For personal use only US$ p per lb US$ / Year • Assume 30mlb U3O8 Revenue $65-75 $191 million and 3mlbs p.a. Capex Amortisation $3.4 $11.6 million production Financing cost $1.0 $3.3 million • p p mining Open-pit g with Operating Costs $28.5 $76.1 million convention
Slide 43: Karoo Targeted Milestones
Karoo Targeted Milestones For personal use only • Jan 2011: Commence resource development drilling program • May 2011: JORC compliant resource • Dec 2012: JORC compliant resource of ~30mlbs • June 2014: Complete Definitive Feasibility Study • July 2016: Commencement of production 42
Slide 44: Wyoming Targeted Milestones
Wyoming Targeted Milestones For personal use only • April 2010: Initial JORC compliant resource at Lance • May 2010: Pre-feasibility study completed • July 2010: Revised JORC compliant resource • Dec 2010: Submit final licence applications • Jan 2011: 2nd revised JORC compliant resource •
Slide 45: Emerging Uranium Producer
Emerging Uranium Producer For personal use only Wyoming ISR (100% PEN) 33mlbs JORC Compliant Resource U3O8 95 – 145mlbs U3O8 Potential Karoo Sandstones (74%) ( ) 90 – 150mlbs U3O8 Potential 7-Feb-11 44