Sunrise Energy Metals Limited · ASX:SRL
Sunrise Energy Metals — Clean TeQ Holdings — Shareholder Meeting (November 2016)
53 slides from Sunrise Energy Metals's shareholder meeting presentation, Nov 22, 2016
Slide 1: Vital metals to sustain an urbanizing planet
Vital metals to sustain an urbanizing planet Coming soon: 8 billion of us. ROBERT FRIEDLAND Co-Chair & Non-Executive Director
Slide 2: Rapid urbanization is likely to continue for decades
“RAPID URBANIZATION IS LIKELY TO CONTINUE FOR DECADES” – WORLD BANK, EAST ASIA REPORT, JANUARY 2015. AN AGE OF UNPRECEDENTED CHANGE, WITH PROFOUND IMPLICATIONS FOR METALS MARKETS, MINERS AND INVESTORS.
Slide 3: In 2007, the people on earth crossed a historic divide
In 2007, the people on earth crossed a historic divide. There was no Big Bang in the middle of the night. But, say UN number crunchers, 2007 is when we first had more people around the planet living in urban areas than in rural areas. Get used to it. Urbanization – with its demands and opportunities
Slide 4: That would total 1 billion more urban residents than today
Our world is gaining about 83 million people every year. By 2030, Earth will have a projected 8.5 billion people. About 5 billion are expected to live in urban areas. That would total 1 billion more urban residents than we have today. Shanghai’s emergence as one of the world’s super-cities was assur
Slide 5: By 2050, 6.3 billion people could live in urban areas
By 2050, 6.3 billion people could live in urban areas. That would be around 2.5 billion more than today. Today’s top 4 megacities (each with more than 10 million people) 2. Delhi: 1990, 9.7 million; 2014, 24.9 million; 2030 (est.), 36.0 million. 1. Tokyo: 1990, 32.5 million; 2014, 37.8 million; 2030
Slide 6: 56% of China's people lived in urban centres in 2015
56% of China’s people lived in urban centres in 2015. It was just 26% in 1990 – then doubled, to 51%, in 2011. Urban projections: 60% in 2020 (with 100 million people moving to cities) and rising further to 76% in 2050. China’s megacities (10m+) 2014 population Shanghai 22.9 million Beijing 19.5 mil
Slide 7: Toxic smog clouds future of urbanizing Earth
A high price: Sickened cities Toxic smog clouds future of urbanizing Earth Outdoor air pollution linked to 3 million deaths each year. – International Energy Agency, June 2016 Ambient air pollution is the greatest environmental risk to health. – UN World Health Organization, May 2016 More than 80% o
Slide 8: Survival masks: Grim fashion statements share public stage with industrial safety gear
Survival masks: Grim fashion statements share public stage with industrial safety gear Successions of sickly, smoggy days, with very high levels of harmful airborne particles generated largely by heavy industry and motor vehicles, have spawned new markets for mask makers. One reported estimate put t
Slide 9: Humans are vulnerable to air pollution seeping into the bloodstream and brain
Humans are vulnerable to air pollution seeping into the bloodstream and brain The miniscule size of particles are less likely to be trapped by hairs and the mucus that line our noses – our body’s natural barrier. Sources: US EPA, BBC
Slide 10: 92% of the world's population lives with outdoor air quality failing WHO guidelines
92% of the world’s population lives with outdoor air quality that fails to meet WHO guidelines Map by World Health Organization showing annual concentration of PM2.5 (micron/m3). China PM2.5 includes pollutants such as sulfate, nitrates and black carbon, which penetrate deep into the lungs and cardi
Slide 11: Airpocalypse: Scenes of an urban scourge
Airpocalypse: Scenes of an urban scourge “Mexico City’s smog is so bad, “Paris institutes weekday ban it wants 40 percent of cars on cars built before 1997 to stay off the road” in battle against air pollution” 2 May 2016 2 July 2016 Photo: Ronaldo Schemidt/AFP/Getty Images Photo: Reuters
Slide 12: Airpocalypse…
Airpocalypse… “A 2017 program would charge “New Delhi begins second £10 pounds ($13) to the most round of car restrictions polluting vehicles entering to limit air pollution” central London” 15 April 2016 5 July 2016 Photo: John Esslinger Photo: Hindustan Times/Getty
Slide 13: Disruption can happen quickly. It's 1900: Can you spot the car?
Disruption can happen quickly. It’s 1900: Can you spot the car? 5th Avenue, NYC, April 15, 1900 Source: Tony Seba, US National Archives
Slide 14: Disruption did happen – and quickly. Now it's 1913
Disruption did happen – and quickly. Now it’s 1913: Can you spot the horse? Source: Tony Seba, from US National Archives 5th Avenue, NYC, March 23, 1913 (7 months later, Ford revolutionized auto making with the industry’s first moving assembly line, slashing a Model T’s building time to 93 minutes f
Slide 15: Around 400,000 would-be buyers paid deposits for Tesla 3
Around 400,000 would-be buyers said to have paid US$1,000 deposits for 2017’s Tesla 3 all-electric car Unprecedented worldwide market enthusiasm generated 115,000 paid reservations even before the car was unveiled last March. Within a month, orders had more than tripled. Tesla 3 could become the
Slide 16: VW repents (and pays) after lying over tailpipe emissions
VW repents (and pays) after lying to consumers & regulators over tailpipe emissions & fuel usage “We’ve totally screwed up,” admitted VW’s U.S. CEO Michael Horn during the company’s Dieselgate crisis (he resigned in March 2016). Part of the price of deception: US$14.7 billion – a record penalty in t
Slide 17: Cobalt and nickel sulphate at heart of lithium battery technology
Cobalt Sulphate (CoSO4.7H2O) & Nickel Sulphate (NiSO4.6 H2O) at heart of lithium battery technology Hybrid & all-electric vehicles use 200% to 300% more copper than conventional gasoline-powered autos Lithium battery core Layers of: Copper foil used in lithium batteries Copper Lithium cobalt oxi
Slide 18: Inside Tesla's Model S batteries
Inside Tesla’s Model S batteries Tesla battery pack weighs 540 kg, equal to about 26% of the car’s total weight Photo: Tesla Motors club user [wk057]. Figure: visualcapitalist.com
Slide 19: Each new generation of car needs more copper wiring
Each new generation of car needs more copper wiring 165 lbs. / 75 kg Electric BMW i3 110 lbs. / 50 kg Hyundai Hybrid 55 lbs. / 24 kg Ford Mustang V8 Sources: Visual Capitalist; U.S. Global Investors
Slide 20: Syerston Project: Nickel and Cobalt Sulphate
SYERSTON PROJECT NICKEL AND COBALT SULPHATE FOR THE LITHIUM-ION BATTERY INDUSTRY AGM, 22 NOVEMBER 2016 (ASX:CLQ)
Slide 21: Disclaimer
DISCLAIMER IMPORTANT INFORMATION This presentation has been prepared by the management of Clean TeQ Holdings Limited (the ‘Company’) in connection with meetings with investors and potential investors and not as specific advice to any particular party or person. The information is based on publicly a
Slide 22: What we plan to do
WHAT WE PLAN TO DO FOCUS IS GLOBAL ENERGY AND TRANSPORTATION MARKETS Develop one of the world’s largest sources of high-purity cathode raw materials for the global lithium-ion battery industry Build the world's first scandium mine to service the transport sector’s need for lighter and stronger alumi
Slide 23: Syerston Project Overview
SYERSTON ORE SYERSTON PROJECT OVERVIEW The Syerston Project is a laterite (iron-hosted) mineral resource, rich in nickel, cobalt and scandium, located 350km west of Sydney and 100% owned by Clean TeQ Uniquely positioned as one of the largest and highest grade sources of cobalt outside Africa Syersto
Slide 24: LiB Market
LiB MARKET CLEAN cunlEQ SYERSTON | PAGE 5
Slide 25: Lithium Ion Battery Market
LITHIUM ION BATTERY MARKET GROWTH FORECASTS VARY WIDELY BUT ARE SUBSTANTIAL Historic and Forecast Global LiB Sales (GWh) Phones & Portable PCs Other (Non-Auto) Automotive 193 Other forecasts: 20% CAGR in LiB sales over last decade Credit Suisse: 294 GWh by 2025 Auto industry interest in EVs has now
Slide 26: EV Sales Forecasts
EV SALES FORECASTS DRIVETRAIN ASSUMPTIONS ARE KEY Forecast Global x-EV Sales (2014 – 2025) Fundamental to raw material forecasts are the adoption rates for each drivetrain BEV Sales Forecasts: Deutsche Bank: Drivetrain Battery Size per EV 3.0m BEV pa by 2025 HEV ~1kWh Avicenne Upside Case: PHEV ~12k
Slide 27: China's EV Demand
CHINA’S EV DEMAND IMPACT OF GOVERNMENT SUBSIDIES China Sales of Alternative Energy Passenger Cars (units) 2014 2015 60,000 Subsidies are prioritised for EV’s with higher 50,000 battery capacity and greater efficiency 40,000 There is also significant investment in urban and regional charging infrastr
Slide 28: Battery Costs Are Falling Rapidly
..BATTERY COSTS ARE FALLING RAPIDLY EXPERIENCE CURVE EFFECTS Battery Costs Falling – Economies of Scale Cost Trajectory – ICE vs EV SYERSTON PA G E 9
Slide 29: EV Going Mainstream
EV GOING MAINSTREAM NOT JUST A TESLA STORY London -- BMW plans to accelerate its electric vehicle plans, in the wake of an executive shake-up and leading into a vote planned for the end of this month. The new BMW expanded electric line-up will kindle fully battery-powered versions of the Mini, the B
Slide 30: A Race to Secure Raw Materials
A RACE TO SECURE RAW MATERIALS CHINA’S AMBITIONS FOR A STRATEGIC INDUSTRY A steady stream of acquisitions Cathode Material Market Share (percentage) Year Asset Purchaser Focus Price 2010 Olaroz Toyota Tsusho / Li US$62M + PF China Japan Korea Other (ARG) JOGMEC + Comp. Gtee 2012 Greenbushes Chengdu
Slide 31: Investment in New Battery Capacity Is Large and Real
SANYO, JAPAN, 2010 NISSAN, USA, 2013 TESLA, USA, 2017 INVESTMENT IN NEW BATTERY CAPACITY IS LARGE AND REAL SAMSUNG, CHINA, 2015 LG CHEM, CHINA, 2015 LG CHEM, USA, 2013-15 Between 2011 and 2014 ~US$10-12B was invested in new battery capacity, adding ~50GWh Between 2014 and 2017 another ~US$7B will be
Slide 32: Cathode Market
CATHODE MARKET SYERSTON PA G E 1 3
Slide 33: Chemistry by Market
CHEMISTRY BY MARKET DOMINANT CHEMISTRIES FOR EV REQUIRE NICKEL AND COBALT 39% 22% 11% 19% 9% 41ktpa 23ktpa 12ktpa 20ktpa 9ktpa LCO NCM NCA LMO LFP (Lithium-Cobalt-Oxide) (Nickel-Cobalt-Manganese) (Nickel-Cobalt-Aluminium) (Lithium-Manganese-Oxide) (Lithium-Iron-Phosphate) Still one of the highest Ex
Slide 34: Cathode – The Key to Cost
CATHODE – THE KEY TO COST NICKEL AND COBALT PRICES DRIVE CELL COST Raw Materials Manufacturing Costs Producer Margin Raw Material Cost Breakdown Metal Cost in Cathode Active Material 100% 100% Housing and feedthrough Lithium ~4% of total cell cost 5% 80% Separator 80% Manganese Electrolyte Cobalt 60
Slide 35: EV Cathode Requires Sulphate
“The main determinants on the cost of the cell are the price of the nickel in the form that we need it … and the cost of the synthetic graphite with silicon oxide coating.” Elon Musk, Tesla CEO NICKEL & COBALT SULPHATE EV CATHODE REQUIRES SULPHATE METAL UNITS ARE REPROCESSED TO CHEMICAL FORM The bat
Slide 36: Cathode Demand Forecast
CATHODE DEMAND FORECAST IMPLICATIONS FOR RAW MATERIAL DEMAND Cathode Raw Material Demand (‘000 tonnes) LCO NCM NCA LMO LFP 560 18% CAGR If NCM and NCA chemistries dominate for EV’s, Contained Metal: then Ni and Co are key raw materials Nickel: ~142ktpa Cobalt: ~90ktpa Anode (C): ~385ktpa Of the 10 t
Slide 37: Syerston Project
SYERSTON PROJECT SYERSTON PA G E 1 8
Slide 38: Why Syerston Is Important
WHY SYERSTON IS IMPORTANT PROTECTION AGAINST SUPPLY CHAIN AND REPUTATION RISK 100% auditable High volume raw materials cathode quality supply chain CoSO4.7H2O Low risk country High volume Sc2O3 for light- with minimal cathode quality weighting in mining and NiSO4.6H2O transport processing risk SYERS
Slide 39: Value Drivers
VALUE DRIVERS LARGE, LOW-COST AND READY 1 2 3 4 RESOURCE COBALT ACID CLEAN-iX® A shallow, multi-decade High grade cobalt, in a Low acid consumption, Highly selective mineral resource with low strip safe mining jurisdiction reducing operating costs extraction provides a ratio and low operating and 10
Slide 40: Mineral Resource
MINERAL RESOURCE LOW MINING RISK Over 1,300 drill holes to define a significant nickel / cobalt / scandium resource The resource is shallow (5m to 40m) and extends over a 2km horizon; simple and low risk strip-mining Mining accounts for ~20% of total average operating costs A high-grade scandium res
Slide 41: 2016 Prefeasibility Study
2016 PREFEASIBILITY STUDY LARGE, LOW-COST AND WITH HIGH COBALT CREDITS 26-28 GWh p.a.# 500,000 Electric Vehicles p.a.* Definitive Feasibility Study due for completion in Q4 2017 Significant scandium credits modelled separately # Assumes NCA chemistry with Ni and Co content by wt% within cathode acti
Slide 42: Cobalt: A Problematic Supply Chain
COBALT A PROBLEMATIC SUPPLY CHAIN “The majority of the cobalt is heading straight to China. Their global hold is huge.” - CRU 2016 Percentage of cobalt produced globally as by-product from 95% copper and nickel mining Percentage of global cobalt production sourced from the 65% Democratic Republic of
Slide 43: Children mining coltan, Kivu Region, DRC
PHOTO CAPTION CHILDREN MINING COLTAN, KIVU REGION, DRC “While the occasional [analyst] questions the availability of enough lithium or flake graphite to satisfy soaring demand from the battery industry, everybody has overlooked or ignored the most critical mineral constraint – Cobalt. It’s a truly g
Slide 44: Cobalt: High Grades and Large Production Volumes
COBALT HIGH GRADES AND LARGE PRODUCTION VOLUMES Undeveloped Cobalt-Bearing Nickel Projects (excl Africa and seabed mining) Cobalt Grade vs Contained Co Resource Syerston represents one of the best undeveloped cobalt resources in the world outside central Africa Twenty-year average feed grade to auto
Slide 45: Acid: Lower Acid Consumption = Lower Operating Cost
ACID LOWER ACID CONSUMPTION = LOWER OPERATING COST Acid Consumption 600 Syerston is forecast to consume less H2SO4 consumption range, kg / tonne ore 500 acid than existing operating HPAL nickel mines today 400 Mineralogy is low in acid-consuming 300 elements, such as Ca and Mg At Syerston a reductio
Slide 46: Clean-iX: Fit for Purpose Flowsheet
CLEAN-IX® FIT FOR PURPOSE FLOWSHEET The metal-rich The extracted solution is injected metals are then put into a Clean-iX® through a Resin-in-Pulp purification circuit to system where the produce high purity leachate contacts nickel sulphate, with polymer resins cobalt sulphate and scandium oxide An
Slide 47: Clean-iX: Sulphate from Primary Extraction
CLEAN-IX® SULPHATE FROM PRIMARY EXTRACTION Nickel Concentrate Low Nickel High Nickel Matte High Concentration PYROMETALLURGY Ore Matte Nickel Solution NiSO4 Beneficiation Smelting Converter Dissolution Purification / SX Ore Leach Low Concentration Mixed Sulfide High Concentration Nickel NiSO4 + Slur
Slide 48: Next Steps
NEXT STEPS SSY Y EER RSS TO T ON N PA PA G GEE 2299
Slide 49: Project Is Development Ready
PROJECT IS DEVELOPMENT READY KEY PERMITTING COMPLETED STUDIES INFRASTRUCTURE EIS POWER & GAS WATER Prefeasibility Study All key infrastructure is Environmental Impact Power and gas are The Project has a completed, with available, including Statement completed within close proximity 3.2GLpa water Ban
Slide 50: Syerston Pilot Plant
PILOT PLANT SYERSTON OVERVIEW Clean TeQ has a large scale pilot plant located in Perth, Western Australia to simulate the entire leaching and RIP extraction process at scale A pilot campaign in October 2016 to process 20 tonnes of Syerston ore will produce nickel and cobalt sulphate samples for cust
Slide 51: Investment Takeaways
INVESTMENT TAKEAWAYS A large High grade Geared to PFS resource with cobalt in a safe Key emerging EV demonstrates decades of mining permitting in and ESS robust production jurisdiction and place growth economics capacity 100% auditable SYERSTON PA G E 3 2
Slide 52: Reserves and Resources: Competent Person Consents
RESERVES AND RESOURCES COMPETENT PERSON CONSENTS The information in this document that relates to nickel-cobalt Mineral Resources is based on information compiled by Diederik Speijers and John McDonald, who are Fellows of The Australasian Institute of Mining & Metallurgy and employees of McDonald Sp
Slide 53: Contact
CONTACT Sam Riggall Co-Chairman & CEO Clean TeQ Holdings Limited 12/21 Howleys Road Notting Hill VIC 3168 AUSTRALIA www.cleanteq.com M: +61 3 9797 6700 E: sriggall@cleanteq.com SYERSTON PA G E 3 4
Clean TeQ Holdings — Shareholder Meeting (November 2016) on 6ix