Canada Nickel Company Inc · TSXV:CNC
Canada Nickel — Investor Presentation (February 2022)
38 slides from Canada Nickel's investor presentation, February 2022
Slide 1: Delivering the Next Generation of Nickel
Canada Nickel Company Delivering the Next Generation of Nickel TSX-V: CNC February 2022
Slide 2: Forward Looking Statements
Forward Looking Statements This Presentation contains certain information that may constitute "forward-looking information" under applicable Canadian securities legislation about Canada Nickel Company Inc. (“CNC”). Forward looking information includes, but is not limited to, the results of the Crawf
Slide 3: Summary
Summary Canada Nickel is the leader in the next generation of large scale nickel supply and one of few new sources of potential supply outside Indonesia/China Nickel market fundamentally short of nickel in medium and long-term – little to no supply growth outside Indonesia/China – potential supercyc
Slide 4: Management and Board
Management and Board Mark Selby ▪ Previous CEO of Royal Nickel Corporation David Smith ▪ Senior VP, Finance and CFO of Agnico Eagle Mines Chairman, CEO ▪ Corporate development, strategy, business planning Director Limited; B.Comm. and market research Executive with Quadra Mining P.Eng., C.Dir. ▪ Cha
Slide 5: Capital Structure and Analyst Coverage
Capital Structure Analyst Coverage Share Price Performance Capitalization as of February 08, 2022 Ticker TSXV: CNC Share Price (C$) $2.98 Basic Shares Outstanding (M) 93.60 Market Capitalization (C$M) $267 Total Debt (1) (C$M) $12.72 Cash & Equivalents (2) (C$M) $16.03 Market Data 20-Day VWAP (C$) $
Slide 6: Nickel Demand Growth Accelerating from EVs
Nickel Demand Growth Accelerating from EVs Nickel demand growth continues to be underestimated – up 15%+ in 2021 (3-5X other base metals) and forecasted by CNC to double by 2030 to 5+ Mt. Corporate activity accelerating and EV companies pursuing offtake. Global Nickel Demand (Mtpa) 2020, 2021 & 2030
Slide 7: Tesla: Please mine more nickel
Tesla: “Please mine more nickel…” Recognition of environmental footprint issues “…please mine more nickel... Tesla will give you a giant contract for a long period of time if you mine nickel efficiently and in an environmentally sensitive way.” – Elon Musk, Co-Founder and CEO, Tesla Earnings Call Ju
Slide 8: Crawford Nickel Sulphide Project Location & Infrastructure
Crawford Nickel Sulphide Project Location & Infrastructure One of the largest nickel sulphide resources located in a well-established mining camp with infrastructure ▪ Major support infrastructure in place ‒ Roads, power, water ‒ Rail connection ▪ Rich mining history and skilled, local workforce ▪ L
Slide 9: Crawford PEA Highlights
Crawford PEA Highlights The Crawford PEA demonstrates strong financial returns based on a large resource with significant upside potential. Robust ▪ US$1.2 billion after-tax NPV8% Economics ▪ 16% after-tax IRR ▪ 42ktpa nickel at peak production (Phase III), 34ktpa nickel LOM Large Scale, ▪ 842kt of
Slide 10: Net C1 Cash Costs
Crawford: 1st Quartile Net Cash Cost Producer Based on PEA results, Crawford is expected to be a low-cost producer with 1st quartile Net C1 Cash Cost and All-in Sustaining Costs. Crawford's Net C1 Cash Cost vs 2020 Net C1 Cash Cost of Global Nickel Operations $10 Spot Nickel Price: $9.53/lb Net C1 C
Slide 11: CO2e Intensity
Crawford: Low Carbon Footprint Crawford estimated to produce 2.8 tonnes of CO2 per tonne of nickel equivalent production: 90% lower than industry average of 28 tonnes CO2 (based on Skarn E0). Nickel GHG Intensity Curve - CO2e Intensity (tCO2e/t NiEq) 0% 25% 50% 75% 100% 180 160 CO2e Intensity (tCO2e
Slide 12: Crawford: A Top 5 Nickel Sulphide Operation Globally
Crawford: A Top 5 Nickel Sulphide Operation Globally Based on PEA results, Crawford is expected to be among the Top 5 nickel sulphide operations globally. Largest Nickel Sulfide Operations by 2020 Annual Production (kt of Nickel / Year) 208 77 75 43 42 (2) 36 33 30 29 Kola (1) Polar (1) Jinchuan Nic
Slide 13: Crawford: Largest Base Metal Mine in Canada
Crawford: Largest Base Metal Mine in Canada Based on PEA results, Crawford is expected to be one of the largest base metal mines in Canada. Largest Canadian Base Metals Mines by 2020 Annual Ni-eq Production(1) (kt of Nickel Equivalent / Year) Nickel Iron Chromium PGEs Cobalt Copper Zinc Molybdenum P
Slide 14: Additional Value Opportunities
Additional Value Opportunities 1 Resource Expansion 2 Recovery Optimization 3 NetZero Carbon Footprint Determine the carbon capture Significant additional exploration Optimization of nickel, iron, chrome potential from the carbon potential within the Crawford recovery and concentrate grades sequestr
Slide 15: Targeting Substantial Resource Increase for Feasibility Study
Targeting Substantial Resource Increase for Feasibility Study Infill drilling supports target of increasing the East Zone resource for feasibility study by 2-3x and the identification of an extensive Higher Grade Core, similar to the Main Zone. High-Grade Core extends a combined 1.6km & width of 20-
Slide 16: Flowsheet Enhancements Delivered Substantial Metallurgical Improvements
Flowsheet Enhancements Delivered Substantial Metallurgical Improvements Latest locked cycle test delivered 62% total nickel recovery – 10 percentage points better than the PEA – and improvements in cobalt recovery, and iron grades & recovery. Improved Nickel Recoveries in the Open Circuit ▪ Results
Slide 17: Crawford Nickel Project Carbon Sequestration Potential
Crawford Nickel Project Carbon Sequestration Potential Canada Nickel completed initial lab scale tests that crystalized the carbon capture potential of its tailings which, if fully confirmed in subsequent testwork, would achieve NetZero production and provide substantial CO2 credits. Figure 1: Drill
Slide 18: Crawford Producing Two Nickel Concentrates + Iron Concentrate
Crawford Producing Two Nickel Concentrates + Iron Concentrate Crawford will produce two nickel concentrates, including a high grade concentrate expected to be the highest grade nickel concentrate at 35% nickel, and an iron concentrate containing chrome 2020 Concentrate Grade (% Ni and % Co) for Glob
Slide 19: Ground-breaking MOU Signed with Local First Nations
Ground-breaking MOU Signed with Local First Nations Canada Nickel has entered into Memorandum of Understandings with Taykwa Tagamou Nation and the Matachewan and Mattagami First Nations. Definitive agreements expected during 2022 “Our community favours a “…happy to be forging a strong “Mark is genui
Slide 20: Unlocking the Timmins Nickel District
Unlocking the Timmins Nickel District Potential Zero-Carbon Nickel District A substantial new nickel district has been consolidated through 18 transactions to acquire or earn into 13 additional nickel targets ▪ 37km2 of ultramafic/mag highs – 40X the scale of 0.85 km2 mag anomaly footprint of Crawfo
Slide 21: A New Nickel District – Hiding in Plain Sight
A New Nickel District – Hiding in Plain Sight… Canada Nickel’s recent district consolidation positions it to become the leader of the third generation of nickel supply – large, scalable, zero carbon potential – located in one of the best mining jurisdictions in the world in proximity to infrastructu
Slide 22: Really?? A New Nickel District?
Really?? A New Nickel District? ▪ Nickel resources are very concentrated in just 6 regions – East half Sulawesi (Indonesia), Sudbury (Canada), Taimyr Peninsula (Russia), Eastern Goldfields (Australia), Bushveld (southern Africa), Surigao/Palawan (Philippines), Jinchuan (China) – The transactions dem
Slide 23: Corporate Activity in Nickel Accelerating
Corporate Activity in Nickel Accelerating Nickel market has already seen significant corporate activity since mid-2020 particularly in nickel sulphide projects. In June 2020, BHP acquired the Honeymoon Well project from Norilsk Nickel. The tenements are located ` 50km from BHP’s Mt. Keith operation
Slide 24: New Nickel Sulphide Discoveries Have Been Acquired at Significant Valuations
New Nickel Sulphide Discoveries Have Been Acquired at Significant Valuations Voisey’s Multiple Nova Asset Cosmos Crawford Bay Mines Bollinger Target: Acquirer: Acquisition C$4.5 A$3.1 C$6.8 A$1.8 ??? Value: billion billion billion billion Acquisition Year: 1996 2007 2007 2015 ??? (1) EV / Nickel C$2
Slide 25: Canada Nickel Trading at Deep Discount to Peers
Canada Nickel Trading at Deep Discount to Peers Enterprise Value / Nickel-equivalent (1) ($US/tonne) $3,715 Denotes $2,704 Development project (2) $1,289 (1) $1,364 $1,382 $1,078 (1) $713 $43 $174 $12 Asset: Tunagain Baptiste Crawford Multiple Eagle's Nest Multiple Jaguar Julimar Tamarack Multiple B
Slide 26: Summary: Investment Highlights and 2022 Catalysts
Summary Investment Highlights 2022 Catalysts • Nickel market entering “supercycle” by mid-decade driven by EV demand • Strategic Investor (Q1) • Recent nickel supply growth largely “dirty nickel” - little visibility on supply growth outside Indonesia • Permitting Commencement (Q1) • Crawford largest
Slide 27: Appendix
CANADA NICKEL COMPANY Appendix www.canadanickel.com
Slide 28: Cost Structure
Cost Structure Crawford is a structurally low cost operation ▪ Large scale and long life operation that mines favourable lithologies - Ore soft (< 100 Mpa) and continuous, allowing for low powder factor (0.25 kg/t) - Ore Ai extremely low (0.005 – 0.07 kg/t), with low steel consumption in both mine &
Slide 29: Crawford PEA Summary Operating Costs & Capex
Crawford PEA Summary Operating Costs & Capex Three phase production plan peaks at nickel production of 42ktpa with a life-of-mine AISC of US$1.94/lb ($4,300 per tonne) Phase I Phase II Phase III Life-of-Mine Unit (Years 1 – 3.5) (Years 3.5 – 7) (Years 8 – 18) (Years 1 – 25) Mill Capacity ktpd 42.5 8
Slide 30: Current Downstream Path to Stainless Steel
Current Downstream Path to Stainless Steel Future Path Likely to Include Path to EV ▪ Nickel, iron and chromium are three key alloying US Stainless Conversion Margins metals in the production of stainless steel, which (US$/lb Nickel) vs makes Crawford products suitable feeds Nickel Sulphate Premiums
Slide 31: Crawford PEA Detailed Summary
Crawford PEA Detailed Summary Phase I Phase II Phase III LOM Ownership: 100% Unit (Years 1 - 3.5) (Years 3.5 - 7) (8 - 18) (Years 1 - 25) Mine Type Type Open Pit Capital Expenditures Initial & Expansion US$ millions $1,188 $543 $194 $1,925 Sustaining & Closure US$ millions / year $68 $73 $51 $44 Min
Slide 32: Crawford PEA Operating Cost Summary
(1) Crawford PEA Operating Cost Summary Operating Costs Phase I Phase II Phase III Life-Of-Mine (Years 1 - 3.5) (Years 3.5 - 7) (Years 8 - 18) (Years 1 - 25) ($ / tonne milled) US$ C$ US$ C$ US$ C$ US$ C$ Labour $2.39 $3.19 $1.49 $1.98 $1.20 $1.60 $1.26 $1.68 Consumables $2.49 $3.31 $2.35 $3.14 $2.3
Slide 33: Crawford PEA Sensitivities
Crawford PEA Sensitivities Delta NPV8% Delta IRR Delta Net C1 Cash Cost (US$ millions) (%) (US$ / lb) Sensitivity - + - + - + Nickel Price ±$1/lb ($445) $435 (2.8%) 2.6% n.a. n.a. ($6.75/lb - $8.75/lb) Nickel Price ±10% ($342) $341 (2.1%) 2.0% n.a. n.a. ($6.98/lb - $8.53/lb) Iron Price ±10% ($101) $
Slide 34: Crawford PEA Assumptions
Crawford PEA Assumptions Parameter Unit Model Assumptions Nickel Price S/lb ($/tonne) $7.75 ($17,000 ) Chromium Price $/lb ($/tonne) $1.04 ($2,300 ) Iron Ore Price $ / tonne $290 US$/C$ Exchange Rate USD:CAD 0.75 Oil $/barrel $60 34
Slide 35: Crawford Mineral Resource
Crawford Mineral Resource Crawford’s resource ranks as one of the 10 largest nickel sulphide resources globally and now includes chrome values ▪ Higher grade core of M&I Resource of 280 Mt at 0.31% Ni, 0.59% Cr and 6.31% Fe within an overall M&I resource of 653 Mt at 0.26% Ni, 0.60% Cr and 6.58% Fe
Slide 36: Timmins Nickel District – First Hole Success Confirms Targeting Approach
Timmins Nickel District – First Hole Success Confirms Targeting Approach Drilling at newly acquired Deloro (Hole DEL22-01 collared in the center of the ultramafic) yielded 480 metres of mineralized dunite Plan View of Deloro Property Drill Results Overlain on Total Field Magnetic Intensity ▪ 1.4 km
Slide 37: Success at Initially Acquired Regional Properties
Timmins Nickel District Success at Initially Acquired Regional Properties All nine holes from Dargavel, Mahaffy, MacDiarmid, and Kingsmill (Noble properties) intersected multi-hundred metre intersections of mineralization • Dargavel hole DAR21-01 yielded highest grade intersection: 0.34% nickel over
Slide 38: Corporate Office
Corporate Office 130 King St West Suite 1900 Toronto ON M5X 1E3 TSX-V: CNC +1 (647) 256-1954 info@canadanickel.com www.canadanickel.com Twitter: @CanadaNickel
Canada Nickel Company — Investor Presentation (February 2022) on 6ix