Ardea Resources Ltd. · ASX:ARL
Ardea Resources — Shareholder Meeting (November 2017)
38 slides from Ardea Resources's shareholder meeting presentation, Nov 23, 2017
Slide 1: Annual General Meeting
ANNUAL GENERAL MEETING 23 November 2017 The KNP Cobalt Zone at the Goldfields Highway, Goongarrie South 1
Slide 2: Disclaimer
Disclaimer Important notice the Company is under no obligation to revise any forward looking statement to This presentation contains general information only and is, or is based upon, reflect events or circumstances after the date of this presentation or to reflect information which has been release
Slide 3: Our aims
Our aims Co Ni Sc To directly supply cobalt sulphate and nickel sulphate to lithium ion battery manufacturers 3
Slide 4: Highlights
Highlights Ardea Resources Limited (ASX:ARL) is a cobalt exploration and development company focussed on developing its 100% owned flagship Kalgoorlie Nickel Project (KNP) Largest Cobalt Resource in the Developed World With well over 700 Mt of defined Co+Ni mineralisation, Ardea is focusing on the h
Slide 5: Highlights
Highlights Fully funded through to DFS $11 million cash, likely exercise of 77c options by May 2018 for a further $19.5 million Optionality Play Ardea provides more leverage to the price of Cobalt then any other public vehicle globally, offering significant relative value compared to nickel-laterite
Slide 6: Corporate Snapshot
Corporate Snapshot Capital Structure Shares on Issue 82,124,946 Share Price (21 Nov 2017) $1.54 52 week high / low $2.20 / $0.17 Share price performance and volume since listing (9 February 2017) Cash $11 million Market Cap $115.5 million Unlisted Options $0.25 (IPO) 12.31 million $0.77 (Loyalty) 23
Slide 7: Peer Comparison
Peer Comparison Project KNP Cobalt Zone Sunrise, NSW Sconi, Qld Flemington NSW Commodities Co, Ni, Sc Co, Ni, Sc Sc, Co, Ni Sc Ownership 100% unencumbered 100% 75% earn-in 100% earn-in Cobalt + nickel sulphate, Cobalt + nickel Scandium oxide, cobalt + Proposed products nickel sulphate Scandium oxide
Slide 8: Cobalt Market 2017 and Beyond
Cobalt Market 2017 and Beyond Cobalt price 1 Nov 2016 – 21 Nov 2017 Cobalt price 1 Jul 2005 – 5 Sep 2017 Cobalt price (USD/t) • Global cobalt production is currently circa 100,000tpa with prices at ~US$60,000/t, well below 2008 levels of more than US$110,000/t • Politically unstable DRC accounts for
Slide 9: The Automotive Electrification Revolution
The Automotive Electrification Revolution Mercedes Benz A range of 10 electric vehicles by 2022, investing €10 billion Toyota Solid-state lithium ion battery, 800-1000 km range, 4 min recharge, production 2022 China World leading ~800,000 electrified vehicle sales in 2017 (up from ~90,000 in 2014) A
Slide 10: Fundamental cobalt supply shortfall
Fundamental cobalt supply shortfall Numerous forecasters show 2022 as an By 2022, the world is important year. expected to require • 50% increase in cobalt production (~150ktpa) from today’s 100ktpa levels 10 new KNP • Several-fold increase in EV sales Cobalt Zones • Most auto manufacturers’ product
Slide 11: KNP Cobalt Zone 64.4 Mt at 0.13 % Co & 0.77 % Ni
KNP Cobalt Zone The KNP is Australia’s and the developed world’s* largest cobalt resource with over 700 Mt of cobalt and nickel mineralisation Focus on the high-grade Cobalt Zone, 64.4 Mt at 0.13 % Co & 0.77 % Ni** 81,000 t contained cobalt metal View over Goongarrie South and Big Four, looking sout
Slide 12: KNP Cobalt Zone
KNP Cobalt Zone • More than $50 million spent historically Vale-Inco and Heron with circa 400,000 metres of drilling and detailed metallurgical work available • Active mining area, within 150 km of Kalgoorlie, WA • On active granted mining leases • 100% ownership of project, unencumbered 12
Slide 13: KNP Cobalt Zone
KNP Cobalt Zone • Shallow, lateritic cobalt- nickel deposits within 120m of surface • Open-pit mining provides low strip ratio (~1:1) • Cobalt and nickel in soft, iron-rich clay, free digging • Flat-lying cobalt-nickel mineralisation usually within 50m of surface 13
Slide 14: Lateritic cobalt-nickel deposit
Lateritic cobalt-nickel deposit Soft, iron-rich clay is host to mineralisation • Cobalt to nickel ratio in most similar deposits is 1:12 to 1:20 • KNP Cobalt Zone cobalt to nickel ratio is less than 1:6 14
Slide 15: Scandium Oxide By-Product
Scandium Oxide By-Product • Scandium discovered by Ardea at Goongarrie • Tabular, near-surface bodies grading between 45 South, Black Range, Kalpini and 500 g/t scandium will be mined to access the cobalt and nickel below • Systematic scandium resampling of KNP Cobalt Zone commencing September • Pot
Slide 16: Preliminary Flowsheet for the KNP Cobalt Zone
Preliminary Flowsheet for the KNP Cobalt Zone Ore HPAL Filtration Scandium 2 Stage Iron Sulphide preparation ion exchange Removal Precipitation Sc Pressure • Scalable Oxidation • Modular Acid/Steam Scandium Sulphur Refinery Fe,Cr,Al Impurity • Numerous possible removal Acid Fe,Al Ni,Co by-products P
Slide 17: HPAL–MS - Advantages
HPAL–MS - Advantages • Proven Technology – Flexibility to recover by-products – Lower operating cost over other leaching options – Ability to adopt a lower CAPEX modular approach – Successful operations available for benchmarking 17
Slide 18: Benchmarking-Successful operations
Benchmarking-Successful operations 1st Generation 3rd Generation 4th Gen • Moa Bay Revitalisation • Coral Bay 1 • Taganito • 100% Capacity in a year • 90% capacity • 90%+ nameplate 3 years • 25,000tpa Ni 3,000tpa Co • 15months • 30,000tpa Ni 2,600tpa Co • 10,000tpa Ni 750tpa Co • Coral Bay 2 • 100%
Slide 19: PFS Test work
PFS Test work • Sample 0.126% cobalt and 1.5% nickel • Completed Bench Scale Autoclave tests • Ongoing Bench scale tests – remove scandium via SX/IC – recover nickel and cobalt as a mixed sulphide – Solvent extraction test work to separate the cobalt and nickel 19
Slide 20: Forward Strategy Using HPAL Flowsheet
Forward Strategy Using HPAL Flowsheet • Select key personnel with previous involvement in HPAL design, commissioning and ramp up. • Assess adopt successful implementation components of third generation laterite operations • The Flow sheet – Will be supported by continuous pilot operations – Be based
Slide 21: PFS delivery
PFS delivery • Completion of Test work prior to Christmas • Refinement of flowsheet Compare and Assess financial and technical risk for the various throughput options – 1Mtpa – 2Mtpa – 4Mtpa • Finalise PFS first Qtr 2018 21
Slide 22: Fast-Tracking Development To Add Value
Fast-Tracking Development To Add Value • Extra funds being used to streamline projects and drilling to upgrade resources and reserves • Expedite DFS by commencing drilling programs now as part of the PFS • Advancement of deposits from Kalpini, Highway, Yerilla camps to KNP Cobalt Zone through strate
Slide 23: Other Projects
OTHER PROJECTS \ 23
Slide 24: Lewis Ponds bulk mining model
Lewis Ponds bulk mining model Major development project with enormous potential • Historic resources: 6.62 Mt @ 2.4 % Zn, 1.4 % Pb, 0.2 % Cu, 1.5 g/t Au, and 69 g/t Ag • Bulk mining open pit exploration target: 15 – 25 Mt @ 2.2 – 3.7 % ZnEq* or 1.0 – 1.5 g/t AuEq* • Main resource on freehold land ow
Slide 25: Mt Zephyr Gold Project
Mt Zephyr Gold Project • Exceptional gold exploration ground in WA Mt Zephyr greenstone belt • Greenstone-hosted gold deposits • No gold exploration for over 20 years • Area east of Celia Lineament is highly prospective • Along structure from Mt Morgans, Lake Roe gold deposits • Dunn’s Line analogue
Slide 26: Mt Zephyr Drill Targets
Mt Zephyr Drill Targets Mt Zephyr / Dunns Line Gold • 4km strike of mineralised BIF with old workings • Historic grades of 5-90 g/t Au • Mt Morgan’s analogue, same host rocks • Mt Magnet Hill 50 “Boogardie Breaks” model Dunns Gale Gold • High-grade, extensive, shallow anomaly Gale • Shallow RAB inte
Slide 27: Upcoming Catalysts
Upcoming Catalysts YZ Upgrading of the KNP Cobalt Zone resources, incorporation of additional »,/ resources from Kalpini and other outlying areas ONGOING » OCT 2017 , Definition of scandium and platinoid resources at Black Range + Scandium and platinoid assessment elsewhere ongoing SRA Sy Q1 2018 \2
Slide 28: Why Ardea?
Why Ardea? • Considerable leverage to increasing cobalt and nickel prices • Fully funded through to DFS • Significant relative value compared to Australian nickel-cobalt-laterite peers • Clear strategy to become a near term cobalt producer • Excellent exploration upside with plan to undertake compre
Slide 29: Thank You
THANK YOU 29
Slide 30: App 1: Resource breakdown
App 1: Resource breakdown KNP Cobalt Zone nickel-cobalt mineral resource (JORC 2012) Resource Cut-off Size Co Ni Contained Contained Area Prospect category (% Co) (Mt) (%) (%) cobalt (t) nickel (t) Goongarrie Goongarrie Measured 0.08 4.6 0.16 1.12 7,200 51,600 South Indicated 0.08 12.9 0.13 0.79 17,
Slide 31: App 1: Resource breakdowns (continued)
App 1: Resource breakdowns (continued) KNP Cobalt Zone nickel-cobalt mineral resource (JORC 2012) – Compliance Statement COMPLIANCE STATEMENT (JORC 2012 and NI43-101) A competent person’s statement for the purposes of Listing Rule 5.22 has previously been announced by the Company for: 1. Kalgoorlie
Slide 32: App 1: Resource breakdowns (continued)
App 1: Resource breakdowns (continued) Lewis Ponds mineral resource (JORC 2012) Quantity Zn Cu Pb Au Ag Resource Category (Mt) (%) (%) (%) (g/t) (g/t) Indicated Main Zone 5.82 2.1 0.1 1.1 1.5 59 Tom’s Zone 0.54 5.5 0.3 3.8 1.7 172 Total Indicated 6.35 2.4 0.2 1.4 1.5 68 Inferred Main Zone 0.17 1.7 0
Slide 33: App 2: Key Risks
Appendix 2: Key Risks An investment in the Company is not risk free. Before deciding to trade in the Shares, Shareholders and interested investors should read the entire Prospectus, consider at least the following risk factors in light of their personal circumstances and investment objectives (inclu
Slide 34: App 2: Key Risks (continued)
App 2: Key Risks (continued) Limited exploration • Aside from Lewis Ponds and the KNP, Ardea’s projects have been subjected to only limited drill testing. Whilst gold and/or nickel mineralisation as the case may be has been located in multiple previous drill intersections, there is a risk that the m
Slide 35: App 2: Key Risks (continued)
App 2: Key Risks (continued) Exploration and Operating Risks (cont.) • (vii) unavailability of transport or drilling equipment to allow access and geological and geophysical investigations; (viii) unavailability of suitable laboratory facilities to complete metallurgical testwork investigations; (ix
Slide 36: App 2: Key Risks (continued)
App 2: Key Risks (continued) Environment • The projects are subject to Western Australian, New South Wales and Federal laws and regulations regarding environmental matters and the discharge of hazardous wastes and materials. As with all mining projects, the projects would be expected to have a varie
Slide 37: App 2: Key Risks (continued)
App 2: Key Risks (continued) Other Risks General Economic Risks and • Share market conditions may affect the listed securities regardless of operating performance. Share market conditions are affected by many Business Climate Risks factors such as: (a) general economic outlook; (b) movements in or o
Slide 38: App 2: Key Risks (continued)
App 2: Key Risks (continued) Exploration, Development, • The business of mineral exploration, project development and mining by its nature contains elements of significant risk. Ultimate and Mining and Processing Risks continuing success of these activities is dependent on many factors such as: (a)
Ardea Resources — Shareholder Meeting (November 2017) on 6ix