Paladin Energy Ltd · ASX:PDN
Paladin Energy — Investor Day (June 2023)
42 slides from Paladin Energy's investor day presentation, Jun 28, 2023
Slide 1: Investor Day
Investor Day Clean energy. Clear future. June 2023
Slide 2: Disclaimer and Competent Person's Statement
Disclaimer and Competent Disclaimer Person’s This presentation contains summary information about the Company’s activities current Except for statutory liability which cannot be excluded, the Company, its officers, as at the date of this presentation. The information in this presentation is of a gen
Slide 3: Paladin's Team
Paladin’s Team Speakers Ian Purdy Anna Sudlow Paul Hemburrow Alex Rybak Chief Executive Officer Chief Financial Officer Chief Operating Officer Chief Commercial Officer Panel Johan Roux Jess Oram Peter Watson General Manager General Manager Non-Executive Director Langer Heinrich Mine Exploration 3
Slide 4: Today's agenda
Today's agenda Topic Presenter Welcome and Introduction Ian Purdy (CEO) Transforming Paladin Anna Sudlow (CFO) Delivering Production Paul Hemburrow (COO) Customers & Markets Alex Rybak (CCO) Growth Ian Purdy (CEO) Questions Panel Conclusion 4
Slide 5: Market Cap, share price and cash snapshot
Market Cap1 A$2.05B Share price1 A$0.69/share Available Cash2 US$132M Index ASX200 Corporate Debt1 Nil Research Coverage Namibia Langer Heinrich Mine Returning to Production 1. As at 26 June 2023 2. As at 31 May 2023 5
Slide 6: Clean energy. Clear future.
Clean energy. Clear future. Returning the Balance sheet Langer Heinrich Cornerstone offtakes secured strength and financial Mine to production and strong uranium market discipline Long term growth optionality • Low risk brownfield restart • Offtakes secured with leading • US$132M1 in available cash
Slide 7: Transforming Paladin
Transforming Paladin Anna Sudlow − CFO 7
Slide 8: Strengthening our business
Strengthening our business • Delivered zero debt via strategic equity placements 20191 Today2 • Implemented Board and Management additions to deliver an Executive Leadership Team with the right operational, commercial, technical and governance skills to deliver production at the Langer Heinrich Mine
Slide 9: Delivering capital flexibility
Delivering capital flexibility Paladin’s strong net cash position underpins a strategic approach to our future capital structure The Company is exploring corporate debt facilities to provide capital flexibility A syndicated debt facility is likely to be the most efficient structure Process underway
Slide 10: Future reporting framework
Future reporting framework • Paladin expects to provide guidance on the FY2024 production profile prior to first production • FY2025 guidance is expected to be provided with the release of the 4Q FY2024 Activity Report in July 2024 (including revenue sensitivities) Metrics reported during production
Slide 11: Delivering sustainability reporting
Delivering sustainability reporting Paladin has adopted and implemented the Independent FID Restart Plan Roll-out of GRI, Issue FY2024 Sustainability Accounting Review Decision to TCFD, Modern Slavery Sustainability Report Sustainability Restart LHM Implement GRI, TCFD, Standards Board (SASB) Report
Slide 12: Net Zero commitments
Net Zero commitments Emissions Intensity by Energy Source (g/kWh) Nuclear energy is the second largest source of global clean energy with almost zero carbon emissions1 1,200 Nuclear energy is recognised as a green source of energy in the EU2 1,000 When Langer Heinrich Mine is back in production, 800
Slide 13: Supporting our local communities at Langer Heinrich Mine
Supporting our local communities at Langer Heinrich Mine Paladin has a policy prioritising local employment which in turn supports the local communities, and has so far provided the following local employment opportunities: • Over 90% of the 900+ project development team • 90% of in-country key man
Slide 14: Paladin transformed
Paladin transformed Delivered strong net cash position and enhancing our capital flexibility Implemented sustainability reporting ahead of production Sarah − image Committed to local community though jobs, education and procurement Delivered the people, skills and policies to deliver sustainable pro
Slide 15: Delivering Production
Delivering Production Paul Hemburrow − COO 15
Slide 16: Langer Heinrich Mine overview
Langer Heinrich Mine overview 75% owned by Paladin Located in Namibia 125km from industrial Port of Walvis Bay Excellent local infrastructure (port, road, rail, water & power) with proximity to the Walvis Bay industrial hub Strong Government and community support for uranium mining in Namibia Lüderi
Slide 17: Returning Langer Heinrich Mine to production
Returning Langer Heinrich Mine to production Proven history Project execution Future success • 10 years of production history • Restart project focused on repair & • Q1 CY2024 production target • Simple, proven process flow with refurbishment and debottleneck of existing • Cornerstone offtakes secur
Slide 18: Proven processing plant
Proven processing plant 10 years of successful operation history Standard crushing and classification Alkaline leach process similar to standard alumina refining process (Bayer Process) CCD solids separation and ion exchange Final product recovery to U3O8 Final product drummed and transported by roa
Slide 19: Open pit mining
Open pit mining Simple open pit mining operation Standard drill & blast mining process Mining to be conducted across four pits Typical African standard load and haul fleet Care and maintenance program has ensured all pits, haul roads and mine infrastructure are in good standing 19
Slide 20: Well defined project scope
Well defined project scope Extensive review process has provided a low-risk pathway to restart LHM Defining the scope Scope defined two-phase 10 years of reliable operations workstream of repairs & Dynamic modelling validated data delivered scope for project refurbishment and debottleneck opportunit
Slide 21: Key work packages
Key work packages Two-phase approach delivered defined work packages to return the LHM plant to operations Repair & Refurbishment • Civil/structural (concrete, steel) 1 Debottleneck • Final Product Recovery (FPR) package 2 • Mechanical (pumps, pulleys, conveyors, • Control system upgrade ancillaries
Slide 22: Recent restart project photos
Recent restart project photos Primary & tailings cyclone clusters fabrication Pre-leach surge tank construction progress Radiation safety briefing Hydrosort screen assembly Valves for overhaul Pipework replacement 22 and upgrade
Slide 23: On track, on budget (over 50% complete)
On track, on budget (over 50% complete) Decision to Long lead orders Early works All equipment Detailed structural & Progression of Repair Operations Repairs & restart LHM completed completed orders completed mechanical engineering & Refurbishment and workforce Refurbishment completed Growth works e
Slide 24: Transitioning towards operations
Transitioning towards operations Key in country and mine site leadership roles have been filled We expect ~ 300 Paladin staff to be operating and maintaining the Plant Strong engagement of local community labour force First phase ROM feed contract to be awarded imminently and contract mining tender
Slide 25: Production profile
Production profile1 Three phases of operation over 17 years producing 77Mlb U3O8 Material Crushed (t) UU308 3O8 Production (lbs) Grade (ppm) Ramp Up Mining Phase Stockpile Phase 7 700 Crushed (t) Production (lb) Millions 6 600 5 500 4 400 Grade (ppm) 3 300 2 200 1 100 - - Y1 Y2 Y3 Y4 Y5 Y6 Y7 Y8 Y9
Slide 26: LHM on track and budget for sustainable production
LHM on track and budget for sustainable production Improving a proven operation with low complexity, high impact upgrades Delivering a well defined, low risk pathway to production Project on time and on budget Targeting Q1 CY2024 first production LHM will be a globally significant producer of U3O8 2
Slide 27: Customers and Markets
Customers and Markets Alex Rybak – CCO 27
Slide 28: Global macro drivers
Global macro drivers Decarbonisation Energy security and geopolitical drivers • Nuclear is essential to achieve ‘Net-zero’ • Recent geopolitical events have accelerated the need for • Second largest source of clean energy global with almost energy independence zero carbon emissions1 • Pivot to supp
Slide 29: Uranium sector fundamentals: supply & demand
Uranium sector fundamentals: supply & demand Structural Supply Shortage, Western Market (Mlb U3O8 p.a.) Average • Demand is exceeding supply deficit of market expectations ~40Mlb p.a. over • Primary supply the next shortage decade1 • Secondary supplies are shrinking • Window of opportunity for incum
Slide 30: Uranium sector fundamentals: global reactor fleet
Uranium sector fundamentals: global reactor fleet Reactors Connected to Grid Global reactor fleet set to grow significantly Net reactors added Reactors under construction* 12 10 8 6 4 2 0 -2 -4 -6 -8 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
Slide 31: Uranium sector fundamentals: secondary supplies and inventories
Uranium sector fundamentals: secondary supplies and inventories Secondary Supplies1 100,000 Underfeeding Utility inventory drawdowns Other Russian supplies 90,000 • Sustained inventory drawdowns are no 80,000 Thousand Pounds (U3O8 ) longer a viable 70,000 option for utilities • Western enrichers to
Slide 32: Uranium sector fundamentals: long term contracting
Uranium sector fundamentals: long term contracting Term Contracting Activity (Mlb U3O8 p.a.) Uranium Purchases by Utilities (Annual %) 275 100% 250 90% 225 80% 200 70% 175 60% 150 Mlb U3O8 50% 125 40% 100 75 30% 50 20% 25 10% 0 0% 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Slide 33: Uranium sector fundamentals: significant term contracting cycle ahead
Uranium sector fundamentals: significant term contracting cycle ahead Utility Contracted Coverage Rates (%) Contract Coverage (% of base requirements) • Utilities are typically well contracted 2-3 years out • Top-tier utilities have longer contract horizons • Security of supply concerns increasing d
Slide 34: LHM contracting strategy: objectives & execution
LHM contracting strategy: objectives & execution First tier counterparties Contract book to underpin the restart • Rebuild a global contract book with industry-leading counterparties • Put in place initial layer of contracts to underpin the • Contract with primary consumers of uranium restart of LHM
Slide 35: LHM contracting strategy: current portfolio
LHM contracting strategy: current portfolio Contracted Mix Geographic Mix Pricing Mix 16% 19% 3% 48% 52% 52% 52% 29% 29% % of production contracted US Europe Asia Uncontracted % of production under BE/Fixed % of production uncontracted % of production under Market-related % of production uncontracte
Slide 36: Exposure to positive uranium fundamentals underpinned by world class contract book
Exposure to positive uranium fundamentals underpinned by world class contract book Growing support for nuclear energy as part of the global decarbonisation thematic Utilities are back in the long term contracting market Paladin has built an industry leading contract book LHM projected production has
Slide 37: Growth
Growth 37
Slide 38: A quality global suite of exploration assets provides growth opportunities
A quality global suite of exploration assets provides growth opportunities Globally significant, high-grade exploration portfolio 41.5Mlb 127.7Mlb Exploration Projects Extensive historical exploration activity with over US$140M previously spent Mineral Resources1,2 203Mt at 710ppm U3O8 for 317.6Mlb
Slide 39: Canada: Michelin Uranium Project
Canada: Michelin Uranium Project1 (75% Paladin ownership) Strategic land position in premier mining Advanced exploration Development and jurisdiction project Exploration pathways • Uranium is classified as a critical mineral • US$75M of total historical in-ground • Update of prior concept study in C
Slide 40: Paladin's strategy for value creation
Paladin’s strategy for value creation Paladin is on a clear pathway to becoming a globally significant independent uranium producer, helping the transition to a low-carbon global economy 1 2 3 Execute at the Define Development Embed Langer Heinrich Mine and Exploration Potential Sustainable Returns
Slide 41: Questions
Questions 41
Slide 42: Investor Enquiries: Alex Rybak
Investor Enquiries: Alex Rybak paladin@paladinenergy.com.au Level 8 191 St Georges Terrace, WA 6000 +61 8 9423 8100 paladin@paladinenergy.com.au paladinenergy.com.au