Sovereign Metals Limited · ASX:SVM
Sovereign Metals — Non-Deal Roadshow (September 2018)
20 slides from Sovereign Metals's roadshow presentation, September 2018
Slide 1: Malingunde Graphite Project
MALINGUNDE GRAPHITE PROJECT THE SAPROLITE ADVANTAGE LOW COST, HIGH MARGIN PFS IMMINENT RIU ROADSHOW, SEPTEMBER 2018 ASX:SVM
Slide 2: Disclaimers & Disclosures
DISCLAIMERS & DISCLOSURES. DISCLAIMER NOTICE This presentation has been prepared as a summary only, and does not contain all information Sovereign Metals Limited’s (“SVM”) assets and liabilities, financial position and performance, profits and losses, prospects, and the rights and liabilities attach
Slide 3: Sovereign Metals: Investment Highlights
SOVEREIGN METALS: INVESTMENT HIGHLIGHTS QUALITY AN EXCEPTIONALLY LOW COST, COARSE FLAKE GRAPHITE DEVELOPMENT STRATEGY SALES TO EXISTING GRAPHITE MARKETS; UPSIDE IN EMERGING MARKETS CASHFLOW SIGNIFICANT CASH RETURNS IN ALL PRICING ENVIRONMENTS PARTNERSHIPS EXPORT LOGISTICS PARTNERSHIP WITH VALE & MIT
Slide 4: Malingunde: A Very Low Cost Coarse Flake Graphite Development
MALINGUNDE: A VERY LOW COST COARSE FLAKE GRAPHITE DEVELOPMENT • Saprolite is the very soft, graphite-bearing, clay-rich oxide material that is formed from intense weathering of the original bedrock. • Malingunde is the world’s largest reported saprolite-hosted graphite resource. Total: 45.7Mt @ 7.2%
Slide 5: Saprolite Advantage: Very Simple Operations with Significant Operating Cost Advantages
SAPROLITE ADVANTAGE: VERY SIMPLE OPERATIONS WITH SIGNIFICANT OPERATING COST ADVANTAGES VERSUS HARD ROCK PEERS FREE DIG, NO DRILL & BLAST, NO PRIMARY CRUSHING OR GRINDING REQUIRED Peers – Hard rock material Sovereign – Soft saprolite (clay) material XX X SAPROLITE + COARSE FLAKE = LOW COST & HIGH REV
Slide 6: Coarse Flake: High Value Concentrates Produced via a Simple Process Flow-sheet
COARSE FLAKE: HIGH VALUE CONCENTRATES PRODUCED VIA A SIMPLE PROCESS FLOW-SHEET • Simple process flowsheet – no primary crush or grind. • High recoveries of ~90%. • High grade concentrates ranging between 96% and 98% TGC. • High value concentrates dominated by coarse flake sizes – ~60% >150µm. 5
Slide 7: Potential for a Simple & Highly Profitable Flake Graphite Operation
POTENTIAL FOR A SIMPLE & HIGHLY PROFITABLE FLAKE GRAPHITE OPERATION MALINGUNDE SOFT SAPROLITE-HOSTED DEPOSIT TO DELIVER VERY LOW COST PRODUCTION, WITH HIGH VALUE CONCENTRATES. OPERATING COST HIGHEST MARGINS $ TARGETING BOTTOM OF THE COST CURVE OPERATIONS SIMPLE MINING & PROCESSING ONLY LOWEST RISK M
Slide 8: Malawi: A Mining Friendly Jurisdiction with Logistics Solution in Place
MALAWI: A MINING FRIENDLY JURISDICTION WITH LOGISTICS SOLUTION IN PLACE • Enviable access to infrastructure; just 20km from Lilongwe, the capital of Malawi. • A stable, transparent jurisdiction, increasingly attracting significant international investment. • Transport MoU signed with Vale & Mitsui.
Slide 9: Forward Plan
FORWARD PLAN PFS • High quality PFS study (PENDING) DOWNSTREAM • Test-work continues on suitability for battery and TEST-WORK other high-end applications • Accelerated pilot program to produce bulk PILOT PLANT concentrates for marketing purposes. OFFTAKE & • Well advanced discussions with a number o
Slide 10: PFS Near Completion
PFS NEAR COMPLETION PFS DESIGNED TO BUILD ON OUTSTANDING RESULTS DELIVERED IN THE SCOPING STUDY (JUNE 2017). World class study managed by Minnovo. Low technical risk with well-validated inputs. Study to be used to commence financing strategy. Focused on costs utilising the saprolite advantage. 9
Slide 11: Bulk Sample Drilling for Pilot Plant Program Commenced at Malingunde
BULK SAMPLE DRILLING FOR PILOT PLANT PROGRAM COMMENCED AT MALINGUNDE Bulk drilling program completed September 2018. ~100 tonnes of soft saprolite graphite ore extracted. Acceleration of the pilot program and production of bulk concentrates driven by significant demand from potential offtake partner
Slide 12: Marketing Strategy
MARKETING STRATEGY Targeting sales into existing traditional markets (refractories, foundries etc.). Upside to emerging high-tech markets including Li-ion batteries. Well advanced discussions with Tier 1 and high quality offtake parties across a number of industrial sectors and global locations. Acc
Slide 13: Natural Flake Graphite: Understanding Demand
NATURAL FLAKE GRAPHITE: UNDERSTANDING DEMAND • Significant graphite demand driven by traditional industrial applications – particularly refractories and expandables. • Long term growth forecasts for energy storage are very compelling. • OVERALL . NATURAL GRAPHITE DEMAND CURRENT APPLICATIONS FOR NATU
Slide 14: The Right Market
THE RIGHT MARKET MAJORITY OF SOVEREIGN’S REVENUE TARGETED TO BE FROM HIGH VALUE COARSE FLAKE FORECASTED GRAPHITE PRICES $5,000 Malingunde flake basket 2018 2025 $4,500 optimised to higher-value $4,000 industrial market INDUSTRIAL MARKET Refractories & Expandable $3,500 Average sales price $1,000-$3,
Slide 15: Natural Flake Graphite: Understanding Supply
NATURAL FLAKE GRAPHITE: UNDERSTANDING SUPPLY • China remains the dominant and lowest cost global producer. • The ability to compete on price with China is critical to project success, noting Chinese supply is increasingly constrained by quality, cost & environmental factors. Canada 2% Turkey 4% Indi
Slide 16: Next Steps: Rapid Pathway to Production
NEXT STEPS: RAPID PATHWAY TO PRODUCTION ACCELERATED PROJECT DEVELOPMENT BASED ON EXCEPTIONAL SCOPING STUDY OUTCOMES. 1. Pre-feasibility study. PENDING 2. Product sales agreements. Advancing 3. Feasibility study & permitting. Q4 2018 – mid 2019 4. Project finance. ~Q3 2019 15
Slide 17: Key Takeaways: World Class Project with Multiple Advantages
KEY TAKEAWAYS: WORLD CLASS PROJECT WITH MULTIPLE ADVANTAGES A SIMPLE OPERATION WITH SUBSTANTIAL COST BENEFITS AND HIGH PRODUCT MARKETABILITY. HIGH GRADE SAPROLITE DEPOSIT: FREE DIG, SIMPLE AND CHEAP TO MINE LOW COST: VERY SIMPLE OPERATIONS WITH SIGNIFICANT OPERATING COST ADVANTAGES COARSE FLAKE: HIG
Slide 18: Management Team with a Proven Track Record of Success
MANAGEMENT TEAM WITH A PROVEN TRACK RECORD OF SUCCESS RAISED OVER $1 BILLION TO FUND NATURAL RESOURCE PROJECTS, INCLUDING TWO PROJECTS CURRENTLY IN CONSTRUCTION. Mr Middlemas was a Senior Group Executive for Normandy Mining for more than ten years, which was IAN MIDDLEMAS Australia’s largest gold mi
Slide 19: Thank You
THANK YOU
Slide 20: Sovereign Metals Limited contact details
Sovereign Metals Limited | ASX : SVM T: +61 8 9322 6322 | F: +61 8 9322 6558 E: info@sovereignmetals.com.au | www.sovereignmetals.com.au Level 9, BGC Centre, 28 The Esplanade, PERTH WA 6000 | ABN: 71 120 833 427 FOLLOW US
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