Orion Minerals Limited · ASX:ORN
Orion Minerals — Investor Presentation (December 2019)
30 slides from Orion Minerals's investor presentation, Dec 2, 2019
Slide 1: Delivering the Prieska Project
ASX/JSE: ORN ASX/JSE: ORN DELIVERING THE PRIESKA PROJECT A strong foundation for near-term development and long-term growth PAGE Presentation: December 2019
Slide 2: Disclaimer
DISCLAIMER This presentation contains summary information about Orion targets, estimates and assumptions in respect of metal To the maximum extent permitted by law, Orion and any of its Minerals Ltd and its subsidiaries (Orion or Company) and their production and prices, operating costs and results,
Slide 3: Corporate Structure
CORPORATE STRUCTURE • Primary listing on the ASX. • Secondary listing on Main Board of the Johannesburg Stock Exchange. Capital structure summary Significant shareholders % Shares on issue 1 2,830M Tembo Capital 24.6 Options on issue 211M Wyllie Group 5.7 Market capitalisation (2.8cps (ASX)) 2 $79M
Slide 4: Orion Minerals – Compelling Investment Case
ORION MINERALS – COMPELLING INVESTMENT CASE THE OREBODY • Globally significant VMS Resource: 30.49Mt @ 1.2% Cu, 3.7% Zn • Mineral Reserve: 13.62Mt @ 1.06% Cu, 3.18% Zn FOUNDATION PHASE (10 YR) BFS OUTCOMES • Initial 10-year, 2.4Mtpa operation targeting 22ktpa Cu & 70ktpa Zn • Strong operating margin
Slide 5: Prieska: Reawakening a Global VMS Giant
PRIESKA: REAWAKENING A GLOBAL VMS GIANT • World-class orebody – NW Hutchings Shaft SE recorded as a Top 30 global VMS deposit • Located in Northern Cape Province, 270km south-west of regional capital, Kimberley Current Flooded Water Level • Established mining region, yet least populous region of Sou
Slide 6: Prieska: Developing a New Mine in the Footprint of an Old One
PRIESKA: DEVELOPING A NEW MINE IN THE FOOTPRINT OF AN OLD ONE Extensive infrastructure already in place: • Primary shafts and underground decline roadways • Sealed access roads to project site • 48km via bitumen road to existing rail siding • Four high-voltage regional lines linked to national elect
Slide 7: Prieska: Mine of the Future
PRIESKA: MINE OF THE FUTURE Implementing a modern operating philosophy (4IR enabled) can contribute to achieving quantum changes in key output parameters that are traditionally slow to improve or have regressed in the local mining industry, including: • Safety and health improvements • Improved envi
Slide 8: Prieska June 2019 BFS Highlights
PRIESKA JUNE 2019 BFS HIGHLIGHTS FOUNDATION PHASE LOM EXTENSION PHASE • Demonstrates compelling investment case to establish • LOM extensions leveraging off Foundation Phase financially robust mine with initial 10-year life development and requiring limited or no o Pre-tax free cash flow of A$1.1bn
Slide 9: Further Optimisations Poised to Enhance Value
FURTHER OPTIMISATIONS POISED TO ENHANCED VALUE Engineering and detailed costing at BFS (15%) accuracy scheduled for completion Q1 2020 • Metallurgical plant design o Include SAG milling o Removes secondary crushing, screening, & rock conveyors. o Capital (A$15m) & Opex savings anticipated Project •
Slide 10: Project Financing Considerations
PROJECT FINANCING CONSIDERATIONS Majority Senior Secured Project Debt Finance * Proposals received from seven institutions * includes two specialist development finance institutions * Discussions progressing * To be finalised post optimisation – revised project cashflow Subordinated debt and structu
Slide 11: Project Significant to South Africa
PROJECT SIGNIFICANT TO SOUTH AFRICA STRONG GOVERNMENT SUPPORT South African State President Cyril Ramaphosa congratulates Orion Minerals Ltd CEO Errol Smart on progress at Prieska State President’s Investment Conference - 6 November 2019 PAGE 11
Slide 12: Key Social Impacts of the Proposed Prieska Mine
KEY SOCIAL IMPACTS OF THE PROPOSED PRIESKA MINE EMPLOYMENT CREATION • Estimated that 846 people (operational Phase) will be employed • Empirical multiplier effect potentially creates 2,500 associated jobs INCREASE IN GROSS DOMESTIC PRODUCT • District GDP increase expected of 20.3% at optimal mining
Slide 13: BEE: Pivotal Transaction Completed
BEE: PIVOTAL TRANSACTION COMPLETED BEE New BEE Entrepreneurs Orion Entrepreneurs 10.7% 100% Safika Black Star Kolobe Nala Resources Minerals Investment Prieska Prieska Community Prieska Northern projects Employees Resources Trust Trust Orion Exploration 1 (PR application pending) 70% Masiqhame: Kant
Slide 14: A Dominant Land-Holding in Mineral Belt Identical to Fraser-Albany
A DOMINANT LAND-HOLDING IN MINERAL BELT IDENTICAL TO FRASER-ALBANY (AUSTRALIA) • We have the worlds largest, single lens VMS Cu-Zn deposit o BFS completed June 2019 o Optimisation studies well advanced • Located in an underexplored mineral belt • 22 additional known VMS Cu-Zn occurrences on our mine
Slide 15: Fraser Range Australia: IGO JV – ORN Free Carried
FRASER RANGE AUSTRALIA: IGO JV – ORN FREE CARRIED* “We have a conviction the (Nova) system is much larger than we believed, and the increased probability of additional discoveries means we are motivated to significantly increase our spending in 2020.” – IGO Managing Director Peter Bradford, quoted o
Slide 16: Appendices
APPENDICES &RYV Orion Minerals PAGE 16
Slide 17: Bankable Feasibility Study Dashboard
BANKABLE FEASIBILITY STUDY DASHBOARD Price and FX Assumptions Unit Value Financial Performance Unit Value Metal price – Cu USD/t 6,834 NPV pre-tax (post-tax) @ 8.0% discount rate AUD M 574 (408) Metal price – Zn USD/t 2,756 IRR pre-tax (post-tax) % 38% (33%) Exchange rate ZAR:USD 14.5 :1 Payback fro
Slide 18: Construction Milestones
CONSTRUCTION MILESTONES Milestone Description Month 1 10 20 30 33 EVAPORATION DAM & TSF EIA Amendment Process Construct, Line & Commission Evaporation Dams Construct and Commission TSF SHAFT DEWATERING & CONSTRUCTION Surface & Shaft Preparation, Pump Installation 294 Level De-water & Slurry Pumping
Slide 19: Mining Production Profile
MINING PRODUCTION PROFILE • Underground mining for majority of the Foundation Phase MILLED ORE SOURCES • Small open pit mined on retreat • Underground mining to commence on completion of: o mine dewatering o shaft refurbishment • Underground establishment program of 23 months before first ore mined
Slide 20: Mineral Resource
MINERAL RESOURCE The Mineral Resources are inclusive of the Mineral Reserves Refer ASX release 26 June 2019 PAGE 20
Slide 21: Mineral Reserve
MINERAL RESERVE Refer ASX release 26 June 2019 PAGE 21
Slide 22: Mine Face to Market
MINE FACE TO MARKET NaCN & ZnSO4 or SMBS Stockpile Classifying Cyclone Double Deck Secondary Screen Sizing Screen Lime ROM Underground Primary Crusher Primary Mill Secondary Mill Existing Mill Feed Bunkers Reagents Reagents Cu Float Collector Collector Conditioning Promoter Promoter Tank CuSO4 Lime,
Slide 23: Problem Looming: Copper Supply Chain
PROBLEM LOOMING: COPPER SUPPLY CHAIN Cecilia Jamasmie: Mining (Dot) Com April 10 2018 PAGE 23
Slide 24: Large Copper Mines Have a Very Long Lead Time
LARGE COPPER MINES HAVE A VERY LONG LEAD TIME Not enough low cost production mines already in development Existing LOMs may be extended with substantially higher metal prices Mining(dot)Com: Visual Capitalist; 23 June 2015 PAGE 24
Slide 25: Add a Major New Copper Demand Driver
ADD A MAJOR NEW COPPER DEMAND DRIVER Mining(dot)Com: Visual Capitalist; 23 June 2015 PAGE 25
Slide 26: And Copper Hungry Renewable Energy
AND COPPER HUNGRY RENEWABLE ENERGY Mining(dot)Com: Visual Capitalist; 23 June 2015 PAGE 26
Slide 27: Zinc Demand – Consistent Consumption Growth
ZINC DEMAND – CONSISTENT CONSUMPTION GROWTH • 230,000tpa new zinc production required to supply projected demand growth • Current supply attrition not being replaced in time PAGE 27
Slide 28: Zinc Concentrate Supply – New Mines Take Time
ZINC CONCENTRATE SUPPLY – NEW MINES TAKE TIME Current development projects dominated by poor quality concentrate producers - unsustainable PAGE 28
Slide 29: Zinc Metal Supply – No Stocks to Absorb Shocks
ZINC METAL SUPPLY – NO STOCKS TO ABSORB SHOCKS Zinc metal stocks at record lows – strong fundamentals with price subdued by sentiment PAGE 29
Slide 30: For further information, contact
For further information, contact: Orion Minerals Limited Suite 617, 530 Little Collins Street Melbourne Vic 3000 Australia ASX/JSE: ORN Phone: +61 (0)3 8080 7170 Email: info@orionminerals.com.au Website: www.orionminerals.com.au PAGE
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