Peninsula Energy Limited · ASX:PEN
Peninsula Energy — Investor Presentation (June 2019)
27 slides from Peninsula Energy's investor presentation, June 2019
Slide 1: Expanding U.S. Uranium Production Capacity
EXPANDING U.S. URANIUM PRODUCTION CAPACITY Corporate Presentation │ June 2019 PENINSULA ENERGY LIMITED ASX:PEN
Slide 2: Disclaimer & Competent Person
Disclaimer & Competent Person This presentation is provided on the basis that the Company nor its representatives make any warranty (express or implied) as to the accuracy, reliability, relevance or completeness of the material contained in the Presentation and nothing contained in the Presentation
Slide 3: Cautionary & Inferred Resources Notice
Cautionary & Inferred Resources Notice The Feasibility Study completed for the Lance Projects includes measured and indicated resources and an assumed resource conversion of 60% (inferred to indicated or greater). The purpose of the Feasibility Study is to demonstrate the Lance Projects economic via
Slide 4: The Uranium Market
The Uranium Market 300 250 mlbs/yr U3O8 200 150 100 50 0 2019E 2020E 2021E 2022E 2023E 2024E 2025E 2026E 2027E 2028E 2029E 2030E 2031E 2032E 2033E 2034E 2035E 2018 Secondary Supplies Existing Mines Forecast New Mines Total Demand PENINSULA ENERGY LIMITED 4 Source: UxC
Slide 5: Supply Factors Favour Higher Prices
Supply Factors Favour Higher Prices The current market prices are well below the average cost of production globally Global Production Restraint Peninsula’s Lance Project is Leveraged to Rising Prices • The worlds producers cut primary production to 138M lbs in 2018 – off ~30M lbs/year • Primary p
Slide 6: Demand Factors Favour Higher Prices
Demand Factors Favour Higher Prices The global concern over climate change has led to greater support for expanding carbon-free nuclear power generation Strong Demand Fundamentals Uncovered Requirements • Nuclear energy growth has pushed demand beyond pre-Fukushima (2011) levels • Primary demand e
Slide 7: Major Uranium Market Catalyst
Major Uranium Market Catalyst The uranium market as a whole has been in a “wait and see” mode pending a critical US governmental decision • The Section 232 Investigation • The United States is currently considering the national security implications of excessive reliance on foreign sources for ura
Slide 8: A Prime Uranium Investment Opportunity
A Prime Uranium Investment Opportunity Investment Criteria Peninsula Active US uranium production asset – with a major project transformation in progress The only ASX-listed company with direct exposure to Section 232 outcomes Strong leverage to rising uranium market prices Long term sales contract
Slide 9: Corporate Overview
Corporate Overview Capital Structure Share Price & Volume History Ticker: ASX:PEN Shares on issue* 247m Share price (6-Jun-19) A$0.265 Price (A$/share) Volume (m) 0.40 7.5 Market capitalisation (6-Jun-19) A$65m 7.0 0.35 6.5 Enterprise Value (6-Jun-19) A$81m 6.0 0.30 Available Cash (31-Mar-19) US$6.4
Slide 10: Investment Upside – Low EV / lb vs Peers
Investment Upside – Low EV / lb vs Peers US$ per lb EV/lb Resource Imminent share price re-rate events in 2019 4.0 3.5 3.0 • Completion of low pH Permit amendments 2.5 2.0 – First re-rate event occurred with approval of 1.5 Permit to Mine Amendment 1.0 – Second likely catalyst is nearing with Source
Slide 11: Lance ISR Project │ Wyoming, USA
Lance ISR Project │ Wyoming, USA - Wyoming is a “can do” state PENINSULA ENERGY LIMITED 11
Slide 12: Lance – A Premier US Uranium Project
Lance – A Premier US Uranium Project • Wyoming is a leading US uranium extraction jurisdiction, hosting multiple projects. Lance is one of the largest in size and scale. Powder River Basin WYOMING, USA Lance Regional Setting Lance Permit Areas PENINSULA ENERGY LIMITED 12
Slide 13: Lance - Our Flagship Project
Lance - Our Flagship Project • Lance holds the largest defined uranium resource of any Exceptional currently producing project in the United States Asset • 53.9M lbs U3O8 JORC (2012) compliant resource base2 • Peninsula developed the Lance Project from its conception Home-grown into a producing asse
Slide 14: Lance – Maintaining Production Capacity
Lance – Maintaining Production Capacity Demonstrating cost control while continuing production during low pH transition • FY19 production guidance of 85,000 – 90,000 lbs • Production significantly cut back to preserve developed well fields for low pH operations • Tightly controlled production expe
Slide 15: Unlocking the Full Potential of Lance
Unlocking the Full Potential of Lance Low pH ISR transformation initiative is being actively advanced • Set to transform the performance and cost profile High Potential • Feasibility Study released in September 2018 • Low pH field demonstration operating since December 2018 • Two regulatory approv
Slide 16: Lance Low pH Demonstration
Lance Low pH Demonstration • FLT Operations started Dec-2018 • Three production patterns in test area • Includes resin optimisation testing Sulfuric Acid Addition Pump Test Pattern Map (in MU-1) PENINSULA ENERGY LIMITED 16
Slide 17: Field Demonstration Status
Field Demonstration Status The Company has successfully achieved all key technical performance objectives for the Phase 1 mining step of the low pH Implementation Plan • pH reduced to commercial operating levels throughout the area • Acid injection and consumption metrics consistent with projectio
Slide 18: Lance Low pH FS Summary
Lance Low pH FS Summary LOM Production Financial Metrics • 33.4 million lbs U3O8 • LOM AISC of US$31.77/lb • 17 year minelife • NPV8 US$157M at US$49/lb Three Stage Expansion Plan Capacity Expansion Production AISC Stage Year Mlbs/yr CAPEX Cost $/lb. $/lb. Stage 1 2019 1.15 $5.3M $14.67 $40.58 Stage
Slide 19: Lance Feasibility Study Take-Away Points
Lance Feasibility Study Take-Away Points Technical • Over 12 months of comprehensive laboratory testing Basis • Almost 50% of global uranium mined using this method LOM • 17 year mine life Production • 33.4 million lbs U3O8 production potential Leveraged to • Each US$10/lb increase in U3O8 price ass
Slide 20: Uranium Sales Portfolio
Uranium Sales Portfolio PENINSULA ENERGY LIMITED 20
Slide 21: Long-Term Contract Portfolio
Long-Term Contract Portfolio • Five sales agreements with major utilities • Weighted sales price between US$51-53/lb U3O8 • Contract portfolio carries through year 2030 • Up to 6.3 million pounds U3O8 remaining under contract • 4.4 million lbs U3O8 committed deliveries • Up to 1.9 million lbs U3O8 o
Slide 22: Conclusion
Conclusion “Peninsula (ASX:PEN) will be one of the most exciting uranium production companies to follow in 2019.” Wayne Heili – CEO PENINSULA ENERGY LIMITED 22
Slide 23: Next Steps for Peninsula
Next Steps for Peninsula Amendment • Permit to Mine amendment granted Progression • Source Material License amendment advancing Testing & • Continue restoration in low pH field demonstration Planning • Maintain alkaline based mining to meet near term sales contract requirements Mine Unit 3 • Investm
Slide 24: Peninsula Energy Take-Away Points
Peninsula Energy Take-Away Points U.S. Domestic • Peninsula is positioned to benefit from ongoing corporate Producer initiatives and current market trends, including Sec.232 outcomes Long Life • Lance has the largest defined US uranium resource currently in Project production • Low pH transition exp
Slide 25: Contact Details
Contact Details REGISTERED OFFICE Unit 32/33, Level 3, 22 Railway Road Subiaco, Western Australia 6008 Australia www.pel.net.au info@pel.net.au FURTHER INFORMATION Wayne Heili Managing Director +61 8 9380 9920 David Coyne Finance Director / CFO +61 8 9380 9920 PENINSULA ENERGY LIMITED 25
Slide 26: Appendix - Board and Management
Appendix 1 - Board and Management Board John Harrison, Non-Executive Chairman Capital Markets Wayne Heili, Managing Director & CEO Exec. Leadership & Technical David Coyne, Finance Director & CFO Finance & Risk Management Harrison Barker, Non-Executive Director Nuclear Fuel Markets Mark Wheatley, No
Slide 27: Appendix – Resources & Competent Person Statement
Appendix 2 – Resources & Competent Person Statement Lance Projects Resource Estimate as at 31 December 2017 Tonnes Classification U3O8(kg) Grade (ppm U3O8) U3O8(lbs) (million) Measured 3.8 1.8 488 3.9 Indicated 10.9 5.4 495 11.9 Inferred 36.3 17.3 476 38.1 Total 51.0 24.5 479 53.9 1) JORC Table 1 in