Grange Resources Limited · ASX:GRR
Grange Resources — London ASX Conference 2010
25 slides from Grange Resources's conference presentation, Mar 12, 2010
Slide 1: Grange Resources
For personal use only Grange Resources March 2010 NOT FOR DISTRIBUTION IN THE US Level 11, 200 St Georges Terrace NOT FOR DISTRIBUTION IN THE US Perth Western Australia 6000 1
Slide 2: Important Information and Disclaimer
Important Information and Disclaimer For personal use only This document has been prepared by Grange Resources Limited (ABN 80 009 132 405) (Grange or the Company). No party other than Grange has authorised or caused the issue of this document, or takes responsibility for, or makes any statements, r
Slide 3: Grange Highlights
Grange Highlights For personal use only Grange is Australia’s largest magnetite producer, formed by a merger between Grange and Australian Bulk Minerals (ABM) in 2009. Australia’s leading exporter of iron ore pellets, producing 2.2Mtpa from the Savage River operations in Tasmania in CY2009 Recently
Slide 4: Company snapshot
Company snapshot For personal use only Board of Directors Current ownership Structure Mr Xi Zhiqiang Chairman Mr Neil Chatfield Deputy Chairman Mr Russell Clark Managing Director, CEO Mr Wei Guo Non Executive Director Mr Clement Ko Non Executive Director Mr Peter Stephens Non Executive Director Curr
Slide 5: Jiangsu Shagang: A strong partnership
Jiangsu Shagang A strong partnership For personal use only Shagang Overview Grange’s largest shareholder Demonstrated continuing support for Grange with an attractive LOM offtake agreement at Savage River at benchmark prices and agreement to negotiate at fair market price for Grange’s share of offta
Slide 6: Grange Board
Grange Board For personal use only Grange has a strong board with a diverse range of experience. Xi Zhiqiang: Chairman Neil Chatfield: Deputy Chairman • Extensive experience in the Chinese steel industry • Recently Executive Director and CFO of Toll Holdings, a position • Baosteel employee for 30 ye
Slide 7: Key Information 2009
Key Information 2009 Profitable even during economically hard times For personal use only CY09 Operational Statistics Jan - Jul – Savage River Jun 2009 Dec 2009 Total volume mined (‘000 bcm) 9,372 9,763 Total ore mined (‘000 bcm) 701 978 Concentrate produced (‘000 tonnes) 1,036 1,195 Pellets produce
Slide 8: Iron Ore Value
Iron Ore Value For personal use only 40% • Iron Ore Pellet ~65-69% Fe • Direct Shipping Lump ~63% Fe Quality • Magnetite Concentrate ~ 67% Fe • Direct Shipping Fines ~58% Fe NOT FOR DISTRIBUTION IN THE US 8
Slide 9: Pellet Price
Pellet Price Rising rapidly with economic recovery For personal use only • Since the iron ore price settlement in June 2009, Grange has had offers to buy pellets into the spot market at a significant premium to current benchmark Pellets are highly leveraged to the world’s economic recovery – when bl
Slide 10: Leading Magnetite Producer
Leading Magnetite Producer For personal use only Grange’s position as Australia’s leading magnetite producer is supported by quality assets in Tasmania and Western Australia. Southdown Project (70%) Savage River (100%) 90km northeast of the Port Northwest Tasmania of Albany Annualised production rat
Slide 11: Savage River Overview
Savage River Overview For personal use only Ownership • Grange 100% • Mineral Resource of 316Mt magnetite at Resources and 50.7% DTR Reserves • Ore Reserve of 124Mt magnetite at 49.2% DTR • 2.6Mtpa blast furnace pellets and concentrate Production (annualised basis) • Potential to expand to 2.9Mtpa L
Slide 12: Large Scale Operations
Large Scale Operations For personal use only NOT FOR DISTRIBUTION IN THE US 12
Slide 13: Own Downstream Infrastructure
Own Downstream Infrastructure For personal use only NOT FOR DISTRIBUTION IN THE US 13
Slide 14: Own Port and Shiploading Infrastructure
Own Port and Shiploading Infrastructure For personal use only NOT FOR DISTRIBUTION IN THE US 14
Slide 15: Increased Production
Increased Production For personal use only 2.6Mtpa 15 NOT FOR DISTRIBUTION IN THE US 15
Slide 16: Reducing costs
Reducing costs For personal use only 16 NOT FOR DISTRIBUTION IN THE US 16
Slide 17: Leveraged to price
Leveraged to price For personal use only M a r gi n 17 NOT FOR DISTRIBUTION IN THE US 17
Slide 18: Solid Customer Base
Solid Customer Base Long term offtake agreements – providing revenue stability For personal use only Agreements are in place for both Savage River and Southdown production at market prices or better. • China’s largest private steel mill, producing 22 Mtpa of pig iron • Grange’s largest shareholder •
Slide 19: Southdown Project
Southdown Project High grade magnetite project with advanced infrastructure For personal use only Ownership • Grange 70%, Sojitz Corporation 30% Resources and • Mineral Resource of 654Mt magnetite at 36.5% DTR1,2 Reserves1 • Ore Reserve of 388Mt magnetite at 35.5% DTR1,3 • 6.6Mtpa magnetite concentr
Slide 20: Resources and Reserves
Resources and Reserves Supporting Long Mine Lives For personal use only Grange has 774Mt of attributable Mineral Resources and 396Mt of attributable Ore Reserves. Mineral Resources (inclusive of reserves) Ore Reserves Tonnes Grade Tonnes Grade (Mt) (%DTR) (Mt) (%DTR) Savage River 4 Savage River Meas
Slide 21: Grange Resources – production growth prospects
Grange Resources – production growth prospects For personal use only 10000 9000 Upside 8000 7000 6000 5000 Southdown kt 4000 3000 2000 1000 Savage River 0 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019 2021 NOT FOR DISTRIBUTION IN THE US 21
Slide 22: The largest producing magnetite company
The largest producing magnetite company For personal use only Out of the numerous junior companies with magnetite assets, Grange is the only one in production. NOT FOR DISTRIBUTION IN THE US 22
Slide 23: Current Focus and Future Milestones
Current Focus and Future Milestones For personal use only Operational improvements at Savage River being implemented Management Operating System being installed New equipment to replace old less productive units Inventory and cost reductions Drilling and model new resources at Savage River Reviewing
Slide 24: Grange Resources – Summary
Grange Resources – Summary For personal use only Australia's leading magnetite producer Australia’s largest iron ore pellet producer High grade quality products Solid customer and revenue base Long life assets Low sovereign risk Extensive magnetite technical and operational expertise New investment
Slide 25: Key Contacts
Key Contacts For personal use only Primary contacts: Russell Clark Managing Director & Chief Executive Officer +61 8 9321 1118 managingdirector@grangeresources.com.au NOT FOR DISTRIBUTION IN THE US 25