Slide 1: Nova Site Visit
For personal use only Nova Site Visit Hosted by Nova and Exploration Teams 4 August 2018
Slide 2: Cautionary statements & disclaimer
Cautionary statements & disclaimer For personal use only • This presentation has been prepared by Independence Group NL (“IGO”) (ABN 46 092 786 304). It should not be considered as an offer or invitation to subscribe for or purchase any securities in IGO or as an inducement to make an offer or invit
Slide 3: Australia's lowest cost nickel miner
Australia’s lowest cost nickel miner Dominant position in emerging mineral belt For personal use only ASX IGO Base Perth, WA Market Cap(1) A$2.5 Billion Cash(2) A$139M Debt(2) A$143M Dividend Policy >30% NPAT Focussed on assets of quality with belt scale potential • Nova ─ First year of commercial p
Slide 4: Nova
For personal use only Nova 4
Slide 5: Our People – Nova
Our People – Nova IGO - 19 months For personal use only Over 30 years of experience in mining engineering and management. Previously held senior leadership roles at MMG, Glencore/Xstrata, Outokumpu Mining Australia Chris Carr Nova General Manager Nova Operation Rhona Wardman Peter Christen Aleks Ree
Slide 6: Operational Overview
Operational Overview First year of commercial production complete For personal use only Discovery Construction Ni & Cu First Offshore GC Drilling Jul 2012 Start Shipment Complete Jan 2015 Jun 2017 June 2018 2012 2013 2014 2015 2016 2017 2018 2019 First Concentrate Nameplate 1.8Mtpa run rate Feasibil
Slide 7: FY18 Scorecard
FY18 Scorecard Strong 2H18 providing momentum for the future FY18 1Q18 2Q18 3Q18 4Q18 FY18 For personal use only Metric Units FY18 Nova Financial Summary(1) Guidance (A$M) (A$M) (A$M) (A$M) (A$M) Nickel in concentrate t 22,258 23,000 – 27,000 Revenue and other income 46.5 78.3 95.9 128.0 348.8 Coppe
Slide 8: FY19 Outlook
FY19 Outlook De-risked by grade control drilling and demonstrated +1.5Mtpa run rate For personal use only Metric Units FY19 Guidance Nickel in concentrate t 27,000 – 30,000 Copper in concentrate t 11,000 – 12,500 Cobalt in concentrate t 850 – 950 Cash cost (payable)(2) A$/Ib Ni 1.65 – 2.00 Sustainin
Slide 9: Nova Year Outlook
Nova 3 Year Outlook Consistent and higher production for Nova For personal use only Outlook Notes • Assumes: Nova Production Outlook ─ 1.5Mtpa mining and processing rate kt A$/lb Payable Nickel ─ 89% nickel recovery and 85% copper 30 3.0 recovery • Main driver is higher grade stopes accessed in 2.5
Slide 10: Nova Safety
Nova Safety Key focus is on the safety of our team For personal use only • Driving continuous performance with safety Nova Safety Statistics performance 20 19.0 18.4 18.5 • Shift to leading safety metrics 18 • Room for continuous improvement 17.0 15.9 • Key work programs delivered in FY18 16 15.4 15
Slide 11: Mining
Mining For personal use only Xxxxxx • xxxx ─ xxxxx ■ xxxxxx 11
Slide 12: Mining Overview
Mining Overview Flexibility delivered through parallel development of Nova and Bollinger For personal use only Nameplate mining rate exceeded in FY18 Mining • Excellent mining performance in ramp up year 500 73.88 75 • Grade control essentially complete 72.96 Mining Cost ($/t ore) 450 69.42 70 ─ 92%
Slide 13: Unique shallow thick flat lying orebody
UNIQUE SHALLOW THICK FLAT LYING OREBODY For personal use only 13
Slide 14: Nova Mining
Nova Mining FY19 Nickel Metal For personal use only DEV UPPR MID 8% 7% 1% BOLL • Completion of grade control underpins high 13% confidence mine plan • Transitioned to the large Nova and Bollinger Ore Stopes • LOM capital development to wind-down from NOVA Dec 18 71% FY19 Focus ─ Take advantage of eq
Slide 15: Nova Mining: Step change improvement through technology
Nova Mining For personal use only • Drive to make a step change improvement in cost through technology Driving • Stage 1 – Fibre optic backbone in place ─ Remote bogging from surface Technology and ─ Mine control function Step Change ─ Ventilation and pump control Improvements ─ Proximity sensors th
Slide 16: Resource Reserves Reconciliation Dilution
For personal use only Xxxxxx • xxxx ─ xxxxx ■ xxxxxx Resource Reserves Reconciliation Dilution 16
Slide 17: Early completion of grade control drilling
EARLY COMPLETION OF GRADE CONTROL DRILLING: ─ Optimisation of UG Design ─ De-risked LOM plan ─ 2km of a 272km total program remains to be completed For personal use only 17
Slide 18: Mineral Resources
Mineral Resources EOFY17 and EOFY18 Nickel Metal (kt) For personal use only EOFY17 EOFY18 JORC Source Tonnes Nickel Copper Cobalt Tonnes Nickel Copper Cobalt Class (Mt) % kt % kt % kt (Mt) % kt % kt % kt Underground Measured 5.2 2.63 137 1.10 57 0.08 4 11.9 2.15 256 0.88 104 0.07 9 Indicated 4.5 2
Slide 19: Ore Reserves
Ore Reserves EOFY17 and EOFY18 Nickel Metal (kt) For personal use only EOFY17 EOFY18 JORC Source Tonnes Nickel Copper Cobalt Tonnes Nickel Copper Cobalt Class (Mt) % kt % kt % kt (Mt) % kt % kt % kt Underground Proved … … … … … … … 10.2 1.93 197 0.79 80 0.07 7 Probable 13.3 2.06 274 0.83 110 0.07
Slide 20: Key Modifying Parameters: Resource Reconciliation
Key Modifying Parameters Resource Reconciliation For personal use only Transitioned into centre portion of Nova/ Bollinger (H2FY18) • Mineral Resource Estimate mined: 0.80Mt grading 1.98% Ni, 0.84% Co and 0.07%Co • Nova Operation Processed actual: 0.76Mt grading 2.02% Ni, 0.84% Cu and 0.07% Co Recon
Slide 21: Processing
For personal use only Processing 21
Slide 22: Processing Overview
Processing Overview Ramp up demonstrated quality and capacity of plant For personal use only Successfully achieved nameplate in FY18 Processing • Processing was mine constrained in 1H18 410 2.50 • Achieved nameplate run rate of 1.5Mtpa • Increased throughout to 1.8Mtpa in 4Q18 390 • SAG mill liner i
Slide 23: Maintenance
Maintenance Protecting our assets Strongly developed management strategy For personal use only • Conditional Monitoring – predictive versus reactive ─ Vibration analysis ─ Thermography WE ARE SAFE 0 LTIs 0 MTIs ─ Motion Amplification WE ARE RELIABLE 0 RWIs 0 SPIs ─ Lubrication Analysis Mill Availabi
Slide 24: Processing Overview: Key focus on recoveries for FY19
Processing Overview Key focus on recoveries for FY19 For personal use only Metallurgical Recoveries with focus on Copper Recovery • Metallurgical recoveries impacted at higher throughput rates 88 • Copper recoveries have proved challenging ─ Loss in both fines (-10um) and coarse (+100um) fraction 86
Slide 25: Processing FY19 Focus
Processing FY19 Focus Deliver guidance and progress continuous improvement program For personal use only Optimisation and cost reduction levers • FY19 Budget based on 1.5Mtpa run rate and recoveries of 88% Ni and 85% Cu ─ Program in place to improve copper and nickel recoveries • Cost reductions ini
Slide 26: People and Community
People and Community For personal use only 26
Slide 27: People
People Nova’s greatest resource For personal use only Nova employs approximately 460 employees and contractors • 39 people from local or surrounding areas • 88% West Australians – 12% Eastern States and International Future employment prospects • Prioritising local people Developing our people • Lea
Slide 28: Aboriginal Engagement
Aboriginal Engagement Respecting Traditional Owners For personal use only Ngadju have Native Title Determination over Nova lease • The Land Use Agreement was signed in August 2014 Employment and Training • 17 Aboriginal people employed at Nova ─ 3 IGO Ngadju Employees ─ 9 Contract Partner Ngadju Emp
Slide 29: Community Engagement – Norseman & Esperance
Community Engagement – Norseman & Esperance We are proactive in our Local Communities For personal use only • Corporate Giving of $228,000 since July 2016 • Esperance Agricultural Day • Schools Programs i.e. Follow the Dream, Girls Academy, TLG • Business services such as Port Authority, Weed contro
Slide 30: Down Stream Processing
For personal use only Down Stream Processing 30
Slide 31: Nova Downstream Processing
Nova Downstream Processing Potentially significant value driver for IGO For personal use only Nickel sulphate hexahydrate crystals produced from Nova nickel concentrate • This was produced as part of the pre-feasibility metallurgical testwork completed in collaboration with Wood Mining and Minerals
Slide 32: Exploration
Exploration For personal use only Xxxxxx • xxxx ─ xxxxx ■ xxxxxx 32
Slide 33: Our Focus on Discovery
Our Focus on Discovery Our People & Culture For personal use only • It is the team that makes discoveries • Internal expertise balanced with execution capacity • Value focused culture • The right people in the right place at the right time Our Ground Our Focus on • Increasing our probability of disc
Slide 34: Our People - Exploration
Our People - Exploration Assembling a high-powered team … and investing in youth For personal use only Ian Sandl Steve Beresford (PhD) Paul Polito (PhD) Andrew Fitzpatrick (PhD) GM Exploration Chief Geoscientist Manager – Albany Fraser Chief Geophysicist IGO - 11 months IGO - 20 months IGO - 19 mont
Slide 35: Making the right ground selection
Making the right ground selection Belt scale opportunities for battery metals For personal use only Fraser Range • 15,000km2 of tenure prospective for Ni-Cu, Cu-Zn and Au mineralisation • IGO is the predominant land holder in the area Lake Mackay • Unexplored outcropping prospective Proterozoic belt
Slide 36: Technology, Innovation and R&D
Technology, Innovation and R&D A core enabler for discovery For personal use only • Integrating technologies, innovation and R&D into our work IGO is focused on technology, innovation and streams R&D as a core enabler for discovery • Across all scales from microscopic to continental scale • Embedded
Slide 37: FY19 Exploration
FY19 Exploration A$51M commitment to exploration in FY19 For personal use only 37
Slide 38: Geological Setting
For personal use only Geological Setting 38
Slide 39: Mafic versus Komatiite Ni deposits
Introduction to Magmatic Sulphide Mineralisation Mafic versus Komatiite Ni deposits For personal use only Mafic hosted Ni-Cu deposits differ from komatiite hosted Ni deposits. This table summarizes the key features that impact on discovery Mafic Ni-Cu-Co deposits Komatiite hosted Ni sulphide deposit
Slide 40: Why the craton margin?
Introduction to Magmatic Sulphide Mineralisation Why the craton margin? For personal use only Upper Lithospheric Domains interpreted at 100km depth and projected to surface 100km 200km Kalgoorlie Crust Perth 300km Nova Lithosphere Asthenosphere Rising plume melt channelled into Sub-vertical conduit
Slide 41: Orthomagmatic Ni-Cu-Co deposits hosted by chonoliths
Introduction to Magmatic Sulphide Mineralisation Orthomagmatic Ni-Cu-Co deposits are hosted by unusual intrusions called chonoliths For personal use only • Chonoliths are small pipe like intrusions • Nova is a typical chonolith hosted Ni-Cu deposit, similar Exocontact sulfides to: ─ Noril’sk, ─ Kaba
Slide 42: What do mafic Ni-Cu deposits and camps look like?
Introduction to Magmatic Sulphide Mineralisation What do mafic Ni-Cu deposits and camps look like? The Voisey’s Bay example: For personal use only Scale 1500E 3000E 4500E 6000E • Mineralisation usually occurs over >6km zone 00 • There are always multiple lenses, often >5 2 Approximate Surface • Nova
Slide 43: Prospectivity
For personal use only Prospectivity 43
Slide 44: Why Explore in the Albany Fraser? Prospectivity map
Why Explore in the Albany Fraser? Prospectivity map for Ni sulphide potential (Warm colours denote higher prospectivity) For personal use only The Albany Fraser has long been known to be highly prospective for Ni-Cu deposits The belt has largely been held by one group since 1979 Despite the recent f
Slide 45: Why Explore in the Albany Fraser? Land holding
Why Explore in the Albany Fraser? IGO believes in the potential of the Albany Fraser and is positioning itself for exponential growth For personal use only • IGO has the largest land-holding in the September 2015 July 2018 Fraser Range of any ASX listed company • Increased ground holding on prospect
Slide 46: An emerging belt with little previous exploration
Why Explore in the Albany Fraser? An emerging belt with zero to little previous exploration For personal use only Newmont JV A few Sirius discovers Ni-Cu companies Resources sulphides in explore for base enter JV ultramafics; metals, PGE agreement with southern Fraser and mineral Creasy Group Range
Slide 47: Which companies have explored the belt
Why Explore in the Albany Fraser? It’s a matter of which companies have been exploring the belt for the past 35 years For personal use only • Creasy controlled 2007 2012 2017 companies have held and continue to hold large areas of tenement to today • A review of exploration activities in the Albany
Slide 48: Few other belts with as much upside
Why Explore in the Albany Fraser? There are very few other belts with as much upside as the Albany Fraser For personal use only • Orthomagmatic Ni-Cu deposits often occur Albany Fraser Belt (0.3Mt Ni metal) Thompson Belt (2.7Mt Ni metal) along entire belts • Newmont, INCO and Sirius were all drawn t
Slide 49: Where there's smoke there's fire
Why Explore in the Albany Fraser? Applying the concept “where there’s smoke there’s fire” For personal use only • Several mafic/ultramafic intrusions are known to occur along the Albany Fraser • Multiple companies have reported magmatic Ni-Cu sulphides in mafic and ultramafic rocks along the entire
Slide 50: How to explore for Magmatic Sulphide Mineralisation
How to explore for Magmatic Sulphide Mineralisation Exploration methodologies change with the search space For personal use only • Different ideas and technologies are required to explore the whole Albany Fraser Belt • The mineral explorers ‘toolbox’ changes with the ‘search space’ (depth to target,
Slide 51: Getting the job done
For personal use only Getting the job done 51
Slide 52: Fraser Range Exploration – Regional Greenfields
Fraser Range Exploration – Regional Greenfields Aircore drilling has identified a thin manageable cover, mostly <50m For personal use only • >145,000km of aircore drilling for 2,057 drill holes completed since May 2017 identifying: ─ Depth to basement, ─ Basement geology, ─ Geochemical anomalies for
Slide 53: Previous exploration ineffective – soil sampling
Fraser Range Exploration – Regional Greenfields Previous exploration has been ineffective – soil sampling For personal use only Cover thickness is variable across the Fraser Range rendering many past soil sampling surveys meaningless 53
Slide 54: Soil sampling through thick cover
Fraser Range Exploration – Regional Greenfields Soil sampling through thick cover is more than a challenge For personal use only 1.5m trench above the Nova pan handle Soil 251ppm Cu, 269ppm Ni Calcrete 1,460ppm Cu, 1,820ppm Ni Manganiferous 10,200ppm Cu, 8,990ppm Ni enrichment 60cm Clay 678ppm Cu, 6
Slide 55: 2017/18 Aircore Drilling Program
Fraser Range Exploration – Regional Greenfields 2017/18 Aircore Drilling Program For personal use only • Most BOH samples represent various types of felsic to intermediate gneisses. However: ─ Several mafic and ultramafic rock types have been intersected across the belt this year, some with 3 phase
Slide 56: Aircore Drilling Geochemical Anomalies
Fraser Range Exploration – Regional Greenfields Aircore Drilling Geochemical Anomalies For personal use only The following require follow up in FY19 • Pike: Coincidental Zn-Cu-Te-Au-Mo • Ecliptic: Strong Cu-Ni-Co-Pt anomaly • Anaconda: Six point, 47 – 356ppb Au anomaly, • Porpoise: Strong Co-Zn anom
Slide 57: Almost no penetrative exploration since 2012
Fraser Range Exploration – Regional Greenfields The timing of the Nova discovery has resulted in almost no penetrative exploration since 2012 For personal use only • New frontier with exploration focus only after Nova discovery in 2012 • Past exploration has been limited due to discontinuous land po
Slide 58: Gravity Data acquisition AFO
Fraser Range Exploration Gravity Data acquisition AFO For personal use only • Close spaced gravity survey is now complete covering >60% of entire AFO • Data is starting to be incorporated into 3D models and targeting programs • IGO has inhouse capability for 3D modelling of potential field data (gra
Slide 59: Spectrem Air engaged by IGO
Fraser Range Exploration – Regional Greenfields Spectrem Air engaged by IGO to directly detect massive sulphide and aid with mapping For personal use only Better signal to noise ratio for detecting deeper ore bodies A patented broadband transmitter square (100%) waveform Collects high resolution tim
Slide 60: Spectrem Lake Mackay Orientation Survey
Spectrem Lake Mackay Orientation Survey Airborne Electromagnetic Survey For personal use only • SPECTREM orientation surveys Fixed Wing 2018 flown on IGO tenements at Lake Mackay and Albany Fraser Range • Data has been compared against other leading AEM platforms • The 588400E line at Lake Mackay SP
Slide 61: Spectrem versus Heli-System
Spectrem Fraser Range Exploration Spectrem AEM Spectrem versus Heli-System For personal use only • Orientation survey demonstrates that Spectrem has deeper depth penetration, maps the regolith with more detail and identifies more basement conductors Heli-System Heli-System survey, 2016 Spectrem Spec
Slide 62: Spectrem update
Fraser Range Exploration Spectrem update For personal use only • 25,051 line km completed to mid-May, 2018 Plumridge • Spectrem currently at Lake Mackay • Poor weather in summer and fog during May has resulted in slower than expected production rates • 21,600 line km still required to complete the s
Slide 63: Moving Loop EM targets
Fraser Range Exploration – Regional Greenfields Moving Loop EM targets For personal use only • Three EM teams working targets in the Fraser Range • Each team has a designated purpose • IGO inhouse fluxgate used to follow up Spectrem AEM targets • High temperature SQUID system used to cover prospecti
Slide 64: Zanthus
Fraser Range Exploration – Regional Greenfields Zanthus For personal use only Zanthus – Buxton Resources JV: • 18AFRD001 targeted IGO plate ZRC095_A_4200S • Intersected 15m of 5-10% banded pyrrhotite within metasediments between 256 – 263.2m • Pyrrhotite bands are 0.5 - 7.0cm thick and occur at 10-3
Slide 65: Woolly
Fraser Range Exploration – Regional Greenfields Woolly For personal use only Woolly – Ponton (Creasy) JV: • DDH 18AFRD003 drilled to test the Wooly_4kS conductor • A 70m zone of blebby and stringer pyrrhotite within qtz>gt>bt meta-sediment intersected. Interpreted to be a sedimentary source • The py
Slide 66: North Bore
Fraser Range Exploration – Regional Greenfields North Bore North Bore – FraserX (Creasy) JV: For personal use only • Drill hole 18AFRD005 tested an 80x80m, 5000S off hole conductor identified after the 2016 RC program • Multiple narrow bands of pyrrhotite and trace chalcopyrite occur within an exhal
Slide 67: Andromeda Cu-Zn Discovery
Fraser Range Exploration Andromeda Cu-Zn Discovery For personal use only • 18AFRD002 tested conductor Andromeda_4kS and intersected: ─ 4.2m of pyrrhotite>pyrite>chalcopyrite>sphalerite assaying 0.96% Cu, 2.42% Zn, 13ppm Ag and 0.2ppm Au ─ Drill hole 18AFRD002 is a GSWA EIS co-funded drill hole 18AFR
Slide 68: Andromeda Cu-Zn Discovery: Massive Sulphide Intersection
Andromeda Cu-Zn Discovery 18AFRD004 Massive Sulphide Intersection measuring 29.9m For personal use only 29.9m @ 1.36% Cu, 2.51% Zn, 0.35g/t Au and 19.9g/t Ag 68
Slide 69: Nova: near mine exploration Project Overview
Nova: near mine exploration Project Overview For personal use only Snapshot • 46.7km2 tenement hosting Nova-Bollinger Ni-Cu deposit • Recently completed 58km2 3D seismic survey • Limited deep diamond drilling outside of the Nova-Bollinger resource • Historic ground EM has not been definitive (SAMSON
Slide 70: Phoenix Prospect update
Long Section looking West Nova: near mine exploration Phoenix Prospect update For personal use only • Four DDH intersections define a mafic intrusion ~150m thick comprising multiple mafic units • The intrusion appears to define a north plunging, pipe-like geometry • The intrusion is hosted in Snowys
Slide 71: Nova Relogging program – key findings
Nova: near mine exploration Nova Relogging program – key findings to date For personal use only • 56 diamond holes totalling 31,000m across six sections logged by new team for geological, geochemical and petrophysical re- assessment • Multiple intersections of “Nova-like Gabbro” intrusives have been
Slide 72: Diamond Drilling Project
Nova: near mine exploration Diamond Drilling Project – >20,000m started in July For personal use only • >20,000m of drilling underway at Nova: ─ Two rigs currently working from underground and surface • Drilling will test: ─ targets generated by Sirius that were not followed up prior to acquisition
Slide 73: Summary of current work program
Fraser Range Exploration – Regional Greenfields Summary of current work program For personal use only Currently operating or initiating: • Three aircore drill rigs, >145,000m drilling completed, another 100,000m to drill in FY19 • One DDH rig currently testing EM targets to 600m • Spectrem airborne
Slide 74: Why the Albany Fraser?
Why the Albany Fraser? The right place, proven deposit potential, highly underexplored For personal use only • An exploration team that combines youthful enthusiasm with discovery experience and academic know-how • An emerging belt on a craton margin with Ni-Cu pedigree • A belt that: ─ Hosts multip
Slide 75: Summary
For personal use only Summary 75
Slide 76: Site Visit Summary
Site Visit Summary Nova and Fraser Range a growth engine for IGO For personal use only Strong Outlook for Nova • Nameplate mining and processing rates exceeded in first year of commercial production • Current LOM Grade control drilling essentially complete • De risked FY19 production Strong Program
Slide 77: igo.com.au
“FOLLOW US» UAS WE GO FROM STRENGTH TO STRENGTH igo.com.au