Iluka Resources Limited · ASX:ILU
Iluka Resources — Merger or Acquisition (June 2022)
39 slides from Iluka Resources's merger presentation, Jun 20, 2022
Slide 1: Sierra Rutile Holdings Limited Demerger Briefing
Sierra Rutile Holdings Limited Demerger Briefing June 2022 1 1
Slide 2: Important Notices and Disclaimer
Important Notices and Disclaimer This presentation has been prepared by Iluka Resources Limited (Iluka). By accessing this presentation you acknowledge that you have read and understood the following statement. Summary information This presentation contains summary information about Iluka, Sierra Ru
Slide 3: Contents
Contents Contents Page 1 Key Management 4 2 Demerger Overview 5 3 Introduction to Sierra Rutile 8 4 Area 1 Operations 11 5 Sembehun Project 18 6 ESG Commitment 24 7 Investment Highlights 27 Appendices A History of Sierra Rutile 30 B A conventional mining and processing operation 31 C Current Market
Slide 4: Key Management
Key Management Theuns de Bruyn Martin Alciaturi Managing Director and Finance Director Chief Executive Officer 4
Slide 5: Demerger Overview
Demerger Overview 5
Slide 6: Demerger Overview
Demerger Overview The demerger will result in two separate ASX-listed companies – Iluka will be a global critical minerals company (mineral sands and rare earths), while Sierra Rutile will be one of the world’s largest natural rutile producers. Overview Demerger Benefits • The demerger will result i
Slide 7: Key Dates
Key Dates Subject to a shareholder vote on 22 July 2022, Sierra Rutile will commence trading on the ASX as a separately listed entity on 27 July 2022 on a deferred settlement basis. Event Date Last time and date for determining eligibility to vote at the Extraordinary General Meeting 5:00pm (AWST) W
Slide 8: Introduction to Sierra Rutile
Introduction to Sierra Rutile 8
Slide 9: Experienced Board and Senior Management
Experienced Board and Senior Management Sierra Rutile will be established with a strong Board and management team that have the requisite skills and experience to deliver sustainable value for shareholders. Board of Directors Senior Management Team Greg Martin • 40 years’ experience in the mining, u
Slide 10: Sierra Rutile Investor Highlights
Sierra Rutile Investor Highlights One of the world’s largest natural rutile producers positioned to significantly extend its mine life and deliver value through development of Sembehun. Investment Highlights Location Attractive market fundamentals driven by depleting global supply and strong demand
Slide 11: Area 1 Operations
Area 1 Operations 11
Slide 12: Area 1 Operations
Area 1 Operations Area 1 represents an established well understood operation that is positioned to deliver value and support the transition to Sembehun. Overview Location & Size 541Kt 2.1Mt Contained Rutile Ore Reserve1 Contained Rutile Mineral Resource1 144kt US$892/t of rutile FY22 Rutile Producti
Slide 13: Area 1 – Mine Life Extension Program
Area 1 – Mine Life Extension Program Sierra Rutile is currently undertaking a work program to convert Mineral Resources to Ore Reserves in order to extend the Area 1 life of mine plan. Area 1 – Mine Life Extension Program Overview Area 1 – FY22 Extension Drilling • Pejebu and Ndendemoia deposits are
Slide 14: Area 1 – Mine Life Extension Program (cont.)
Area 1 – Mine Life Extension Program (cont.) While the mine life extension work program underway is focussed on the Pejebu and Ndendemoia deposits, Area 1 holds Mineral Resources across a number of deposits that will be investigated for conversion to Ore Reserves over time. Area 1 Deposits Area 1 –
Slide 15: Area 1 – Recent Operating Performance
Area 1 – Recent Operating Performance Following significant operational improvements in the second half of 2021 and the reset of the fiscal regime for Area 1 operations, Sierra Rutile has performed strongly since June 2021. Recent Operational Improvements Ore Processed & Rutile Grade 1.7% • Poor ope
Slide 16: Area 1 – Recent Operating Performance (cont.)
Area 1 – Recent Operating Performance (cont.) The implementation of these initiatives and improved commodity prices has resulted in significantly improved operational and financial performance at Sierra Rutile since 30 June 2021. Area 1 rutile production, unit cash cost of production (net of co-cred
Slide 17: Sierra Rutile Marketing
Sierra Rutile Marketing Sierra Rutile has a long and established market presence, including relationships with all of the primary chloride-based titanium pigment manufacturers as well as the world’s largest producers of high-specification aircraft-quality titanium metal. Overview Sierra Rutile End-U
Slide 18: Sembehun Project
Sembehun Project 18
Slide 19: Sembehun Project
Sembehun Project Sierra Rutile will be focused on advancing its Sembehun Project, representing one of the largest and highest grade natural rutile deposits in the world. Sembehun Location & Size • One of the largest and highest-grade natural rutile deposits in the world. • Phased development approac
Slide 20: Sembehun Geology
Sembehun Geology Sembehun’s rutile grade and resource thickness endowment and rutile grade tonnage curve highlight the high grade areas within the Sembehun Ore Reserve and Mineral Resource estimate. Sembehun Rutile Grade * Resource Thickness Endowment Sembehun Rutile Grade Tonnage Curve 600 Tonnes (
Slide 21: Sembehun PFS Summary
Sembehun PFS Summary The PFS sets out an attractive project and pathway to developing Sembehun, leveraging the significant Area 1 infrastructure in place, remaining Area 1 Ore Reserves and Mineral Resources and forecast Area 1 cash flows to develop Sembehun in a two phased approach. Sembehun PFS Hig
Slide 22: Sembehun PFS Summary – Capex & Opex Estimate
Sembehun PFS Summary – Capex & Opex Estimate The Sembehun PFS operating expenditure and capital expenditure estimates for Phase 1 and Phase 2 are outlined below. Operating Expenditure Estimate Capital Expenditure Estimate (real, US$/t rutile) Phase 1 Phase 2 (real, US$m) Phase 1 Phase 2 Total Mining
Slide 23: Indicative Timeline
Indicative Timeline Sierra Rutile’s approach is expected to see the development of Sembehun integrated with the remaining operations at Area 1. The below timeline is based on the recently completed Sembehun PFS Note: Sierra Rutile is working towards being in a position to make a final investment dec
Slide 24: ESG Commitment
ESG Commitment 24
Slide 25: Sierra Rutile Health, Safety & Environment
Sierra Rutile Health, Safety & Environment The health and safety of all employees, contractors and visitors is of fundamental importance to Sierra Rutile. Health & Safety Environment Health Committed to compliance with the Environmental Project The Sierra Rutile Clinic, established in the 1970s, com
Slide 26: Supporting the Local Communities
Supporting the Local Communities Sierra Rutile is proud of its social investments in Sierra Leone and its contributions to the development of a strong, healthy and vibrant local community. Health Education Workforce Security & Conduct Social Investment & Development Sierra Rutile has actively invest
Slide 27: Investment Highlights
Investment Highlights 27
Slide 28: Sierra Rutile Investment Highlight Summary
Sierra Rutile Investment Highlight Summary One of the world’s largest natural rutile producers positioned to significantly extend its mine life and deliver value through development of Sembehun. Sierra Rutile Investment Highlights Attractive market fundamentals driven by depleting global supply and
Slide 29: Appendices
Appendices 29
Slide 30: Appendix A: History of Sierra Rutile
Appendix A: History of Sierra Rutile 1920s 1995 2005 2016 2021 Titanium-bearing mineral The second dredge was Refurbishment Iluka completed the Sierra Rutile won sands first discovered in under construction when commenced (funded by acquisition of Sierra Rutile the International 1960s south-western
Slide 31: Appendix B: A conventional mining and processing operation
Appendix B: A conventional mining and processing operation The Area 1 operations and proposed Sembehun flowsheet presents a low risk, well understood mining operation. Conventional Mining & Processing Ore from mine Wet Concentrator Plants Heavy Mineral Concentrate • Truck and excavator operation wit
Slide 32: Appendix C: Current Market Dynamics
Appendix C: Current Market Dynamics A global supply deficit is emerging as growing demand levels outstrip depleting global resources, leading to increasing prices for natural rutile and zircon. Demand for natural rutile is supported by its high grade, low impurity characteristics and the configurati
Slide 33: Appendix D: Balance Sheet & Rehabilitation Support
Appendix D: Balance Sheet & Rehabilitation Support Sierra Rutile has a strong balance sheet and sufficient liquidity to maximise the value of its existing Area 1 mining operations and continue to progress and invest in its flagship development project, Sembehun. Pro-forma Balance Sheet Well Capitali
Slide 34: Appendix E: TZMI Pricing – Sembehun PFS
Appendix E: TZMI Pricing – Sembehun PFS The Sembehun PFS is based on TZMI Base price forecasts as set out below. Beyond 2035, TZMI’s long term Base price of US$1,223/t of rutile (2021 real) is assumed. TZMI forecast rutile price (2022 to 2035) 2,000 LT (real) Base price: US$1,223/t US$/t FOB rutile
Slide 35: Appendix E: TZMI Pricing – Sembehun PFS (cont.)
Appendix E: TZMI Pricing – Sembehun PFS (cont.) The Sembehun PFS is based on TZMI Base price forecasts as set out below. Beyond 2035, TZMI’s long term Base price of US$212/t of ilmenite (2021 real) is assumed. TZMI forecast ilmenite price (2022 to 2035) 450 LT (real) Base price: US$212/t US$/t FOB i
Slide 36: Appendix F: Mineral Resource & Ore Reserve Estimates
Appendix F: Mineral Resource & Ore Reserve Estimates Set out below is a summary of the Sierra Rutile Group’s Ore Reserve and Mineral Resource estimates as at 31 December 2021. Mineral Resource Estimate Ore Reserve Estimate In Situ In Situ In Situ Mineral Resource Material In Situ In Situ In Situ Mat
Slide 37: Appendix G: Competent Persons’ Statement
Appendix G: Competent Persons’ Statement Ore Reserve and Mineral Resource estimates and Production Target The information in this presentation that relates to Mineral Resource estimates for Area 1 is based on information compiled by Mr Brett Gibson, who is a member of the Australian Institute of Geo
Slide 38: Appendix H: Risks
Appendix H: Risks Sembehun PFS key risks This presentation and Section 3.12 of the Demerger Booklet summarises the outcomes of the recently completed Sembehun PFS and the material assumptions underpinning the PFS. The PFS was completed with the assistance of specialist consultant, Hatch. As discusse
Slide 39: For more information contact
For more information contact Martin Alciaturi Finance Director martin.alciaturi@srx.group 39