Euro Manganese, Inc. · TSXV:EMN
Euro Manganese — Investor Presentation (May 2023)
37 slides from Euro Manganese's investor presentation, May 16, 2023
Slide 1: Poised to Support the Energy Transition
For personal use only Poised to Support the Energy Transition INVESTOR PRESENTATION May 2023
Slide 2: Legal Disclaimer: Forward-Looking Statements and Risks Notice
LEGAL DISCLAIMER Forward-Looking Statements and Risks Notice Certain statements in this presentation constitute “forward looking statements” or “forward looking information” within the meaning of applicable securities laws. Such statements and information involve known and unknown risks, uncertainti
Slide 3: High-Purity Manganese 101: Market Overview
For personal use only High-Purity Manganese 101 MARKET OVERVIEW
Slide 4: Manganese is an essential raw material in most lithium-ion batteries
MARKET OVERVIEW Manganese is an essential raw material in most lithium- ion batteries Nickel-Manganese-Cobalt (NMC) cathodes are currently the dominant chemistry For personal use only in EV batteries with ~50% market share Batteries make up ~30% of the total cost of EVs ABOUT HIGH-PURITY MANGANESE I
Slide 5: Global manganese market: high-purity manganese is a niche product
MARKET OVERVIEW Global manganese market: high-purity manganese is a niche product Only 1% of manganese mined globally is processed into a grade suitable for EV batteries Specialty Alloys For personal use only 5
Slide 6: Global high-purity manganese production landscape
MARKET OVERVIEW Global high-purity manganese production landscape Supply currently dominated by China; project pipeline inadequate to meet forecasted demand For personal use only Supply Forecast • Only x2 new projects at Feasibility stage • Demand for HP Mn forecasted to surpass supply in 2023-2024
Slide 7: Industry tail winds benefitting high-purity manganese market
MARKET OVERVIEW Industry tail winds benefitting high-purity manganese market Macro factors aligning to drive increased demand for high-purity manganese For personal use only Continued growth of global EV Development of manganese- EU & US regulation supports 1 market 2 rich chemistries 3 localization
Slide 8: Lack of supply combined with increasing demand results in significant deficit
MARKET OVERVIEW Lack of supply combined with increasing demand results in significant deficit Opportunity for HPMSM price to rise as supply vs demand deficit bites For personal use only Global High-Purity Manganese Demand & Supply to 2031 Battery Metal Prices (2018-2023) 1,200 500 Global production
Slide 9: New EU and US regulation an opportunity for EMN
MARKET OVERVIEW New EU and US regulation an opportunity for EMN Euro Manganese well-positioned to benefit from proposed legislation For personal use only EU Critical Raw Materials Act US Inflation Reduction Act • Battery-grade manganese identified as a • Reform to EV tax credit ($7,500) strategic ra
Slide 10: Who We Are: Company & Project Overview
For personal use only Who We Are COMPANY & PROJECT OVERVIEW
Slide 11: Battery metals company set to be a leading producer of high-purity manganese
COMPANY OVERVIEW Battery metals company set to be a leading producer of high-purity manganese Focused on delivering fully-traceable, responsibly-produced manganese for the EV industry For personal use only Strategically located asset; sole manganese resource in the EU Positioned to support shift to
Slide 12: Chvaletice is a unique waste-to-value project
PROJECT OVERVIEW Chvaletice is a unique waste-to-value project Involves reprocessing historical mine tailings to produce high-purity manganese For personal use only Recycling • Historic tailings containing easily-treated manganese carbonate (1) • Well-defined mineral reserve of 27Mt @ 7.4% Mn with u
Slide 13: Flow sheet produces two high-purity manganese products: HPEMM & HPMSM
PROJECT OVERVIEW Flow sheet produces two high-purity manganese products: HPEMM & HPMSM Robust process uses proven, conventional and commercial technologies; adheres to strict European environmental regulations For personal use only 1 Ore to Slurry Raw tailings 2 Magnetic Separation 3 Leaching and Pu
Slide 14: Project designed to deliver exceptional ESG benefits
PROJECT OVERVIEW Project designed to deliver exceptional ESG benefits Wide-ranging benefits for all stakeholders #3 ORE For personal use only Use of Best Available Technologies to Minimize Footprint STOCKPILE • Net positive environmental benefits from remediation of historic tailings • MoU to use 10
Slide 15: Chvaletice's products to have amongst lowest CO2 footprint vs incumbent industry
PROJECT OVERVIEW Chvaletice’s products to have amongst lowest CO2 footprint vs incumbent industry Results of benchmarked LCA of high priority to customers and financiers For personal use only HPEMM / HPMSM CO2 Emissions Comparison (Scope 1+2+3) CMP HPEMM 64% lower than China 20 17.1 Kg CO2 eq. per k
Slide 16: Demonstration Plant nearly fully commissioned; HPEMM produced
PROJECT OVERVIEW Demonstration Plant nearly fully commissioned; HPEMM produced Enables large-scale product samples on batch basis For personal use only • HPEMM (99.9% pure) produced in March 2023, external lab tests confirm meets Plant specifications • Final HPMSM crystallization module currently un
Slide 17: Project has good cashflow and margins together with supply security for Europe
PROJECT ECONOMICS Project has good cashflow and margins together with supply security for Europe Stable production over 25-year project life, supported by 27 Mt reserve base For personal use only Feasibility Study Base Case Highlights ($ figures in USD) Feasibility Study Base Case Price Forecast for
Slide 18: Project operational costs based on cost environment in mid-2022
PROJECT ECONOMICS Project operational costs based on cost environment in mid-2022 Energy and reagents constitute ~68% of operational costs For personal use only Operational Costs ($/t of Plant Feed) $214.5 Opex 19.8 Royalty, freight, insurance • Reagents and energy account for ~30% and 38% of opex r
Slide 19: Project capital costs include robust contingency
PROJECT ECONOMICS Project capital costs include robust contingency Capex figure reflects post-COVID supply chain environment For personal use only Capital Cost Breakdown ($M) $757.3 Capex 78.4 • Robust +$100M contingency (includes $78M contingency and $25M Contingency of growth capital on direct cos
Slide 20: Superior nature of Chvaletice products demand price premium
PROJECT ECONOMICS Superior nature of Chvaletice products demand price premium Product quality, ESG credentials and localization aspects deliver a price premium For personal use only Unique Aspects of Chvaletice HPEMM & HPMSM Ex-Works China HPMSM Price vs. Forecasted European HPMSM Price High-purity
Slide 21: First offtake term sheet announced
OFFTAKE PROCESS First offtake term sheet announced Increasing attention on high-purity manganese; Auto OEMs continue to invest in projects to secure critical raw materials For personal use only Overview of Verkor Offtake Term Sheet • Lithium • Outlines minimum tonnages • Nickel Financial support & o
Slide 22: Broader offtake tender process progressing well; robust offtake funnel
OFFTAKE PROCESS Broader offtake tender process progressing well; robust offtake funnel Volumes under discussion exceeds capacity (>150 ktpa HPMSM); 80% production capacity targeted to support project finance For personal use only Regulation is changing dynamics with potential Offtake Funnel (Cathode
Slide 23: Permitting and next steps
PROJECT TIMELINE Permitting and next steps On track to deliver final investment decision by H1 2024 For personal use only H1 2023 H2 2023 2024 2025 2026 2027 DEMONSTRATION PLANT Customer samples & supply chain qualification Available for testing other feedstocks ENGINEERING, PROCUREMENT & CONSTRUCTI
Slide 24: Chvaletice: Funding
For personal use only Chvaletice: Funding PROJECT FINANCE
Slide 25: Project financing strategy: mix of debt and equity
PROJECT FINANCE Project financing strategy: mix of debt and equity Staged equity strategy; structured to reduce dilution For personal use only Strategic Investment Private Offering Public Offering At project level, based on NAV At corporate level, based on ▪ EMN shareholders ▪ OEMs & key off-takers
Slide 26: Our Growth Horizon: North America
For personal use only Our Growth Horizon: North America GROWTH OPPORTUNITY
Slide 27: Rationale for North American growth strategy
GROWTH OPPORTUNITY Rationale for North American growth strategy Opportunity to supply pCAM/CAM plants under development in North America with locally-produced high-purity manganese For personal use only • Demand for HP Mn in NA expected to reach >250Ktpa by 2031* • No current HP Mn processing capaci
Slide 28: Bécancour opportunity provides first-mover advantage in North America
GROWTH OPPORTUNITY Bécancour opportunity provides first-mover advantage in North America For personal use only Bécancour overview • Scoping study complete to evaluate development of an HPEMM dissolution plant to produce HPMSM • Study leveraged process development and engineering work Bécancour land
Slide 29: Looking Forward: Outlook
For personal use only Looking Forward OUTLOOK
Slide 30: 2023 Key catalysts
OUTLOOK 2023 Key catalysts Demonstration Plant Status For personal use only Production of on-spec products HPEMM complete; HPMSM expected Q2 Shipments to interested parties Expected early Q3 EPCM for Commercial Plant Appointment of EPCM contractor 5 bids received, top 2 further evaluated, selection
Slide 31: Poised to Support the Energy Transition
For personal use only Poised to Support the Energy Transition TSXV: EMN | ASX: EMN | OTCQX: EUMNF | Frankfurt Stock Exchange: E06 info@Mn25.ca | www.Mn25.ca
Slide 32: Executive leadership team
COMPANY OVERVIEW Executive leadership team Track record of raising capital and delivering large-scale projects; deep high-purity manganese processing experience For personal use only Matt James Martina Blahova James Fraser Fausto Taddei Andrea Zaradic Jan Votava President & CEO CFO VP Commercial Com
Slide 33: Euro Manganese capitalization
CORPORATE INFORMATION Euro Manganese capitalization Euro Manganese is a BC Company incorporated in 2014 and listed publicly in 2018; its head office is located in Vancouver For personal use only Ownership Structure at May 10, 2023 TRADING SYMBOLS CORPORATE MEMBERSHIPS Total 402,669,227 TSX-V and ASX
Slide 34: FQ2 2023 Financial highlights and position
FINANCIAL POSITION FQ2 2023 Financial highlights and position Funded to complete certain 2023 commitments and corporate G&A For personal use only Funded to complete: Cash Balance – January 1, 2023 C$18.3 • Demonstration plant commissioning and batch operation Commissioning of the Demonstration Plant
Slide 35: Resources converted to Reserves with 98% classified in Proven category
RESERVE STATEMENT Resources converted to Reserves with 98% classified in Proven category Estimated in accordance with the CIM Definition Standards on Mineral Resources and Mineral Reserves adapted by CIM Council, as amended, which are materially identical to the JORC Code. For personal use only Chva
Slide 36: Notes to Mineral Reserve Statement
RESERVE STATEMENT Notes to Mineral Reserve Statement For personal use only 1. Estimated in accordance with the CIM Definition Standards on Mineral Resources and Mineral Reserves adopted by CIM Council, as amended, which are materially identical to the JORC Code. 2. The Mineral Resource is inclusive
Slide 37: Compliance Statements
LEGAL Compliance Statements Competent and Qualified Persons Statement All production targets for the Chvaletice Manganese Project referred to in this presentation are underpinned by estimated Proven and Probable Reserves prepared by competent persons and qualified persons For personal use only in ac