Sunrise Energy Metals Limited · ASX:SRL
Sunrise Energy Metals — Clean TeQ Holdings — Investor Presentation (October 2018)
27 slides from Sunrise Energy Metals's investor presentation, October 2018
Slide 1: Clean TeQ Sunrise: Critical Raw Materials for the Battery Revolution
CLEAN TEQ SUNRISE CRITICAL RAW MATERIALS FOR THE BATTERY REVOLUTION CORPORATE PRESENTATION OCTOBER 2018 CLQ
Slide 2: Disclaimer: Forward Looking Statements
DISCLAIMER FORWARD LOOKING STATEMENTS Certain statements in this presentation constitute “forward-looking statements” or “forward-looking information” within the meaning of applicable securities laws. Such statements involve known and unknown risks, uncertainties and other factors, which may cause a
Slide 3: Key Highlights
KEY HIGHLIGHTS Our vision is to empower the clean revolution • Rapidly progressing development of the Clean TeQ Sunrise Project in NSW, Australia • Project will produce critical raw materials for the rapidly growing electric vehicle (EV) and energy storage markets • Nickel sulphate and cobalt sulpha
Slide 4: The Battery Revolution
THE BATTERY REVOLUTION DRIVING RAW MATERIAL DEMAND Page 4
Slide 5: Electric Vehicle Sales Expected to Drive Huge Growth in Raw Materials Demand
THE BATTERY REVOLUTION ELECTRIC VEHICLE SALES EXPECTED TO DRIVE HUGE GROWTH IN RAW MATERIALS DEMAND Global EV sales projections EV related cobalt & nickel demand projections (million vehicles) (kt) 16 90 14 80 70 12 60 10 50 8 40 3.5x 6 2.5x 30 4 20 2 10 0 0 2015 2016 2017 2018 2019 2020 2021 2022 2
Slide 6: China Is Leading the Race
CHINA IS LEADING THE RACE EMISSIONS CONTROLS LEGISLATION DRIVING THE AGENDA BYD Yuan EV360 • New Energy Vehicle (NEV) mandate effective in 2019 • Credit based system targeting: 10% EV (2019), 12% (2020) • EV subsidies based on vehicle range: • ~US$ 11,000 for EV range ≥400 km • Chinese technical cap
Slide 7: Nickel – Sulphate Capacity Needs to Grow
NICKEL – SULPHATE CAPACITY NEEDS TO GROW Forecast Mined Supply of Class 11 Nickel Projects ▪ Electric vehicles are heavy consumers of nickel sulphate 1,200 350 Nickel Production (excl FeNi/NPI), ktpa ▪ Next generation lithium ion batteries will be more nickel intensive 300 Nickel Sulphate Demand, kt
Slide 8: Cobalt – Supply & Geographically Constrained
COBALT – SUPPLY & GEOGRAPHICALLY CONSTRAINED ▪ Majority of global cobalt sourced from DRC presenting major Cobalt Production – Global Rankings supply risk for end users ▪ Security of supply ▪ Auditability of supply chain ▪ 95% of production comes as a by-product of copper or nickel production ▪ High
Slide 9: Scandium: Enabling a New Generation of Lightweight Alloys
SCANDIUM ENABLING A NEW GENERATION OF LIGHTWEIGHT ALLOYS ▪ Sunrise is one of the world’s largest and highest Airbus Group’s Light-rider grade scandium resources ▪ Scandium is used to provide next generation lightweight aluminium alloys for key transportation markets ▪ Clean TeQ continues to promote
Slide 10: Clean TeQ Sunrise: Advanced Development Project
CLEAN TEQ SUNRISE ADVANCED DEVELOPMENT PROJECT Page 10
Slide 11: Project Overview
PROJECT OVERVIEW ADVANCED DEVELOPMENT PROJECT LOCATED IN CENTRAL NSW ▪ 100% owned by Clean TeQ ▪ Located 350km west of Sydney in an established mining region ▪ Significant infrastructure in place including sealed road to site ▪ Laterite (iron-hosted) mineral resource, rich in nickel, cobalt and scan
Slide 12: Key Advantages
KEY ADVANTAGES PRIMARY DRIVERS TO SUCCESS AT SUNRISE MINERALOGY FLOWSHEET LOCATION ▪ High cobalt grades relative to ▪ Proprietary Clean iX technology ▪ Fully auditable, non-DRC supply other laterite deposits1 provides lowest cost path to attracting strong interest from end battery ready products use
Slide 13: Project Is Development Ready
PROJECT IS DEVELOPMENT READY STUDIES Definitive Feasibility Study completed in June 2018 PERMITS Approved 2.5mtpa project from New South Wales Government WATER Secure 3.2Glpa water allocation INFRASTRUCTURE Road and rail access in place POWER Mains power and gas in close proximity to site PILOT PLAN
Slide 14: Indicative Project Schedule
INDICATIVE PROJECT SCHEDULE 2H 2018 2019 2020 2021 C O M P L E TE D E F I N I TIV E C O M M E N CE C O M M E N CE C O M M I SS IO N IN G F E AS I B I L ITY C O N S T R U C TI ON & R AM P U P STUDY FINALISE FINANCING AND OFFTAKE CONSTRUCTION FEED EARLY WORKS D E T AI L E D E AR L Y W O R K S F I N AL
Slide 15: 2018 Definitive Feasibility Study
2018 DEFINITIVE FEASIBILITY STUDY1 OUTSTANDING ECONOMIC AND TECHNICAL OUTCOMES 2 3 1 – Full information regarding the Definitive Feasibility Study is contained in the technical report titled “Sunrise Nickel Cobalt Project, New South Wales, Australia NI 43-101 Technical Report” dated effective 25 Jun
Slide 16: Strong Cash Flow Generation
STRONG CASH FLOW GENERATION OUTSTANDING ECONOMIC AND TECHNICAL OUTCOMES Clean TeQ Sunrise is forecast to deliver up to Cumulative and Net Free Cash Flow Projection ($USm) ▪ US$14 billion in revenue1 800 8,000 ▪ Life of Mine EBITDA of US$8.6 billion1 600 6,000 ▪ Average annual EBITDA of US$344 millio
Slide 17: Competitive Operating Cost Position
COMPETITIVE OPERATING COST POSITION LOWEST QUARTILE C1 CASH COSTS1 C1 Cash Costs1 US$/lb Ni before US$/lb Ni after $10.00 credits credits $8.00 Mining $1.14 $1.14 $6.00 Spot nickel price: $US 5.80/lb2 Processing $3.33 $3.33 $4.00 $2.00 Haulage & Port $0.07 $0.07 $0.00 General & Administration $0.14
Slide 18: Community and Social Benefits
COMMUNITY AND SOCIAL BENEFITS Strong community benefits over life of mine including: • Employment • Infrastructure upgrades • Taxes • Royalties Clean TeQ | Corporate Presentation - October 2018 Page 18
Slide 19: Next Steps: Financing, Offtake & Delivery
NEXT STEPS FINANCING, OFFTAKE & DELIVERY Page 19
Slide 20: Complete Project Financing
COMPLETE PROJECT FINANCING FUNDING STRATEGY MAY INVOLVE PROJECT LEVEL INVESTOR ▪ Discussions are ongoing with a range of parties regarding project level investment, including with; ▪ End users ▪ Market intermediaries ▪ Other strategic investors ▪ Strategic investment opportunities may be linked to p
Slide 21: Secure Project Debt Financing
SECURE PROJECT DEBT FINANCING STRONG BANKING SUPPORT FOR PROJECT DEBT FACILITY ▪ Mandated Lead Arranger (MLA) group appointed November 2017 ▪ Industrial Commercial Bank of China (ICBC) ▪ National Australia Bank ▪ Societe General ▪ Natixis ▪ US$500 million in indicative commitments received, prior to
Slide 22: Finalise Offtake Agreements
FINALISE OFFTAKE AGREEMENTS CONSIDERABLE DEMAND FROM END USERS AND INTERMEDIARIES ▪ Extensive due-diligence is ongoing by a range of parties Maiden offtake agreement in 2017 considering product offtake and/or project level investment ▪ Product samples provided to various participants including: ▪ OE
Slide 23: Commence Project Delivery
COMMENCE PROJECT DELIVERY MCC SELECTED AS A KEY PROJECT DELIVERY PARTNER ▪ Heads of Agreement signed with Metallurgical Corporation of China Ltd. (MCC) in August 2018 ▪ Front-end engineering and design (FEED) to begin in 4Q 2018 ▪ Significant benefits of partnering with MCC include: Fixed-price EPC
Slide 24: Our Key Project Partners
OUR KEY PROJECT PARTNERS DEBT FINANCING PROJECT DELIVERY OFFTAKE PRODUCT END-USE ICBC appointed to the Heads of Agreement signed Binding five-year offtake Landmark agreement with Mandated Lead Arranger with MCC in August 2018 for an agreement for 20% of cobalt Chinalco and Chongqing (MLA) group for
Slide 25: www.cleanteq.com
P: +61 3 9797 6700 E: info@cleanteq.com Clean TeQ Holdings Limited 12/21 Howleys Rd Notting Hill VIC 3000 AUSTRALIA www.cleanteq.com Clean TeQ
Slide 26: Corporate Overview
CORPORATE OVERVIEW Capital Structure Major Shareholders3 ASX/TSX Code CLQ Robert Friedland 12.98% Shares on Issue1 745.4 M Pengxin International 12.41% Options on Issue1 12.75 M FMR LLC 7.85% Performance Rights on issue1 5.3 M AustralianSuper 6.3% Cash at Bank (30 June 2018) 152.6 M Market Capitalis
Slide 27: Competent and Qualified Persons Consents
COMPETENT AND QUALIFIED PERSONS CONSENTS The information in this presentation that relates to Mineral Resources is based on information compiled by Mr Lynn Widenbar, a member of the Australasian Institute of Mining and Metallurgy. Mr Widenbar is a full- time employee of Widenbar and Associates. Mr W
Clean TeQ Holdings — Investor Presentation (October 2018) on 6ix