Sovereign Metals Limited · ASX:SVM
Sovereign Metals — Investor Presentation (June 2019)
21 slides from Sovereign Metals's investor presentation, June 2019
Slide 1: Malawi – A Potential Significant New Rutile Province
Malawi – A Potential Significant New Rutile Province ABN: 71 120 833 427 I ASX : SVM
Slide 2: Rutile
Rutile is a highly valuable mineral that contains >95% TiO2 (Titanium dioxide) Titanium Has a wide range of uses and is irreplaceable 22 Ti Titanium 2
Slide 3: Titanium - A Growing $15B Global Market
Titanium - A Growing $15B Global Market 5% TITANIUM METAL 90% PIGMENT MARKET TiO2 5% WELDING 3 Source: TZMI
Slide 4: Rutile is Highly Valuable
Rutile is Highly Valuable The predominant feedstock source for TiO2 is ilmenite, while higher value natural rutile is scarce and in supply deficit Highest Grade, Highest Value, Rarest TiO2 mineral Natural Rutile 95%+ 16% TiO2 $1,100/t Of Mined TiO2 Feedstock Others (inc. Leucoxene) (2017) Chloride I
Slide 5: Environmental and "Value in Use" Advantages
Environmental and “Value in Use” Advantages Natural rutile is the preferred feedstock for pigment producers Input and outputs based on feedstock of pigment plant ~17x ~12x (per tonne of pigment) LESS LESS Advantages Source: RBC and Iluka WASTE CHLORINE Does not require upgrading for the pigment THAN
Slide 6: Supply Gap Emerging
Supply Gap Emerging Global natural rutile supply/demand to 2025 ‘000 TiO2 Units 1,200 1,000 800 600 400 200 0 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019f 2020f 2021f 2022f 2023f 2024f 2025f f= forecast Source: TZMI and SVM Analysis Likely new projects Existing supply Underlying demand 6
Slide 7: Supply Deficit Driving Rutile Prices Up
Supply Deficit Driving Rutile Prices Up Current Rutile Pricing Source: TZMI (February 2019) Source: Iluka Historical and Forecast Rutile Pricing $2,000 $1,200 $1,800 High $1,600 $1,400 Mid $1,100 $1,200 US$/t US$/t Low $1,000 $1,000 $800 $600 $900 +21% $400 $200 $0 $800 Q1-2018 Q1-2019 7
Slide 8: Strong Indications From The Industry
Strong Indications From The Industry “…demand for high grade (titanium) feedstocks remained strong. Demand for pigment strengthened over the first quarter of 2019 and this has contributed to sustained strong demand for high-grade feedstocks.” Iluka sees continued growth in demand for high-grade tita
Slide 9: Sovereign Metals has identified a potential New Rutile Province in Malawi
Sovereign Metals has identified a potential NEW RUTILE PROVINCE in Malawi Malawi A stable, transparent jurisdiction, increasingly attracting international investment 9
Slide 10: Sovereign controls >4,000km of highly prospective ground in Malawi
Sovereign controls >4,000km 2 of highly prospective ground in Malawi 10
Slide 11: Operation Ready Infrastructure
Operation Ready Infrastructure Established rail network direct to Nacala Port CEAR train in operation Paved roads surrounding project locations Grid power becoming available across license areas Established labour pool and other industrial services Plentiful water sources for operations Nacala Port
Slide 12: High-Grade and Widespread Rutile Mineralisation
High-Grade and Widespread Rutile Mineralisation Paragneiss Belt 125 Regional Drill Holes Re-Assayed Rutile Dominant TiO2 mineral in numerous zones Multiple Rutile Prospects Identified 12
Slide 13: Rutile mineralisation hosted in saprolite
Rutile mineralisation hosted in saprolite Intense weathering has formed a “blanket” of soft, friable saprolite across much of Sovereign’s ground The saprolite is highly enriched in rutile in numerous areas Saprolite is “free-dig” from surface to ~25m Highly successful metallurgical testwork demonstr
Slide 14: High Recovered Rutile Grade Using Conventional Mineral Sands Flowsheet
High Recovered Rutile Grade Using Conventional Mineral Sands Flowsheet Produced from 180kg sample from the Wofiira prospect Conventional mineral sands flowsheet Metallurgy conducted at world- class Australian laboratories Recovered grade of 1.16% rutile from in-situ saprolite ore at commercial speci
Slide 15: Outstanding Rutile Specifications
Outstanding Rutile Specifications 96% TiO2 with Comparison of Sovereign’s rutile specifications to leading global producers Malawi Rutile Sierra Rutile RBM Kwale Namakwa Sands Constituent (Sovereign) (Iluka) (Rio Tinto) (Base Resources) (Tronox) recovered grade of TiO2 % 96.0 96.29 93.30 96.18 94.50
Slide 16: Source Rocks Similar to Sierra Rutile (Iluka)
Source Rocks Similar to Sierra Rutile (Iluka) Sovereign tenements underlain by paragneiss bed rock Sierra Rutile deposits formed due to weathering and erosion of paragneiss bed rock into Alluvial placer deposits In Malawi, deep weathering of the bedrock has resulted in high concentrations of rutile
Slide 17: Rutile resource grades for current producers and planned projects
Sierra Rutile Rutile resource grades for current producers and planned mineral sand projects Sierra Rutile 1.10% The world’s only primary rutile operation All other rutile is produced as a by-product Snapper 0.80% Campaspe/Atlas 0.60% WIM 150 0.50% 2018 rutile production was 122kt, Mission Private 0
Slide 18: Accelerated exploration and metallurgy testwork programs underway
Accelerated exploration and metallurgy testwork programs underway Hand auger drilling to define discrete areas of mineralisation for future resource definition Extensive regional soil sampling and panning to identify new areas of rutile mineralisation Continued metallurgical test-work to optimise an
Slide 19: Compelling Investment Case
Compelling Investment Case Exposure to undersupplied commodity during increasing demand Mining friendly jurisdiction Operation-ready infrastructure Highly promising metallurgical testwork Extensive ground-holding in Malawi with multiple rutile targets identified 19
Slide 20: Company Information
Company Information Sovereign Metals Limited Contact Us ABN: 71 120 833 427 Dr Julian Stephens (Perth) ASX : SVM Managing Director +61(8) 9322 6322 CAPITAL STRUCTURE Sam Cordin (Perth) Shares on Issue 359,273,673 +61(8) 9322 6322 Unlisted Options ($0.10 to $0.18) 45,550,000 Sapan Ghai (London) +44 2
Slide 21: Disclaimers & Disclosures
DISCLAIMERS & DISCLOSURES DISCLAIMER NOTICE This presentation has been prepared as a summary only, and does not contain all information Sovereign Metals Limited’s (“SVM”) assets and liabilities, financial position and performance, profits and losses, prospects, and the rights and liabilities attachi