Sheffield Resources Limited · ASX:SFX
Sheffield Resources — Investor Presentation (September 2019)
40 slides from Sheffield Resources's investor presentation, Sep 23, 2019
Slide 1: Thunderbird Mineral Sands Project Investor Presentation - BFS and Market Update
For personal use only Thunderbird Mineral Sands Project Investor Presentation - BFS and Market Update September 2019
Slide 2: Notice and Disclaimer
Notice and Disclaimer IMPORTANT: You must read the following in conjunction with this Bankable Feasibility Study Update (BFSU). Summary information in relation to Sheffield For personal use only This BFSU contains summary information about Sheffield Resources Limited (ACN 125 811 083) (Company or Sh
Slide 3: Notice and Disclaimer
Notice and Disclaimer Not financial product advice For personal use only This Bankable Feasibility Study Update (BFSU), and the information provided in it, does not constitute, and is not intended to constitute, investment or financial product advice (nor tax, accounting or legal advice). This BFSU
Slide 4: Thunderbird Bankable Feasibility Study Update: Comparative analysis
Thunderbird Bankable Feasibility Study Update Comparative analysis - BFSU outcomes compared to prior assumptions For personal use only Previous Metric 2019 BFSU Disclosures Change • Reduced Stage 1 capital costs Total Funding • Reduced remaining equity Requirement A$478m A$579m1 A$101m (17%) require
Slide 5: Zircon focus, reduce capital, increased revenue and reduced risk
Thunderbird Bankable Feasibility Study Update Zircon focus, reduce capital, increased revenue and reduced risk For personal use only Thunderbird Ore Reserve and Mineral Resources1 World Class, • Ore Reserve1 of 748Mt @ 11.2% HM and >1,050Mt Mineral 1,050Mt High Grade Resources1 (>80% in the Measured
Slide 6: Zircon focus, reduce capital, increased revenue and reduced risk
Thunderbird Bankable Feasibility Study Update Zircon focus, reduce capital, increased revenue and reduced risk For personal use only Globally • Sheffield aims to be a globally significant zircon producer Thunderbird Annual Average Production significant with estimated average production of: Years 1
Slide 7: Indicative Mine Schedule
Indicative Mine Schedule LOM plan to deliver 202ktpa zircon and 961ktpa ilmenite on average over a 37 year mine life For personal use only Stage 1 Stage 1 and 2 1,600 1,498 1,497 1,506 1,506 1,514 1,459 125 124 129 130 132 127 112 110 113 112 113 104 1,182 1,200 114 ‘000 tonnes 911 97 883 827 90 78
Slide 8: A Strong Cash Operating Margin
A Strong Cash Operating Margin Revenue and Site Cash Costs A$ per tonne of Ore Mined (Production Years) For personal use only 30 $28.18 25 $26.23 $A per tonne mined $24.31 $23.71 $22.89 20 $21.57 $21.66 $21.99 $21.05 $20.33 $19.57 15 $12.30 $11.65 $11.51 $10.28 $9.92 $9.84 $9.43 $9.48 $9.54 10 2.16
Slide 9: One of the Highest Margin Projects Globally - TZMI
One of the Highest Margin Projects Globally - TZMI Thunderbird is in the first quartile - one of the highest margin projects globally For personal use only Independent TZMI Feedstock Cost Study for CY 2022 (Published 2018) R/C Ratio 4.0 1st quartile 2nd quartile 3rd quartile 4th quartile 3.5 3.0 Thu
Slide 10: Largest, high grade, zircon rich mineral sands projects globally
Largest, high grade, zircon rich mineral sands projects globally Comparison of contained zircon within Ore Reserves of key global mineral sands deposits1 For personal use only 7 6 5 Contained Zircon Mt 4 3 2 1 0 Notes: 1. Thunderbird Ore Reserve (red) as published on the ASX on 31 July 2019. Contain
Slide 11: One of the Largest, Highest Grade Ore Reserves Globally
One of the Largest, Highest Grade Ore Reserves Globally Comparison of Ore Reserves and grade between the key large mineral sands deposits globally1,2,3 For personal use only • Large, mature mineral sands deposits globally are typically showing a strong trend of accelerating grade depletion with each
Slide 12: History of Thunderbird
History of Thunderbird A greenfield project rapidly progressed by Sheffield from the grassroots exploration stage in 8.5 For personal use only years Key milestones pre BFS release Key milestones post 2017 BFS release BFSU release Dec 2010: 2012: 2014: Oct 2015: Mar 2017: May 2018: Sep 2018: Nov 2018
Slide 13: Thunderbird is a High Grade, Thick Deposit
Thunderbird is a High Grade, Thick Deposit Deposit exhibits strong continuity and high Valuable Heavy Mineral (“VHM”) grades For personal use only • Thunderbird is the first significant mineral sand deposit to be discovered in the Canning Basin and is typical of an off-shore, sub-wave base style dep
Slide 14: Conventional and Well Tested Mining Techniques
Conventional and Well Tested Mining Techniques Thunderbird will use conventional and well tested dry mining techniques and equipment currently employed in existing and similar mineral sands operations globally For personal use only Major mining equipment to be utilised1 LOM mining blocks1 Equipment
Slide 15: Simple and Conventional Processing Circuit
Simple and Conventional Processing Circuit Simplified conventional flowsheet producing three quality products for LOM For personal use only Stages 1 & 2 • Same flow sheet as 2017 BFS with removal of LTR • Stage 2 is a simple duplication of Stage 1 mining and processing • Dry mining via conventional
Slide 16: Well Positioned Near Existing Port Infrastructure
Well Positioned Near Existing Port Infrastructure Thunderbird is conveniently located between two existing ports Port of Broome For personal use only • Thunderbird is located in close proximity to two existing ports ̶ Port of Broome is 148km away, including 115km of major national highway ̶ Port of
Slide 17: Supporting Site Infrastructure
Supporting Site Infrastructure Construction of accommodation village, road access, energy and water facilities underway For personal use only Significant progress to date: Accommodation village at Thunderbird ̶ Main access road to Thunderbird established off the Great Northern Highway mid-way betwee
Slide 18: Stage Total Funding Requirement
Stage 1 Total Funding Requirement The total Stage 1 funding requirement is estimated at approximately A$478 million For personal use only Stage 1 upfront capex1 Total funding requirement Amount Amount Description (A$m) Description (A$m) Comments Wet Concentrator Plant 52.9 Processing 174.9 Concentra
Slide 19: Revised Stage Capital Expenditure
Revised Stage 1 Capital Expenditure c. 80% of the revised Stage 1 upfront capex is subject to a fixed price EPC contracts with GRES & others For personal use only Bridge From BFS Stage 1 Upfront Capex to Revised BFSU Funding Requirement (A$m) 1 Original BFS Stage 1 upfront capex of A$348m, with A$10
Slide 20: Stage Funding Sources
Stage 1 Funding Sources With c. A$335m of debt funding secured through the Taurus and NAIF facilities. For personal use only A$143m of equity funding is required to commence construction of Thunderbird Stage 1 Stage 1 Funding (A$m)1 c. A$143m in equity funding is required in addition to the Taurus a
Slide 21: Production and Recoveries
Production and Recoveries For personal use only Final Products (kt) 2,000 1,569 1,553 1,514 1,512 1,506 1,506 1,498 1,497 1,459 1,366 1,600 1,296 1,231 1,210 1,206 1,198 1,191 1,177 1,164 1,152 1,116 1,115 1,105 1,098 1,097 1,095 ‘000 tonnes 1,087 1,085 1,064 1,046 1,037 1,012 1,200 962 911 883 827
Slide 22: Revenue and EBITDA
Revenue and EBITDA Total Gross Revenue by Product (A$m) For personal use only 700 600 541 559 557 505 498 511 478 493 493 500 449 453 146 146 146 415 413 419 407 425 411 425 421 422 126 126 126 388 404 383 397 397 400 404 417 116 116 121 374 385 376 400 $Am 360 112 116 107 320 298 107 107 107 102 10
Slide 23: Capex and Operating Margins
Capex and Operating Margins For personal use only Capex by category (A$m) 250 215 Capex breakdown (A$m) 200 Total Stage 1 capex 3921 149 Total Stage 2 capex 2372 143 150 100 LOM sustaining capex (Stage 1 & 2) 134 16 $Am 100 70 148 50 47 50 103 39 57 5 10 14 7 46 43 1 1 2 3 3 15 0 - - - - - FY20 FY21
Slide 24: Stage Execution Strategy
Stage 1 Execution Strategy Sheffield expects to convert BFSU cost estimate into an EPC contract1 with GRES that will deliver the process plant and associated infrastructure on a fixed price, turnkey basis For personal use only 1 2 3 Owners Works (A$99m) EPC Design and Engineering Construction (A$293
Slide 25: Premium Quality Products
Premium Quality Products Production of high quality zircon products and ilmenite suited to chloride slag production For personal use only Thunderbird produces three high quality finished products comprising: • Premium Zircon % Revenue1 over Stage1&2 ̶ Product has high ZrO2 (> 66% ZrO2 + HfO2) and ve
Slide 26: Optimally Positioned to Supply Key End Markets
Optimally Positioned to Supply Key End Markets Sheffield has a clear competitive advantage in supplying the Asian markets For personal use only Close proximity to port and other key infrastructure • Thunderbird is located in a low risk jurisdiction with minimal chance of supply disruption • Simple m
Slide 27: A Substantial Supply Gap in the Zircon Market is Emerging
A Substantial Supply Gap in the Zircon Market is Emerging Thunderbird ideally positioned to help bridge part the expected supply gap For personal use only Significant zircon supply gap expected 1 Key observations • Supply decline of 2.9% p.a. expected up to 2023 ̶ Supply is dominated by Australia an
Slide 28: Substantial Supply Gap in the Titanium Market is Emerging
Substantial Supply Gap in the Titanium Market is Emerging Thunderbird ideally positioned to help bridge the expected supply gap For personal use only Significant supply gap for high TiO2 feedstocks on the horizon1 Key observations Rutile supply decline of 10.5% p.a. expected up to 2023 ̶ Supply volu
Slide 29: Primary Approvals, Leases & Agreements in Place
Primary Approvals, Leases & Agreements in Place Thunderbird is fully permitted and construction ready For personal use only Party Topic Scope Date Complete In Place Dept of Environment & Environmental Approval Federal Government environmental approval for project Sep 2018 Energy (Cwth) Department
Slide 30: Environment
Environment All necessary State and Federal environmental approvals received For personal use only • Sheffield’s strong social licence to operate is supported by full State and Federal environmental approvals following a 3 year Public Environmental Review ("PER") • The PER process required Sheffield
Slide 31: Native Title Agreement
Native Title Agreement Native Title agreement signed and is irrevocably binding on both Sheffield and the Traditional Owners For personal use only • Sheffield signed the Co-existence Agreement (Native Title Agreement) for Thunderbird on 31 October 2018 • The Traditional Owners for the Mt Jowlaenga P
Slide 32: Stage Development & Commissioning Timeline
Stage 1 Development & Commissioning Timeline The proposed timetable takes into account all foreseeable seasonal events, such as the wet season. Early works have already commenced For personal use only Note: This timetable is subject to obtaining FID. Continuing further construction on early works is
Slide 33: APPENDIX: Sheffield Resources Corporate Overview
APPENDIX: Sheffield Resources Corporate Overview Sheffield Resources is an ASX listed mineral sands developer which owns 100% of the large scale shovel ready Thunderbird Mineral Sands Project For personal use only • Sheffield Resources Limited (“Sheffield” or the “Company”) is an ASX Capital structu
Slide 34: APPENDIX: Thunderbird Ore Reserves
APPENDIX: Thunderbird Ore Reserves For personal use only Thunderbird Ore Reserves: Valuable Heavy Mineral in-situ grade1 Valuable Heavy Mineral Grade (In-situ)2 In-situ HM Ore Reserve Ore Tonnes Tonnes HM Grade Zircon HiTi Leucoxene Leucoxene Ilmenite Oversize Slimes Category (Mt) (Mt) (%) (%) (%) (
Slide 35: APPENDIX: Thunderbird Mineral Resources
APPENDIX: Thunderbird Mineral Resources For personal use only Thunderbird Mineral Resources: Valuable Heavy Mineral in-situ grade1 In-situ HM Valuable Heavy Mineral Grade (In-situ)3 2 Cut-off Mineral Resource Ore Tonnes Tonnes HM Grade Zircon HiTi Leucoxene Leucoxene Ilmenite Slimes Oversize (HM%) C
Slide 36: APPENDIX: Operating Assumptions
APPENDIX: Operating Assumptions Key physical and cost assumptions which underpin the BFSU Financial Model For personal use only Physical assumptions overview Operating cost breakdown Stage 11 Stage 22 LOM3 A$/t ore mined Stage 11 Stage 22 LOM3 Mining 3.19 2.98 3.37 Volume Processing 4.36 3.65 3.69 O
Slide 37: APPENDIX: US$175m Taurus facility summary
APPENDIX: US$175m Taurus facility summary Sheffield expects to conclude similar debt package with an experienced metals & mining specialist private equity fund For personal use only Taurus Overview Tranche A Key Terms • Experienced specialist global investor based in Australia, targeting small to Fa
Slide 38: APPENDIX: A$95m NAIF Loan Facility Summary
APPENDIX: A$95m NAIF Loan Facility Summary Sheffield expects to conclude debt financing with Government support to provide very long tenor financing demonstrates conviction and support for Thunderbird For personal use only NAIF Overview Tranche C Key Terms2 • Northern Australia Infrastructure Fund (
Slide 39: APPENDIX: Royalty Regime and Fiscal Assumptions
APPENDIX: Royalty Regime and Fiscal Assumptions Key royalty and fiscal arrangements are outlined below For personal use only Arrangement or Calculation State government royalty • WA State government royalty of 5% of Total Sales Revenue Taurus royalty • Royalty for years 1 to 4, starting on first sal
Slide 40: APPENDIX: Significant Regional Exploration Upside
APPENDIX: Significant Regional Exploration Upside Strategic value demonstrated through multiple discoveries made along a 160km long trend For personal use only • Exploration has delineated 14 zones of significant mineralisation along a 160km Dampier Project – Regional Plan1 long highly mineralised t
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