Volt Resources Ltd · ASX:VRC
Volt Resources — Investor Presentation (June 2016)
26 slides from Volt Resources's investor presentation, June 2016
Slide 1: Emerging natural graphite supplier to the hi-tech battery industry
“Emerging natural graphite supplier to the hi-‐tech ba<ery industry” Hong Kong Investor Presenta/on June 2016 ASX: VRC 1
Slide 2: Disclaimer
Disclaimer The informa-on contained in this confiden-al document (“Presenta-on”) has been prepared by Volt Resources Limited (the “Company”). It has not been fully verified and is subject to material upda-ng, revision and further amendment. While the informa-on contained herein has been prepared in go
Slide 3: Corporate overview: Volt Resources (VRC.AX)
Corporate overview: Volt Resources (VRC.AX) Capital Structure VRC Share Price Chart (12-‐months) Shares on Issue 851,183,515 0.14 Op/ons and Rights 301,665,605 0.12 Share Price (10 June 2016) A$0.125 0.10 52 week high / low A$0.127 / 0.011 FD Market Cap A$145.0m 0.08 Cash (30 June 2016) * Es-mate A
Slide 4: Board and management
Board and management Senior execu/ve profiles -‐ Minerals marke-ng specialist with 25 years experience in Stephen Hunt global roles: 15 yrs at BHP & 10 yrs at ASX listed companies B Bus (Marke-ng) Execu-ve Chairman -‐ Ex-‐founding director at graphite focused Magnis Resources AICD -‐ Experienced
Slide 5: Spherical graphite demand drivers: the Green effect
Spherical graphite demand drivers: the “Green effect” Major “Green effect” drivers for baUery grade, spherical graphite, comprise: Ø Accelera-ng demand for electric vehicles -‐ reaching 6m in 2020F (vs c. 800k in 2015) Ø Evolu-on of the u-lity power storage market Upstream impact: Ø Drives up dema
Slide 6: Quantifying the Green effect uplift
Quan/fying the “Green effect” upli_ BaUery sector’s demand for naturally sourced spherical graphite: +200% by 2020 Spherical graphite demand ('000 tpa) 180 160 140 120 100 80 60 40 20 0 2015 2020F Source: Benchmark Mineral Intelligence (BMI) Note: Naturally sourced graphite represents 65% of the baKe
Slide 7: Battery manufacturers: gearing up production capacity
BaUery manufacturers: gearing up produc/on capacity BMI es/mates >US$12bn capex on a dozen new facili/es globally by 2020 Ø Tesla’s giga-‐factory may need 90-‐100k tpa of spherical graphite by 2020 7
Slide 8: But naturally sourced graphite preferred feedstock
But naturally sourced graphite preferred feedstock BaUery manufacturers (and significantly Tesla according to BMI) prefer natural graphite over synthe/c, due to its: Ø Lower price as much cheaper to produce Ø Higher energy density and power output (applicable for EVs) Ø Lower impact on the environ
Slide 9: Tanzania is now in play; China at capacity limit
Tanzania is now in play; China at capacity limit Ø China ramped up spherical graphite produc-on 50% in 2015 (BMI)… Ø …but s-ll unlikely to produce sufficient quality feedstock for its own needs Ø Emerging players (i.e. Tesla – relies 100% on China) face a supply squeeze Ø Diversifying natural grap
Slide 10: An upcycle commencing: spherical graphite prices +10% (BMI)
An upcycle commencing: spherical graphite prices +10% (BMI) 10
Slide 11: Volt Resources: Vision and management objectives
Volt Resources: Vision and management objecAves “Volt Resources aims to become the preferred supplier of high quality large flake graphite to the emerging hi-‐tech ba<ery industry.” To deliver against this vision, management’s objec/ves are: Ø Increase and op-mise the resource in Tanzania Ø Levera
Slide 12: The Resource – Namangale project in southern Tanzania
The “Resource” – Namangale project in southern Tanzania Ø Located in Mozambican Mobile Belt: a band of highly metamorphosed rocks Note: Magnis Resources Nachu project area iden-fied in ASX media release 31 March 2016 (www.magnisresources.com) The Company confirms that it is not aware of any new infor
Slide 13: Namangale project's quality attributes
Namangale project’s quality attributes Ø Tanzanian graphite contains larger flake sizes (baKery grade)… Ø …but, lower average total graphi-c carbon grades than Mozambique Ø Access to cri-cal infrastructure: v Sealed roads through tenement v Deep water port at Mtwara is only 140km and heavily und
Slide 14: Tanzania has well established mining & service industry
Tanzania has well establish mining & service industry PESTEL analysis: Poli/cal stable and enjoying solid economic performance Poli/cs Ø Rela-vely stable democracy since 1960s & English speaking Ø Strong and successful purge against corrup-on (IMF Apr 2016) Economics Ø Economic performance (GDP +
Slide 15: Initial results from Namangale: Top notch graphite resource
Ini/al results from Namangale: Top notch graphite resource Ø Maiden total JORC compliant Total Resource of 214.4Mt @ 5.1% TGC* Ø Total of 82 RC holes and 9 diamond drill holes Ø Very shallow resource (<100m); low cost deposit to explore and mine Deposit Tonnes Grade (Mt) (% TGC) Namangale 1 196.0
Slide 16: Battery sector wants large flake graphite: VRC is delivering
BaUery sector wants large flake graphite: VRC is delivering Ini/al test-‐work (at Namangale) on diamond core indicates: Ø Very high propor-on of Super Jumbo and Jumbo flake sizes Ø The graphite flakes can be liberated using coarse par-cle sizes Ø Incremental flota-on testwork underway to op-mise re
Slide 17: Namangale project on track to be commercially viable
Namangale project on track to be commercially viable Mul/ple samples from the Namangale deposit demonstrate VRC’s graphite meets the `purity’ grade for commercial applica/ons: Ø Graphite concentrate results from Namangale 2 returned grades up to 98.3% TGC with +300 and +500 micron flake Ø For Naman
Slide 18: Purity and flake size determine pricing
Purity and flake size determine pricing Ø Price for base market applica-ons largely depend on purity and flake size Ø Premium pricing structure for high purity flake for baKery/electronic use Ø VRC is focused on – higher margin – large and jumbo flake graphite Forecast 2020 Graphite Product Purity (%
Slide 19: Legacy and key target milestones
Legacy and key target milestones Ø Report card: Management are on track 3. Met Results Restructure 1. Board Reserves 6. Ore Complete 7. PFS Decision Investment Financial 12. Commence Construction 13. Agreements 9. Offtake commence 10. DFS Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2
Slide 20: Pre-Feasibility Study (PFS) for Namangale project underway
Pre-‐Feasibility Study (PFS) for Namangale project underway This includes: Ø Metallurgical testwork: Flake size and concentrate op-miza-on underway Ø Marke/ng: MOUs with reputable end-‐users signed by mid-‐2016 Ø Mine planning: Reviewing produc-on op-ons to iden-fy target market and best entry
Slide 21: Peer comparison and value proposition
Peer comparison and value proposi/on Ø Material shareholder value can be created through explora-on and PFS de-‐ risking; VRC is embarking on this journey ASX Listed Graphite Companies (A$m) (Market Capitalisation) Predevelopment 1,500 1,200 900 Study Phase 600 Exploration Phase 300 -‐ VRC BKT MT
Slide 22: VRC's points of difference from rivals in Tanzania
VRC’s points of difference from rivals in Tanzania Ø A large graphite focused tenement (2,000skm) holder Ø Best posi-oned to access cri-cal infrastructure Ø A large Jumbo flake, JORC compliant, graphite resource: 214Mt @ 5.1% ØExcellent graphite concentrate purity produced – 98.3% TGC – from simpl
Slide 23: Strategic competitive advantages facilitate value creation
Strategic compe//ve advantages facilitate value crea/on Ø Best posi-oned to maximize value across the supply chain for stakeholders: 1) Low extrac-on costs (capex/opex), due to minimal down stream processing 2) Low transport costs thanks to ready access to efficient infrastructure 3) Has right produc
Slide 24: Strategic Advisor for North America
Strategic Advisor for North America VRC appointed EAS Advisors (NYC based) as its North American advisor: Ø Solid legacy assis-ng select ASX companies secure funding to deliver growth Ø To date, EAS has par-cipated in over $3.5bn worth of transac-ons Ø EAS will promote VRC to the North American i
Slide 25: Key takeaway
Key takeaway “An upcycle is commencing for spherical graphite and VRC is well posiAoned to capitalise on this dynamic.” 25
Slide 26: Volt Resources contact details
Volt Resources Telephone: + 61 3 9614 0600 EOZail: Info@voltresources.com Web: www.voltresources.com 26