Arafura Rare Earths Limited · ASX:ARU
Arafura Rare Earths — Arafura Resources — Investor Presentation (June 2020)
32 slides from Arafura Rare Earths's investor presentation, Jun 11, 2020
Slide 1: Investor Presentation
8/06/2020 INVESTOR PRESENTATION For personal use only ASX:ARU (ASX:ARU) Not for release to US wire services or distribution in the United States of America 1
Slide 2: Disclaimer
8/06/2020 For personal use only This presentation has been prepared by Arafura Resources Limited (Arafura, Arafura Resources or the Company) and is of a summary form only and therefore contains general background information which may not be complete. It should be read in conjunction with and full r
Slide 3: Production Targets and Forecast Financial Information
8/06/2020 For personal use only Production Targets and Forecast Financial Information The information in this presentation that relates to production targets and financial information included in this presentation is extracted from ASX announcement dated 16 March 2020 (Major Increase in Mine Life fo
Slide 4: Corporate Snapshot
8/06/2020 Corporate Developing the world-class Nolans Capital Structure Snapshot NdPr project ASX Code ARU For personal use only Nolans aims to supply 5-10% of ASX Share Price (5 June) $0.078 global demand for NdPr oxide, Shares on Issue 1,055m the key rare earths in permanent Market Capitalisation
Slide 5: Nolans Project
8/06/2020 Nolans For personal use only Project (ASX:ARU) Not for release to US wire services or distribution in the United States of America 5
Slide 6: 100% Australian Domiciled in the NT
8/06/2020 100% Australian Domiciled in the NT For personal use only Ore to oxide at a single site in the Northern Product traceability and single site waste Territory management certainty Environmental approvals secured including DFS includes fully-costed rehabilitation of for water management perma
Slide 7: Definitive Feasibility Study (DFS) Completed & Improved
8/06/2020 Definitive Feasibility Study DFS completed February 2019 (DFS) Completed & Improved confirming Nolans as a world class For personal use only NdPr project CAPEX US$726m, low OPEX producer Ore Mining Reserves Inventory at US$27.02/kg NdPr Mining & Processing Long-life asset based on Ore Proj
Slide 8: Environment & Sustainability
8/06/2020 Environment & For personal use only Sustainability (ASX:ARU) Not for release to US wire services or distribution in the United States of America 8
Slide 9: Sustainable Supply
8/06/2020 Extensive community and Licence to Operate – Sustainable Supply stakeholder consultation For personal use only Waste management plan tailings and residue facility Assessing impact from mining, extraction and transport corridor Surface water and groundwater management plans Biodiversity stu
Slide 10: Verified Tracking & Tracing across the Supply Chain
8/06/2020 Verified Tracking & Tracing across the Supply Chain For personal use only Supply Sustainable Production Arafura RE NdPr Oxide Metal NdPr Metal Magnet NdFeB Magnet OEM Chain Producer Convertor (China) (Germany) (Australia) (Thailand) Waste Management Certainty Supplier Toll Processor Manufa
Slide 11: Breaking the Chinese Monopoly
8/06/2020 Breaking the Chinese For personal use only Monopoly (ASX:ARU) Not for release to US wire services or distribution in the United States of America 11
Slide 12: Rare Earths are Critical Minerals
8/06/2020 Rare Earths China exerts control over most of the global rare earth supply chain are Critical Australia and its strategic allies For personal use only Minerals recognise the threat posed by China’s strategy to deny capital to new developments Australia is active in its policy response: Cri
Slide 13: China's Evolving Integrated NdPr Supply Chain
8/06/2020 China’s Evolving Integrated NdPr Supply Chain – Enables Made In China 2025 Strategy For personal use only Ore Concentrate Oxide Metal Alloy Magnet Component EV 2010 95% 95% 90% 80% 85% 80% 2018 70% 70% 85% 90% 90% 90% Market Value x 10x 100x 1000x MADE IN CHINA CHINA 2025 REST OF THE WORLD
Slide 14: Rest of the World Alternative Supply Chain
8/06/2020 Rest of the World Alternative Supply Chain For personal use only Ore Concentrate Oxide Metal Alloy Magnet Component EV European auto industry employs Diversification of NdPr supply Government recognition of the Nolans offtake strategy focused 13.8 million people which equates source may pr
Slide 15: Product Offtake
8/06/2020 Product Offtake For personal use only Amount Proportion Customer / Target Region Offtake Status (tonnes p.a.) of Revenue NdPr Oxide – targeting contract with NdFeB magnet companies &/or end users JingCi Material Science 900 MoU Baotou Tianhe Magnetics 900 MoU Japan 96% South Korea 2,557 In
Slide 16: Development Opportunities
8/06/2020 Most rare earth processing is based on Development Chinese technology for bastnaesite or For personal use only Opportunities monazite/xenotime ore types Export of rare earth separation technology from China prohibited Arafura has patented IP proven at demonstration scale for apatite ore to
Slide 17: Project Funding Strategy
8/06/2020 Project Funding For personal use only Strategy (ASX:ARU) Not for release to US wire services or distribution in the United States of America 17
Slide 18: Project Funding Solutions
8/06/2020 Project Funding Solutions For personal use only The Enablers The Opportunities • Alignment with offtake and strategic partners that removes • China new supply more constrained – capital strategically some market risk focused downstream and tougher environmental standards • Offtake contract
Slide 19: Project Funding Strategy
8/06/2020 Project Funding Strategy Arafura looking to secure US$726m to meet CAPEX requirements for the Nolans project For personal use only Potential sources of funding include equity, debt, JV and/or project selldown with a strategic investor DFS completion and environmental approval are critical
Slide 20: Other Funding Sources
8/06/2020 Other Funding For personal use only Sources Subordinated debt facilities and other funding sources NAIF and Clean Energy Finance Corporation (CEFC) Mezzanine or cost over-run facility Build-Own-Operate (BOO) and equipment financing Offtake finance – prepayment or working capital (ASX:ARU)
Slide 21: Current Focus
8/06/2020 Current For personal use only Focus (ASX:ARU) Not for release to US wire services or distribution in the United States of America 21
Slide 22: 2020 Focus
8/06/2020 2020 Focus For personal use only Prioritising project Provision of sample Escalate engagement Continued dialogue work streams against product & advancing with financiers and with Australian and cash conservation terms sheets with end financial advisors for other governments priorities in l
Slide 23: Appendices
8/06/2020 For personal use only Appendices (ASX:ARU) Not for release to US wire services or distribution in the United States of America 23
Slide 24: Experienced Board
8/06/2020 Experienced Board For personal use only MARK SOUTHEY CHRIS TONKIN QUANSHENG ZHANG CATHY MOISES GAVIN LOCKYER CHAIRMAN NON-EXECUTIVE DIRECTOR NON-EXECUTIVE DIRECTOR NON-EXECUTIVE DIRECTOR MANAGING DIRECTOR Mark Southey has previously held Chris Tonkin has over 35 years’ Quansheng Zhang hold
Slide 25: Experienced Management
8/06/2020 Experienced Management For personal use only RICHARD BRESCIANINI PETER SHERRINGTON LLOYD KAISER BRIAN FOWLER STEWART WATKINS GENERAL MANAGER CHIEF FINANCIAL OFFICER & GENERAL MANAGER GENERAL MANAGER GENERAL MANAGER EXPLORATION & BUSINESS COMPANY SECRETARY SALES & MARKETING NT & SUSTAINABIL
Slide 26: Long Life Asset
8/06/2020 Long Life Asset For personal use only RESOURCES TONNES (m) RARE EARTHS TREO % PHOSPHATE P2O5 % NdPr ENRICHMENT % Measured 4.9 3.2 13 26.1 Indicated 30 2.7 12 26.4 Inferred 21 2.3 10 26.5 TOTAL 56 2.6 11 26.4 As announced on 7 June 2017. 1% TREO cut-off grade. Numbers may not compute exactl
Slide 27: Process Flowsheet Supported by Successful Pilot
8/06/2020 Process Flowsheet For personal use only Supported by Successful Pilot (ASX:ARU) Not for release to US wire services or distribution in the United States of America 27
Slide 28: Residue Storage Facility
8/06/2020 Residue General arrangement of the final RSF design Storage Facility For personal use only Waste streams generated within the process plant disposed in RSF, a purpose built, long- term, earth fill, lined containment facility. The RSF footprint has been designed for the entire LOM and will
Slide 29: Updated Indicative Production Timeline
8/06/2020 Updated Indicative Production Timeline For personal use only This schedule targets first production 35 months after Project Commitment subject to a number of factors including: • Sufficient project funding being secured • Product offtake being secured (ASX:ARU) • Completion of construction
Slide 30: International Offer Restrictions
8/06/2020 International Offer Restrictions For personal use only This document does not constitute an offer of new ordinary shares ("New Shares") of the Company in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the New Shares ma
Slide 31: International Offer Restrictions
8/06/2020 International Offer Restrictions For personal use only Section 138 of the Securities Act (Ontario) provides that no action shall be commenced to enforce these rights more than (a) in the case of any action for rescission, 180 days after the date of the transaction that gave rise to the cau
Slide 32: International Offer Restrictions
8/06/2020 International Offer Restrictions For personal use only Singapore This document and any other materials relating to the New Shares have not been, and will not be, lodged or registered as a prospectus in Singapore with the Monetary Authority of Singapore. Accordingly, this document and any o
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