Lithium Americas Corp. · NYSE:LAC

Lithium Americas — Investor Presentation (January 2013)

25 slides from Lithium Americas's investor presentation, Jan 2, 2013

  1. Slide 1: Lithium Americas January 2013

    www.lithiumamericas.com January 2013

  2. Slide 2: Cautionary Statements

    Cautionary Statements Forward-Looking Statements This presentation is intended to be strictly informational. Lithium Americas Corp. (the “Company”) reserves the right, at its sole discretion, to modify all or any part of this presentation without any liability or notification to any person. This pre

  3. Slide 3: Key Highlights

    Key Highlights  Lithium industry has extremely favourable fundamentals  Significant increases in demand  Significant increases in price  Few competitors  Lithium Americas is a pure-play, near-term lithium producer  3rd largest lithium brine resource in the world  Definitive Feasibility Study

  4. Slide 4: Lithium Has Many Uses

    Lithium Has Many Uses  Hard Rock Production costs are historically 2 times as expensive as brine production costs Lithium Americas’ Brine Evaporation Ponds Source: Ziemann et al, 2012 4 34

  5. Slide 5: Batteries: The Fastest Growing Application for Lithium

    Batteries: The Fastest Growing Application for Lithium  In the year 2000, batteries accounted for ~ 4% of lithium demand  In 2011, batteries accounted for ~ 29% of lithium demand  Demand increasing for both small format batteries (ie cell phones, laptops, digital cameras, hand held power tools) a

  6. Slide 6: Current Producers Approaching Production Limits

    Current Producers Approaching Production Limits  Current market dominated by 4 producers (3 from Brine)  Current industry capacity ~ 150,000 tonnes LCE  Forecast demand in 2020 ~ 300,000 tonnes LCE (100% shortfall)  Forecast demand in 2025 ~ 500,000 tonnes LCE (230% shortfall)  Rockwood and Tia

  7. Slide 7: Demand and Price Both Increasing Significantly

    Demand and Price Both Increasing Significantly  Lithium demand expected to more than triple by 2025  Lithium price has more than doubled over the last 10 years  All major lithium producers have increased prices over the last 12 months  Current price of lithium carbonate is ~ US$6,500 per tonne L

  8. Slide 8: Cauchari-Olaroz Project: Strategically Located

    Cauchari-Olaroz Project: Strategically Located  Project located in Argentina, the third largest lithium producer  Large property package ~ 83,000 ha  Close proximity to current producers (within 200km)  Excellent infrastructure  Natural gas pipeline 50km  Paved highway  Deep sea port 550km 

  9. Slide 9: Large Resource and Reserve Estimation With Significant Upside

    Large Resource and Reserve Estimation With Significant Upside  3rd largest lithium brine resource in the world  Long mine life  Reserves allow for a 40 year mine life based on the company’s Stage 1 & Stage 2 production profile  Each stage expected to produce 20,000 tonnes per annum of lithium ca

  10. Slide 10: On-Site Operations

    On-Site Operations Production Wells  Large diameter production drilling program complete – 4 wells yielded flow rates of between 20 and 25 litres per second (in the brine aquifer)  Capable of producing 20-25% of the total lithium carbonate output of Stage 1 Evaporation Ponds  The entire evaporati

  11. Slide 11: Project Outline

    Project Outline  Largest CAPEX component is pond construction  Ponds expect to cover over 650 ha  Portion of the infrastructure already in place (pond, wells, lab and camp)  Safe ground conditions to build the mine (not the case with most mines built on a salt lake) 11

  12. Slide 12: Feasibility Study Highlights for Stage 1

    Feasibility Study Highlights for Stage 1  Feasibility Study plant engineering prepared by ARA WorleyParsons (+15% accuracy)  Operating costs projected to be one of the lowest in the industry  Potash significantly contributes to overall project economics FS Stage 1: 20,000 TPA Lithium Carbonate an

  13. Slide 13: Committee of Experts Project Approval Granted

    Committee of Experts Project Approval Granted  Final project approval obtained from the Committee of Experts  JEMSE (Provincial Mining company) to own 8.5% of the Cauchari-Olaroz Project, significantly decreasing political risk  JEMSE to contribute for their participation out of future dividends

  14. Slide 14: Project Financing – Last Major Milestone Before Construction

    Project Financing – Last Major Milestone Before Construction Negotiations Underway  Mitsubishi Corporation and Magna International are current strategic investors with off-take options  Collectively own ~ 17% of shares outstanding  Option to purchase up to 37.5% of lithium production, contingent

  15. Slide 15: Market Overview

    Market Overview Research Coverage Capitalization Shares Outstanding / Fully Diluted 77 M / 86 M (August 31, 2012) Share Price (as at January 2, 2013) $ 0.95 52 week High / Low $ 1.70 / $ 0.70 Major Shareholders Market Cap (as at January 2, 2013) $ 73 M Pinetree Cash on hand (as at August 31, 2012) $

  16. Slide 16: Strong Leadership Team

    Strong Leadership Team Management Team Board of Directors  W. Thomas Hodgson, MBA  David D’Onofrio, CA Executive Chairman • CFO of PowerOne Capital Markets Limited • Mr. Hodgson is an independent financial consultant • Previously served as an advisor to the Chairman of Magna International, one of

  17. Slide 17: Summary

    Summary  Third largest lithium brine resource and reserve in the world  Fully permitted  Operating costs expected to be one of the lowest in the industry  Robust project financials  DFS identifies Stage 1 project NPV of US$738 million (pre-tax, at 8% discount rate)  Stage 2 provides significan

  18. Slide 18: Appendix – DFS Information

    LITHIUM AMERICAS Appendix — DFS Information

  19. Slide 19: Reserve and Resource Estimation

    Reserve and Resource Estimation Average Lithium Mass Cumulated Brine Volume (m³) Concentration (mg/L) Li (tonne) Li2CO3 (tonne) Proven Reserves 679 37,000 197,000 5.50 x 107 Probable Reserves 665 476,000 2,517,000 7.16 x 108 TOTAL RESERVES 666 513,000 2,714,000 7.71 x 108 Updated Measured Resource 6

  20. Slide 20: Conservative Price Assumptions Relative to Current Market Price

    Conservative Price Assumptions Relative to Current Market Price  The lithium carbonate price Year Price Assumption per tonne of Lithium Carbonate (US$) assumptions were obtained High Case Base Case Low Case 2015 5,800 5,700 4,600 from SignumBOX 5,900 5,800 4,700 2016  The Company believes the 2017

  21. Slide 21: Sensitivity Analysis for Stage 1

    Sensitivity Analysis for Stage 1  Independent market studies identify 3 long term price scenarios  Current battery grade Lithium Carbonate price ~ US$ 6,500 per tonne and Potash ~ US$ 580 per tonne (Brazil)  Project is profitable even in low price scenario 20,000 TPA of Lithium Carbonate 40,000 T

  22. Slide 22: Projected Operating Cost for Stage 1

    Projected Operating Cost for Stage 1 Catering & Camp Services General & Administration Transportation 2% 3%  Lithium Americas’ projected Lithium Carbonate 3% Maintenance 6% cash operating costs isUS$1,876 per tonne Salt Removal and Transport  The Lithium Carbonate net cash operating 7% costs of US

  23. Slide 23: Initial Capital Cost for Stage 1

    Initial Capital Cost for Stage 1 Soda Ash (Li2CO3 Plant) Drilling Wells (Wells) Electric Supply and Distribution  50% of the CAPEX is related to pond 3% 3% (Li2CO3 Plant) Freight and Customs Expenses 4% construction (Li2CO3 Plant) 4% SX Boron Plant & Brine Storage  Majority of the construction mat

  24. Slide 24: Stage 1 Timeline: Clear Path to Construction

    Stage 1 Timeline: Clear Path to Construction  Clear path to construction with near term milestones  Regular catalysts throughout the next three years  The company has achieved every milestone for the past 3 years 2012 2013 2014 2015 2016 2017 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

  25. Slide 25: Stage 2 Development Plan

    Stage 2 Development Plan  Reserves allow doubling of capacity of the plant after completing Stage 1  Proposed Stage 2 development:  2018 start expansion to 40,000 TPA Lithium Carbonate plant  2020 start expansion to 80,000 TPA Potash plant  2022 Full Production  Economic estimates of Stage 2 n

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