Hastings Technology Metals Limited · ASX:HAS
Hastings Technology Metals — Investor Presentation (December 2019)
29 slides from Hastings Technology Metals's investor presentation, December 2019
Slide 1: Yangibana Project – Begin the Future
Yangibana Project – Begin the Future Investor Presentation December 2019 Hastings Technology Metals Limited (HAS.ASX) 1
Slide 2: Important Notice – Disclaimer
Important Notice – Disclaimer All currency amounts are in A$ unless stated otherwise. Disclaimer This presentation has been prepared by Hastings Technology Metals Limited (“Company”). It does not purport to contain all the information that a prospective investor may require in connection with any po
Slide 3: Everyday Use of Permanent Magnets
Everyday Use of Permanent Magnets Hastings Technology Metals Limited (HAS.ASX) 3
Slide 4: Yangibana Project – Milestones Achieved
Yangibana Project – Milestones Achieved May 16 PFS completed PROJECT MILESTONES Nov 17 Mar 19 & DFS Commenced Nov 18 Capex Revised to Nov 14 DFS completed Successful Skyrock Baotou A$427 million Beneficiation Results Nov 17 offtake contract Native Title signed Apr 19 Oct 19 agreement Euler Hermes In
Slide 5: Investment Attraction
Investment Attraction Why Hastings? Yangibana Project Area • Electric Vehicle (EV) growth = Demand for NdPr magnets Broc ✓ Total tenement area – 650km2 ✓ 250kms NE of Carnarvon ✓ Every EV powertrain requires ~1.5 – 2.0kg of NdPr ✓ FIFO workforce ✓ 21.3 MT Resource ✓ CAGR of 9% for NdPr magnets 2020
Slide 6: Capital Structure and Share Price
Capital Structure and Share Price Capital Structure $/Shares Share Price Performance Cash Balance (at 30 September 2019) A$14.1M $0.60 4.0 3.5 Shares in Issue 937.9M $0.50 Share Price (rebased) 3.0 $0.40 Share Price (28 October 2019) A$0.175 Volume ('m) 2.5 $0.30 2.0 Market Capitalisation (31 Octobe
Slide 7: World Leading NdPr : TREO
World Leading NdPr : TREO Up to 48% NdPr : TREO High rates of beneficiation 48% 50x 75% to >100% higher than peers NdPr 0.43% to > 20% in MREC 15,000 tpa MREC Small and compact plant = 8,500 tpa TREO 1 Mtpa Volume size 200m x 200m = 3,400 tpa NdPr 50 – 100% > peers Low CAPEX of A$517M – up NdPr+Dy&T
Slide 8: Mineral Resource and Reserve Statement
Mineral Resource and Reserve Statement Mineral Resources M Tonnes TREO % Nd2O3+Pr6O11 % Measured 4.15 1.15 0.43 Indicated 10.92 1.13 0.38 Inferred 6.18 1.09 0.35 TOTAL 21.25 1.12 0.38 Ore Reserves M Tonnes TREO % Nd2O3+Pr6O11% Probable 12.20 1.13 0.40 ~ 50 x upgrade from Final Product MREC (tpa) TRE
Slide 9: Yangibana Project Summary
Yangibana Project Summary Key Facts Capital cost (incl 15% Contingencies) A$593M Bald Hill Pit Mining Production 1.0 Mtpa Mine Life 13 years Annual (MREC) production ~15,000 tpa Annual (TREO) production ~8,500 tpa Average (NdPr) production* 3,400 tpa LOM Cost of Production ~ A$20.50 / kg TREO Commis
Slide 10: Final Process Flowsheet
Final Process Flowsheet Ore Sorting ➢ Scope to lower opex Beneficiation ➢ Standard monazite flotation ➢ 2nd pilot test achieved 80% TREO recovery vs 70% at DFS Hydromet ➢ Well known and reliable hydrometallurgical processes Mixed Rare Earth Carbonate (MREC) ➢ Annual production of 15Kt ➢ Customer tak
Slide 11: 3D Process Plant layout design
3D Process Plant layout design Compact design - small footprint of 200m x 200m Hastings Technology Metals Limited (HAS.ASX) 11
Slide 12: Yangibana Advantage – Highest NdPr:TREO ratio
Yangibana Advantage – Highest NdPr :TREO ratio One of the Highest NdPr:TREO rare earth deposits in the world Comparison of REO Distribution & Basket Value Between Hastings and Major Light RE Producers China Outside of China RE Oxide/TREO Unit Baotou Sichuan Mt Weld Mountain Pass Lanthanum % 9.99 25.
Slide 13: Rare Earth Oxide Prices
Rare Earth Oxide Prices China F.o.B. Export prices 8-10-2019 (USD/kg) & YTD change Nd Oxide Prices, FOB China USD/mt Lanthanum oxide La2O3 $1.88 - 6.0% Cerium oxide CeO2 $1.93 - 3.5% Praseodymium oxide Pr6O11 $52.00 - 9.7% Neodymium oxide Nd2O3 $45.80 - 1.5% Dysprosium oxide Dy2O3 $267.00 + 50.0% Te
Slide 14: Capital Cost Estimate - Updated
Capital Cost Estimate - Updated NAIF considering funding for Gas Pipeline, Power Plant and Roads upgrade Previous* Update Changes Capital Expenditure (A$M) (A$M) (A$M) Key Contracts Awarded Mine 5 13 8 ➢ Design and Supply of Rotary Kiln Off Gas Process plant 259 262 3 Scrubbing Plant awarded to Tota
Slide 15: Major Activities Update
Major Activities Update Phase One Phase Two Enabling Infrastructure Mine Construction Apr 2019 – Q1 2020 Q2 2020 – Q2 2022 ➢ Installation of the accommodation camp ➢ Process plant ➢ Airstrip upgrade ➢ Open pit pre-stripping ➢ Continuing development of the site access roads ➢ Tailings Storage Facilit
Slide 16: Next Steps – Project Timeline
Next Steps – Project Timeline Yangibana Project Timeline ➢ Hastings remains on track to achieve key milestones for the Yangibana Project ➢ Construction targeted to commence Q1/2 2020 with production to commence ~ 24 months build time ➢ Hastings’ Yangibana Project is well positioned to be the next AS
Slide 17: Exploration Upside
Exploration Upside ➢ Yangibana trends only drilled in small isolated areas totalling ~50 sqkm ➢ Many carbonatite intrusions hidden under light sand cover ➢ Only drilled deposits with surface expression to date ➢ Bald Hill/Frasers Pits open along strike and at depth Process Plant ➢ Bald Hill – Fraser
Slide 18: Electric Vehicles – Catalyst for NdPr Demand
Electric Vehicles – Catalyst for NdPr Demand Expected Growth of Electric Vehicle (EV) Sales Worldwide 25 Commercial (truck and vehicle) EV’s are inevitable – 54% drop in emissions over next decade 23.0 EV (electric vehicle) Timeline European Emissions Standards – 95% of vehicles PHEV (plug-in hybrid
Slide 19: Renewable Energy – Wind
Renewable Energy – Wind ➢ Paris Accord 2015 – governments agreed to combat climate change and promote renewable energy ➢ Renewable energy cost today is estimated to be almost equal to fossil fuel on price per kWh* ➢ Neodymium magnets (NdFeB) have the highest power-to-weight ratio and most efficient
Slide 20: NdPr Price Forecast 2020 – 2035
NdPr Price Forecast 2020 – 2035 NdPr Price Forecast $130.0 ➢ *CAGR of 8.5% for NdPr magnets $120.0 from 2019 – 2025 is the key factor $110.0 pushing NdPr price up $100.0 $90.0 ➢ Automotive OEMs to launch multiple $80.0 new EV models from 2021 onwards $70.0 $60.0 ➢ No major rare earth mine coming $50
Slide 21: Global NdPr Demand & Supply
Global NdPr Demand & Supply The supply gap for NdPr is widening ➢ China consumption 2017 - 46KT of NdPr oxide 2022 - forecast 60KT. ➢ China supply tightening due to: • Stricter environmental enforcement • Made in China 2025 policy • Expect Beijing to restrict sale of RE magnets to external parties ➢
Slide 22: Financial Highlights
Financial Highlights Attractive project metrics Description Unit LOM Basket Price (average) US$ / kg 39.90 ➢ NPV of A$549M and IRR of 21% Life of mine years 13 ➢ Payback period – 3.4 years Project NPV (post-tax) A$M 549 ➢ Avg Annual Free Cash Flow (post- IRR % 21% tax) A$160M Payback period years 3.
Slide 23: Project Finance Lenders
Project Finance Lenders ➢ Concessionary financing options identified, advancing on due diligence and submission for credit application ➢ Untied Loan Guarantee Scheme (known as UFK) – German government offers concessionary loan interest if raw material is strategic to German industry and creates new
Slide 24: Project Funding - Overview
Project Funding - Overview Lenders’ Gearing Requirements and Resulting Equity A$M A$M % Sunk cost up to DFS 33 4% Project Capex – Mine & Process Plant 398 Additional Infra Capex – Gas Pipeline & Power Plant, 119 Shire Roads upgrade (NAIF funded) Contingency @ 15% (EH requirement) ** 76 Total Project
Slide 25: Offtake Customers
Offtake Customers ➢ Schaeffler – Eligibility for UFK financing. Advancing on negotiations on key terms of UFK loan: • Volume: 5KT p.a. for 10 years • Long term price and discount structure, payment terms, floor price, delivery timeline, etc ➢ Thyssenkrupp – 3.5KT p.a. for 10 years ➢ Sky Rock Baotou
Slide 26: Board of Directors
Board of Directors Charles Lew Jean Claude Steinmetz Mal Randall Neil Hackett Guy Robertson Executive Chairman Non Executive Director Non Executive Director Non Executive Director Finance Director • Corporate Finance Director • Previously Chief Operating • Bachelor of Applied • Corporate Finance and
Slide 27: Experienced Senior Management Team
Experienced Senior Management Team Andrew Reid Pit Wah Chung Nick Holthouse Valerie Quay Robin Zhang Chief Operating Officer Chief Financial Officer General Manager – Legal Counsel Process Engineering Engineering & Operation Manager Readiness • 25 years of expertise in • 20 years experience in • 30+
Slide 28: Independent Consultants and Advisors
Independent Consultants and Advisors Engineering, Procurement, Construction and Management (EPCM) Commodity Market Analysis Project Finance Legal Counsel to Borrower Project Finance Debt Advisory Independent Technical Experts to Lenders Financial Adviser to Euler Hermes Environmental and Social Gap
Slide 29: Thank You / Questions?
Thank You / Questions? Hastings Technology Metals Limited (HAS.ASX) 29
Hastings Technology Metals — Investor Presentation (December 2019) on 6ix