Hazer Group Ltd. · ASX:HZR
Hazer — Investor Presentation (March 2018)
40 slides from Hazer's investor presentation, Mar 19, 2018
Slide 1: Hazer Group Ltd: Company Overview – March 2018
For personal use only HAZER GROUP LTD LOW COST - LOW EMISSION HYDROGEN & GRAPHITE PRODUCTION COMPANY OVERVIEW – MARCH 2018 1
Slide 2: Hazer Group Limited
HAZER GROUP LIMITED For personal use only Founded in 2010 to commercialise technology initially developed at the University of Western Australia Nearly 10 years development, collaboration with leading Australian universities LOW COST LOW EMISSION Listed on ASX since Dec 2015; returned HYDROGEN over
Slide 3: Corporate and Market Snapshot
CORPORATE AND MARKET SNAPSHOT For personal use only (ASX: HZR, HZRO) Share Price & Volume Capital Structure HZR Share price & volume (4 mths) Current Shares on Issue 88.1m $0.700 1,400,000 Market Capitalisation @$0.45 $ 40m Cash @ 31 Dec 2017 $ 8.3m $0.600 1,200,000 Total Options 55.4m $0.500 1,000,
Slide 4: Hydrogen & Energy Markets
HYDROGEN & ENERGY MARKETS For personal use only HYDROGEN OFFERS THE IDEAL CLEAN ENERGY SYSTEM TRUE CLEAN ENERGY ENERGY DENSE Unlike fossil fuels, hydrogen represents a truly Hydrogen is exceptionally “energy dense” – clean energy fuel, as combustion generates 1 kilogram of hydrogen can generate sign
Slide 5: Significant Industry, Investment Tailwinds
SIGNIFICANT INDUSTRY, INVESTMENT TAILWINDS For personal use only 5
Slide 6: The Problem with Hydrogen Production
THE PROBLEM WITH HYDROGEN For personal use only PRODUCTION IS HIGH IN EMISSIONS OR EXPENSIVE Significant CO2 emissions FOSSIL FUEL 95% OF TOTAL GLOBAL HYDROGEN REFORMING PRODUCTION Chemically equivalent to direct CnHm + [O] COx + H2 combustion, but less energy efficient CURRENT BARRIER TO GROWTH IN
Slide 7: The Hazer Process
THE HAZER PROCESS For personal use only HYDROGEN & GRAPHITE FROM NATURAL GAS CH4 2H2 + C NATURAL GAS HYDROGEN 2 US$100 BILLION PA IRON-ORE SYNTHETIC GRAPHITE US$15 BILLION PA 7
Slide 8: Hazer & Hydrogen Production
HAZER & HYDROGEN PRODUCTION For personal use only DE-CARBONISING & CAPTURING ALL THE VALUE OF FEEDSTOCK GAS 2 2 HYDROGEN 25% STEAM METHANE HAZER PROCESS REFORMING (SMR) Instead of carbon dioxide, the carbon Current large scale hydrogen production content of the natural gas is captured in the process
Slide 9: Potential Markets
POTENTIAL MARKETS OPPORTUNITIES IN THREE MAJOR GLOBAL MARKETS For personal use only INDUSTRIAL CLEAN HYDROGEN SYNTHETIC HYDROGEN AND ENERGY GRAPHITE US$100 Billion US$18 Billion by 2023 (FCV) US$15 Billion • Cheaper and cleaner alternative • Multiple applications • High quality, low cost graphite so
Slide 10: Industrial Hydrogen & Hydrogen Energy
For personal use only INDUSTRIAL HYDROGEN & HYDROGEN ENERGY 10
Slide 11: The Hydrogen Industry
THE HYDROGEN INDUSTRY For personal use only THE HYDROGEN ECOSYSTEM HAS FIVE CORE FUNCTIONS HYDROGEN INDUSTRY Technical Support Production Distribution Application Policy & Regulatory Functions HAZER OFFERS A NEW APPROACH FOR HYDROGEN PRODUCTION 11
Slide 12: Hazer vs. SMR
HAZER vs. SMR MODELLING FOR HYDROGEN PRODUCTION For personal use only • Steam Methane Reforming (SMR) is currently the most commonly used and cost effective conventional hydrogen production process 75% commodity 70% reduction in • SMR also emits significant quantities of CO2 cost reduction co2 emiss
Slide 13: Scenario Modelling – Option
SCENARIO MODELLING – OPTION 1 For personal use only LOWER COST BY UTILISING FUEL GAS FOR SYSTEM ENERGY Combustion of Fuel Gas Hydrogen Iron Product Ore Reactor Tail Gas PSA (or similar) Fuel Gas Energy input Product (system) Reactor Tail Gas (PSA Tail Gas) Optional – Solid / gas combustion of separa
Slide 14: Scenario Modelling – Option
SCENARIO MODELLING – OPTION 1 For personal use only LOWER COST BY UTILISING FUEL GAS FOR SYSTEM ENERGY Hazer operating costs per tonne of H21 Assumptions Input Costs Conversion Assumption1 (%) 70% Natural Gas input cost (A$) A$ 3,040 Gas (NG/FG) to electricity conversion (%) 50% Iron ore cost (A$) A
Slide 15: Sensitivity – SMR Comparison
SENSITIVITY – SMR COMPARISON For personal use only HAZER’S ADVANTAGE IS DRIVEN BY GAS PRICE & GRAPHITE VALUE $1,200 $1,000 REGION C Cost of commodities consumed (nat. gas, iron ore) is covered by sale of graphite Graphite value (A$/tonne) $800 Long term graphite concentrate price est US$725/tonne $6
Slide 16: Hazer vs. Electrolysis
HAZER VS. ELECTROLYSIS MODELLING FOR HYDROGEN PRODUCTION For personal use only • Electrolysis is an alternative hydrogen production process that can use renewable energy and water to produce near zero CO2 emission hydrogen 6x hydrogen production Commodity cost inputs • Modelling indicates Hazer coul
Slide 17: Scenario Modelling – Option
SCENARIO MODELLING – OPTION 2 LOW CO2 EMISSIONS USING RENEWABLE POWER For personal use only System Energy (Renewable Generation) Hydrogen Iron Product Ore Reactor Tail Gas PSA (or similar) Fuel Gas Energy input Product (system) Reactor Tail Gas (PSA Tail Gas) Solid / gas separation Methane Graphite
Slide 18: Scenario Modelling – Option
SCENARIO MODELLING – OPTION 2 LOWER COST & GREATER PRODUCTION THAN ELECTROLYSIS For personal use only Hazer operating costs per tonne of H21 Assumptions Input Costs - Hazer Conversion Assumption (%) 50% NG Input Cost (A$) A$ 4,800 Process Inputs (per tonne of H2 product) Renewable electricity cost (
Slide 19: Sensitivity – Electrolysis Comparison
SENSITIVITY – ELECTROLYSIS COMPARISON HAZER’S OPERATING COST ADVANTAGE OVER ELECTROLYSIS IS INDEPENDENT OF For personal use only GRAPHITE VALUE WHEN POWER COST IS NON-TRIVIAL Target graphite price necessary for Hazer cost-equivalence to electrolysis as natural gas price changes $900 $800 Graphite Pr
Slide 20: Hazer Hydrogen
HAZER HYDROGEN CLEANER AND CHEAPER ALTERATIVE For personal use only Greater CO2 emissions (per kWhr) than direct combustion of fossil fuel • ‘Clean’ and economically completive hydrogen • Significant emissions reductions anticipated over alternative fossil fuel based hydrogen production (SMR) Coal G
Slide 21: Hazer Hydrogen: Multiple Clean Hydrogen Applications
HAZER HYDROGEN MULTIPLE CLEAN HYDROGEN APPLICATIONS For personal use only CARBON CAPTURE AND STATIONARY VEHICLE FUEL UTILISATION POWER (CCU) • Major vehicle manufacturers • An alternative to CCS (Carbon Capture • Low energy requirements potentially developing FCV models and Storage), where CO2 emiss
Slide 22: Fuel Cell Vehicles
FUEL CELL VEHICLES AN EMERGING GLOBAL MARKET FOR HAZER For personal use only • Fuel cell vehicle (FCV) market estimated USD 18 billion by 2023 • Major vehicle manufacturers are developing FCV models • Newly created ‘Hydrogen Council’ • Toyota, Shell, BWM, GM among the 13 members • Plans to invest $1
Slide 23: MoU Signed with Primetals
MOU SIGNED WITH PRIMEMETALS For personal use only DEPLOYMENT OF HAZER TECHNOLOGY IN STEEL INDUSTRY • Hazer has executed an MoU with Primetals Technologies, a leading global engineering company and solution provider for the metals industry • Primetals is a joint venture between Mitsubishi Heavy Indus
Slide 24: Carbon Capture & Utilisation (CCU)
CARBON CAPTURE & UTILISATION (CCU) For personal use only HAZER PLANT INTEGRATED INTO STEEL PRODUCTION CO2 Emissions STEEL PLANT Hydrogen (Reductant ) Hydrogen (CCU Usage) Graphite (Coke Replacement) CCU / METHANOL PLANT HAZER PLANT Graphite Steel Methanol 3 Products = 3 Revenue Streams 24
Slide 25: Synthetic Graphite
For personal use only SYNTHETIC GRAPHITE 25
Slide 26: Global Graphite Market
GLOBAL GRAPHITE MARKET For personal use only Estimated Graphite Demand • Total graphite market in 2016 is estimated at 2.4Mt • Expected to increase to 4.1Mt by 2025 • Total value of the graphite market is ~US$ 15 Billion • Take-up of EV’s and FCEV’s is likely to underpin future demand for graphite •
Slide 27: Hazer Graphite
HAZER GRAPHITE PRODUCTION, PROCESSING, VALUE For personal use only Value Raw Product Primary Purification Secondary Purification 80-95% tgc 95-99% tgc >99% tgc • Direct product from reaction • Single stage chemical purification • Two stage chemical purification process; no additional processing from
Slide 28: Partnership with MIN
PARTNERSHIP WITH MIN INVESTMENT AND COMMERCIAL PARTNER For personal use only • In March 2017 Hazer completed A$5M strategic placement with ASX-listed mining and mining services provider Mineral resources Ltd • MIN significantly increased their stake in Hazer to 14% • In December 2017 Hazer signed a
Slide 29: Battery Testing
BATTERY TESTING PROMISING RESULTS IN LITHIUM-ION BATTERIES For personal use only • Preliminary longer-term cycle results indicate virtually no loss in capacity after 100 cycles • Equivalent performance to commercial synthetic graphite used in lithium-ion battery applications • Results demonstrate Ha
Slide 30: Commercialisation and Scale-Up
For personal use only COMMERCIALISATION AND SCALE-UP 30
Slide 31: Laboratory to Pre-Pilot Plant
LABORATORY PRE-PILOT PLANT HAZER HAS MADE SIGNIFICANT PROGRESS SINCE IPO For personal use only STAGE 5 FULL COMMERCIAL PLANTS 2017 STAGE 4 COMMERCIAL PROTOTYPE (PILOT PLANT) TBC 2018 PROJECT 2016 INITIATION STAGE 1-2 - LABORATORY STATIC BED REACTOR FLUIDIZED BED REACTOR STAGE 3 – PRE-PILOT PLANT OPE
Slide 32: Commercialisation Process
COMMERCIALISATION PROCESS STAGED SCALE UP DEVELOPMENT For personal use only ~100x increase ~100x increase ~100x increase Further increase Pilot Laboratory Pre-Pilot Plant (Commercial Large Commercial Small Commercial (Complete) (On-going) Prototype) TOTAL PRODUCTS 10 – 100 Tones / Day Up to 100g / D
Slide 33: Other Commercial Options
OTHER COMMERCIAL OPTIONS BUILD DIVERSIFIED REVENUE THROUGH MULTIPLE COMMERCIAL OPTIONS For personal use only LICENSE BUILD, OWN PARTNERSHIP & OPERATE Share capital & Hazer can License IP to 3rd construct own parties and operating costs with hydrogen or and operate generate high plants and sell margi
Slide 34: Progress Since IPO
PROGRESS SINCE IPO SIGNIFICANT PROGRESS ON COMMERCIALISATION PATHWAY For personal use only PROCESS DEVELOPMENT GRAPHITE DEVELOPMENT CORPORATE / COMMERCIAL Successful construction, Strong balance sheet with commissioning & operation Demonstrated raw graphite purity at up to 95% potential future capit
Slide 35: Future Goals: Technical Milestones
FUTURE GOALS TECHNICAL MILESTONES For personal use only SCALE UP DEVELOPMENT: • Next generation reactor design and implementation • Increase production rates and run times • Begin design process for the next scale of Hazer plant GRAPHITE DEVELOPMENT: • Evaluate commercial viability for graphite acro
Slide 36: Future Goals: Corporate & Commercial Milestones
FUTURE GOALS CORPORATE & COMMERCIAL MILESTONES For personal use only MINERAL RESOURCES: • Ongoing milestones as collaboration with MinRes progresses PRIMETALS TECHNOLOGIES • Technical roadmap to determine preferred development pathway • Progression to a binding formal agreement and execute roadmap O
Slide 37: Experienced & Capable Team
EXPERIENCED & CAPABLE TEAM For personal use only STRONG CORPORATE, COMMERCIAL AND TECHNICAL EXPERIENCE Mr Geoff Pocock | Managing Director Mark Edwards| Chief Operating Officer Founder, HazerGroup Ltd Decades of experience across a variety of Over 15 years experience in corporate engineering f
Slide 38: Strong Board Capabilities
STRONG BOARD CAPABILITIES For personal use only COMMERCIAL, TECHNICAL & REGULATORY EXPERTISE Mr Tim Goldsmith| Chairman Ms Emma Waldon| Company Sec / CFO Over 20 years as Partner with global Over 18 years global corporate experience. professional services group PwC Diverse financial, corporate
Slide 39: Hazer Group Ltd
For personal use only HAZER GROUP LTD Michael Wills MARKETING, COMMUNICATIONS & IR mwills@hazergroup.com.au www.hazergroup.com.au 39
Slide 40: Disclaimer: Important Information
DISCLAIMER For personal use only IMPORTANT INFORMATION This presentation has been prepared by Hazer Group Limited (“Hazer” or “the Company”) This presentation is not a financial product or investment advice or recommendation, offer or invitation by any person or to any person to sell or purchase sec