Arafura Rare Earths Limited · ASX:ARU
Arafura Rare Earths — Arafura Resources — Investor Presentation (October 2017)
24 slides from Arafura Rare Earths's investor presentation, Oct 3, 2017
Slide 1: Arafura Resources Limited – October 2017 Investor Presentation
For personal use only Arafura Resources Limited Up and coming supplier of NdPr to permanent magnets used in the growing clean energy industry October 2017 Investor Presentation
Slide 2: Disclaimer
Disclaimer 2 For personal use only Important Notice This presentation has been prepared by Arafura Resources Limited (Arafura Resources). It 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 revie
Slide 3: Investment Highlights & Capital Structure
Investment Highlights & Capital Structure 3 For personal use only • ASX listed company developing the Nolans Rare Earths Project in the Northern Territory, low geopolitical risk, 30+ year mining and chemical processing operation ASX Code ARU • Nolans is one of the largest and richest deposits of Neo
Slide 4: The NdPr Market
For personal use only 4 The NdPr Market Arafura Resources Limited (ASX:ARU) October 2017
Slide 5: Overview: Secure Supplier of NdPr to Permanent Magnets Used in Clean Energy
Overview 5 For personal use only Secure Supplier of NdPr to Permanent Magnets Used in Clean Energy • NdPr is a key component in the manufacture of high-strength NdFeB permanent magnets used in electric vehicles (EVs), wind turbines, portable electronic devices, and many industrial applications • NdP
Slide 6: NdPr Snapshot – Clean Energy Applications
NdPr Snapshot – Clean Energy Applications 6 For personal use only EV Drivetrain: 1kg of NdPr Electric Vehicles: 41 million by 2040 each containing 1.7kg of NdPr Wind Turbines: Up to 150kg of NdPr per MW Electric Bicycles: 30 million in 2017 each containing 0.1kg of NdPr Arafura Resources Limited (AS
Slide 7: Established Markets & Growing Applications
Established Markets & Growing Applications 7 For personal use only Source: Adamas Intelligence, Arnold Magnetic Technologies, Japanese industry participants, Roskill Arafura Resources Limited (ASX:ARU) October 2017
Slide 8: Automakers EV Growth Strategy
Automakers EV Growth Strategy 8 For personal use only Arafura Resources Limited (ASX:ARU) October 2017
Slide 9: The NdPr Supply Opportunity
The NdPr Supply Opportunity 9 For personal use only Source: ACREI, Adamas Intelligence, corporate filings and presentations, IMCOA, rare earth end users, Roskill Arafura Resources Limited (ASX:ARU) October 2017
Slide 10: Emerging Supply Dynamic – NdPr Price Trend
Emerging Supply Dynamic – NdPr Price Trend 10 For personal use only June 2015: China removes tariffs New supply dynamic and price adjustment. Industry analysts: “end- users can sustain prices of US$90-100kg” Illegal production floods the market ahead of measures by China to consolidate production an
Slide 11: Emerging Demand Dynamic – China 2025 Strategy
Emerging Demand Dynamic – China 2025 Strategy 11 For personal use only • Steady increases in global magnet production 2014 to 2016, NdPr price movement indicates continued growth for 2017 • China’s domestic consumption will increase as it pursues clean energy objectives • “China 2025 Strategy” explo
Slide 12: Non-China Supply Peer Comparison
Non-China Supply Peer Comparison 12 For personal use only • Non-China NdPr supply will be constrained by the sector’s historical inability to attract capital • Nolans is one of the world’s largest and more advanced undeveloped NdPr projects which provides investors with a compelling investment oppor
Slide 13: The Nolans Project
For personal use only 13 The Nolans Project Arafura Resources Limited (ASX:ARU) October 2017
Slide 14: Project Configuration
Project Configuration 14 For personal use only Arafura Resources Limited (ASX:ARU) October 2017
Slide 15: Close To Key Infrastructure
Close To Key Infrastructure 15 For personal use only • Stuart Hwy – 10 km east • Alice Springs railyard, airport and other services – 135 km south • Amadeus gas pipeline – adjacent to processing site • Water supply – 30 km south • Tailings and process wastes remain at site Arafura Resources Limited
Slide 16: Project Metrics
Project Metrics 16 For personal use only • Ultra competitive operating costs US$6.23/kg TREO or US$24.38/kg NdPr oxide – lowest amongst peers • Phosphoric acid recovered to reduce commodity risk • High rare earths recovery • NdPr oxide price US$72/kg FOB China Refer Arafura ASX release 7 June 2017 f
Slide 17: Pilot Scale Work Completed In 2017
Pilot Scale Work Completed In 2017 17 For personal use only Beneficiation Pilot Plant Phosphoric Acid Regeneration Circuit Bulk Pre-Leach Pilot Plant TREO Grade 7.0% TREO Recovery >80% NdPr Oxide Grade 1.8% NdPr Oxide Recovery >82% P2O5 Grade 29% P2O5 Recovery >90% Al2O3 Grade <3.2% Fe2O3 Grade <1.9
Slide 18: Piloting & Final Feasibility
Piloting & Final Feasibility 18 For personal use only Arafura Resources Limited (ASX:ARU) October 2017
Slide 19: Project Funding Strategy
Project Funding Strategy 19 For personal use only • Reduced domestic institutional investor interest • Underperformance (or failure) of non-Chinese producers and volatility in rare earth prices has resulted in reduced institutional equity investor interest in the rare earth sector • Equity will rema
Slide 20: Summary
Summary 20 For personal use only Attribute Arafura High growth and high value NdPr magnet focus ✓ NdPr production planned to coincide with projected supply gap ✓ Located in a jurisdiction with low geopolitical risk and with strategic support ✓ Long-life, low-risk resource with planned output that su
Slide 21: Contact
For personal use only Contact: Level 3, 263 Adelaide Terrace Perth, WA, 6000, Australia T: +61 8 6210 7666 E: arafura@arultd.com October 2017 Corporate Presentation
Slide 22: Appendix A: Mineral Resources
Appendix A: Mineral Resources 22 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 1% TREO cut-off grade. Numbers may not compute exactly due to rounding. “NdPr
Slide 23: Appendix B: Environmental Assessment In Progress
Appendix B: Environmental Assessment In Progress 23 For personal use only Draft EIS submitted May 2016 EIS Supplement submitted February 2017 Remaining steps in Northern Territory Environmental Impact Assessment process Public and government review May-August 2016 No major risks identified 609 comme
Slide 24: Appendix C: Peer Comparison
Appendix C: Peer Comparison 24 For personal use only Notes and assumptions used in the preparation of the Peer Comparison • Exchange rate of AUD1 = USD 0.795. ASX-Listed Peer Group Companies • Forecast operating data for development projects based on published company reports and project updates. AR
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