Almonty Industries Inc. · NASDAQ:ALM
Almonty Industries — Investor Presentation (December 2018)
33 slides from Almonty Industries's investor presentation, December 2018
Slide 1: Update on Almonty Industries & Sangdong Mine Project
Update on: ALMONTY INDUSTRIES & SANGDONG MINE PROJECT PREPARED BY ALMONTY INDUSTRIES, INC. December 2018
Slide 2: Legal Disclaimer
Legal Disclaimer This presentation includes certain statements that may be considered “forward-looking information” within the meaning of applicable Canadian securities regulations and “f orwarding-looking statements” within the meaning of the United States Private Securities Litigation Reform Act o
Slide 3: I. Update on Almonty Industries Inc.
I. Update on Almonty Industries Inc.
Slide 4: Almonty – Key Financial Performance
Almonty – Key Financial Performance Last Twelve Months (LTM) Revenue (CAD m) EBITDA from Mining Op (CAD m) 25 14 12 20 10 15 8 10 22,5 6 12,702 17,3 4 7,604 5 10,8 10,8 2 2,875 2,953 0 0 Q4 16/17 (9/30) Q1 17/18 (12/31) Q2 17/18 (3/31) Q3 17/18 (6/30) Q4 16/17 (9/30) Q1 17/18 (12/31) Q2 17/18 (3/31)
Slide 5: Almonty – Production and Cost
Almonty – Production and Cost Production (WO3 MTU) 300,0 Production Cost (U$/MTU) Los Santos Panasqueira 250,0 Chinese Cost Band 200,0 156,0 161,3 150,0 147,5 24 583 126,3 24 130 100,0 20 925 20 905 50,0 27 962 17 943 22 172 0,0 15 275 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2017 Q4 2017 Q1 2018 Q2 2
Slide 6: Almonty – Financial Projection for coming years
Almonty – Financial Projection for coming years The trend in LTM is expected to continue in coming years aided by newly implemented measures including: • Operation of ore sorting equipment at Panasqueira allowing additional reclamation of the coarse fraction tailings with reasonably anticipated prod
Slide 7: Almonty Today (1) – An Established Global Tungsten Chain in Conflict Free Regions
Almonty Today (1) – An Established Global Tungsten Chain in Conflict Free Regions Panasqueira Location: Portugal Acquisition in: 2016 Ownership: 100% Los Santos Development Production Stage: Almonty Korea Tungsten Location: Spain NI 43-101 P&P: 1,951kt @ 0.20% WO3 Acquisition in: 2011 Resource: M&I:
Slide 8: Almonty Today (2) – Lowest Cost Producer in the World
Almonty Today (2) – Lowest Cost Producer in the World Global tungsten production cost curve Rapidly perishing upon State-owned, criminal punishment large companies in China enforced since 2017 $205-245/mtu Unlicensed / illegal mining & tail retreatment companies in China Sangdong (est) 8
Slide 9: Shareholder Profile
Shareholder Profile Shareholder No. of sharesoutstanding % Lewis Black/Almonty Partners LLC 35,214,420 19.4% Global Tungsten & Powders 27,562,500 15.2% Deutsche Rohstoff AG 22,983,624 12.7% J.P. Morgan Chase & Co. 15,600,000 8.5% Korea Zinc Co., Ltd. 3,450,000 1.9% Thomas Gutschlag/Mark Trachuck 1,4
Slide 10: II. Update on Sangdong Mine Development Project
II. Update on Sangdong Mine Development Project
Slide 11: Profile of Sangdong Project Management Team
Profile of Sangdong Project Management Team Lewis Black – Chairman and CEO Nuno Alves – Director of Mining Mining Engineer with 20+ years experience, Over 10 years in the tungsten mining industry both underground and open pit Former Chairman and CEO of Primary Metals Orchestration & supervision of m
Slide 12: Status of Key Sangdong Contracts
Status of Key Sangdong Contracts Project - Risks & Mitigation Key Contracts Signed: Date Contract Specifications Dec. 26, 2017 EPC Contract w/POSCO E&C; LNTP-1 (Engineering) issued on Jan 12, 2018 Mar. 12, 2018 Offtake Agreement w/GTP, Amendment Agreement on Aug. 23, 2018 Apr. 20, 2018 Site Clearanc
Slide 13: Offtake – Key Elements & Status
Offtake – Key Elements & Status Principal Offtake Terms Later of: (1) 10 years from 1st delivery; Lasts till 12 months post full repayment Period (2) PF Loan tenure plus 12 months; or of PF Loan (3) Delivery of Total Contract Quantity 90,000 MTU in Year 1 (Ramp up) Approx. 90% of 230~240,000 MTU/yea
Slide 14: Key Development to date - Permits
Key Development to date - Permits All Primary Licenses & Permits are in place: Permits to be obtained are those pertaining to individual construction to be submitted with finalized engineering drawings a couple of months before the commencement of respective construction Area Relevant Permits Stat
Slide 15: Key Development to date - Resource
Key Development to date - Resource Chronological Development of Sangdong Resource Indicated + Measured (unit : 1,000) Inferred (unit : 1,000) Total F2 F3 HALO/F4/F5 MAIN F1 HW Total F2 F3 HALO/F4/F5 MAIN F1 HW Tetra-Tech (2012) 7,387 1,448 1,458 1,505 2,976 0 53,882 6,777 7,027 12,496 4,467 23,115 A
Slide 16: Key Development to date - Metallurgy
Key Development to date - Metallurgy Metallurgical Test Works Test works at KIGAM Wardell Low Grade WO3 High Grade Moly 1st 2nd 3rd 4th Armstrong Test done in May-Jun 2016 Aug-Oct 2016 Nov-Dec 2016 Mar-Jul 2017 Feb-Mar 2018 Jul-Aug 2018 Aug-18 Feed grade (% WO3) 0.50 ~ 0.70 0.41 ~ 0.56 0.36 0.46 ~ 0
Slide 17: Key Development to date - Social & Environmental
Key Development to date - Social & Environmental Free from all Korea Tungsten legacy, e.g. old tailings dams All facilities are to be built within the area classified as ‘Industrial Zone’ and ‘Special District for Economic Promotion of Areas of Mine Closure (Presidential Decree)’ Despite the e
Slide 18: Latest Development Sangdong Project - Risks & Mitigation
Latest Development Sangdong Project - Risks & Mitigation Site Clearance Completed • Site clearance (demolition) started on April 23 was completed on July 5, 2018; Concrete recycling was completed on August 6, 2018 > Ready for site handover to EPC Contractor Before Ongoing After 18
Slide 19: Latest Development Sangdong Project - Risks & Mitigation
Latest Development Sangdong Project - Risks & Mitigation Mine Development (Underground) • New mining plan and consequent drift development and cross cut plans finalized in Mar. 2018 • Permit for underground explosive treatment was granted (May 26, 2018) • Permit for new portal (Monty B) was granted
Slide 20: Latest Development - Update on Political, Government & Community
Latest Development Update on Political, Government & Community • Overwhelming Community supports prevail and continue • Strong supports from permitting agencies in form of expeditious approval Gov’t & Community • Diverse Gov’t subsidies, No NSR Relations • Newly elected Mayor stated all-out support
Slide 21: Finalized Financing Structure
Finalized Financing Structure State of Funding Structure Equity or Hybrid Equity 100% Injection Owned Senior PF Loan US$73 m KfW-IPEX Bank Project Account Offtake P+i of AKTC Payment Offtake Agreement Offtake Party OeKB (GTP) Supply ECA cover • U$73 mil senior loan, 8.25 years with an initial princi
Slide 22: Timetable - Key Milestones Ahead
Timetable - Key Milestones Ahead • Site handover and Ground Breaking toward the end of 2018 • EPC completion target by the end of Q2 2020; Following commissioning, the commencement of production is set for 3Q 2020 • Toward the end of mine development (18 months), trial and advance mining begins in Q
Slide 23: III. Tungsten Market Update
III. Tungsten Market Update
Slide 24: Tungsten – Demand/Supply
Tungsten – Demand/Supply DEMAND • Global demand for tungsten is forecast to grow by 2.5% per year till 2026 with Chinese consumption accounting for ~60% of demand • Automotive, mining, construction and oil & gas sectors, the largest end-users, continue to grow with increasing applications of tungste
Slide 25: Tungsten Prices
Tungsten Prices Tightening Supply Demand Balance sets Long term Direction of Tungsten Prices • 2017 saw a significant rise in prices driven by strong global industrial growth and decreased supply from China • Prices have remained strong in 2018 on continued reduction/idling of Chinese supply • Facto
Slide 26: Appendix - Other Almonty Mines
Appendix - Other Almonty Mines
Slide 27: Overview of Almonty Group Structure
Overview of Almonty Group Structure Public Shareholders Almonty Industries Inc. (Canada, TSX Listed) 100% Woulfe Mining Corp Beralt Ventures Inc. 7887523 Canada Inc. (British Columbia) (British Columbia) (Canada ) 100% 100% 100% 100% Beralt Tin and Wolfram Almonty Daytal Resources Valtreixal Resourc
Slide 28: Los Santos (1)
Los Santos (1) Overview Optimization Plan • Acquired in September 2011 Increase production to >90,000 MTU per annum • Located in the western Iberian Peninsula in the province – Plant process refinement expected to result in a 40% recovery of Salamanca, Spain improvement and increased throughput •
Slide 29: Los Santos (2)
Los Santos (2) • Tailings reprocessing to begin following depletion of fresh ore in 2019 • Environmental reclamation on the way • Relocation of facilities to in Valtreixal saving €14,5 M and a great deal of time Tailings reprocessing 5 years of reserved tailings with no mining cost Sand – 2,745 mi
Slide 30: Los Santos (3)
Los Santos (3) • Ore production per year – 500,000 t • Tungsten production WO3/y – 880t • Tungsten produced up to now – 6,802t WO3 = 5,374 t W • No. of workers (75 Daytal + 25 Mining contractor) =100 Los Santos tungsten concentrate production (tons) since comissioning in 2008
Slide 31: Panasqueira (1)
Panasqueira (1) Overview Optimization Plan Re-acquired in January 2016 • Enhancing production profile Located in Portugal in close proximity to Los Santos Mine in Spain - Recently updated NI 43-101 compliant technical report – A historical wolframite mine in production since 1896 filed in Februa
Slide 32: Panasqueira (2)
Panasqueira (2) MineralResource Mineral Resource Estimate Estimate (1) Panasqueira December31, 2016 Tonnes Avg Grade Contained WO3 Reserves WO3 Tonnes MTU Proven 775,000 0.22% 1,694 169,400 Probable 1,176,000 0.19% 2,234 223,400 Total Reserves 1,951,000 0.20% 3,928 392,800 New Tailings Dam Resources
Slide 33: Valtreixal – A Hidden Treasure
Valtreixal – A Hidden Treasure Mineral Resource Estimate (1) Valtreixal Brownfield Development Valtreixal October31, 2015 • A tin/tungsten exploration and evaluation project located in Tonnes Avg Grade Contained WO3equivalent western Spain in close proximity to the Los Santosmine (WO3 +Sn) • Filed u
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