Pls Group Limited · ASX:PLS
Pls — Pilbara Minerals — Investor Presentation (January 2018)
55 slides from Pls's investor presentation, Jan 30, 2018
Slide 1: Pilgangoora – the world's leading lithium development project
For personal use only Pilgangoora – the world's leading lithium development project Corporate Presentation – January 2018
Slide 2: Important Notices and Competent Person's Statement
Important Notices and Competent Person’s Statement Not an Offer of Securities For personal use only This document has been independently prepared by Pilbara Minerals Limited (Pilbara) and is dated 24/01/2018. This document is provided for informational purposes and does not constitute or contain an
Slide 3: Important Notices and Competent Person's Statement
Important Notices and Competent Person’s Statement Not Financial Product Advice For personal use only This document does not constitute financial product advice or take into account your investment objectives, taxation situation, financial situation or needs. This document consists purely of factual
Slide 4: Company Overview
For personal use only Company Overview Lithium Market Pilgangoora Project Summary 4
Slide 5: Pilbara Minerals – Overview
Pilbara Minerals – Overview ► 100% ownership interest in the world-class Pilgangoora Lithium -Tantalum Project For personal use only ► Pilgangoora is located in the Pilbara region of Western Australia, a proven mining jurisdiction 120km south of Port Hedland with established transport and port infra
Slide 6: Pilbara Minerals – overview: Capital Structure and Board
Pilbara Minerals – overview Capital Structure Board of directors For personal use only Current Share Price (23 January, 2017) A$ $1.01 Tony Kiernan – Non-Executive Chairman Shares on Issue # 1,645 million ► Highly experienced public company director and former solicitor with over 30 Options on Issue
Slide 7: Company Overview
For personal use only Company Overview Lithium Market Pilgangoora Project Summary 7
Slide 8: Lithium Growth Batteries are the key driver
Lithium Growth Batteries are the key driver The way we Generate, Use, Distribute and Store energy is changing. For personal use only Lithium Ion rapidly becoming the dominant rechargeable battery technology. Electric Vehicle uptake driving the growth in demand, followed by energy storage. The Lithiu
Slide 9: Lithium raw materials
Lithium raw materials The key ingredient of the improved battery supply chain ► Lithium raw materials are the vital ingredient for lithium Battery Supply Chain For personal use only battery technology Lithium raw materials ► Lithium is sourced predominantly from: Spodumene Mine - Hard Lithium Carbon
Slide 10: Lithium Raw Material Prices – Grade Differential
Lithium Raw Material Prices – Grade Differential For personal use only Lithium Carbonate ≈99% Technical Grade Lithium Carbonate ≥99.5% - Battery Grade Variance – Battery Grade vs Technical Grade over recent history Minimum - +USD$1,200/tonne Maximum - +USD$3,500/tonne Several implications – • Techni
Slide 11: Global Cost Curve – Carbonate Grade Matters
Global Cost Curve – Carbonate Grade Matters…… Global cost curves are not ‘normalised’ For personal use only for Battery Grade specifications, i.e. ≥99.5% purity lithium carbonate The majority of brine production does not meet Battery Grade specifications and therefore has to have more money spent on
Slide 12: China market overview – 2016 snapshot
China market overview – 2016 snapshot (Lithium Carbonate Equivalent) For personal use only Domestic Production +15kt Imports +85kt ►Spodumene SC6.0 (56kt) LOCAL PRODUCTION: ►Brine (7kt) ► Brine (10kt) Exports +11kt ►Lithium Carbonate (22kt) ► Spodumene (5kt) ►Lithium Carbonate (1kt) +90kt China ►Lit
Slide 13: Massive expansion of Lithium ion battery making capacity underway
Massive expansion of Lithium ion battery making capacity underway For personal use only More than USD20bn of committed investment expected to result in new battery manufacturing expansions that will increase global production capacity significantly and drive production costs down 13 Source: Benchmar
Slide 14: Roskill significantly upgrade Lithium Outlook
Independent research group, Roskill, significantly upgrade Lithium Outlook Significantly increased outlook driven by Li-Ion Battery demand in Electric Vehicles For personal use only Battery Other 1,800 Increased lithium use driven by EV battery requirements: 1,600 168 1,400 e-Buses PHEV & BEV HEV e-
Slide 15: Transition to Electric Vehicles – Exponential Adoption Curve
Transition to Electric Vehicles – Exponential Adoption Curve 2025 Forecast EV Penetration Rates Roskill’s forecast scenarios for sales of EV’s (GWh) LCE Demand in Li-ion batteries For personal use only (% of total vehicle sales) 4,000 10 x growth from 83kt Assumed performance gains in batteries coul
Slide 16: Transition to Electric Vehicles – Factors Driving Adoption
Transition to Electric Vehicles – Factors Driving Adoption Momentum growing from consumers, car manufactures and regulators – EV’s fast becoming mainstream – tipping point is accelerating For personal use only • Reduction in Battery Costs bringing EV's closer to • Comfort (noise, smooth acceleration
Slide 17: Global motor vehicle lithium demand growing strongly
Global motor vehicle lithium demand growing strongly ► Tesla Model 3 deliveries started in August 2017 with a long Global EV Builds For personal use only range battery life of 310 miles with a starting retail price of USD 35,000 (>500,000 pre-orders) ► Mercedes Benz releasing twelve new models of EV
Slide 18: Pilgangoora Project
For personal use only Company Overview Lithium Market Pilgangoora Project Summary 18
Slide 19: Project highlights
Project highlights Outstanding project economics driven by very low cost of operations DFS OUTCOMES, 2Mtpa Process Capacity – Stage 1 For personal use only ► Average annual production of approximately 314ktpa of 6% spodumene concentrate (44ktpa of Lithium Carbonate Equivalent or LCE) and 321,000lbs
Slide 20: Pilgangoora – Quality Product Streams
Pilgangoora – Quality Product Streams For personal use only ► Testwork and now pilot scale programs deliver outstanding results and demonstrates the class of the Pilgangoora project as a large-scale, low cost supplier of quality lithium raw materials. ► Genuine 6% Lithia (SC6.0) – low iron chemical
Slide 21: Offtake secured
Stage 1 Offtake secured Strong industrial relationships with offtake partners ► Stage 1 (2mpta) 10-year 160,000tpa 6% chemical-grade spodumene concentrate For personal use only offtake signed with Ganfeng Lithium ► Pricing based on a 6-month pricing mechanism that takes into account the Chinese impo
Slide 22: Pilgangoora Project – construction progress
Pilgangoora Project – construction progress For personal use only 22
Slide 23: Pilgangoora Project – construction progress
Pilgangoora Project – construction progress Power Plant For personal use only Tailings Thickener Ball Mill Tailings Thickener 23
Slide 24: Pilgangoora Project – construction progress
Pilgangoora Project – construction progress For personal use only Camp ROM PAD Construction TMF Construction 24
Slide 25: Pilgangoora 2Mtpa – delivering on project execution
Pilgangoora 2Mtpa – delivering on project execution For personal use only Stage 2 Stage 1 Stage 3 Stage 4 PFS (2Mtpa Resource DFS (2Mtpa) Project and 4Mtpa) Growth Complete Execution Complete Resource Estimation Project Definition Detailed Design and Project Execution – from ► JORC Inferred ► Maiden
Slide 26: Stage 2 Expansion Option – Pre-Feasibility Study
Stage 2 Expansion Option – Pre-Feasibility Study (“PFS”) …and More Outstanding projected economic returns, project now expected to grow to 5Mtpa PFS on 4Mtpa completed in September 2016: For personal use only ► Modest estimated incremental capital to expand to 4Mtpa, AUD 128m ► LOM average annual pr
Slide 27: 5Mtpa Expansion Project
5Mtpa Expansion Project Great Wall and Ganfeng Lithium off-take arrangements will underpin the Stage 2 expansion of For personal use only the Pilgangoora Project, while also providing an off-take-linked debt financing solution for a significant proportion of the Stage 2 capital requirements. ► Offta
Slide 28: 5Mtpa Expansion Case - Project Delivery Schedule
5Mtpa Expansion Case - Project Delivery Schedule For personal use only 28
Slide 29: DSO & Downstream Processing Opportunities
DSO & Downstream Processing Opportunities DSO: For personal use only ► Finalised a Mine Gate Sale Agreement with Pilbara iron ore miner Atlas Iron Limited on 20 December 2017 to deliver a minimum of 1.0 million tonnes of unprocessed ROM lithium-tantalum material . ► Capitalise on current strong dema
Slide 30: Summary
For personal use only Company Overview Lithium Market Pilgangoora Project Summary 30
Slide 31: Summary Investment highlights
Summary Investment highlights For personal use only Outstanding project Rapid pathway Ideally placed to Low-cost and through Significant economics and Offtake and full capitalize on high quality construction and resource scale ability to Stage 1 project robust lithium lithium production from and gra
Slide 32: Supplementary Information
For personal use only Supplementary Information 32
Slide 33: Board of Directors
Board of Directors Highly experienced company director and former solicitor with over 30 years’ professional For personal use only Non-Executive Tony Kiernan experience. Currently Chairman and a non-executive director of several ASX-listed resource Chairman companies Mining Engineer with over 22 yea
Slide 34: Management Team
Management Team Chartered Accountant with more than 25 years’ experience in the Australian resources sector. Prior to joining Pilbara Minerals, Mr Lynn served as the Chief Brian Lynn Chief Financial Officer For personal use only Financial Officer at Atlas Iron Limited and spent 12 years as the Chief
Slide 35: Lithium Ion Battery Technology
For personal use only Lithium Ion Battery Technology Lithium Market Pilgangoora Project 35
Slide 36: Leverage to Lithium Ion Battery Materials
Leverage to Lithium Ion Battery Materials ► The leverage to Lithium Ion battery materials sits with Lithium For personal use only ► Massive market growth required in lithium raw materials to contribute to growth in battery industry; ► 250% supply growth to 2025 ► >500% supply growth to 2030 ► Its of
Slide 37: Lithium ion batteries – Market Potential
Lithium ion batteries – Market Potential For personal use only New markets being created and a further substantial driver of Lithium ion consumption…… The lower the cost of the lithium ion battery, the greater the market application and China is now a key driver in lowering the cost of the batteries
Slide 38: Lithium Ion Battery Technology
For personal use only Lithium Ion Battery Technology Lithium Market Pilgangoora Project 38
Slide 39: Leading the Charge for Lithium-Ion Megafactories
Leading the Charge for Lithium-Ion Megafactories (EV only) For personal use only Estimated 521% increase between 2016 and 2020: Relates to batteries for EV’s only. 39
Slide 40: Massive expansion of Lithium ion battery making capacity underway
Massive expansion of Lithium ion battery making capacity underway Battery making capacity set to increase significantly For personal use only ► Significant expansion through entire lithium-ion supply chain, including major chemical conversion capacity expansion (spodumene to Carbonate & Hydroxide) o
Slide 41: Increasing availability and choice of Electric Vehicles
Increasing availability and choice of Electric Vehicles Models by style and range available through to 2020: For personal use only Telsa Model 3 released with 2 battery types: • Standard – 220 Miles • Long Range – 310 Miles Current EV’s on the market: 41 Source: Bloomberg New Energy Finance
Slide 42: Technology Adoption
Technology Adoption Adoption Rates of Consumer Technology Solar – Installed Capacity, Estimates vs Actual and the influence of cost For personal use only “There are two kinds of forecasters: those who don’t know, and those who don’t know they don’t know.” ― John Kenneth Galbraith Source: Scientific
Slide 43: Pricing – outlook strong
Pricing – outlook strong ► Ganfeng Lithium and General Lithium spodumene offtake Roskill Price forecasts – Battery-grade Lithium Carbonate For personal use only price based on relativity to the combined Chinese domestic and import market pricing outcomes for battery grade lithium carbonate ► Offtake
Slide 44: Great Wall Motors - China's largest SUV and pickup manufacturer
Great Wall Motors - China’s largest SUV and pickup manufacturer • Listed on the Hong Kong & Shanghai Stock Exchanges For personal use only • Market capitalisation of RMB 120Bn ~US$19Bn • >60,000 employees and produces ~1 Million vehicles per year from 4 vehicle manufacturing bases. • SUVs under sold
Slide 45: Ganfeng Lithium – China's largest fully integrated lithium company
Ganfeng Lithium – China’s largest fully integrated lithium company ► Established in 2000 in Jiangxi Province, China, Ganfeng For personal use only Lithium has a capacity of around 35,000tpa of LCE and produces lithium carbonate, lithium hydroxide, lithium metals, butyl lithium, and a number of other
Slide 46: General Lithium – a major producer of lithium chemicals in China
General Lithium – a major producer of lithium chemicals in China ► Listed on NEEQ, Beijing, Code No: 837358 with a market capitalisation For personal use only of RMB 2.6Bn (USD ~410m) ► Currently produces 8,000tpa of Lithium Carbonate (LC) & 2,000tpa of High Purity LC 4N (99.99%) ► Recently commissi
Slide 47: Lithium Ion Battery Technology
For personal use only Lithium Ion Battery Technology Lithium Market Pilgangoora Project 47
Slide 48: Resources & Reserves
Resources & Reserves JORC Mineral Resources: 25th January 2017 For personal use only Category Tonnage Li2O (%) Ta2O5 Fe2O3 (%) Li2O (T) Ta2O5 (Mt) (ppm) (Mlbs) Measured 17.6 1.39 151 0.44 244,000 5.9 Indicated 77.7 1.31 125 0.58 1,017,000 21.5 Inferred 61.1 1.13 125 0.71 691,000 16.8 Total 156.3 1.2
Slide 49: Pilgangoora – a globally significant hard rock lithium resource
Pilgangoora – a globally significant hard rock lithium resource For personal use only PILBARA MINERAL S Note: Tantalum adjusted resource size includes consideration of the revenue of tantalum by-product. Source: Published resource estimates by project owners. Note that resources estimates for projec
Slide 50: Pilgangoora – mining
Pilgangoora – mining A straightforward open pit mining development ► Measured, Indicated and Inferred Resource of 156.3Mt @ 1.25% Li2O For personal use only and 128ppm Ta2O5 containing 1,952,000 tonnes Li2O, and including 44Mlbs Ta2O5 (Mineral Resource Update ASX release dated 25 January 2017) ► Ore
Slide 51: Pilgangoora – processing
Pilgangoora – processing ► Industry standard processing flowsheet For personal use only ► Spodumene concentrate produced at three mines in Western Australia ► 2-stage heavy media separation ► Gravity separation, tantalite recovery ► Grinding leading to oxide flotation ► Low/High intensity magnetic s
Slide 52: Pilgangoora – mine to ship
Pilgangoora – mine to ship Contracted logistics chain proposed ► Road transport from mine site to Wedgefield Storage Facility Loading – Rotabox For personal use only ► 127km via Great Northern Highway utilising double road trains ► Product storage at Wedgefield and loaded into shipping containers ►
Slide 53: Operating costs set to become one of the lowest cost spodumene producers
Operating costs set to become one of the lowest cost spodumene producers ► DFS indicates first 5 years’ average cash operating Operating Costs – USD (Real) first 5 years ave2 For personal use only cost1 of USD 189/t concentrate CFR2 ► Contributing factors to the low forecast cash operating cost: ► S
Slide 54: Pilgangoora – capital costs
Pilgangoora – capital costs Project Capital Expenditure Forecast by Month For personal use only AUDm AUDm Monthly Expenditure Cumulative 35 32.7 32.4 284 300 30.1 30 250 Total Project Expenditure to Dec 17 = $122M 24.9 25 200 20 18.3 17.2 17.5 150 15.2 15 11.5 12.0 10.9 11.7 100 10 7.9 7.0 7.1 5.4 6
Slide 55: 2Mtpa - A rapid pathway development and production
2Mtpa - A rapid pathway development and production For personal use only 55
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