South32 Ltd. · ASX:S32
South32 — Technical Presentation (May 2023)
49 slides from South32's technical presentation, May 26, 2023
Slide 1: Hermosa Project Site Tour
26 May 2023 South32 Limited (Incorporated in Australia under the Corporations Act 2001 (Cth)) (ACN 093 732 597) ASX / LSE / JSE Share Code: S32 ADR: SOUHY ISIN: AUQ00000S320 south32.net HERMOSA PROJECT SITE TOUR South32 Limited (ASX, LSE, JSE: $32; ADR: SOUHY) (South32) will today host an equity ana
Slide 2: Hermosa Site Tour Presentation
HERMOSA SITE TOUR PRESENTATION 26 May 2023
Slide 3: Important Notices
IMPORTANT NOTICES • This presentation should be read in conjunction with the “Hermosa Project Update” announcement released on 17 January 2022 and the “Hermosa Project Update” announcement released on 8 May 2023, which are available on South32’s website (www.south32.net). Figures in italics indicate
Slide 4: Hermosa Highlights
HERMOSA HIGHLIGHTS Only advanced deposit Multiple options in commodities in the US that can produce First mining project added critical to a low-carbon future two federally-designated to the FAST-41 process critical minerals Clark is ideally positioned Taylor is an attractive Highly prospective land
Slide 5: Hermosa at a Glance
HERMOSA AT A GLANCE Potential to produce commodities critical for a low-carbon future across multiple decades Taylor zinc-lead-silver Clark battery-grade manganese- Regional resource development option zinc-silver development option growth potential Targeting a sustainable operation Advancing discus
Slide 6: Delivering on Our Strategy
DELIVERING ON OUR STRATEGY Further increasing our exposure to commodities critical to a low-carbon future Group Underlying revenue(a) Our portfolio opportunities are leveraged to (H1 FY23) commodities with attractive demand profiles Increased our interest in the Mozal Aluminium smelter Participated
Slide 7: Opportunity to Capture Growing EV Battery Market
OPPORTUNITY TO CAPTURE GROWING EV BATTERY MARKET Committed government policies We expect manganese-rich battery Manganese-rich cathodes provide are expected to underpin a near chemistries to capture ~30% of the substantial cost, performance and six-fold increase in North American EV market by 2030,
Slide 8: Key Milestones
KEY MILESTONES Progressing Taylor and Clark toward development, installing initial infrastructure and unlocking value in our highly prospective regional land package May-23 Hermosa confirmed as the first mining project to be covered by the FAST-41 process Jan-23 Signed our first non-binding, non-exc
Slide 9: Welcome to Hermosa
WELCOME TO HERMOSA
Slide 10: Project Location
PROJECT LOCATION Located in southern Arizona, close to infrastructure, skilled service suppliers and domestic supply chains Hermosa location Hermosa land package Patented Unpatented Prospects Deposits SLIDE 9
Slide 11: North American Context
NORTH AMERICAN CONTEXT Government policies are incentivising the build out of electric vehicle supply chains and demand for critical minerals Strong end-user interest in securing battery-grade manganese supply from Clark, Inflation Reduction Act the largest, most advanced project of its type in the
Slide 12: Our Sustainability Approach
OUR SUSTAINABILITY APPROACH Our sustainability commitment and principles are embedded in our approach to developing Hermosa Protecting and • Designing an integrated remote operating center, providing safe and respecting our people flexible working conditions and enabling workforce diversity • Invest
Slide 13: Taylor Overview
TAYLOR OVERVIEW Potential to be a globally significant producer of base metals Taylor Highlights Taylor site map 138Mt zinc-lead-silver Mineral Resource(a), Exploration target ranging which remains open from 10 to 95Mt(a) WTP2 in several directions Dry-stack TSF PFS outlined potential for a Designed
Slide 14: Taylor Mineral Resource
TAYLOR MINERAL RESOURCE A large Mineral Resource with the potential to support high productivity and throughput Taylor Deposit geology and mineralisation (looking south-west) Taylor Deposit Highlights(a) 138Mt Mineral Resource with a Strike length ~2.5km and width zinc equivalent grade of 8.61%2 ~1.
Slide 15: Taylor Exploration Potential
TAYLOR EXPLORATION POTENTIAL Our resource range analysis work supports the potential for further resource growth Taylor Deposit and Exploration Target (looking south-west) Taylor Deposit Exploration Highlights A highly prospective Exploration Target 10 to 95Mt, mineralised system mid case of ~45Mt E
Slide 16: Peake Prospect Opportunity
PEAKE PROSPECT OPPORTUNITY The Peake prospect is located south of the Taylor Deposit and contains high-grade copper-lead-zinc-silver mineralisation Peake prospect (looking north-east) Peake Highlights(a) Clark Deposit Taylor Deposit Potential for a continuous structural Current 5 hole drilling progr
Slide 17: Taylor PFS Design
TAYLOR PFS DESIGN PFS results support Taylor’s potential to be a multi-decade base metals operation • Longhole open stoping underground mine with paste backfill, similar to Cannington Low footprint, underground mine • Dual shaft access which enables higher grade ore in early years with dual shaft ac
Slide 18: Taylor Development Progress
TAYLOR DEVELOPMENT PROGRESS Feasibility study work to date has confirmed key design features in the PFS, with further studies underway to optimise for a permitting process under FAST-41 Construction of dewatering Key PFS design parameters Optimising the development schedule infrastructure is on sche
Slide 19: Dewatering Progress
DEWATERING PROGRESS Dewatering activity is progressing, enabling access to both the Taylor and Clark deposits Dewatering pathway 2022 Q4 FY23e FY24e Permits received, Expected construction Completion of commenced of second water dewatering wells construction of treatment plant required before dewate
Slide 20: Clark Overview
CLARK OVERVIEW Ideally positioned to provide secure, localised supply of battery-grade manganese for the North American market Only advanced project in the PFS-S confirmed potential Confirmed flowsheet to produce US with a clear pathway to produce to produce ~60ktpa BGM, high-purity manganese sulpha
Slide 21: Clark Mineral Resource
CLARK MINERAL RESOURCE Large Mineral Resource provides the optionality to target high-grade zones early in the mine life and scale production for future demand Taylor and Clark Deposits (looking south-west) Clark Geology Highlights(a) 55Mt manganese-zinc-silver oxide Mineralised from near surface de
Slide 22: Clark Bulk Sample Drill Results
CLARK BULK SAMPLE DRILL RESULTS Recent drill results have returned higher average local manganese grades Clark cross-section of drill hole locations Clark Drill Result Highlights(a) Bulk Sample Results Prior Drilling Results • HDS-767: 16.2 m @ 21.6% Mn • HDS-105: 16.2 m @ 13.1% Mn • HGS-040: 49.7 m
Slide 23: Clark PFS-S Results
CLARK PFS-S RESULTS Selection phase PFS demonstrated the potential for a long-life operation producing battery grade material • Small footprint underground mine integrated with Taylor An integrated, small footprint • Single decline extending from surface to a depth of ~600 metres underground mine de
Slide 24: Clark Development Pathway
CLARK DEVELOPMENT PATHWAY Creating the opportunity to supply battery-grade manganese from an integrated, sustainable development in southern Arizona Defined the Commenced pilot Signed first MOU Completed PFS-S opportunity plant production Defined initial Mineral Signed our first non- Completed
Slide 25: Clark Development Pathway
CLARK DEVELOPMENT PATHWAY A phased approach to grow with the market Ongoing Potential grant Decline Demonstration Study work customer funding construction plant engagements • Assessing opportunities to • Preparing to commence • Commenced engineering • Construction planned to • Domestic build-out of
Slide 26: Hermosa's Regional Exploration Potential
HERMOSA’S REGIONAL EXPLORATION POTENTIAL A highly prospective regional land package with the potential for future discoveries Hermosa land package Hermosa high priority corridor Exploration Highlights Patented Unpatented Original land package Prospects “The Shire” Flux Prospect More than doubled our
Slide 27: Flux Prospect Opportunity
FLUX PROSPECT OPPORTUNITY Flux is located immediately downdip of a historic mining area with the potential to host Taylor-like mineralisation Flux proximity to Taylor and Clark Flux Project Area Flux Highlights The Flux prospect has been identified as a priority prospect in the regional corridor Flu
Slide 28: Looking Ahead
LOOKING AHEAD Acceptance into FAST-41 Multiple options in commodities Critical path dewatering reinforces domestic support critical to a low-carbon future progressing to schedule for new critical minerals supply Completing current Taylor feasibility study and Phased approach to Clark, drill program
Slide 29: Supplementary Information
SUPPLEMENTARY INFORMATION
Slide 30: Taylor PFS Summary
TAYLOR PFS SUMMARY PFS summary information(a) Mining Capital costs Mineral Resource estimate 138Mt averaging 3.82% zinc, 4.25% lead and 81g/t silver ~US$1,230M Direct capital expenditure (Mining ~US$565M, Surface facilities ~US$440M, Resource life ~22 years Dewatering ~US$225M) Mining method Longhol
Slide 31: Taylor PFS Mine Design
TAYLOR PFS MINE DESIGN Our PFS mine design employs conventional methods, delivering high productivity from multiple faces Taylor Deposit underground mine design Dual shaft access prioritises Ventilation shaft higher grade ore in early years 0 Main shaft Proposed mining method is low technical risk,
Slide 32: Taylor PFS Process Design
TAYLOR PFS PROCESS DESIGN Conventional sulphide ore flotation circuit that produces separate zinc and lead concentrates with silver credits LEAD CIRCUIT CONCENTRATE HAULAGE ORE MINING CONCENTRATE HAULAGE Lead rougher circuit feeds into the zinc rougher circuit Lead thickener produces lead concentrat
Slide 33: Taylor PFS Product Recoveries
TAYLOR PFS PRODUCT RECOVERIES Taylor is expected to produce high-quality zinc and lead concentrates, with substantial silver by-product credits Average metal recoveries % Mid-grade zinc concentrate with relatively high silver content 90% 91% 81% High-grade lead concentrate Silver primarily reports t
Slide 34: Taylor PFS Production Profile
TAYLOR PFS PRODUCTION PROFILE Preferred PFS development scenario to target throughput of up to 4.3Mtpa(a) Payable ZnEq production and ZnEq head grade2 ktpa, LHS; %, PFS schedule contemplates a three year single stage ramp up to nameplate Up to 4.3Mtpa nameplate capacity, ~22 year resource life 400 9
Slide 35: Footnotes
FOOTNOTES 1. Goal is defined as an aspiration to deliver an outcome for which we have not identified a pathway for delivery, but for which efforts will be pursued towards achieving that outcome, subject to certain assumptions or conditions. 2. Refer to market release “Hermosa Project Update Presenta
Slide 36: South32
SOUTH32
Slide 37: Annexure 1: JORC Code Table 1 Section 1
Annexure 1: JORC Code Table 1 CLARK – EXPLORATION RESULTS The following table provides a summary of important assessment and reporting criteria used for the reporting of Clark oxide exploration results for the Hermosa project, which is located in southern Arizona, USA (Figure 1), in accordance with
Slide 38: Criteria Commentary
Criteria Commentary Sub-sampling • Sawn half core and barren core samples are taken at predominantly 1.5m intervals after techniques and logging. Sampling is also terminated at litho-structural and mineralogical boundaries. sample preparation • Sample preparation has occurred offsite at Australian L
Slide 39: Criteria Commentary
Criteria Commentary Location of data • Drill hole collar locations are surveyed by registered surveyors using a GPS Real Time points Kinematic (RTK) rover station, which correlates with the Hermosa project RTK base station and Global Navigation Satellite Systems with up to 1cm accuracy. • Downhole s
Slide 40: Section 2 Reporting of Exploration Results
Section 2 Reporting of Exploration Results (Criteria listed in the preceding section also apply to this section.) Criteria Commentary Mineral tenement • The Hermosa project mineral tenure (Figure 2) is secured by 30 patented mining claims and land tenure totalling 228 hectares that have full surface
Slide 41: Criteria Commentary
Criteria Commentary Drill hole Information • A drill hole plan (Figure 4) provides a summary of drilling collar locations that support the drilling results in relation to the Clark FY20 Mineral Resource domains. Figure 5 shows a cross section relative to key inputs in Figure 4, along with simplified
Slide 42: Figure 1: Regional Location Plan
Figure 1: Regional Location Plan 41
Slide 43: Figure 2: Hermosa Project Tenement Map
Figure 2: Hermosa Project Tenement Map 42
Slide 44: Figure 3: Hermosa project regional geology
Figure 3: Hermosa project regional geology 43
Slide 45: Figure 4: Regional Geology Map Legend
Figure 4: Hermosa Project Regional Geology Map Legend 44
Slide 46: Figure 5: Clark Deposit Plan and Collar Locations
Figure 5: Clark Deposit Plan and Collar Locations 45
Slide 47: Figure 6: Cross Section
Figure 6: Cross Section A SH 1600 m HMS-005: 78.9 m @ 21.1% Mn and aeubin 10.5m @ 10% Mn HGS-040: 49.7 m @ 19.7% 1400 m Mn and 35.5 m @ 15% Mn 1300 m . Volcanics 4200 m Carbonate HDS-767: 18.9m @ 18.6% Mn and 16.2 m @ 21.6% Mn 1100m CZ 200m 650 ft 710 N CDS-012: 109.1m @ 16.5% Mn Volcanics CDS-014:
Slide 48: Table 1: Hole ID, collar location, dip, azimuth and drill depth
Table 1: Hole ID, collar location, dip, azimuth and drill depth New drilling Hole ID Easting Northing Elevation Dip Azimuth Total Depth CDS-014 1075588 168044.8 5476.674 -62 5 332 CDS-012 1075536 168279.6 5456.783 -80 17 305 CDS-003a 1075486 168523.2 5410.44 -87 114 371 CDS-011 1075551 168271 5457.7
Slide 49: Drill hole intercepts and Competent Persons Statement
FY22 Mineral Resource Estimate drilling From To Width Zinc Manganese Silver Hole ID Cut off (m) (m) (m) (%) (%) (ppm) HDS-673 271.3 290.2 10% Mn 18.9 1.0 20.4 63 HDS-174 216.7 239.1 10% Mn 22.4 3.1 22.3 126 HDS-123 179.8 234.7 10% Mn 54.9 4.3 16.9 68 HDS-047 164.6 179.8 10% Mn 15.2 0.8 17.5 80 HDS-1