Sovereign Metals Limited · ASX:SVM
Sovereign Metals — 121 Cape Town (February 2019)
21 slides from Sovereign Metals's conference presentation, February 2019
Slide 1: World Class Opportunity
ABN: 71 120 833 427 WORLD CLASS OPPORTUNITY LOWEST OPERATING COST COARSE FLAKE GRAPHITE PROJECT GLOBALLY FEBRUARY 2019 ASX:SVM
Slide 2: Sovereign Metals: Investment Highlights
SOVEREIGN METALS: INVESTMENT HIGHLIGHTS ONE OF A KIND HIGH GRADE, SOFT, FREE-DIG SAPROLITE DEPOSIT LOW COST AN EXCEPTIONALLY LOW COST, COARSE FLAKE GRAPHITE PROJECT HIGH QUALITY CONCENTRATES OPEN TO TRADITIONAL REFRACTORY AND EMERGING LI-ION SECTORS SUBSTANTIAL UPSIDE HUGE SCALABILITY AND EXPANSION
Slide 3: Potential for a Simple & Highly Profitable Flake Graphite Operation
POTENTIAL FOR A SIMPLE & HIGHLY PROFITABLE FLAKE GRAPHITE OPERATION MALINGUNDE SOFT SAPROLITE-HOSTED DEPOSIT TO DELIVER VERY LOW COST PRODUCTION, WITH HIGH VALUE CONCENTRATES. OPERATING COST HIGHEST MARGINS $ BOTTOM OF THE COST CURVE OPERATIONS SIMPLE MINING & PROCESSING ONLY LOWEST RISK MARKETING E
Slide 4: PFS Confirms Extremely Robust Project
PFS CONFIRMS EXTREMELY ROBUST PROJECT US$323/t US$49m US$1,216/t Average Total BASKET SALES OPERATING DEVELOPMENT PRICE COST (FOB) CAPEX (including contingency of US$5.2m) 16 years 52,000t 600,000t Average annual Average PLANT Total ANNUAL THROUGHPUT MINE LIFE PRODUCTION US$201m IRR 56% US$42m NPV P
Slide 5: Saprolite Advantage: Very Simple Operations with Significant Operating Cost Advantages
SAPROLITE ADVANTAGE: VERY SIMPLE OPERATIONS WITH SIGNIFICANT OPERATING COST ADVANTAGES VERSUS HARD ROCK PEERS FREE DIG, NO DRILL & BLAST, NO PRIMARY CRUSH OR GRIND REQUIRED Peers – Hard rock material Sovereign – Soft saprolite (clay) material XX X SAPROLITE + HIGH GRADE + COARSE FLAKE = LOW COST & H
Slide 6: Operating Costs: At the Bottom of the Curve
OPERATING COSTS: AT THE BOTTOM OF THE CURVE MASSIVE OPERATIONAL ADVANTAGE OVER HARD ROCK PEERS. MINING COSTS (per tonne of concentrate) Free-dig (no drill and blast) SVM Near surface Low strip ratio 1:1 PEERS* Conventional truck and shovel operation $0 $20 $40 $60 $80 $100 $120 $140 PROCESSI
Slide 7: Low Costs: At the Bottom of the Curve
LOW COSTS: AT THE BOTTOM OF THE CURVE MALINGUNDE HAS THE LOWEST ESTIMATED UNIT OPERATING COST OF THE CURRENT AND FUTURE LISTED GRAPHITE DEVELOPMENT PIPELINE. CAPITAL COSTS ARE AT THE LOW END OF THE FUTURE SUPPLY PIPELINE IN TERMS OF BOTH ABSOLUTE CAPITAL AND CAPITAL INTENSITY. LISTED SUPPLY PIPELINE
Slide 8: Logistics: Access to Operating Rail Provides Material Transport Cost Advantage
LOGISTICS: ACCESS TO OPERATING RAIL PROVIDES MATERIAL TRANSPORT COST ADVANTAGE • Operating rail = low transport costs; below or comparable to regional peers utilising trucks. • Transport MoU signed with Vale & Mitsui. Drafting of formal US$66/t Total agreement in progress. MINE GATE TO PORT • Rail d
Slide 9: Malawi: Mining Friendly Jurisdiction
MALAWI: MINING FRIENDLY JURISDICTION A STABLE, TRANSPARENT JURISDICTION, INCREASINGLY ATTRACTING INTERNATIONAL INVESTMENT. EXCELLENT EXISTING INFRASTRUCTURE Grid power from 2024. Established Rail Road network. Established labour pool and other industrial services. Recently commissioned (on t
Slide 10: Marketing Strategy: Ability to Sell into Multiple Market Sectors
MARKETING STRATEGY: SOVEREIGN HAS THE ABILITY TO SELL INTO MULTIPLE MARKET SECTORS TARGETING SALES INTO EXISTING TRADITIONAL MARKETS AND EMERGING LI-ION BATTERY MARKETS. Premium quality product with ~60% +150µm, 96-98% TGC commanding high revenues. Realistic basket pricing assumption of US$1,216 per
Slide 11: Rutile Potential: Broad & Widespread Rutile Potential
RUTILE POTENTIAL: BROAD & WIDESPREAD RUTILE POTENTIAL HIGH-GRADE TiO2 AS RUTILE IDENTIFIED OVER LARGE AREAS WITHIN SOVEREIGN’S GROUND HOLDINGS Natural rutile is a highly sought after, high grade titanium feed source. • Current sales price ~US$1,000/t • Long term pricing of US$1,250/t* Sovereign has
Slide 12: Rutile Potential: Highly Enriched Near Surface
RUTILE POTENTIAL: HIGHLY ENRICHED NEAR SURFACE • Rutile occurs in soft, free-dig saprolite down to at least 12m and is particularly enriched in the upper 2-3m of the weathering profile. • Rutile mineralisation shows no discernible relationship to graphite. 125 shallow hand-auger holes selected for r
Slide 13: Next Steps: Rapid Pathway to Production
NEXT STEPS: RAPID PATHWAY TO PRODUCTION GRAPHITE: ACCELERATED PROJECT DEVELOPMENT BASED ON EXCEPTIONAL PFS OUTCOMES: • Commenced definitive feasibility study (DFS). • Pilot plant to start in coming weeks for product marketing and qualification. • Development of product sales agreements. • Permitting
Slide 14: Malingunde: World Class Opportunities
MALINGUNDE: WORLD CLASS OPPORTUNITIES US$323/t US$49m 52kt 16 years US$201m Average Total Average Total Pre-tax OPERATING DEVELOPMENT ANNUAL MINE LIFE NPV COST CAPEX PRODUCTION GRAPHITE RUTILE TECHNICAL FINANCIAL TECHNICAL & MARKET World’s largest, soft saprolite Best in class opex – strong Hu
Slide 15: Appendices
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Slide 16: Maiden Ore Reserve
MAIDEN ORE RESERVE HIGH GRADE RESERVE WITH 32% IN THE PROVED AND 68% IN THE PROBABLE CATEGORY. PFS BASED 100% ON RESERVES. Saprolite is the very soft, graphite- bearing, clay-rich oxide material that is formed from intense weathering of the original bedrock. Significant opportunity to increase the m
Slide 17: Mineral Resource Estimate – June 2018
MINERAL RESOURCE ESTIMATE – JUNE 2018 Malingunde is the world’s largest reported saprolite-hosted graphite resource. MALINGUNDE MINERAL RESOURCE ESTIMATE 4.0% cut-off grade Measured Indicated Inferred Total Tonnes Grade Tonnes Grade Tonnes Grade Tonnes Grade (Mt) (% C) (Mt) (% C) (Mt) (% C) (Mt) (%
Slide 18: Market Information: Capital Structure
MARKET INFORMATION OPPORTUNITY FOR MATERIAL RE-RATE: CAPITAL STRUCTURE1 DELIVERY OF WORLD CLASS PFS & RUTILE Shares on Issue 1 343,496,073 POTENTIAL WITH A CLEAR & SIMPLE STRATEGY. Unlisted Options 1 ($0.10 to $0.18) 43,325,000 Un-Diluted Market A$27.4 m Capitalisation @A$0.079 1 ASX : SVM SHARE PRI
Slide 19: Management Team with a Proven Track Record of Success
MANAGEMENT TEAM WITH A PROVEN TRACK RECORD OF SUCCESS RAISED OVER $1 BILLION TO FUND NATURAL RESOURCE PROJECTS, INCLUDING TWO PROJECTS CURRENTLY IN CONSTRUCTION. Mr Middlemas was a Senior Group Executive for Normandy Mining for more than ten years, which was IAN MIDDLEMAS Australia’s largest gold mi
Slide 20: Disclaimers & Disclosures
DISCLAIMERS & DISCLOSURES. DISCLAIMER NOTICE This presentation has been prepared as a summary only, and does not contain all information Sovereign Metals Limited’s (“SVM”) assets and liabilities, financial position and performance, profits and losses, prospects, and the rights and liabilities attach
Slide 21: Sovereign Metals Limited | ASX: SVM
Sovereign Metals Limited | ASX : SVM T: +61 8 9322 6322 | F: +61 8 9322 6558 E: info@sovereignmetals.com.au | www.sovereignmetals.com.au Level 9, BGC Centre, 28 The Esplanade, PERTH WA 6000 | ABN: 71 120 833 427 FOLLOW US