Slide 1: Equity Raising: Investor Presentation
For personal use only Equity Raising: Investor Presentation 26 April 2016
Slide 2: Equity Raising
Equity Raising For personal use only Alkane is conducting a pro‐rata non‐renounceable entitlement offer (the “Offer”) of fully paid ordinary shares Offer on the basis of 1 New Share for every 5 existing shares held at the record date 29 April 2016 structure The maximum number of New Shares which
Slide 3: Corporate Profile
Corporate Profile For personal use only • Listed on ASX since 1969, also listed on OTCQX (US) • ~6,300 shareholders • Multi commodity explorer, miner and developer focused on Central West of NSW, Australia • Active in region for more than 20 years • Developed Peak Hill Gold Mine in 1996, operated to
Slide 4: Board & Management
Board & Management For personal use only Board John S F Dunlop (Chairman) BE(Min), MEngSc(Min). Mining Engineer D Ian Chalmers (Managing Director) MSc. Geologist Ian J Gandel (Director) LLB, BEc. Businessman Anthony D Lethlean (Director) BAppSc. Geologist/Banker Karen Brown (Company Secret
Slide 5: Investment Highlights
Investment Highlights For personal use only DZP a highly strategic asset − Globally significant resource of zirconium, hafnium, niobium (tantalum), yttrium and rare earths (RE) − Significant hafnium, yttrium and heavy rare earth content − Polymetallic product suite providing greater revenue and cu
Slide 6: 1H FY2016 Snapshot
1H FY2016 Snapshot For personal use only Indicative Shareholder Base as at 31 March 2016 1H FY2016 Financials • Total income A$56.2 million 16% 3% • Profit before income tax A$8.9 million • Operating cash flow A$19.1 million • Total equity A$178.1 million 7% • Market cap at 21 April ~A$90 million •
Slide 7: Tomingley Gold Operation
Tomingley Gold Operation For personal use only Project Information FY 2016 Guidance: $115M construction capex funded without debt Production 60,000 – 70,000oz Resource – ~688,000oz of gold (ASX 21 Sept 2015) AISC(1) A$1,250 – A$1,350/oz Mine Method – open cut & underground (1) Refer to
Slide 8: Dubbo Zirconia Project
Dubbo Zirconia Project For personal use only • Located 400km northwest of Sydney within a region that has substantial infrastructure – roads, rail, power, gas, light engineering, people (~100,000), being a large agricultural and mining area • A very large polymetallic resource of the metals zirconiu
Slide 9: Process Flowsheet – 2015 Changes
Process Flowsheet – 2015 Changes For personal use only Addition of hafnium circuit Further onsite separation of rare earths Replacement of evaporation ponds with in‐process evaporation © 2016 Alkane Resources Ltd 9
Slide 10: DZP Financial Summary
DZP Financial Summary For personal use only FEED completed August 2015 Project Financials: DZP REVENUE SPLIT Capex A$1.3B / A$103M contingency Revenue A$550 ‐ $600Mpa Nb, 15.8% Pr‐Nd, 21.8% Opex A$260Mpa EBITDA A$290 ‐ $340Mpa 20 year pre‐tax NPV A$1.2B (8%) and 17.5% IRR Hf, 9.2% Revenue projecti
Slide 11: DZP 2015/16 Key Milestones
DZP 2015/16 Key Milestones For personal use only State Approval 28 May 2015 Federal Department of Environment Approval 25 August 2015 Front end engineering design completed 27 August 2015 Revamped flowsheet, with specific rare earth separation on site, improved waste management and reduced water con
Slide 12: Equity Raising Planned Uses – DZP Focussed
Equity Raising Planned Uses – DZP Focussed For personal use only To purchase the remaining parcels of land within the DZP project area • AZL will own all land required for the fully permitted Dubbo Zirconia Project (~3,400ha after planned acquisitions) • Several parcels of land outside the project f
Slide 13: Group Funding
Group Funding For personal use only Strong cash generation from TGO has been utilised to fund DZP development Currently seeking to increase the group working capital facility • Acceleration of exploration activities for highly prospective targets and enhance Group working capital base From 1 July 20
Slide 14: Key Milestones to Development
Key Milestones to Development For personal use only Milestone Timing* Project Resources Acquire remaining key land parcels to secure project footprint Q2 2016 Secure remaining water resources Project funding Powerline easement option fees Project funding Key Agreements Rare earth toll proces
Slide 15: Funding Strategy
Funding Strategy For personal use only Investment at Project Government Commercial Bank Equity Capital Level Assistance Programs Debt (CBD) Markets (ALK) • Strategic • ECA Style Funding • Advisors: SMBC • Advisors: Petra Capital Investment(s) • Lead coordinator: • Attractive Project • Attractive Pro
Slide 16: DZP Timetable
DZP Timetable For personal use only FEED provided ~30% detail design and the Project engineering design is now at construction stage awaiting finance. Construction timeline includes remaining detailed design and project infrastructure – access road; power line and water supply. Estimates of times ar
Slide 17: The DZP Advantage
The DZP Advantage For personal use only Internationally strategic with supply of several critical metals from non‐Chinese sources Business case has robust revenues, even at current Chinese domestic RE and Zr prices Full spectrum of rare earth magnet materials – neodymium, praseodymium, didymium (neo
Slide 18: Equity Raising Overview
For personal use only Equity Raising Overview © 2016 Alkane Resources Ltd 18
Slide 19: Equity Raising
Equity Raising For personal use only Alkane is conducting a pro‐rata non‐renounceable entitlement offer (the Offer) of fully paid ordinary shares on the basis Offer structure of 1 New Share for every 5 existing shares held at the record date 29 April 2016 The maximum number of New Shares which m
Slide 20: Equity Raising: Indicative timetable
Equity Raising For personal use only Indicative timetable(1) Announcement of Entitlement Offer Tuesday, 26 April 2016 Lodgement of Appendix 3B, Cleansing Statement and Offer Booklet with ASX Tuesday, 26 April 2016 Record Date for the Entitlement Offer Friday, 29 April 2016 at 7.00pm Mailing of perso
Slide 21: Key Risks
For personal use only Key Risks © 2016 Alkane Resources Ltd 21
Slide 22: Key Risks
Key Risks For personal use only There are a number of risks, both specific to Alkane and of a general nature, which may, either individually or in combination, affect the future operational and financial performance of Alkane, the development of its projects and the value of its shares. The risk
Slide 23: Key Risks (cont.)
Key Risks (cont.) For personal use only Alkane is in the process of negotiating contracts with various counterparties with respect to the sale of products from its Dubbo Zirconia Project. Whilst Alkane has Product sales entered into non‐binding memoranda of understanding for its zirconium products
Slide 24: Key Risks (cont.)
Key Risks (cont.) For personal use only Adverse changes to Changes in government policy may have an adverse impact on Alkane’s operational performance as well as actual or potential profitability. Changes which may have Government policy an adverse impact on Alkane include (but are not limited to)
Slide 25: Important Notes and Disclaimer
For personal use only Important Notes and Disclaimer © 2016 Alkane Resources Ltd 25
Slide 26: Important Notes & Disclaimer
Important Notes & Disclaimer For personal use only Not for distribution or release in the United States or any other jurisdiction in which distribution would be unlawful This presentation is issued by Alkane Resources Limited ABN 35 000 689 216 (“Company” or “Alkane” or “ALK”). Summary information T
Slide 27: Important Notes & Disclaimer
Important Notes & Disclaimer For personal use only Future performance and forward‐looking statements (cont.) • disclaim any obligations or undertaking to release any updates or revisions to the information to reflect any change in expectations or assumptions; and • disclaim all responsibility and li
Slide 28: Foreign Selling Restrictions
Foreign Selling Restrictions For personal use only International Offer Restrictions This document does not constitute an offer of new ordinary shares ("New Shares") of the Company in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, an
Slide 29: Foreign Selling Restrictions
Foreign Selling Restrictions For personal use only Switzerland The New Shares may not be publicly offered in Switzerland and will not be listed on the SIX Swiss Exchange ("SIX") or on any other stock exchange or regulated trading facility in Switzerland. This document has been prepared without regar
Slide 30: For personal use only
For personal use only © 2016 Alkane Resources Ltd 30
Slide 31: DZP Resources and Reserves
DZP Resources and Reserves For personal use only Dubbo Zirconia Project – Mineral Resources Toongi Tonnage ZrO2 HfO2 Nb2O5 Ta2O5 Y2O3 REO Deposit (Mt) (%) (%) (%) (%) (%) (%) Measured 35.70 1.96 0.04 0.46 0.03 0.14 0.75 Inferred 37.50 1.96 0.04 0.46 0.03 0.14 0.75 Total 73.20 1.96 0.04 0.46 0.03 0.1
Slide 32: Resource & Reserves: Tomingley
Resource & Reserves: Tomingley For personal use only TOMINGLEY GOLD OPERATIONS MINERAL RESOURCES (as at 30 June 2015) MEASURED INDICATED INFERRED TOTAL Total Gold DEPOSIT Tonnage Grade Tonnage Grade Tonnage Grade Tonnage Grade (Kt) (g/t Au) (Kt) (g/t Au) (Kt) (g/t Au) (Kt) (g/t Au) (Koz) Open Pittab