Globe Metals & Mining Limited · ASX:GBE
Globe Metals & Mining — Minor Metals & Rare Earths Conference 2008
28 slides from Globe Metals & Mining's conference presentation, Sep 10, 2008
Slide 1: The Outlook for the Niobium Industry
For personal use only The Outlook for the Niobium Industry Mark Sumich, Managing Director Globe Metals & Mining Limited Minor Metals & Rare Earths Conference Hong Kong, 4-5 September 2008
Slide 2: Disclaimer & Notice
Disclaimer & Notice For personal use only The views expressed in this presentation contain information derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. Any forw
Slide 3: Outline
Outline For personal use only 1. Niobium Industry, Current Issues and Outlook: Market size Market segments Applications and substitutes Prices Growth outlook 2. Globe’s Kanyika Niobium Deposit: Malawi, Africa Solid Niobium Cavity Cell, International Linear Collider 2
Slide 4: About Globe
About Globe For personal use only • African focused uranium and specialty metals resource company. • Listed on Australian Stock Exchange since December 2005. • Discovered the Kanyika Niobium Deposit in Malawi, Africa: Multi-commodity: niobium, uranium, tantalum and zircon 56Mt JORC Inferred reso
Slide 5: Market Size
Market Size For personal use only World Nb Production (tonnes) 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Sources: CBMM for data 1965-2006; Globe calculation 2007 4
Slide 6: Market Segments
Market Segments For personal use only 1. Steel Market: Additive into steel products ~85-90% niobium market 10-12% of steel products use niobium Dominated by CBMM: Araxa deposit, Brazil Concentration of FeNb suppliers: CBMM (~80%), Anglo American (Catalao deposit, Brazil), IAMGOLD (St. Hono
Slide 7: Geographical Segments
Geographical Segments For personal use only Note: Represents CBMM sales of FeNb by region 6
Slide 8: Tantalum Market
Tantalum Market For personal use only Concentrate Concentrate Capacitor End Suppliers Processors Producers Users • Miners Refine tantalum Utilized in manufacture Manufacture electronics • Recyclers into tantalum powder of capacitors with tantalum capacitors. and wire Consumes 60% of Small percentage
Slide 9: Applications & Substitutes
Applications & Substitutes For personal use only • Applications: High-strength low-alloy steels (HSLA): bridges, buildings, oil and gas pipelines (properties: increased tensile strength; corrosion and pressure resistant); typically 0.03%-0.1% Nb content Super-alloys: aerospace, turbines (propert
Slide 10: Millau Bridge, France
Millau Bridge, France For personal use only 9
Slide 11: Millau Bridge, France
Millau Bridge, France For personal use only • Completed in 2004, at 343m above the River Tarn, it is the world’s tallest bridge structure (23m higher than the Eiffel Tower). • Weight of 43,000t using primarily HSLA steel. • The bridge has many features that characterise the benefits of niobium: De
Slide 12: Niobium Capacitors
Niobium Capacitors For personal use only • The main application for tantaulum concentrates (Ta2O5) is capacitors. • Ta2O5 price spike in 1999-2000 generated the first wave of research into niobium capacitors; there is now a small but burgeoning niobium capacitor market. • Where niobium capacitors ar
Slide 13: Auto Applications
Auto Applications For personal use only • HSLA steel increasingly used in auto manufacture: Stronger and tougher than mild steels Superior corrosion resistance, weldability and formability Enables manufacturer to meet stringent crash-resistant standards (otherwise require additional weight/aff
Slide 14: ILC
ILC For personal use only • International Linear Collider, Switzerland. • Requires 20,000 superconducting cavities, devices that accelerate particles to near-light speed (superconductors: zero electrical resistance). • Niobium is the elemental superconductor with the highest transition temperature:
Slide 15: Prices
For personal use only Ju 0 20 40 60 80 100 120 140 l-0 4 O ct -0 4 Prices Ja n- 05 Source: Metal Pages Ap r- 0 5 Ju l-0 5 O ct -0 5 Ja n- 06 Ap r- 0 6 FeNb Ju l-0 6 O ct -0 FeV 6 Ja n- 07 Ap r- 0 FeMo 7 Ju l-0 7 O ct -0 7 Ja Selected Ferro-Alloy Price Comparison (US$/Kg) n- 08 Ap r- 0 8 Ju l-0 8 14
Slide 16: Prices
Prices For personal use only 1. FeNb (v FeV): Very substitutable with each other in many steel applications Less volatile (managed prices) Historically lower price Less metal often required to obtain equivalent performance specification 2. FeNb: Current long-term (12 month) contracts ~US$4
Slide 17: Sources of Growth
Sources of Growth For personal use only 1,400,000 60 1,200,000 50 Crude Steel Production (tonnes) grams FeNb/tonne Crude Steel 1,000,000 40 800,000 30 600,000 20 400,000 10 200,000 0 0 2000 2001 2002 2003 2004 2005 2006 World Crude Steel Production (tonnes) "Consumption Intensity": grams FeNb/t Crud
Slide 18: Developing Markets
For personal use only Developing Markets 17
Slide 19: Demand Outlook
Demand Outlook For personal use only World Nb Production (tonnes) 180,000 160,000 2008-2012: @ 20% p.a. growth 140,000 120,000 2008-2012: @ 10% p.a. growth 100,000 80,000 60,000 2002-2007: 20% p.a. growth 40,000 20,000 0 65 9 67 9 69 9 71 9 73 9 75 9 77 9 79 9 81 9 83 9 85 9 8.7 9 89 9 91 9 93 9 95
Slide 20: Final Observations
Final Observations For personal use only • Opaque market. • Chinese FeNb consumption doubled Q1 07 v Q1 08. • Planned additions to production capacity suggest forecast 5yr CAGR > 10%. • Regulation also increasingly a source of growth: e.g. auto crash standards. • Niobium industry dominated by CBMM.
Slide 21: Kanyika Niobium Project
Kanyika Niobium Project For personal use only • Pre-Feasibility Study underway. • Production planned to commence 2011. • Expectation is to supply both steel and processor markets. • > 20yr mine life capacity: long-term, reliable supplier of niobium. • Malawi politically stable and pro-mining. • Glob
Slide 22: Brief History
Brief History For personal use only Grant of EPL (March 2006): Grassroots; airborne radiometric anomaly Discovery (2006-2007): Multi-commodity (niobium, uranium, tantalum, zircon) A$3m; 80 holes; ~9,000m 56Mt Inferred JORC Resource (March 2008): Niobium the primary commodity 2.1.km o
Slide 23: Kanyika Resource
Kanyika Resource For personal use only 56.4Mt Inferred Resource Incl. 14.1Mt High-Grade Resource (1,500ppm Nb2O5 cut-off) (3,000ppm Nb2O5 cut-off) Metal Metal Grade Metal Metal Grade (Mlbs) (tonnes) (ppm) (Mlbs) (tonnes) (ppm) Nb2O5 320.7 145,500 2,600 115.7 52,500 3,700 U3O8 8.9 4,000 70 3.0 1,400
Slide 24: Kanyika Resource
For personal use only Kanyika Resource 23
Slide 25: Scoping Study
Scoping Study For personal use only “The Kanyika Project has the potential to become a very profitable operation with at least a 20 year mine life” • US$3B revenue and US$1.1B free cash flow over 20 year period*. • High operating margins: US$93M in yr 1, averaging US$77M for the life of mine. • Mode
Slide 26: Financial Summary
Financial Summary For personal use only Production 3,000t/year Nb 4,000t/year Nb Initial Capex. US$156M US$177M Year 1 Year 20 Year 1 Year 20 Mill Feed 1.7Mt 2.6Mt 2.2Mt 3.5Mt Strip Ratio (waste:ore) 0.5 0.9 0.5 0.9 Revenue US$112M US$114M US$150M US$152M Operating Expense US$41M US$63M US$52M US$80
Slide 27: Pre-Feasibility Study
Pre-Feasibility Study For personal use only Study commenced September 2008, with three initial areas of focus: 1. Drilling: Upgrade JORC classification of near surface, high grade area Explore extension to north Explore depth potential to ~250m 2. Metallurgy: Validate process flow sheet Ge
Slide 28: Contact Details
Contact Details For personal use only For more information, please contact: Mark Sumich: Managing Director, Globe Metals & Mining Limited T: +61 8 9486 1779 mark.sumich@globemetalsandmining.com.au Presentation available at: www.globemetalsandmining.com.au 27
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