Apc Minerals Limited · ASX:APC
Apc Minerals — Australian Potash — Investor Presentation (August 2022)
35 slides from Apc Minerals's investor presentation, Aug 16, 2022
Slide 1: ASX Announcement: Investor Presentation
ASX ANNOUNCEMENT ASX: APC 16 August 2022 For personal use only Investor Presentation Australian Potash Limited (ASX: APC or the Company) is pleased to provide a copy of its latest investor presentation. This release was authorised by the Managing Director & CEO. Matt Shackleton Michelle Blandford Ma
Slide 2: About Australian Potash Limited
About Australian Potash Limited APC holds a 100% interest in the Lake Wells Sulphate of For personal use only Potash (LSOP), located approximately 500km northeast of Kalgoorlie, in Western Australia's Eastern Goldfields. The Company is finalising pre- development plans for commencement of constructi
Slide 3: Lake Wells Sulphate of Potash Project Investor Presentation
For personal use only Australian Potash Limited Lake Wells Sulphate of Potash Project Investor Presentation Lake Wells Sulphate of Potash Project August 2022
Slide 4: Disclaimer
Disclaimer Nature of this document For personal use only This presentation has been prepared by Australian Potash Limited (APC or the Company). The information is based on publicly available information, internally developed data and other sources. By receiving this presentation, you acknowledge and
Slide 5: Executive summary
Executive summary A compelling opportunity in a non-substitutable & essential, strategically vital market For personal use only Compelling macro-economic market dynamics: record pricing for SOP in all markets • Increasing demand for SOP and limited opportunities to increase global supply Best in Cla
Slide 6: Project overview
Project overview Lake Wells Sulphate of Potash (SOP) Project For personal use only Located ~500km north-east of Kalgoorlie, in a tier 1 mining jurisdiction 100% owned asset c. 30% of start-up bore field already developed ‘Shovel ready’: all necessary approvals in place with production target
Slide 7: The value proposition
The value proposition Equity at large discount to funded project value For personal use only Corporate snapshot Scenario analysis – NPV at various SOP prices* 1,400 Current Pro-forma NPV Current EV 1,200 1,200 Share price (A$) 0.043 0.038 Current SOP spot price (fob NW Europe US$1,000 – US$1,168 50%
Slide 8: Increasing demand for potash
Increasing demand for potash Long term supply constraints and long term demand pressure For personal use only 1. Decreasing arable land per person 2. Increasing population driving potash demand 2 World population vs arable land per person1 9.0 0.45 8.0 0.40 7.0 0.35 Arable land per person (ha) World
Slide 9: Forecast shortfall in potash supply
Forecast shortfall in potash supply Forecast production and forward prices imply Mannheim expansion will be needed to meet future demand For personal use only 3. SOP demand and supply imbalance1 4. Inflationary SOP pricing1 Mannheim expansion required Assumes Mannheim 4.0 to meet demand 1,000 expans
Slide 10: Optimisation program
Optimisation program Delivering the most efficient project development For personal use only FEED1 Optimised production2 Impact • IRR and NPV • Increase (likely) • Offtake • Increase Annual production (ktpa SOP) 170,000 205,000 • Harvest ponds • Minor • Process plant • Minor • CAPEX • NIL Number of
Slide 11: Entitlements Issue
Entitlements Issue For personal use only • Prospectus is available at https://www.australianpotash.com.au/site/investor-information/2022-rights-issue • $7.7m entitlement offer announced 27 July 2022 • 1-for-4 pro-rata non-renounceable offer to eligible shareholders at $0.038 per share plus 1 free at
Slide 12: Leadership team
Leadership team Dr Natalia Streltsova Board of Directors Tony Dominkovich Management team For personal use only Non-Executive Chair Project Manager Over 25 years’ minerals industry experience, extensive +40 years experience Australia, Africa, USA and UK operational experience with BHP Group and
Slide 13: Robust ESG strategy
Robust ESG strategy Turning strong ESG credentials into World Class ESG asset For personal use only Exploration Early Works Development Operations 2021 2022 2024 2025 & Study Australian Federal Government Construction and operations Measuring and reporting Scope Focus on safety and accredited Safety
Slide 14: Committed to Sustainability
Committed to Sustainability APC has identified 8 of 17 UN Goals* to contribute to For personal use only Early Works Development Operations SOP increases agricultural productivity Full-time job creation & sustainable growth plans Measuring and reporting Scope 1 & 2 emissions Resources to safeguard ph
Slide 15: Conclusion
Conclusion APC represents a compelling equity value opportunity For personal use only Substantial value opportunity – inappropriate peer comparison leads to undervaluing this Tier 1 project Potash is increasingly vital for sustainable food production Demand for SOP significantly outstrips supp
Slide 16: Appendices
For personal use only Appendices www.australianpotash.com.au 14
Slide 17: Sustainable potash supports global food security
1 Sustainable potash supports global food security Committed to measuring and reporting on Environmental impact as part of food Supply Chain For personal use only 2.5% of total Global Greenhouse Gas Emissions come from potash* Scope 1 & 2 emissions Scope 3 emissions Distribution & End use Production
Slide 18: Environmentally sustainable potash
1 Environmentally sustainable potash 68% less GHGs than 80% of the global supply of Sulphate of Potash1 For personal use only • Fertiliser use can be environmentally positive Greenhouse gas emissions1 • enhance agricultural productivity and stimulate CO2 (kg CO2eq/tonne SOP scope 1, 2 & 3) uptake by
Slide 19: Social supply chain: our Company and Partners
1 Social supply chain: our Company and Partners For personal use only Tier 1 Mining Investment Jurisdiction*: WA = No.1 Case Study: Laverton Training Centre • Transparent employment and equal opportunity legislative regime • Established and funded by APC • Work Health and Safety Act 2020 (WA) provid
Slide 20: Governance and transparency
1 Governance and transparency An integrated governance platform operating in a transparent, sophisticated jurisdiction For personal use only Board of Directors The sustainability of the Lake Wells Board Committees • Risk & Sustainability Project is considered Big 4 Audit Committee and managed under
Slide 21: Project details and status
1 Project details and status Lake Wells is shovel ready with all necessary approvals in place and production expected in 2024 For personal use only Simplified flowsheet* Project details Lake Wells is Australia’s only 100% borefield solar salt SOP development with zero kilometres of trench abstract
Slide 22: Implementation team – international expertise
1 Implementation team – international expertise For personal use only Project management Process design Borefield development Commercial Green Legal Corey Milne Consulting www.australianpotash.com.au 20
Slide 23: Early Works Complete
1 Early Works Complete Staged development to support conservative schedule For personal use only Village infrastructure in place to support early works construction activities 20 rooms, tavern, kitchen/dining room, sewage treatment plant and potable water plant all constructed 28 bore pads con
Slide 24: Early Works Complete
1 Early Works Complete Staged development to support conservative schedule For personal use only On-playa evaporation pond trial program complete High-grade K SOP produced from pilot-evaporation program1 Organic certification received in Europe, USA & Australia2 Operational experts engaged
Slide 25: +75% of Construction Contracts by Value are EPC
1 +75% of Construction Contracts by Value are EPC Minimises the risk of cost overruns, schedule creep and process under-performance For personal use only Construction EPC Packages Construction Owner’s Team Operations’ EPC Packages Operations’ Owner’s Team Process plant Borefield drilling Villa
Slide 26: Borefield Only Development
1 Borefield Only Development For personal use only 100% Borefield Development with NIL km of Trenching • 25% of borefield by well numbers developed • 36% of Probable Reserve* by volume developed • Brine abstraction (mining method) materially de-risked through early works program * Refer ASX Announce
Slide 27: SOP is the premium form of potassium fertiliser
2 SOP is the premium form of potassium fertiliser Essential, non-substitutable part of the food supply chain For personal use only 7Mt Market Size Essential & Non-Substitutable • SOP = 10% of the global demand for potassic • <1% Chloride/ fertilisers 17% Sulphur • 170ktpa = 2.4% of SOP demand • Pota
Slide 28: WA positioned to be a global leader in SOP production
2 WA positioned to be a global leader in SOP production Scale & quality of Resource, production capability, nexus to Asia For personal use only Scale and quality of Resource Nexus to Asia • WA is currently developing several Solar Salt SOP Production (mt) • At least 40% of global potash demand is de
Slide 29: SOP Pricing
2 SOP Pricing Premium product commands premium pricing For personal use only • Granular or Standard SOP High K2O granular High K2O standard • Soluble • Powdered • Granular • 50% - 52% K2O • +52% K2O • 50% K2O • 50% - 52% K2O • Soluble • Low Chloride • Insoluble • Bulk • Organic • Organic • Inorganic
Slide 30: Global Production Cost Profile
2 Global Production Cost Profile LSOP SOP is in the lowest quartile on the global cost curve For personal use only Global FOB SOP Cost Curve 2018* Mannheim capacity: high energy, Brine mineralisation, long First Peer Quartile FOB cost (US$/t) 540 Comparison Sustainable Production high cost, environm
Slide 31: Geographically diverse offtake marketing and distribution agreements
2 Geographically diverse offtake For personal use only marketing and distribution agreements www.australianpotash.com.au 29
Slide 32: Project CAPEX Summary FEED base case
3 Project CAPEX Summary FEED base case A de-risked project plan 170ktpa SOP For personal use only CAPEX^ A$m Delivery & Execution Risk Mitigated Owner’s Team 18 Capable & experienced owner’s team Bore drilling & development 16 Schedule guarantee, specialist contractor, productivity KPIs Borefield fi
Slide 33: LSOP OPEX Summary FEED base case
3 LSOP OPEX Summary FEED base case 170ktpa SOP Cash Cost US$251/t For personal use only OPEX^ Brine SOP MOP Conversion Combined Annual production 120,000 tonnes 50,000 tonnes 170,000 tonnes Salt harvesting 13 - 9 Power 49 3 35 Reagents & consumables 12 266 85 Labour 57 - 41 Export logistics (FOB) 59
Slide 34: LSOP FEED Summary
3 LSOP FEED Summary FEED base case 170ktpa SOP Strong returns in all scenarios For personal use only Assumptions^ Unit SOP Price (495-605 US$/t) 286 544 SOP price [real] US$/t 550 FX (0.77-0.63 US$/A$) 312 542 FX rate US$:$A 0.70 Opex (+/-10%) 371 460 Discount rate % 8.0 Capex (+/-10%) 389 442 Mine
Slide 35: Australian Potash Limited
For personal use only Australian Potash Limited (ASX: APC) Tel: (08) 9322 1033 Email: admin@australianpotash.com.au Website: www.australianpotash.com.au www.australianpotash.com.au 33
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