Iluka Resources Limited · ASX:ILU
Iluka Resources — TZMI Congress 2018
24 slides from Iluka Resources's conference presentation, Nov 13, 2018
Slide 1: Addressing the Deficit
Addressing the Deficit Tom O’Leary For personal use only Managing Director, Iluka Resources 13 November 2018
Slide 2: Disclaimer – Forward Looking Statements
Disclaimer – Forward Looking Statements For personal use only This presentation has been prepared by Iluka Resources Limited (Iluka). By accessing/attending this presentation you acknowledge that you have read and understood the following statement. Forward Looking Statements This presentation conta
Slide 3: Key Messages
Key Messages For personal use only Supply-demand for high Iluka is taking action to Iluka has a pipeline of grade chloride feedstocks support its customers projects – many of which and zircon to remain in are scalable structural deficit 3
Slide 4: Iluka's View of the Market
Iluka’s View of the Market For personal use only Jacinth-Ambrosia, South Australia
Slide 5: Supply-Demand Fundamentals – Zircon
Supply-Demand Fundamentals – Zircon For personal use only Global Zircon Supply Global Zircon Demand • Significant inventory depletion in recent years • Small changes in market eased Q3 tightness ‒ 2016-18 supply = production + inventory • Q4 Chinese demand likely to be subdued • Existing producers’
Slide 6: Supply-Demand Fundamentals – High Grade Titanium Dioxide Feedstocks
Supply-Demand Fundamentals – High Grade Titanium Dioxide Feedstocks For personal use only Global High Grade Feedstock Supply Global High Grade Feedstock Demand • Production disruptions have reduced supply • High level of pigment plant utilisation in 2018 and contributed to tight market • Reduced pig
Slide 7: Industry Response
Industry Response For personal use only • Titanium Feedstocks - limited response to shortage • Zircon - aside from Iluka, industry response to date limited to Kalimantan Indonesian Exports – Total and to China 2010 to 2017 Detailed 2018 year to date Zircon sand and concentrate Price Zircon sand and
Slide 8: Addressing the Deficit for Customers
Addressing the Deficit for Customers For personal use only • Zircon market tightness eased in late 3Q; underlying structural deficit remains • Iluka can continue to release additional ZIC to assist customers / market • Project initiated to scope SR1 re-start to supply high-grade synthetic rutile • W
Slide 9: Iluka's Production Response
Iluka’s Production Response For personal use only Iluka’s Zircon Production and Sales kt 400 Production1 Zircon sand ZIC ZIC flex Sales 300 200 100 0 2012 2013 2014 2015 2016 2017 2018 2 2019 2 20202 20212 Iluka’s response to tight market conditions3: • Guided 2018-2021 zircon production of ~335ktpa
Slide 10: Iluka Projects Underway
Iluka Projects Underway For personal use only Jacinth-Ambrosia, South Australia Cataby, Western Australia
Slide 11: Cataby Development On Track
Cataby Development On Track For personal use only • Progress on track and within budget ‒ site foundation works well advanced Average Annual Production 2019- 2022 2023- 2026 ‒ planning for commissioning of mining unit Zircon kt 60 40 ‒ mining contractor removing overburden and has Rutile kt 35 25 co
Slide 12: Ambrosia Early Mine Move
Ambrosia Early Mine Move For personal use only • As announced, the Iluka Board has approved accelerated mine move to Ambrosia • The mine move is expected to be completed by October 2019 (previously 2022) • Capital expenditure of ~$35 million in 2019 ‒ deferred capital of ~$20 million cost over 2020-
Slide 13: ZIC Production Potential
ZIC Production Potential1 For personal use only • Produced by upgrading / blending current and stockpiled MSP byproduct streams • Simple reclaim with minimal processing and low cost • Match production / sales to market Iluka’s ZIC sources Mineral Processing Unit, Narngulu (90ktpa capacity) • US: alm
Slide 14: Increasing Rutile Production Capacity
Increasing Rutile Production Capacity For personal use only Gangama DM2 expansion site SRL Expansions • Lanti dry and Gangama mine expansions progressing on track ‒ engineering, procurement and construction contractor mobilised to site ‒ earth moving vehicles delivered ‒ civil construction and equip
Slide 15: Utilisation of Synthetic Rutile Capacity
Utilisation of Synthetic Rutile Capacity For personal use only SR1 Restart • ~120ktpa of synthetic rutile production capacity • Commenced scoping study for restart • Assessing optimal feed sources – internal and external • Subject to relevant approvals Synthetic rutile kiln in operation, Capel Weste
Slide 16: Iluka's Medium Term Projects
Iluka’s Medium Term Projects For personal use only
Slide 17: New Project Supply Challenges
New Project Supply Challenges For personal use only Unconventional deposits requiring technical solutions (eg. fine minerals, depth, product quality) Zircon and rutile typically induced as by-products of ilmenite projects Iluka evaluates many Limited high zircon and rutile assemblage projects and wi
Slide 18: Fine Minerals
Fine Minerals For personal use only • Conducting pre-feasibility study on development of WIM deposits in western Victoria • Underlying challenges of deposits ‒ recovery of fine sized minerals ‒ zircon product eligibility for ceramic market ‒ monetizing rare earth co-product • Strategic rationale of
Slide 19: Balranald
Balranald For personal use only Project Overview • Large, deep, high grade rutile-rich deposit with ilmenite and zircon production • Progressing scalable, underground mining method • Third field trial deferred pending drilling programme results Project Update • Drilling programme completed ‒ sonic d
Slide 20: Sierra Rutile Sembehun Development
Sierra Rutile Sembehun Development For personal use only • Sembehun group of deposits are more than 70% of remaining Sierra Rutile ore reserves • DFS underway • Value optimisation work continues ‒ Sembehun early works schedule compressed following initial project re-evaluation 20
Slide 21: Where to next for prices?
Where to next for prices? For personal use only Jacinth-Ambrosia, South Australia
Slide 22: Iluka's Approach to Pricing
Iluka’s Approach to Pricing For personal use only • Iluka approaching pricing decisions mindful of history • Current price appropriate given: – market conditions – customers’ capacity to pay – sustainable returns • Industry participants will influence what happens next Zircon Price History US$/t (no
Slide 23: Key Messages
Key Messages For personal use only Supply-demand for high Iluka is taking action to Iluka has a pipeline of grade chloride feedstocks support its customers projects – many of which and zircon to remain in are scalable structural deficit 23
Slide 24: For personal use only
For personal use only Sales and marketing enquiries: Investors and other enquiries: Matthew Blackwell Melissa Roberts matthew.blackwell@iluka.com melissa.roberts@iluka.com +61 8 9360 4989 +61 450 398 431 www.iluka.com