Iluka Resources Limited · ASX:ILU
Iluka Resources — Corporate Update (April 2022)
26 slides from Iluka Resources's corporate update, Apr 4, 2022
Slide 1: Eneabba Rare Earths Refinery – Final Investment Decision
Iluka Resources Limited Eneabba Rare Earths Refinery – Final Investment Decision 3 April 2022
Slide 2: Disclaimer
Disclaimer 2 This presentation has been prepared by Iluka Resources Limited (Iluka). By accessing this presentation you acknowledge that you have read and understood the following statement. This presentation includes forward-looking statements reflecting Iluka’s current expectations. These statemen
Slide 3: Delivery of value from competitive advantage
Delivery of value from competitive advantage 3 Iluka’s disciplined approach to Rare earth bearing minerals are capital allocation delivers value co-products of mineral sands. through collaboration, Iluka has over 70 years’ experience partnerships and risk sharing in developing and marketing industri
Slide 4: Approval of Eneabba rare earths refinery (Phase 3)
Approval of Eneabba rare earths refinery (Phase 3) 4 Fully integrated Multi-decade Domestic Risk sharing Solid project First production rare earths facility production of arrangement economics with 2025 refinery critical minerals significant Designed specifically Project funded by Iluka potential fo
Slide 5: A fully integrated refinery
A fully integrated refinery 5 01 02 03 04 05 06 07 CARS EXPLORATION, CRACKING & SEPARATION & COMPONENT MODERN DEVELOPMENT, CONCENTRATING METALLISATION LEACHING FINISHING MANUFACTURE MANUFACTURING MINING MONAZITE MIXED RARE SEPARATED RARE RARE EARTH PERMANENT MOTORS & ORE CONCENTRATE EARTHS EARTH OXI
Slide 6: Refinery overview
Refinery overview 6 Refinery advantaged by fully integrated design and Eneabba brownfields location, enabling minimal environmental impact. Integrated refinery Brownfield site Stockpile optionality Roasting and leaching, Iluka has operated at Internal feedstock options purification and finishing Ene
Slide 7: Refinery feedstock
Refinery feedstock 7 Eneabba refinery designed as multi-decade facility capable of processing multiple feedstocks. Initially fed by Eneabba stockpile at minimal cost, potential future feedstock sources include Iluka’s Wimmera deposit and third parties. Initial feedstock Future feedstock options Futu
Slide 8: Refinery economics – capital cost
Refinery economics – capital cost 8 Capital Summary $m The refinery has been designed specifically with the capability to process rare earth concentrates from Iluka Cracking and leaching plant 170-200 production sources and third parties, establishing a Separation and finishing 320-390 strategic pro
Slide 9: Refinery economics – operating costs
Refinery economics – operating costs 9 • Refinery operating costs will vary depending on the feed rate and feed blend of the plant Feedstock costs excluded from operating costs ‒ operating costs based on processing the Eneabba stockpile Eneabba – Eneabba stockpile forms part of the refinery feed are
Slide 10: Risk sharing arrangement
Risk sharing arrangement 10 Eneabba Phase 3 is being delivered through a risk sharing arrangement between Iluka and the Australian Government. Iluka Australian Government Fully Integrated Contribution Contribution Refinery Equity-like contribution of $1,270 million Eneabba stockpile1 $1,050 million
Slide 11: Risk sharing arrangement terms
Risk sharing arrangement terms 11 Iluka contribution • Eneabba stockpile, Phase 1 and Phase 2 plant transferred to new RefineryCo Iluka • Cash equity provided on 1:3 ratio basis with initial Critical Minerals Facility loan drawdowns • Royalty payment to Iluka of up to $81 million p.a., capped at cum
Slide 12: Risk sharing arrangement terms
Risk sharing arrangement terms 12 1 2 3 4 Iluka Refinery Refinery operating and capital costs Critical Minerals Facility Critical Eneabba Additional cash loan interest payments1 Minerals distributed 50:50 cash flow Facility loan stockpile Critical Minerals royalty waterfall scheduled payment Facilit
Slide 13: Refinery economics
Refinery economics 13 Utilising only the Eneabba stockpile as feedstock, the Eneabba refinery generates sufficient cash flow1 to repay the EFA loan facility and provide a solid economic return to Iluka via equity distributions and royalty payments. Illustrative refinery economics (Eneabba stockpile
Slide 14: Iluka’s capital management approach
Iluka’s capital management approach 14 Mineral sands business (and growth opportunities) will not be impacted by RefineryCo’s debt. 1 Mineral sands business + Deterra stake (20%) 2 Rare earths business • Strong cash flow generation from mineral sands operations to fund project pipeline – average $27
Slide 15: Rare earths market opportunity
Rare earths market opportunity 15 Forecast passenger Forecast wind power electric vehicles installation million GW 40 100 Rapid growth in rare earth oxide demand forecast – 30 NdPr key input to 80 permanent magnets 20 60 10 EVs currently ~6% of passenger vehicle sales 0 40 → forecast ~40% by 2030 20
Slide 16: Marketing approach
Marketing approach 16 Iluka has completed extensive market development activities as part of customer engagement, competitor analysis and discussions with industry participants. Leverage Iluka has experience selling direct to customers in opaque, non-exchange-traded markets and into a experience wid
Slide 17: Delivery timeline
Delivery timeline 17 Key State and Federal government environmental approvals decisions for the project have been made. Construction planned to start end 2022 with first production 2025. 2021 2022 2023 2024 2025 Key approvals received1 Other approvals2 Feasibility study Engineering Detailed design P
Slide 18: For more information contact
For more information contact Luke Woodgate, Group Manager, Investor Relations and Corporate Affairs investor.relations@iluka.com
Slide 19: Supplementary information
Supplementary information Eneabba stockpile
Slide 20: Detailed risk sharing arrangement terms
Detailed risk sharing arrangement terms 20 Special Purpose Entity • “RefineryCo” is an Iluka wholly owned Special Purpose Entity (SPE) • Critical Minerals Facility loan provided to RefineryCo, non-recourse to Iluka • Iluka contributes Phase 1 and Phase 2 plant and Eneabba stockpile to RefineryCo Ilu
Slide 21: Refinery physicals – illustrative physical flowsheet worked examples
Refinery physicals – illustrative physical flowsheet worked examples 21 RARE EARTH RECOVERIES AND FEED RATE RARE EARTH MINERALS ASSEMBLAGE FINAL PRODUCT Eneabba Stockpile EP3 recovery assumption = 90% Monazite = 85% of monazite conc. Nd 17% (simplified across all circuits) = 85% * 24.6 ktpa ENEABBA
Slide 22: Pricing assumptions – Adamas Intelligence September 2021
Pricing assumptions – Adamas Intelligence September 2021 22 US$/kg US$/kg 140 1,800 1,600 120 1,400 100 1,200 80 1,000 60 800 600 40 400 20 200 - - 2028 2032 2022 2038 2021 2022 2023 2024 2025 2026 2027 2029 2030 2031 2033 2034 2035 2036 2037 2038 2039 2040 2021 2023 2024 2025 2026 2027 2028 2029 20
Slide 23: Mineral Resource and Ore Reserves Compliance Statement
Mineral Resource and Ore Reserves Compliance Statement 23 Mineral Resources and Ore Reserves Estimates As an Australian company with securities listed on the Australian Securities Exchange (ASX), Iluka is subject to Australian disclosure requirements and standards, including the requirements of the
Slide 24: Mineral Resource and Ore Reserves
Mineral Resource and Ore Reserves 24 HM Assemblage(2) Mineral Material In Situ HM Clay Ilmenite Zircon Rutile Monazite Xenotime Deposit Resource Tonnes HM Tonnes Grade Grade Grade Grade Grade Grade Grade Rare earth oxide assemblage Category(1) mt kt (%) (%) (%) (%) (%) (%) (%) MSP By-Product Measure
Slide 25: Eneabba refinery process flowsheet
Eneabba refinery process flowsheet 25 Cracking Roasting the RE mineral concentrates with sulfuric acid to make water soluble Leaching Dissolving REs in water leaving insoluble gangue for disposal Purification Neutralisation to remove impurities including iron phosphate, aluminium, thorium and then r
Slide 26: Refinery site plan
Refinery site plan src Rare Earth Separation and Finishing Purtfeation ee hs and Leaching J bt i - , y 4 77 4 Ps ; bed o fi u Phase 2 Plant ay z H > aks 4 * ae ths WORRSHOP ‘CONTROL ROOM & sorrces