Boss Energy Limited · ASX:BOE
Boss Energy — Boss Resources — Investor Presentation (May 2020)
34 slides from Boss Energy's investor presentation, May 11, 2020
Slide 1: Australia's Next Uranium Producer
For personal use only AUSTRALIA’S NEXT URANIUM PRODUCER CORPORATE PRESENTATION 11 MAY 2020
Slide 2: Qualification
QUALIFICATION For personal use only The information contained in this presentation or subsequently provided to any recipient of this presentation The information in this document relating to the Feasibility Study is extracted from the announcement whether orally or in writing by or on behalf of Boss
Slide 3: Corporate Overview
CORPORATE OVERVIEW For personal use only BOARD OF DIRECTORS KEY METRICS (ASX:BOE) SHAREHOLDER LOCATION Non-Executive Chairman Peter O’Connor Shares on issue 1,584 million 3% 3% Australia Managing Director/ CEO Duncan Craib Share price 6.6 cents 11% Europe Technical Director Bryn Jones Market cap A$1
Slide 4: Honeymoon Restart Project
For personal use only HONEYMOON RESTART PROJECT BOSS RESOURCES 4 BOSS RESOURCES | AUSTRALIA’S PREMIER URANIUM JURISDICTION 4
Slide 5: Project Overview
PROJECT OVERVIEW For personal use only 1st WORLD OPERATIONAL PROJECT FULLY EXPERIENCED JURISDICTION READINESS ECONOMICS PERMITTED TEAM • Located in South Australia, • A proven restart operation • Global first mover • 1 of only 4 fully • MD/ CEO / Market Adviser the premier and most in care & mainten
Slide 6: Honeymoon Restart Project
HONEYMOON RESTART PROJECT For personal use only • Three of Australia’s four fully permitted uranium mines are in South Australia, 2 of which are In-Situ Recovery (ISR) operations • An international Tier 1 mining jurisdiction of choice for uranium supply, providing diversification for utilities BEVER
Slide 7: Resources and Exploration Upside
RESOURCES For personal use only AND EXPLORATION UPSIDE • 71.6Mlb U3O8 JORC Resource* • Mining License 6109 contains 34 Mlb U3O8 • Average grade 620 U3O8 ppm • Shallow mineralisation at 90-120m depth • In-Situ Recovery (ISR) cheapest method of resource extraction • Significant Exploration Target in a
Slide 8: Exploration Upside
EXPLORATION UPSIDE For personal use only • Exploration Target up to 190Mlbs. In addition to the global Mineral Resource, the Exploration Target estimate for Honeymoon stands at 28Mt to 133Mt of mineralisation at a grade of 340ppm to 1,080ppm U3O8 for a contained 58Mlbs to 190Mlbs U3O8 (26,300 to 86,
Slide 9: Site Infrastructure
A$170m SITE WATER TREATMENT PRODUCTION PLANT WELL For personal use only INFRASTRUCTURE CONTROL FIELDS CENTRE ADMIN BUILDINGS PRODUCTION FACILITY CAMP WORKSHOP PLS PONDS BOSS RESOURCES | AUSTRALIA’S NEXT URANIUM PRODUCER 9
Slide 10: Staged Production Approach
Fully permitted to STAGED PRODUCTION export 3.3Mlbs/ annum U3O8 For personal use only APPROACH equivalent 3.50 3.2 Mlbs 3.00 Fast-tracked Annual Production Mlbs U308 2.50 production, within 2 Mlbs 2.00 12-months, with low capital outlay, to 1.50 seize upon a rising 1.00 0.88 Mlbs uranium market 0.50
Slide 11: Current Work Programs
CURRENT WORK For personal use only PROGRAMS Current market conditions are moving toward Honeymoon’s restart, as we have first mover advantage and will be Australia’s next uranium producer when desired price is achieved. • Continued engagement with utilities to be included in off-market requests and
Slide 12: How Boss Resources Advanced Honeymoon
EXECUTION HOW BOSS RESOURCES 2Mlb / ANNUM – 3.2Mlb U3O8 For personal use only ADVANCED HONEYMOON AIC < $32/lb Project Scoping Pre-Feasibility Field Leach Resource Feasibility Operational Quick Restart Expansion Acquisition Study Study Trial Upgrade & Study Readiness & • Solvent extraction • Ion exch
Slide 13: Honeymoon Economics
For personal use only HONEYMOON ECONOMICS BOSS RESOURCES 13 BOSS RESOURCES | AUSTRALIA’S PREMIER URANIUM JURISDICTION 13
Slide 14: Contract Premium to Spot Prices
CONTRACT PREMIUM TO SPOT PRICES For personal use only Honeymoon AIC ~ US$ 32lb US$60lb incentive price required for majority of new uranium production to be economically viable is lower than current spot and term contract prices Source: Cameco BOSS RESOURCES | AUSTRALIA’S NEXT URANIUM PRODUCER 14
Slide 15: Financial Sensitivities
Key financial summary with FINANCIAL SENSITIVIES contract uranium price range For personal use only of US$40/lb to US$60/lb at an exchange rate of A$1: US$0.68 Financial Metric Unit US$40/lb US$45/lb US$50/lb US$55/lb US$60/lb Revenue $M 813 910 1,006 1,103 1,200 EBITDA $M 324 414 504 594 685 Free C
Slide 16: Honeymoon Financial Returns
January 2020 Feasibility Study HONEYMOON assumes a base case uranium price of only For personal use only FINANCIAL RETURNS US$50/lb Revenue, EBITDA, OPEX and CAPEX (US$ 000) Key Financial Return Metrics (US$ M) BOSS RESOURCES | AUSTRALIA’S NEXT URANIUM PRODUCER 16
Slide 17: Honeymoon Financial Returns
HONEYMOON For personal use only FINANCIAL RETURNS Key Financial Summary (US$ M) – Steady State Annual Average Key Financial Summary (US$ M) – Life of Mine BOSS RESOURCES | AUSTRALIA’S NEXT URANIUM PRODUCER 17
Slide 18: Honeymoon Costings
HONEYMOON Life of Mine CAPEX (%) For personal use only COSTINGS 6% Stage 1 8% 23% Stage 2 11% Deferred Cost Metrics (US$/Lb) New Wellfield Wellfield Header Extension 13% Rehab Costs 39% Life of Mine OPEX (%) Wellfield Costs 13.1% 6.5% Labour 6.6% 23.2% Power 1.3% Reagents & Consumables Capex - US$10
Slide 19: Global Peer Comparisons of Development Projects
For personal use only GLOBAL PEER Comparisons of Development Projects BOSS RESOURCES 19 BOSS RESOURCES | AUSTRALIA’S PREMIER URANIUM JURISDICTION 19
Slide 20: Capex & All In Cost by Phases of Development
CAPEX & ALL IN COST For personal use only BY PHASES OF DEVELOPMENT PEA PFS DFS 70 Letlhakane Bubble size = 60 Resource contained Etango PLS - UG only U3O8 Mlbs* Lost Creek Wiluna 50 Mutanga Norasa AIC (US$/LB) 40 Tiris Mulga Rock Lance Madaouela 30 Westmoreland Arrow PLS Dewey Burdock HONEYMOON 20 S
Slide 21: Capex Intensity & All In Cost
CAPEX INTENSITY & ALL IN COST For personal use only BY PHASES OF DEVELOPMENT PEA PFS DFS 70 Etango 60 Mulga Rock Mutanga Norasa 50 Lost Creek ALL-IN-CASH-COST (US$/LB) Letlhakane Lance 40 Tiris Wiluna Madaouela HONEYMOON 30 Gryphon Westmoreland < US$40/lb AIC Dewey Burdock Bubble size = < US$50/lb 2
Slide 22: Pre-Production Capex
PRE-PRODUCTION CAPEX For personal use only Low capex to 1,200 OP/UG build in absolute terms 1,000 UG UG PRE-PRODUCTION CAPEX (US$M) OP 800 600 UG OP 400 OP/UG OP OP OP OP ISR OP 200 OP ISR ISR ISR OP ISR ISR Capex - US$10M 0 AISC – US$37.00/lb Honeymoon Arrow Phoenix Wiluna PLS - UG only Gryphon Mul
Slide 23: Construction and Commissioning
CONSTRUCTION Competitively For personal use only AND COMMISSIONING short construction 60 time CONSTRUCTION + COMMISSIONING (MONTHS) 50 OP/UG 40 UG UG OP OP/UG ISR UG 30 OP OP OP OP OP 20 ISR ISR OP ISR 10 Capex - US$10M 0 AISC – US$37.00/lb Arrow PLS Lance Tiris Norasa Dewey Burdock Mulga Rock Etang
Slide 24: The Case for Nuclear
For personal use only THE CASE FOR NUCLEAR BOSS RESOURCES 24 BOSS RESOURCES | AUSTRALIA’S PREMIER URANIUM JURISDICTION 24
Slide 25: Uranium: Strong Market Fundamentals
URANIUM: For personal use only STRONG MARKET FUNDAMENTALS RISING REDUCED CUTTING BARRIERS TO OPPORUNITY DEMAND PRODUCTION SUPPLY ENTRY • Strong fundamentals • Demand has exceeded • Uranium production is • Dramatic cuts to global • No new production can supporting a positive global production in now
Slide 26: Nuclear Capacity
USA and France continue to dominate overall reactor demand NUCLEAR CAPACITY with 32% and 15% of For personal use only nuclear capacity Nuclear electricity production and nuclear share of total electricity by country 900 80% Nuclear electricity production (KWe) Nuclear share of electricity (%) 800 70
Slide 27: Nuclear Capacity
China is leading the increase in reactor buildouts, in NUCLEAR CAPACITY addition to India and For personal use only Russia. Nuclear reactors under construction Nuclear reactors planned 14 45 12 40 Number of Reactors 10 35 30 8 Number of Reactors 25 6 20 4 15 10 2 5 0 Capex - US$10M 0 AISC – US$37.00
Slide 28: Supply and Demand
Low uranium prices have curtailed supply. Contract prices must rise SUPPLY AND DEMAND to incentivise new For personal use only production meeting known demand Supply Demand forecast Closures represent ~25% of supply base 200 50 45 150 40 U3O8 (mlbs) 35 U3O8 (mlbs pa) 30 100 25 20 50 15 10 5 - Capex
Slide 29: Contract Coverage Needed
Satisfying utility consumption by drawing down CONTRACT COVERAGE NEEDED inventories and buying For personal use only from the spot market is not sustainable US inventories are being drawn down US utilities will have to cover soon 60 140 50 120 100 mlbs pa U3O8 mlbs pa U3O8 40 80 30 60 20 40 10 20 Ca
Slide 30: Nuclear Energy Costs & CO2
Nuclear energy remains one of the most cost competitive NUCLEAR ENERGY COSTS & CO2 sources of energy, For personal use only with lowest C02 emissions C02 emissions by energy Levelised unit cost and C02 type (kg C02/kWh) 300 250 200 US$/MWh 150 100 50 0 Solar Coal Offshore IGCC Onshore Nuclear Capex
Slide 31: Appendix
For personal use only APPENDIX BOSS RESOURCES 31 BOSS RESOURCES | AUSTRALIA’S PREMIER URANIUM JURISDICTION 31
Slide 32: Global Peer Comparisons Reference Table
Source: SS: Scoping Study, PEA: Preliminary Economic Assessment, PFS: Preliminary Feasibility Study, DFS: Definitive Feasibility Study or Feasibility Study. All study outputs from technical reports on the respective company’s websites. Exchange rates used A$:US$0.68 and C$:US$0.75. All Mineral Resou
Slide 33: Global Peer Comparisons Reference Table
Source: SS: Scoping Study, PEA: Preliminary Economic Assessment, PFS: Preliminary Feasibility Study, DFS: Definitive Feasibility Study or Feasibility Study. All study outputs from technical reports on the respective company’s websites. Exchange rates used A$:US$0.68 and C$:US$0.75. All Mineral Resou
Slide 34: Keep Up To Date With Us
KEEP UP TO DATE WITH US: bossresources.com.au @Boss_Resources For personal use only ANALYST COVERAGE Canaccord Larry Hill - lwhill@cgf.com Euroz Steven Clarke- sclarke@euroz.com Hartleys Aiden Bradley- aiden.bradley@hartleys.com.au AUSTRALIA’S NEXT URANIUM PRODUCER BOSS RESOURCES | AUSTRALIA’S NEXT