Australian Mines Limited · ASX:AUZ
Australian Mines — Investor Presentation (April 2018)
35 slides from Australian Mines's investor presentation, Apr 13, 2018
Slide 1: Investor Presentation April 2018
Investor Presentation April 2018 ASX: AUZ australianmines.com.au March 2018
Slide 2: Disclaimer
Disclaimer This document is a visual aid accompanying a presentation by the Managing Director during Australian Mines’ international roadshow in April and May 2018. It is not intended to be read as a stand-alone document. It contains selected information, in abbreviated or summary form, and does not
Slide 3: Australian Mines – at a glance
Australian Mines – at a glance • Rapidly growing resource and battery chemical company • Successfully operated an underground nickel mine in Western Australia • Expanded operations into battery metals in 2016 • The only exploration company in Australia for Cobalt with a 100% off-take agreement secur
Slide 4: Development timeline
Development timeline Q2 2019 Sconi: Construction of processing plant Q1 2019 Sconi: advances Construction of processing plant Sconi: commences Scandium off-take Q4 2018 Project financing finalised secured Mineral Resource updated Flemington: Regional Pre-Feasibility Sconi: exploration Study commence
Slide 5: Investment Highlights
Investment Highlights • Demand for electric vehicles (EVs) expected to increase demand for critical battery metals Favourable market fundamentals • Ethical concerns mean that manufacturers are seeking suppliers with an auditable supply chain in order to meet the increasing scrutiny of consumers (ex-
Slide 6: Favourable market fundamentals
Favourable market fundamentals • Electric vehicles to account for 30% of all new car sales across Europe by 20254 • Each year, there will be 1 million more UK-registered electric vehicles cruising the English countryside, for example • Globally, electric vehicles will account for 14% of all new car
Slide 7: Cobalt and nickel to drive the electric vehicle industry
Cobalt and nickel to drive the electric vehicle industry • Electric vehicles are powered by lithium-ion batteries • Composition of lithium-ion batteries may vary slightly between vehicle manufacturers • Typical electric vehicle batteries comprise nickel and cobalt plus manganese / aluminum • Approx.
Slide 8: Cobalt’s expected critical supply shortage
Cobalt’s expected critical supply shortage 2017 Cobalt Mine Production by Region6 • Electric vehicle companies expected to Other increase demand for critical battery metals Zambia countries Papua New 3% 11% including cobalt (and nickel) Guinea 3% • Historically, cobalt supplies have mainly Madagasca
Slide 9: Sconi Cobalt-Nickel-Scandium Project
Sconi Cobalt-Nickel-Scandium Project • The most advanced cobalt project of its type in Australia • Located within 250 kilometres of the approved cobalt & nickel exporting port of Townsville in northern Queensland, Australia • 100% owned by Australian Mines7 • Greenvale (base for the Sconi project) b
Slide 10: Outcropping, laterally-extensive ore body
Outcropping, laterally-extensive ore body • Sconi is a laterite deposit • 64% of the world’s nickel currently comes from laterite deposits10 • Ore body outcrops at Sconi and is friable, meaning easy (low cost) open pit mining operation • Strip ratio for life of mine is very low 0.6 (waste) : 1.0 (or
Slide 11: Sconi’s development program
Sconi’s development program • Workforce to be employed on a residential basis with emphasis on recruiting locally o Existing community of Greenvale located within 10 kilometres of proposed operation • Investigating renewable energy options to part-power the Sconi processing plant • Longest lead item
Slide 12: Flemington Cobalt-Nickel-Scandium Project
Flemington Cobalt-Nickel-Scandium Project • Located 370 kilometres west of Sydney • Extensive tenement package • Acquiring 100% interest in the project13 • Existing cobalt Mineral Resource14 • Mineralisation from surface • Only a fraction of the tenement area currently explored • Mining Lease applic
Slide 13: Flemington: Potential second production hub
Flemington: Potential second production hub • Flemington mineralisation is the continuation of Clean TeQ Holding’s (ASX: CLQ) Sunrise project • Flemington / Sunrise mineralisation separated only by a tenement boundary • Regional field mapping and sampling in progress to test entire Flemington projec
Slide 14: Flemington status and work program
Flemington status and work program • Potential to unlock significant value at Flemington by increasing the cobalt, scandium and nickel Mineral Resource16 • Additional air core and reverse circulation (RC) drilling commencing this quarter • Maiden cobalt Mineral Resource of 2.7 million tonnes at 0.10
Slide 15: Flemington community engagement
Flemington community engagement • Employed Community Liaison person from within local Parkes community o Cindy Nutley o cnutley@australianmines.com.au • Establishing a shop front office in the heart of the Parkes shopping district o information centre for future mining development at Flemington • Pl
Slide 16: Thackaringa Cobalt Project
Thackaringa Cobalt Project • 100% owned by Australian Mines • Located within 25 kilometres of Broken Hill in central New South Wales • No third-party royalties or claw back • Similar geology and cobalt potential as adjoining Cobalt Blue Holdings • Thackaringa provides significant cobalt exploration
Slide 17: Thackaringa early results offer upside
Thackaringa early results offer upside • Adjoins Cobalt Blue’s (ASX: COB) Railway and Pyrite Hill project to the north and south in New South Wales • Surface sampling of Target Areas A and B completed in March quarter • Surface sampling of Target Areas C in progress • Anticipate final results for al
Slide 18: Processing Plant: Proven technology and design
Processing Plant: Proven technology and design • Australian Mines’ proposed Pressure Acid Leach (front end) + Solvent Extraction (back end) processing plant uses a proven “ore to finished product” flow chart o Utilises both a conventional, industry standard processing flow chart and construction des
Slide 19: Indicative design - Sconi Project’s 2Mtpa processing plant
Indicative design - Sconi Project’s 2Mtpa processing plant April 2018 www.australianmines.com.au 19
Slide 20: Australian Mines already operating Australia’s largest demo plant
Australian Mines already operating Australia’s largest demo plant • Australian Mines, in conjunction with Simulus Engineering, is currently operating a demonstration- scale processing plant in Perth, Australia • This processing plant is the largest test plant of its type operating in Australia • Pre
Slide 21: Off-take agreement secured with leading battery manufacturer
Off-take agreement secured with leading battery manufacturer • Australian Mines has executed a binding off-take term sheet agreement with SK Innovation • Australian Mines will be the sole supplier of cobalt to SK Innovation18 • Off-take quantities are up to: o 12,000 tonnes of cobalt sulphate per ye
Slide 22: SK: Australian Mines’ electric vehicle battery partner
SK: Australian Mines’ electric vehicle battery partner • Korean-headquartered, SK is the world’s 57th largest company • 3rd largest Korean company • Annual revenue in excess of US$120 billion • Ranked 1st in the Korean oil & gas sector • Ranked 1st in the Korean telecommunication sector • World’s se
Slide 23: Public statements from the SK Innovation’s President Kim Jun
Public statements from the SK Innovation’s President Kim Jun SK Innovation’s President, Mr Kim Jun, stated at a press conference held in Seoul, Korea on 11 April 2018 that: ✓ Australian Mines’ proposed processing flow chart for the Sconi Project has the ability to produce the 'battery metal’ of coba
Slide 24: Potential upside from scandium
Potential upside from scandium • In addition to developing multiple battery metal operations, Australian Mines has established a Research and Development Division researching the application of MIG fighter-jet superalloy for the electric vehicle sector • The advantage of this superalloy over convent
Slide 25: Experienced management team
Experienced management team Michael Ramsden Benjamin Bell Chairman Managing Director Lawyer with 30 years experience as a Geophysicist with 20 years experience in the minerals corporate advisor industry Mick Elias Tim Maclean Director Chief Operating Officer International recognised expert in lateri
Slide 26: For further information:
For further information: Shareholder Contact: Media Contact: Sophia Bolhassan Michael Cairnduff Investor Relations Manager Cannings Purple Ph: +61 488 022 944 Ph: + 61 406 775 241 E: sbolhassan@australianmines.com.au E: mcairnduff@canningspurple.com.au April 2018 www.australianmines.com.au 26
Slide 27: April 2018 www.australianmines.com.au
April 2018 www.australianmines.com.au 27
Slide 28: Appendix 1: References
Appendix 1: References Slide 3 : Australian Mines - at a glance 1 See Australian Mines’ announcement to the ASX dated 6 March 2018 for full details of the terms of its binding off-take agreement with SK Innovation, which include the following key commercial terms: • A seven-year contract term from t
Slide 29: References
References Slide 3 : Australian mines - at a glance (continued) 2 See Australian Mines’ announcement to the ASX dated 8 December 2017 for full details of the Sconi transaction. Australian Mines has an option to acquire 100% of the Flemington project from Jervois Mining Limited. The last option payme
Slide 30: References
References Slide 8 : Cobalt’s expected critical supply shortage 6 US Geological Survey 2018 Mineral Commodity Summary (Cobalt) Slide 9 : Sconi Cobalt-Nickel-Scandium Project 7 See Australian Mines’ announcement to the ASX dated 8 December 2017 for full details of the Sconi transaction. 8 See Austral
Slide 31: References
References Slide 10 : Outcropping, laterally-extensive ore body 10 Macquarie Research Commodities Comment - The right sort of nickel for batteries – it’s complicated 22 March 2018 11 See Australian Mines Limited’s announcement to the ASX dated 31 March 2017 for further details on the Sconi Project.
Slide 32: References
References Slide 13 : Flemington: Potential second production hub 15 The Mineral Resource Estimate for the Flemington Cobalt-Scandium-Nickel Project is reported under JORC 2012 Guidelines and was reported by Australian Mines Limited on 31 October 2017. The Mineral Resource for Flemington, as announc
Slide 33: References
References Slide 21 : Off-take agreement secured with leading battery manufacturer 18https://translate.google.com.au/translate?hl=en&sl=ko&u=http://www.fntimes.com/html/view.php%3Fud%3D2018041112571223671ab245d71a_18 &prev=search 19 See Australian Mines’ announcement to the ASX dated 6 March 2018 fo
Slide 34: References
References Slide 23 : Public statements from the SK Innovation’s President Kim Jun 20 https://translate.google.com.au/translate?hl=en&sl=ko&u=http://www.fntimes.com/html/view.php%3Fud%3D2018041112571223671ab245d71a_18&p rev=search April 2018 www.australianmines.com.au 34
Slide 35: Appendix 2: Competent Persons Statement
Appendix 2: Competent Persons Statement Sconi Project The Mineral Resource for the Sconi Project contained within this document is reported under JORC 2012 Guidelines. This Mineral Resource was first reported by Australian Mines on 31 March 2017. There has been no Material Change or Re-estimation of
Australian Mines — Investor Presentation (April 2018) on 6ix