Slide 1: Central Eyre Iron Project Definitive Feasibility Study
Central Eyre Iron Project Definitive Feasibility Study www.ironroadlimited.com.au March 2014
Slide 2: Cautionary Statements
Cautionary Statements Forward Looking Statements This announcement contains certain statements with respect to future matters and which may constitute "forward-looking statements". Such statements are only predictions and are subject to inherent risks and uncertainties which could cause actual value
Slide 3: Cautionary Statements
Cautionary Statements Modelling based upon 25 year mine life, consisting of: • Initial 17 years using Proven and Probable Mining Reserve of 2,071Mt @ 15.5% iron (200x100m, 100x50m diamond drill spacing); • Further eight years using 28% Measured, 24% Indicated and 48% Inferred Resources of 1,303Mt @
Slide 4: Long Life Magnetite Project
Long Life Magnetite Project www.ironroadlimited.com.au 4
Slide 5: Iron Road's Vision
Iron Road’s Vision Iron Road’s vision is to become a trusted and reliable supplier of premium iron concentrates to the Asian marketplace www.ironroadlimited.com.au 5
Slide 6: Central Eyre Iron Project (CEIP)
Central Eyre Iron Project (CEIP) • 100% owned Iron Road • Definitive Feasibility Study complete • 21.5 million tonnes per annum of concentrate • Production from 2018 • Expected mine life +25 years • High quality concentrate will assist steel mills reduce pollution and improve efficiencies – indicati
Slide 7: Definitive Feasibility Study Key Outcomes
Definitive Feasibility Study Key Outcomes Operating Cost Annual Capital Intensity Capital Cost (FOB) /t Revenue (per Annual Tonne) US$3.98B US$44.33 US$2.8B US$185 NPV (12.5%) Project IRR Mine Life $US2.69B 21% 25+ years Ungeared, Ungeared, post-tax post-tax www.ironroadlimited.com.au 7
Slide 8: DFS Guiding Principles And Outcomes
DFS Guiding Principles And Outcomes • Consistent high quality • Bulk testing has • Coarse product easier to Premium product is competitive and clean confirmed value in handle and transport solution for steel mills benefits for steel mills than finer concentrates • Meets requirements for • Readily su
Slide 9: Process Design Highlights
Process Design Highlights Smart Modular In Pit Crushing and Processing Plant > Tailings Handling > Rail and Port Design > Conveying (IPCC) > Design > Processing plant Mine designed for Three discrete Filtered tailings Standard gauge, utilises high IPCC from day recovery trains and waste he
Slide 10: Highly Competitive Operating Costs
Highly Competitive Operating Costs • FOB operating costs (ex-State royalty) of US$44.33 per dry metric tonne • Normalising cost curve for prices received, the CEIP is placed in the second quartile of the 2018 price adjusted CFR China cost CEIP curve • Competitive with recent large- scale Pilbara dev
Slide 11: Iron Ore Market Dynamics
Iron Ore Market Dynamics • Iron ore price stable in 2013, trading In 2014, the big four suppliers are expected to account between US$110 - 150 per tonne, for more than 70% of global seaborne supply mostly within US$120 - $140 range • Most independent market forecasters BHP have slowly turned more bu
Slide 12: Iron Ore Market Dynamics
Iron Ore Market Dynamics • Consistent history of equity market analysts over estimating future supply • China increasingly working to improve energy efficiencies and air quality • High quality feedstock to become more desirable over time to balance expanding volumes of lower grade ore products – Les
Slide 13: Premium Product, Attractive To Customers
Premium Product, Attractive To Customers • High Grade (67% iron), low impurity product • Will assist steel mills reduce pollution and improve performance – this will become ever more important as regulations tighten • Will receive a quality premium differential – US$18/t, based on independent advice
Slide 14: Supportive State Government
Supportive State Government • Major Development status declared by Deputy Premier John Rau • Recognises significance to South Australia of Iron Road’s integrated iron export project • Allows for project approvals to be considered at highest level of government • Clear and transparent framework to ac
Slide 15: Short and Long Term Benefits to South Australia
Short and Long Term Benefits to South Australia Jobs • Peaking at 1950 during construction • ~700 long-term operations • Plus additional indirect jobs created from project Infrastructure • Additional capacity for other minerals exporters from day one • Opens up deep water port access to significant
Slide 16: Large Scale Mining of Consistent Orebody
Large Scale Mining of Consistent Orebody • Well understood, uniform ore body • Large scale open pit, long life, low strip ratio • Coffey Mining studied owner mining utilising conventional truck & shovel, load and haul – Ore Reserve estimated using costs and cash flows based on this scenario – most c
Slide 17: Hybrid-IPCC Mining Optimisation
Hybrid-IPCC Mining Optimisation • In Pit Crushing & Conveying (IPCC) selected as ideally suited to CEIP – Open pit designed and optimised for Hybrid-IPCC – Conventional truck and shovel operation for first three years of operation – Significantly reduced mining fleet (93 cf 30 Cat 797’s) – Reduced o
Slide 18: Proven Mechanical Processes
Proven Mechanical Processes • Three discrete processing lines, commissioned in a staged sequence over 12-14 months • Conventional SAG and ball milling process, followed by gravity and magnetic separation • Significant benefits to capital and operating costs over earlier considered secondary/tertiary
Slide 19: Smart, Low Cost Engineering and Construction
Smart, Low Cost Engineering and Construction Smart modular design • Processing plant comprised of large, self contained modules • Wet commissioning to be conducted at fabrication prior to delivery • Significant reduction in schedule risk arising from site based rework • Based on size envelope establ
Slide 20: LNG Module, Gladstone, Queensland
LNG Module, Gladstone, Queensland www.ironroadlimited.com.au 20
Slide 21: Heat Exchanger Module, Crude Expansion Project, Port Arthur Texas
Heat Exchanger Module, Crude Expansion Project, Port Arthur Texas. www.ironroadlimited.com.au 21
Slide 22: Utilities Corridor and Rail Network
Utilities Corridor and Rail Network Corridor • Minimise impacts, one corridor only • Comprises rail, power line, service road and water pipeline (pipeline for part of route only) Infrastructure features • Scalable design philosophy • Potential to link into the Trans-Australian rail network, increasi
Slide 23: Cape Hardy Export Facility
Cape Hardy Export Facility • Initial 70Mtpa capacity at the ship loader (at 80% utilisation) – Enables Iron Road to load a Capesize vessel in approximately 24 hours – Modular jetty and wharf construction – Ship loader to service two Capesize berths • 21.5Mtpa initially reserved for CEIP • Capesize a
Slide 24: The Only Capesize Port in South Australia
The Only Capesize Port in South Australia • A strategic asset, the only Capesize port from Esperance to Port Kembla – Potential to be the only Australian port capable of loading ULOC vessels (300,000+ dwt) • Is well situated in favourable climate and year round protected waters – No vessel movement
Slide 25: Key Financial Parameters
Key Financial Parameters Key Financial Assumptions (real 2013 terms) Capital cost estimate (incl. contingencies) US$3.98 billion Pre-stripping and preparatory mining works US$0.48 billion Capital intensity US$185 per annual tonne FOB operating cost (ex state royalty) US$44.33/dmt (dry metric tonne)
Slide 26: Keeping Communities Involved
Keeping Communities Involved • Dedicated community team – Although every employee is a ‘community ambassador’ • Involved in local events and community sponsorships • Keeping communities informed through: – Community information sessions – Regular updates in the local press – Presentations to communi
Slide 27: Realising the Vision
Realising the Vision • Finalising government submissions and applications • Strengthening the plan through stakeholder engagement • Increasing customer awareness • Securing project partners and financing • Positioning the Company to initiate the operational readiness plan www.ironroadlimited.com.au
Slide 28: Australia's Next Fully Integrated Iron Supply Business
Australia’s Next Fully Integrated Iron Supply Business • Positive long term market dynamics • Strategic value in securing a long life and scalable source of supply • Consistent high quality product expected over entire life of project – At a time of steadily declining hematite quality and intensifyi
Slide 29: Delivering Australia's Next Fully Integrated Iron Supply Business
Disclaimer Delivering Australia’s Next Fully Integrated Iron Supply Business Subscribe to alerts online www.ironroadlimited.com.au www.ironroadlimited.com.au 29
Slide 30: Appendices
Disclaimer Appendices www.ironroadlimited.com.au 30
Slide 31: Board and Management
Board and Management Peter Cassidy Non Executive Chairman Board Key Investors Julian Gosse Non Executive Director The Sentient Ian Hume Non Executive Director Group 73% Jerry Ellis AO Non Executive Director Leigh Hall AM Non Executive Director Andrew Stocks Managing Director Larry Ingle General Mana
Slide 32: Key Operating Parameters
Key Operating Parameters Mine life • 25 years Steady state production • 21.5Mtpa of concentrate • Ore mined • Mine strip ratio Mining 3.57 billion tonnes 1.22 : 1 over life of mine waste : ore • Product size of greater • Power demand of 260 • Water requirement of 14 Processing than -130 micron (p80)
Slide 33: CEIP Resource Statement
CEIP Resource Statement CEIP Global Mineral Resource Tonnes Fe SiO2 Al2O3 P Location Classification (Mt) (%) (%) (%) (%) Measured 2,222 15.69 53.70 12.84 0.08 Murphy South/Rob Roy Indicated 474 15.6 53.7 12.8 0.08 Inferred 667 16 53 12 0.08 Boo-Loo Inferred 328 17 52 12 0.09 Total 3,691 16 53 13 0.0
Slide 34: CEIP Reserve Statement
CEIP Reserve Statement CEIP Global Mineral Resource Tonnes Fe Location Classification (Mt) (%) Proved 1,871 15.6 Murphy South/Rob Roy Probable 200 15.1 Total 2,071 15.5 The information in this report that relates to Reserves estimated for Murphy South / Rob Roy (MSRR) is based on and fairly represen
Slide 35: Large Scale, Long Life Project
Large Scale, Long Life Project 3,000 Largest Measured + Indicated magnetite Mineral Resource in 2,500 Australia. Underpins long life M+I Resources - tonnes (millions) operation: 2,000 • Mineral Resource 1,500 Resource Category Measured (tonnes) 3.7Bt @ 16% Fe* Indicated (tonnes) • Exploration Target