Globe Metals & Mining Limited · ASX:GBE
Globe Metals & Mining — Africa Down Under Conference 2009
34 slides from Globe Metals & Mining's conference presentation, Sep 4, 2009
Slide 1: Globe Metals & Mining Investor Update
For personal use only Globe Metals & Mining Investor Update Africa Down Under Conference – Perth, Australia 4 September 2009
Slide 2: Disclaimer
Disclaimer For personal use only The views expressed in this presentation contain information derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. Any forward looki
Slide 3: Table of Contents
Table of Contents Investment Highlights 5 SECTION 1– SECTION 1 – Company Company Overview Overview Corporate Overview 6 For personal use only Kanyika Niobium Project 7 Path to Production 8 Project Valuation 9 Why Globe? 10 Resource 12 SECTION 2– SECTION 2 Kanyika Niobium – Kanyika Niobium Project Pr
Slide 4: Company Overview
Section 1 For personal use only COMPANY OVERVIEW 4
Slide 5: Investment Highlights
Investment Highlights For personal use only Production of ferro-niobium (FeNb) to commence in 2012 - Kanyika Niobium Project Project NPV (post-tax): ~US$200m Modest capex.: US$152m; annual revenue: US$152m; operating margin: 49% Capital payback: 2.1 years 20+ year mine life based on known
Slide 6: Corporate Overview
Corporate Overview For personal use only Strategy Summary Capital Structure (ASX :GBE) To become a multi-commodity producer by 2012 Ordinary shares 70.3m Low capital cost, high margin, quick capital payback Current Price A$0.29 +20 year mine life, significant exploration upside Market Capitali
Slide 7: Kanyika Niobium Project
Kanyika Niobium Project For personal use only 55.3Mt Indicated and Inferred JORC resource/24Mt high grade 100-110Mt exploration target/40-50Mt high grade 20+ year mine life on JORC resources/40+ year mine life expl. target 3,000tpa Nb metal production (+ credits) 1.7 - 2.3Mtpa* throughput
Slide 8: Path to Production
Path to Production For personal use only Sept 2008 Commence Pre-Feasibility Study March 2009 – Nov 2009 Mini-pilot metallurgical program to produce FeNb (and provide samples for customers) March 2009 – June 2010 Development Agreement with the Govt. of Malawi – determine fiscal regime for Project Mar
Slide 9: Project Valuation
Project Valuation US$ million Initial Outlay Year 1 Years 1-20 For personal use only Capex 151.7 93 Capex* US$M - Upstream plant 85.9 Revenue - Acid plant 36.0 - FeNb 117.0 2,340 - Alloy plant 7.0 - Ta205 22.7 457 - General & other 22.8 - U308 12.8 246 * Excludes working capital Total 152.5 3,043 Ro
Slide 10: Why Globe?
Why Globe? For personal use only In April 2007, Globe raised A$8m to pursue grass-roots exploration in Malawi. In the subsequent 28 months at Kanyika: July 2007 Commenced drilling (total 18,000m of drilling to date at Kanyika) March 2008 Initial 56Mt Inferred JORC resource June 2008 Scoping Study re
Slide 11: Kanyika Niobium Project
Section 2 For personal use only KANYIKA NIOBIUM PROJECT 11
Slide 12: Resource
Resource 2 Indicated Resource For personal use only 13.2Mt Incl. 8.5Mt High-Grade (1,500ppm Nb2O5 cut-off) (3,000ppm cut-off) Metal Tonnes Grad2e (ppm) Tonnes Grade (ppm) Nb2O5 48,590 3,600 35,730 4,200 U3O8 1,320 100 940 110 Ta2O5 2,120 160 1,620 190 Inferred Resource 42.1Mt Incl. 15.5Mt High-Grade
Slide 13: Deposit
For personal use only Deposit 13
Slide 14: Flowsheet
For personal use only Flowsheet 14
Slide 15: Thuthuka Group
Thuthuka Group For personal use only Thuthuka is a world class private South African multi-disciplinary engineering company, active in the design, manufacture, installation project management and project finance for the chemical, mining, metallurgical and industrial markets The scope of work inc
Slide 16: Products & Markets
Products & Markets Processing For personal use only Ferro-Niobium Tantalum Uranium/Yellowcake Kanyika Production (p.a.) 3,000t 194t/0.43Mlbs 117t/0.26Mlbs Market Share (%) 3-4% (2013)¹ 8% <0.2% Market Size 2008 (p.a.) 67,000t 5.3 Mlbs 63,000t Kanyika Production Primary By-produ
Slide 17: Infrastructure
For personal use only Infrastructure 17
Slide 18: Financials
Financials US$ million Unit Cost Year 1 Unit Cost Year 10 For personal use only Production¹ - Strip ratio (waste:ore) 0.6:1 1.9:1 - Mill feed (Mtpa) 1.72 2.26 - Nb205 (ppm) 3,831 2,919 - Ta205 (ppm) 173 138 - U308 (ppm) 104 78 Revenue 152.5 153.3 Royalties (3%)2 4.6 4.6 Net Income 147.9 148.7 Operat
Slide 19: Niobec Mine Comparison
Niobec Mine Comparison Niobec Mine Kanyika Project¹ For personal use only Owner IAMGOLD (TSX: IMG) Globe (ASX: GBE) Location Quebec, Canada Mzimba, Malawi Commencement of FeNb Production 1994 2012 Resources/Reserves (Mt) 52.3 (incl. 23.4 reserves) 55 (Indicated + Inferred resources) Grade (ppm) - Nb
Slide 20: Malawi
Malawi Republic of Malawi Malawi Economy Grew by 9.7% in 2008 – IMF For personal use only Size 118,484km2 “Malawi’s economy expanded by an estimated 9.7 percent in 2008, boosted Capital Lilongwe by an expansion of the telecommunication industry, high tobacco sales and Official Language English a str
Slide 21: Community & Government Relations
Community & Government Relations For personal use only Community Engagement Globe conducts periodic (six monthly) formal meetings at Kanyika with Mabulabo Traditional Authority, representatives of the Ministry of Mines & Energy and the Mzimba District Commissioner’s Office. Photo (right) from Kanyik
Slide 22: Niobium
For personal use only Section 3 NIOBIUM 22
Slide 23: Key Facts
Key Facts For personal use only Chemical Symbol Nb; atomic # 41 on periodic table Market Size (2008 est.) 67,000t (Nb metal content) Market Value (2008 est.) US$2.8bn (@ average US$42/kg Nb metal) Segments 90%+ consumed in steel industry as FeNb FeNb Growth 21% CAGR (2002-07); 7.9% CAGR (1990-08)¹ W
Slide 24: Niobium Products
Products For personal use only 4kg of niobium used in the manufacture of a mid-sized vehicle would save 100kg of steel, which would translate into fuel savings of half a litre per 100km¹ 1. “Niobium Demand, Price Stays High, Despite Steel Weakness”, Mining Weekly.com, 7 November 2008 24
Slide 25: Market Structure
Market Structure For personal use only Company Mine Nb Production 2008 Market % CBMM Araxa, Brazil 51,000 76.1% Anglo American Catalao, Brazil 5,000 7.5% IAMGOLD Niobec, Canada 4,200 6.3% Chinese/Others Purchased ores 1,500 2.2% Total FeNb (Nb content) 61,700 92.1% Non-Steel Nb production Various 5,
Slide 26: Trends
Trends For personal use only “The level of consumption of [niobium and tantalum] is to a large extent an indicator of a nation’s technical prowess.” (E. G. Polyakov & L. P. Polyakova, “Current Trends in the Production of Tantalum and Niobium”, Metallurgist, Vol. 47, Nos. 1-2, 2003) “In 2008, ferro-n
Slide 27: Market Size and Growth
Market Size and Growth For personal use only World Niobium Production (tonnes): 1965-2008 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Sources: Compiled utilising data from Mining Research (www.miningresearch.co.uk), Roskill (www.roskill.co.uk), CBMM (www.cbmm.br) and Tantalum & Niobium Intern
Slide 28: Consumption Intensity
Consumption Intensity “The growth in consumption of niobium…has resulted from both the overall growth in total steel consumption and a shift from For personal use only mild steels to higher quality steels, which often contain niobium. Worldwide, in 2008 the unit consumption of niobium in steel was a
Slide 29: Commodity Prices
Commodity Prices For personal use only Selected Ferro-Alloy Price Comparison (US$/Kg) 140 120 100 80 60 40 20 0 l-04 v-04 r-0 5 l-05 v-0 5 r-0 6 l-06 v-0 6 r-0 7 l-07 v-07 r-0 8 l-08 v-0 8 r-0 9 Ju o a Ju o a Ju o a Ju o a Ju o a N M N M N M N M N M FeNb FeV FeMo Source: www.metalpages.com 29
Slide 30: Commodity Prices
Commodity Prices For personal use only “Ferro-niobium prices increased sharply from mid-2007…By May 2008, spot prices had risen to US$39.70-41.90/kg (US$18- 19/lb), with producer prices at US$35.30-36.40/kg (US$16-16.50/lb). In November 2008 a benchmark contract price of US$43.00-46.00/kg (US$19.50-
Slide 31: Substitutes?
Substitutes ? For personal use only Nb V Mo Market Size (2008 est.) 67,000t 60,000t 212,000t Use in Steel Industry (%) 90%+ 85% 75% Refining HSLA/low carbon Primary Application Refining high carbon steels Hardening steel steels CAGR 1990-08 (%) 7.9% 2.7% 2.9% Metal Content in Alloy (%) 66% 45-50%; 8
Slide 32: Substitutes?
Substitutes ? For personal use only “In the higher-quality steels, where niobium is finding increasing use, there is little opportunity for substitution by other alloying elements. At the typical addition rate of 0.05%, niobium delivers steel with a ferrite grain size of 20μm2. Similar additions of
Slide 33: Outlook
Outlook 1. Economic Crisis For personal use only “… the niobium industry remained confident of the industry’s future prospects. Demand for natural gas linepipe, the main application for HSLA steel, is healthy and will remain so. The automobile industry, another major consumer of HSLA steel, was in a
Slide 34: Contacts
For personal use only Contacts 34
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