Igo Limited · ASX:IGO
Igo — Independence Group NL — Diggers and Dealers Mining Forum 2018
37 slides from Igo's conference presentation, Aug 7, 2018
Slide 1: Independence Group NL – Diggers and Dealers Mining Forum 2018
INDEPENDENCE GROUP NL Diggers and Dealers Mining Forum 2018 Peter Bradford, Managing Director and CEO 7 August 2018 ASX:IGO / ADR:IIDY
Slide 2: Cautionary statements & disclaimer
Cautionary statements & disclaimer • This presentation has been prepared by Independence Group NL (“IGO”) (ABN 46 092 786 304). It should not be considered as an offer or invitation to subscribe for or purchase any securities in IGO or as an inducement to make an offer or invitation with respect to
Slide 3: Presentation Focus
Presentation Focus: • Introduction • FY18 & FY19 • Tropicana & Nova • EV Batteries & the opportunity for Nickel & IGO • Discovery • People 3
Slide 4: Intro
Intro 4 4
Slide 5: Focus on high quality, long life assets that deliver great financial outcomes
Focus on high quality, long life assets that deliver great Share Ownership financial outcomes Substantial Holders(1) Mark Creasy 16% Institutional Ownership(3) Australia 69% FIL 9% USA 21% T Rowe Price 8% UK & Europe 6% CBA 6% ROW 4% ASX IGO Ausbil 5% Base Perth, WA Share Price Performance(1) Market
Slide 6: Future portfolio to focus on minerals critical to energy storage
Future portfolio to focus on minerals critical to energy storage IGO EBITDA Profile (A$M)(1) 600 500 400 300 200 100 - FY12 FY13 FY14 FY15 FY16 FY17 FY18e FY19e FY20e Long (A$M) Jaguar (A$M) Tropicana (A$M) Nova (A$M) 1) Macquarie Research – 30 Jul 2018 6
Slide 7: FY18 & FY19
FY18 & FY19 7
Slide 8: FY18 Highlights
FY18 Highlights • Record revenue and underlying EBITDA for FY18(1) • Successful first year of commercial production at Nova • Significant value enhancement programs continued at Tropicana • Long Operation transitioned into Care & Maintenance • Jaguar divestment completed for total consideration of A
Slide 9: FY19 Guidance
FY19 Guidance(1) Nova is fully de-risked by grade A stronger year is projected for control drilling FY19 at Tropicana Metric Units FY19 Guidance Metric Units FY19 Guidance Nickel in concentrate t 27,000 – 30,000 Gold produced (100%) koz 500 – 550 Copper in concentrate t 11,000 – 12,500 Gold sold (IG
Slide 10: Tropicana
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Slide 11: Tropicana
Tropicana • 330km NE of Kalgoorlie • 525,000oz gold production (100%) at A$935/oz AISC(1) • ~10 year mine life remaining • Upside potential Tropicana Production (100%) & AISC koz A$/oz 160 1,400 140 1,167 1,200 1,093 1,076 120 939 1,000 100 800 80 600 60 400 40 20 200 - - 1Q18 2Q18 3Q18 4Q18 Ounces
Slide 12: Tropicana value drivers
Backfilling Tropicana value drivers • Grade streaming drives FY19- FY20 gold production and costs • Long Island underpins mine life 6MW Ball Mill • Additional ball mill delivers lift in scale and gold recovery ─ Construction commenced ─ Commissioning by end CY18 • Underground potential being advance
Slide 13: Tropicana – 5km strike of mineralisation
Tropicana – 5km strike of mineralisation 1) Refer to AGA ASX release dated 3 Aug 2018: Tropicana Site Visit 13
Slide 14: Reserve extension opportunities
Reserve extension opportunities Boston Shaker Underground Drilling(1) • Boston Shaker underground study expected 2Q19 • Future underground assessment at Havana and Havana South • Regional exploration along 160km of strike on 3,000km2 1) Refer to AGA ASX release dated 3 Aug 2018: Tropicana Site Visit
Slide 15: Nova
Nova 15
Slide 16: Nova
Nova • Delivers scale, low cost, long mine life and exploration upside • Successful first year of commercial production Nova Production & Payable Cash Cost Tonnes A$/lb 8,000 7,344 3.98 3.84 4 7,000 2.68 5,961 6,000 1.79 2 5,000 4,500 4,454 - 4,000 3,230 3,000 2,472 1,832 2,011 2,000 1,000 - 1Q18 2Q
Slide 17: Successful first year of commercial production
Successful first year of commercial production • Delivered nameplate capacity of 1.5Mtpa ─ Demonstrated 1.8Mtpa mining and processing rate • Transitioned to smaller number of larger stopes at Nova and Bollinger • Resource model performing • Nickel recoveries in line with or better than design recove
Slide 18: 18
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Slide 19: Strong outlook for Nova
Strong outlook for Nova Directional Production and Cash Costs • Consistent and higher production rate expected next A$/lb kt three years 30 3.0 • Main driver is higher grade 2.5 stopes in core of Nova and 20 2.0 Bollinger 1.5 • Assumes: 10 1.0 ─ 1.5Mtpa mining and 0.5 processing rate - FY18A FY19E F
Slide 20: EV Batteries, Nickel & IGO's Opportunity
EV Batteries, Nickel & IGO’s Opportunity 20
Slide 21: Nickel to be a big winner from EV battery demand disruption
Decreasing stockpiles and an uptick in stainless steel demand are placing pressure Nickel to be a big winner on the nickel price from EV battery demand Official Nickel Exchange Stockpiles and Price(1) disruption Nickel Stocks Nickel Price 600 (kt) (US$/t) 17,000 • Market in deficit in 2016 & 2017 50
Slide 22: Expect nickel price pressure to increase as demand for EV batteries grows
Expect nickel price pressure to increase as Nickel Mine Supply by Product (kt)(1) demand for EV batteries Ni ktpa 2018E supply Ni ktpa picks up after 2020 3,500 deficit of 3,500 167kt(2) Forecast Nickel Price Consensus(3) (US$/t) 3,000 3,000 2,500 2,500 2,000 2,000 17,000 1,500 1,500 16,000 1,000 1,
Slide 23: EV lithium ion battery cathodes with higher nickel content
EV lithium ion battery cathodes with higher nickel Cathode Metal Content content are key to enabling 2.1% higher energy density 9.0% 2.1% 4.6% 13.8% 30.4% 27.4% NMC Chemistry – Energy Density by Type (Wh/kg)(1) >300 300 with Si with Si anode anode 30.2% 36.2% 71.9% 270 82.3% 73.1% 230 200 180 150 28
Slide 24: Downstream processing potential at IGO
LME Nickel Versus Nickel Sulphate (US$/t)(1,2) US$/t Downstream processing potential at IGO 20,000 18,000 • Produce nickel and cobalt NiSO4 sulphates for EV batteries 16,000 Price Premium • Delivers potential for higher 14,000 payability, premium price and higher concentrator 12,000 recoveries 10,00
Slide 25: Nickel sulphate hexahydrate crystals produced from Nova nickel concentrate
Nickel sulphate hexahydrate crystals produced from Nova nickel concentrate • Demonstrated technical feasibility of process route • Validated and improved upon previous metallurgical assumptions – potential for lower capex & opex • Expect Prefeasibility to be completed in 2Q19 1) Photographs to the L
Slide 26: Discovery
Discovery 26
Slide 27: A$51M committed to discovery in FY19
A$51M committed to discovery in FY19 Nova A$12.0M Tropicana A$3.0M Long A$33.0M A$2.5M Greenfields, Generative & Other Focussed on discovery and organic growth 27
Slide 28: FY19 drilling underway!
FY19 drilling underway! • Completed the largest 3D seismic program ever undertaken in Australia over the Nova Mining Lease • New AMT and Squid EM • Full geological reassessment • Collaborative R&D • Planned 20,000m drilling program in FY19 28
Slide 29: Why explore the Fraser Range?
September 2015 Why explore the Fraser Range? • Multiple magmatic intrusions • Ni/Cu anomalism reported by multiple explorers along belt • Disseminated and blebby sulphides Empirical evidence demonstrates belt is fertile 1) Classic Minerals ASX Releases: 29 Aug 2013, 12 Dec 2013 and 17 Dec 2016 2) Si
Slide 30: Systematic exploration over ~15,000km2 of consolidated tenure
February 2018 July 2018 Systematic exploration over ~15,000km2 of consolidated tenure • Multiple EM platforms • Bedrock geochem using Aircore • Gravity survey & mapping • Follow up RC/DDH Goal is to discover the next Nova! 30
Slide 31: Lake Mackay is a 12,800km2 belt scale greenfields exploration project
Lake Mackay is a 12,800km2 belt scale greenfields exploration project for IGO • Polymetallic intersections in drilling at Grapple & Bumblebee • Rock chip samples from Grimlock prospect confirm results with up to 2.5% Co, 1.1% Ni, 46.4% Mn(1) • Spectrem airborne EM survey commenced 1) Refer to PRX AS
Slide 32: People
People 32
Slide 33: Mining Engineering Enrolments
Something wrong with this Mining Activity Vs Mining Engineering Enrolments(1,2) story 9,000,000 350 • Several years of rhetoric has 8,000,000 300 perpetuated a myth that the Mining Engineering Enrolments 7,000,000 Gold & Iron Ore Production 250 mining boom has busted 6,000,000 5,000,000 200 • 81% de
Slide 34: Greater conversation needed on attracting new entrants to the industry
There is a need for greater conversation about how we attract new entrants to the industry • Role for individual companies, industry associations, government • Increase awareness and interest in mining at the high school level 34
Slide 35: Part of the IGO Difference is our focus on people
Part of the IGO Difference is our focus on people • Strong sense of purpose • Empowered people who are, and act as, owners of the business and want to make a difference • Focus on diversity because it is the right thing to do 35
Slide 36: Concluding Comments
Concluding Comments • Great people and great culture • Demonstrated exploration, development and operating capability • Great assets at Nova and Tropicana • Strong balance sheet and free cashflow • Poised for organic growth: ─ Discovery ─ Downstream processing 36
Slide 37: uwaie a
uwaie a v FOLLOW US | AS WE GO FROM STRENGTH TO STRENGTH igo.com.au
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