Peninsula Energy Limited · ASX:PEN
Peninsula Energy — Shaw Stockbroking Uranium Conference (December 2010)
45 slides from Peninsula Energy's conference presentation, Dec 6, 2010
Slide 1: Company Presentation ASX cover letter
6 December 2010 Companies Announcement Office Via Electronic Lodgement COMPANY PRESENTATION Please find attached a copy of the presentation that will be made by Peninsula Energy Limited’s Executive Chairman Gus Simpson to a series of Australian investors this week. A copy of the presentation can als
Slide 2: Investor Update - Shaw Stockbroking Uranium Conference
INVESTOR UPDATE SHAW STOCKBROKING URANIUM CONFERENCE John Simpson (Gus) Executive Chairman 6 December 2010
Slide 3: Disclaimer
Disclaimer This presentation is provided on the basis that the Company nor its representatives make any warranty (express or implied) as to the accuracy, reliability, relevance or completeness of the material contained in the Presentation and nothing contained in the Presentation is, or may be relie
Slide 4: Competent Person
Competent Person The information in this presentation that relates to Exploration E ploration Results, Res lts Mineral Resources Reso rces and Ore Reserves Reser es is based on information compiled by Mr Alf Gillman. Mr Gillman is a Fellow of the Australian Institute of Mining and Metallurgy. Mr Gil
Slide 5: Investment Highlights
Investment Highlights • Emerging uranium producer listed on the (ASX:PEN) with established project pipeline • p 25.2mlbs JORC Compliant Resource and g growing g • Exploration potential 185–295mlbs U3O8 between Wyoming and Karoo • Planned production of 1.5mlbs U3O8 p.a. commencing 2012 from Wyoming a
Slide 6: Corporate
Corporate Share Price PEN – Daily Line Chart (Close) Shares on issue 1,642m XJO – Daily Line Chart (Close) PEN – Simple MA (20) (Close) Share price $0.061 Market capitalisation $100m Cash balance $7m Debt $0 Enterprise value $93m Equity Facility $50m Shareholding Directors & Associates ~ 10% Top 20
Slide 7: Uranium Assets
Uranium Assets 25 2mlbs JORC Compliant Resource U3O8 25.2mlbs 13 project areas with drill-defined mineralisation 95 – 145mlbs U3O8 Potential Average project grades up to 1,250ppm eU3O8 618 km2 land holding 7 project areas Exploration potential in quality uranium provinces Lance, Wyoming Karoo, South
Slide 8: Business Plan
Business Plan • Commences ISR production at RossRoss, Wyoming in 2012 building to 1.5mlbs U3O8 p.a. (Plant capacity 3mlbs p.a.) U d Underpin i balance b l sheet h t with ith profit fit from f Wyoming W i • Develop p conventional mining g and milling g operation p at Karoo by 2016 / 2017 • Continue t
Slide 9: Directors and Management
Directors and Management Board of Directors • Executive Chairman Gus Simpson Strong leadership, corporate and project management skills • Technical Director Dr Alan Marlow PhD in economic geology and uranium specialist • Non Executive Director Malcolm James Strong corporate and project financing exp
Slide 10: Uranium – Compelling Logic
PENINSULA@A) . . . ENERGY 2 Uranium — Compelling Logic The energy density of various fuel sources. Material Energy Density (MJ/1kg) Solar* 0.2-1 Wood 10 Ethanol 268 Coal 32.5 Crude Oil 41.9 Diesel 458 Natural Gas 55.6 Natural Uranium 570000 Reactorgrade Uranium 3700000 *| had to fudge a bit with the
Slide 11: Uranium Demand
Uranium Demand REGION Reactor Units and Market Demand Forecasts Anticipated p byy Region g # of U308 # of U308 # of U308 # of U308 Reactor Demand Reactor Demand Reactor Demand Reactor Demand Units mlbs pa Units mlbs pa Units mlbs pa Units mlbs pa 2010 2015 2020 2030 North America 124 52 126 54 133 5
Slide 12: Uranium Supply
Uranium Supply • Kazakhstan ISL U3O8 Production Increases: 2000, 5mlbs 2008, 18mlbs 2009, 36mlbs 2010, 42mlbs restrained spot price but all production has been purchased • Megatons to Megawatts program – Uranium recovery from nuclear weapons ends in 2013 24mlbs – ENDS 11
Slide 13: Future Uranium Supply Issues
Future Uranium Supply Issues • Further Kazak production expansion UNLIKELY • Cigar Lake development delay due to mine flooding (October 2006 / August 2008); Production was to be 2007, now 2013/2014 at earliest UNLIKELY • Olympic Dam expansion ~$9-30Bn DELAYED INDEFINITELY • Mid Midwest t Mine Mi (Mc
Slide 14: Uranium Price Projections
Uranium Price Projections $120 Historic Future Composite Price Scenario $100 $ $80 US$/lb U3O8 $60 U $40 $20 $0 00 01 02 03 04 05 06 07 08 09 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 20 200 200 200 200 200 200 200 200 200 200 202 Composite Price Projection, UxC Uranium Market Outlook Q1 201
Slide 15: USA Uranium
PMNS) USA Uranium _ AMERICA: SIGNIFICANT URANIUM RESOURCE OPPORTUNITY * 104 nuclear reactors consume 55mm lbs of U308/year to generate 20% of US electricity grid * Currently, the US produces approximately 4mm Ibs of U308/year * Down-blended Russian nuclear weapons have supplied the U308 fuel for the
Slide 16: Wyoming Uranium
Wyoming Uranium C rrentl Licenced Currently Christensen‐Irigaray Sweetwater Lance Project Smith Ranch‐Highland In Permitting Ross Lost Creek Hank & Nichols Jab & Antelope Moore Ranch 15
Slide 17: Lance Project – Mineral Potential
Lance Project – Mineral Potential • Explored by Nubeth JV 1971-1984 1971 1984 – 5,400 drill holes – Trial ISR for 8 months • 22 roll fronts e extend tend for a combined linear strike length of 190 miles (305 km) • 13 project areas with drill defined mineralisation 16
Slide 18: Lance Project – Exploration Potential & JORC Resource
Lance Project – Exploration Potential & JORC Resource Exploration Tonnes Grade U3O8 Potential (M) (ppm U3O8) (mlbs) Range From To From To From To Total 117.7 134.7 360 500 95 145 Resource Tonnes Grade U3O8 Thickness GT Category (M) (ppm U3O8) (ft) ((mlbs)) Measured* 3.6 465 3.6 8.9 0.41 Indicated* 6
Slide 19: Ross Permit Area
Ross Permit Area Ross Permit Tonnes Grade U3O8 Area (ppm U3O8) (lbs) Measured 1,980,618 503 2,195,283 Indicated 2,403,208 476 2,523,628 Inferred 688,141 477 724,107 Total 5,071,967 487 5,443,018 • in advanced permitting • permit application to be submitted Dec 2010 • baseline environmental data acqu
Slide 20: Ross P.A. – Geology Fly Through
Ross P.A. – Geology Fly Through 19
Slide 21: In-Situ Recovery – Process
In-Situ Recovery – Process Process • Groundwater combined with oxygen and bicarbonate and circulated through deposit via injection and recovery wells • Oxygen enriched water moves through aquifer and dissolves in-situ uranium • Uranium enriched solution is pumped to surface and precipitated as yello
Slide 22: Worldwide ISR Mining Jurisdiction
Worldwide ISR Mining Jurisdiction 21
Slide 23: Lance Projects – Development Model
Lance Projects – Development Model • 25 2mlbs U3O8 JORC compliant resource 25.2mlbs Resource Tonnes Grade U3O8 Thickness GT Category (M) (ppm U3O8) (mlbs) (ft) Measured* Measured 36 3.6 465 36 3.6 89 8.9 0 41 0.41 Indicated* 6.0 421 5.6 9.0 0.38 Inferred* 17.1 422 16.0 8.5 0.35 Total* Total 26.7 429
Slide 24: Lance Project Schedule
Lance Project Schedule 2009 2010 2011 2012 Permitting Resource Definition Scoping study/ PFS / DFS Construction Commissioning Production Expanded Resource Drilling 23
Slide 25: Lance – Pre-Feasibility Study
Lance – Pre Pre-Feasibility Feasibility Study US$ per lb US$ / Year • ISR mining i i with ith Revenue $65-$75 $112 million centralised plant • 1.5mlbs p.a. U3O8 Operating cash cost (C1) $13.5 $13 5 $20 million • Uranium grade 507ppm Royalties & Tax $7.9 $12 million U 3O 8 Total Operating Cash Cost $
Slide 26: Project Status – D.F.S.
Project Status – D.F.S. • Colorado-based global mining engineering consultants Lyntek Inc • The DFS 80% complete and will be finished by Januaryy 2011,, ahead of schedule • Lyntek has delivered second iteration of plant design and completing the third round of metallurgical testing • Process of opti
Slide 27: Project Status – Met. Testing
Project Status – Met. Testing The agitation Th i i l leach h testing i shows h R Ross uranium i l leaches h very well ll at low concentrations of bicarbonate and oxidant in the lixivant • An average g of all samples p resulted in better than 80% leaching g of uranium • Testing of drill core displays
Slide 28: Project Status – Permitting
Project Status – Permitting Mine Permitting Proceeding to schedule Petrotek Engineering Corporation • completed DDW feasibility study • Applications lodged Baseline Aquifer Characterisation • 24 aquifer monitoring bores completed y g • hydrological p pressurization and p pumping p g tests Weather St
Slide 29: Project Status – Funding
Project Status – Funding • Appointed Rockbury to coordinate the project funding process – Gerard Holden – past MD Barclays Global • Debt – discussions with banking groups underway – likely to involve ˜ 60% debt • Equity – potential involvement of strategic investor – discussions underway 28
Slide 30: Project Status – Uranium Sales
Project Status – Uranium Sales • Discussions ongoing with utilities, brokers, and trading houses • Company assessing various EOI from these groups • Company p y has responded p to RFP’s from three US power utilities and is currently negotiating terms 29
Slide 31: Karoo Projects – South Africa
Karoo Projects – South Africa • 6pproject j g 1,986 km2 in areas covering the Karoo basin • The Karoo is one of the main areas of focus for uranium exploration in RSA • Significant associated molybdenum mineralisation 30
Slide 32: Karoo – Regional Geology
Karoo – Regional Geology Poortjie Teekloof Member Formation Moordenaars// Loxton Members Abrahamskraal Davidskolk Formation Member Stratigraphic Column 6-Dec-10 31
Slide 33: Karoo Projects – Mineral Discovery
Karoo Projects – Mineral Discovery • 1970 1970’s s JCI and Union Carbide drilled 1 1,300 300 drill holes delineated three mineral deposits on three of the of the projects • 2008 Radiometric and magnetic survey over 6 sites - 392 uranium occurrences • 2008 Underlying geology and topography interprete
Slide 34: Karoo Projects – Exploration Potential and Historic Mineralisation
Karoo Projects – Exploration Potential and Historic Mineralisation Exploration Tonnes Grade U3O8 Potential (M) (ppm U3O8) (mlbs) Range From To From To From To Total 36.0 60.0 1,200 1,400 90 150 Historic Grade U3O8 Mineralisation Tonnes (ppm U3O8) ( (mlbs) ) Site 22 860,000 1,480 2.8 Site 45 2,786,00
Slide 35: Site 22 Uranium Potential
Site 22 Uranium Potential • 23 kilometers of prospective strike 2.8mlbs U3O8 at 1,480ppm • 120 km2 of prospective Poortjie Sandstone • 707 percussion holes drilled by JCI • GT7 2.8mlbs drill- defined U3O8 • Amenable to open- pit mining • Numerous un un-tested tested U3O8 occurrences open pit adit ac
Slide 36: Site 22 Uranium Potential
Site 22 Uranium Potential • Historic JCI drilling • Extent of host Poortjie Formation •3,500m • Drill-defined 2.8mlbs U3O8 at 1,480 ppm • multiple stacked uranium-bearing channels h l • full topography • radiometric anomalies • mining limits • mineralised channels • >15mlbs U3O8 potential
Slide 37: Site 45 Uranium Potential
Site 45 Uranium Potential • Prospective p Davidskolk Member • 432 holes Drilled by JCI • Drill-defined mineralisation amenable to open-pit mining 4.8mlbs U3O8 • Numerous un-tested uranium occurrences • Potential for >15mlbs U3O8 open pit audit access Cross Section 6-Dec-10 36
Slide 38: Site 45 Uranium Potential
Site 45 Uranium Potential 25km • DK2 basal sandstone • drill intersections • DK2 resource channel • DK3 upper sandstone • drill intersections • DK3 resource channel • anomalous surface samples • potential 15mlbs U3O8 6-Dec-10 37
Slide 39: Site 29 Uranium Potential
Site 29 Uranium Potential B • 108km2 of Prospective Poortjie Sandstone • 308 holes drilled by A A Union Carbide • Drill-defined 600,000 lbs U3O8 att 1,107 1 107 ppm • Numerous un-tested uranium occurrences 0 1.25 2.5 5 • Multiple untested Kilometers channel systems open pit • Mineralisation amenable
Slide 40: Karoo Projects – Development Model
Karoo Projects – Development De elopment Model • Multiple open-pits; with central processing facility at Beaufort West • Conventional mining & milling operation • All sites within road-hauling distance • Planning production in 2016/2017 • Continue to delineate > 120mlbs of uranium mineralisation 39
Slide 41: Karoo Projects – Project Schedule
Karoo Projects – Project Schedule 2010 2011 2012 2013 2014 2015 2016 2017 Resource Definition (JORC conversion) Internal Conceptual Study Ext. Scoping study PFS/BFS Constr ction Construction Commissioning Production Expanded Resource Ongoing Drilling 40
Slide 42: Karoo Projects – Conceptual Study
Karoo Projects – Conceptual Study US$ p per lb US$ / Year • Assume 30mlb U3O8 Revenue $65-75 $191 million and 3mlbs p.a. Capex Amortisation $3.4 $11.6 million production Financing cost $1.0 $3.3 million • p p mining Open-pit g with Operating Costs $28.5 $76.1 million conventional milling Royalty (3%
Slide 43: Karoo Targeted Milestones
Karoo Targeted Milestones • Dec 2010: Commence resource development drilling program • June 2011: JORC compliant resource • Dec 2012: JORC compliant resource of ~30mlbs • June 2014: Complete Definitive Feasibility Study • July 2016: Commencement of production 42
Slide 44: Wyoming Targeted Milestones
Wyoming Targeted Milestones • April 2010: Initial JORC compliant resource at Lance • May 2010: Pre-feasibility study completed • July 2010: Revised JORC compliant resource • Dec 2010: 2nd revised JORC compliant resource • Dec 2010: Submit final licence applications • Jan 2011: Uranium sales co
Slide 45: Emerging Uranium Producer
Emerging Uranium Producer Wyoming ISR (100% Pen) 25.2mlbs JORC Compliant Resource U3O8 95 – 145mlbs U3O8 Potential Karoo Sandstones (74%) ( ) 90 – 150mlbs U3O8 Potential 6-Dec-10 44
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