Lynas Rare Earths Limited · ASX:LYC
Lynas Rare Earths — Lynas — International Minor Metals Conference 2010
29 slides from Lynas Rare Earths's conference presentation, Apr 27, 2010
Slide 1: Will There Be Sufficient Rare Earths To Meet Demand From Clean Energy Technology?
International Minor Metals Conference Will There Be Sufficient Rare Earths For personal use only To Meet Demand From Clean Energy Technology? London, April 2010 Lynas Corporation Limited ACN: 009 066 648
Slide 2: Disclaimer
Di l i Disclaimer For personal use only ► Th release, The l publication bli ti or di distribution t ib ti off this thi presentation t ti iin certain t i jjurisdictions i di ti may b be restricted ti t db by llaw and d th therefore f persons in i such h jjurisdictions i di ti iinto t which hi h thi t
Slide 3: Rare Earths unique properties underpin new materials technology required in today's society
Rare Earths unique properties underpin new materials t i l technology t h l required i d in i today’s t d ’ society i t For personal use only L th id Plus Lanthanides Pl Yttrium Ytt i Are A Rare R Earths E th P Properties ti Of Rare R Earths E th Chemical ▫ Unique electron configuration g Cataly
Slide 4: Hybrid motor and battery technology are dependent upon Rare Earths
Hybrid motor and battery technology are d dependent d t upon Rare R Earths E th For personal use only HYBRID Electric Motor And Generator HYBRID NiMH Battery Neodymium Lanthanum Praseodymium Neodymium Dysprosium Cerium C i Terbium E bli better Enabling b tt emission i i standards t d d
Slide 5: Weight reduction in the automotive industry with Rare Earth magnets improves fuel consumption
Weight reduction in the automotive industry with R Rare E Earths th magnets t iimproves fuel f l consumption ti For personal use only Weight Reduction Through New Magnets Electric motor with Neo magnets is half the weight of traditional ferrite motor Electric seats, windows and mirrors Sunroof a
Slide 6: Rare Earths play a pivotal emissions control role in automotive catalytic converters and clean diesel
Rare Earths play a pivotal emissions control role i automotive in t ti catalytic t l ti converters t andd clean l diesel di l For personal use only Auto--cats In Every New Car Auto Clean Diesel Technology Autocats convert harmful gases to inert Rare Earths compound added to diesel gases fuel in the
Slide 7: Rare Earths are vital for other important energy efficiency applications
Rare Earths are vital for other important energy efficiency ffi i applications li ti For personal use only Compact Fluorescent Light Bulb Fluid Catalytic Cracking Legislation driving demand Lanthanum is used in the catalyst for FCC Europium, Terbium and Yttrium to increase oil refinery yields by 7%
Slide 8: New generation wind turbines are moving to permanent magnet turbines – a high growth market
New generation wind turbines are moving to permanentt magnett tturbines bi – a high hi h growth th market k t For personal use only Wind Turbine Power 120GW global wind generation in 2008 18% annual growth forecast to 2020 to 700GW Turbines scaling to 3MW plus, key differentiator Generator technolog
Slide 9: The consumer electronics industry uses Rare Earths in many applications
The consumer electronics industry uses Rare E th in Earths i many applications li ti For personal use only HIGH POWER NEO MAGNETS PHOSPHORS Disk drives RED GREEN BLUE Computers Data storage TV and computer screens Ipods CRT Video recorders Plasma Gaming consoles LCD Video cameras S
Slide 10: Demand for Rare Earths is driven by the underlying applications, and China dominates production
Demand for Rare Earths is driven by the underlying applications, li ti and d China Chi dominates d i t production d ti For personal use only 2010 Demand Forecast by y Application pp 2010 Demand Forecast by y Region g Other, 3% Phosphors, 11,000t Ceramics, 1% 6% USA, 8% Glass Additive, 13 000t 13,000
Slide 11: Magnets and battery alloy are forecast to be the growth drivers for Rare Earths demand to 2014
Magnets and battery alloy are forecast to be the growth th d drivers i for f Rare R E Earths th demand d d to t 2014 For personal use only Growth Forecast by y Application pp 2014 Demand by y Application pp Application Growth rate 2014 demand Phosphors, Other, 2% % p.a. tonnes 6% Ceramics, 1% • Magn
Slide 12: The sustainability of Rare Earths supply is becoming more fragile
The sustainability of Rare Earths supply is b becoming i more fragile f il For personal use only Rare Earths Supply Sources Chinese Policy Issues (2010 capacity, it REO) Baotou 55,000t 2010 Production Quota is 89,300t Relocation of iron ore mining Baotou: 50,000t Tailing T ili ffacilities ilit
Slide 13: The Chinese Government is seeking to improve the environmental impact of production in China
The Chinese Government is seeking to improve th environmental the i t l iimpactt off production d ti in i China Chi For personal use only Baotou Tailing Pond Southern Clay -13-
Slide 14: As supply tightened in '08 prices increased, in '09 demand dipped, prices have now recovered
As supply tightened in ‘08 prices increased, in ‘09 d demandd dipped, di d prices i have h now recoveredd For personal use only Supply, Demand and Price Development REO US$/k US$/kg US$15.55/kg US$15 55/kg Metric M t i Tonnes T 19 April 10 OB China basis 16.00 185000 15.00 14.00 160000 Chart 13.00 R
Slide 15: Applications use different Rare Earths, the supply distribution does not match demand distribution
Applications use different Rare Earths, the supply di t ib ti does distribution d nott match t h demand d d distribution di t ib ti For personal use only Rare Earths Usage by Application Application La Ce Pr Nd Sm Eu Gd Tb Dy Y Other • Magnets 23.4% 69.4% 2% 0.2% 5% • Battery Alloy 50% 33.4% 3.3% 10
Slide 16: Elemental Pinch Points based on Lynas Demand and Supply for 2010
Elemental Pinch Points based on Lynas Demand and d Supply S l for f 2010 For personal use only Supply vs Demand Supply/Demand imbalance (REO, (REO separated t d products) d t ) (REO, (REO separated t d products) d t ) Demand vs. Supply Lanthanum 41,200t 30,500t Lanthanum -10,700t -27% Cerium 43,900t
Slide 17: Mineral scarcity – it is not about size of resource, it is about production in a specific timeframe
Mineral scarcity – it not about size of resource, it i about is b t production d ti in i a specific ifi timeframe ti f For personal use only Shortages occur when supply as a function of time can no longer keep up with demand as a function of time The ultimate recoverable resource in the ground is ir
Slide 18: Lynas is the leader among defined Rare Earths resources under development outside China
Lynas is the leader among defined Rare Earths resources under d development d l t outside t id China Chi For personal use only Rare Earth Development Projects Bubble Size Represents Stated Production Volume $2,500.00 Steenkampskraal $2,000.00 (US $/ Tonne of Ore, prrices Feb '10) Mt Weld alue $1 500
Slide 19: 2014 Elemental Pinch Points, maximum China supply plus two new resources – shortages remain
2014 Elemental Pinch Points, maximum China supply l plus l two t new resources – shortages h t remain i For personal use only 2014 Supply Assumptions Supply/Demand imbalance (REO, (REO separated t d products) d t ) (REO, (REO separated t d products) d t ) Baotou 60,000t Lanthanum - 10,200t -19% Li
Slide 20: Mount Weld will be a major fully integrated source of Rare Earths supply outside of China
Mount Weld will be a major fully integrated source of Rare Earths supply outside of China For personal use only About Lynas Corporation Assets for Integrated Source of Supply Vision : Be a global leader in Rare Earths for a sustainable future Exchange: Australian Stock Exchange ASX 200 Company, code
Slide 21: Lynas is building a resource base to meet demand with our processing hub in Malaysia
Lynas is building a resource base to meet demand with ith our processing i hub h b in i Malaysia M l i For personal use only Multiple mine sources for f concentrate supplies Mount Weld Malawi * Industrial Infrastructure Chemical industrial land Gebeng Industrial Estate Gas,, Water,, Electricity y
Slide 22: The current mining operation is within the Central Zone Pit
The current mining operation is within the C t l Zone Central Z Pit For personal use only Central Lanthanide Deposit Sector The Total CLD Sector Mineral Resource Mount Weld Tenements (2.5% REO cut-off) Category Tonnes Grade Tonnes (Mt) (%REO) (kt) REO Measured 2.21 14.7 324 Indicated 5.26 10.7 563 I
Slide 23: Mount Weld pit floor is 51m below surface, the mine plan pit floor is another 36m down
Mount Weld pit floor is 51m below surface, the mine i plan l pit it floor fl is i another th 36m 36 down d For personal use only Southern Zone o e Offices Overburden 773,000t on stockpiles 8% 13% 17% 26% 15% 13% 21% 20% Conc. Top soil Plant 1.5km -23-
Slide 24: The Concentration Plant is scheduled to commence operations by the end of 2010
The Concentration Plant is scheduled to commence operations ti b by the th endd off 2010 For personal use only ► All Approvals in place ► Mechanical Engineering Design complete ► All major equipment procured ► Construction contract with Abesque Engineering has been re- re-initiated Mount Weld Concen
Slide 25: Malaysia site construction: Lynas Advanced Materials Plant
Lynas Advanced Malaysia Materials Plant site construction: Piling for post ► Phase 1 : 11,000T , REO t treatment t t workshop k h For personal use only ► Phase 2 : 22,000T REO -25-
Slide 26: The Advanced Materials Plant is scheduled to commence processing in Q3 2011
The Advanced Materials Plant is scheduled to commence processing i in i Q3 2011 For personal use only ► Engineering Design to be completed United Group engaged as the Engineering and Construction Contractor ► All Approvals for construction in place ► Contract Status on- on-site Bulk earth works
Slide 27: Six customer agreements have been signed
Si customer Six t agreements t have h been b signed i d For personal use only Rhodia Supply Contract 6th Customer Agreement – Supply • >US$200M¹ Contract • Long term 10 year contract • Long term multiple year contract • Cerium, Europium, Terbium & • Product from Phase I & Phase II of Lanthanum final
Slide 28: Lynas – building a stable supply chain for vital raw materials to a sustainable world
Lynas – building a stable supply chain for vital raw materials t i l tot a sustainable t i bl worldld For personal use only Applications Raw Material Supply Lynas The growth drivers are : China dominates the Funds raised for the 1 More 1. M efficient ffi i t use off market with 95% supply completion
Slide 29: NOTE
NOTE For personal use only The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves is based on information compiled by Brendan Shand, who is a member of The Australasian Institute of Mining and Metallurgy. Brendan Shand is an employee of Lynas Corporatio