Igo Limited · ASX:IGO
Igo — Investor Day (February 2020)
129 slides from Igo's investor day presentation, Feb 4, 2020
Slide 1: IGO Limited Analyst Briefing
For personal use only IGO Limited Analyst Briefing 4 February 2020
Slide 2: Cautionary Statements & Disclaimer
Cautionary Statements & Disclaimer • This presentation has been prepared by IGO Limited (“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 For personal use only as an inducement to make an offer or invitation with
Slide 3: Competent Person's Statements
Competent Person’s Statements • Any references to IGO Mineral Resource and Ore Reserve estimates should be read in conjunction with IGO’s Annual Update of Exploration Results, Mineral Resources and Ore Reserves For personal use only dated 30 January 2020 (Annual Statement) and lodged with the ASX fo
Slide 4: Purpose & Strategy
For personal use only Purpose & Strategy 4
Slide 5: Our Purpose
Our Purpose Making a Difference For personal use only We believe in a world where people power makes amazing things happen. Where technology opens up new horizons and clean energy makes the planet a better place for every generation to come. We are bold, passionate, fearless and fun – we are a smart
Slide 6: Strategic Focus
Strategic Focus Strategically focused on metals critical to clean energy For personal use only Globally High-quality Relevant Products Vertically Proactively Integrated People Green 6
Slide 7: Our Purpose: Tangible achievements
Our Purpose Tangible achievements toward the delivery of our purpose For personal use only Globally High-quality Vertically Proactively People Relevant Products Integrated Green • Own and operate • Nickel concentrate • Developed the IGO • Nova hybrid solar farm • Better than Nova – Australia’s highl
Slide 8: Strategic Priorities for FY20
Strategic Priorities for FY20 Leveraging organic and inorganic growth opportunities For personal use only What we’re doing… Optimise Nova safely Improve efficiencies and reduce costs by implementing smart solutions Unlock value from Tropicana Transition to underground mining at Boston Shaker and und
Slide 9: Our Values
For personal use only Our Values 9
Slide 10: Our Values
Our Values Reimagined through co-creation with our people in 2019 to embody the IGO Difference For personal use only 10
Slide 11: People, Culture and Sustainability
For personal use only People, Culture and Sustainability 11
Slide 12: Leadership: Board of Directors
Leadership Highly engaged and experienced Board of Directors For personal use only PETER BILBE PETER BRADFORD Non-Executive Managing Director Chairman & CEO DEBRA BAKKER KATHLEEN BOZANIC PETER BUCK KEITH SPENCE NEIL WARBURTON Non-Executive Non-Executive Non-Executive Non-Executive Non-Executive Dire
Slide 13: Leadership: Executive Leadership Team
Leadership Executive Leadership Team For personal use only PETER BRADFORD KEITH ASHBY KATE BARKER Managing Head of HSEQ General Director & Risk Counsel & CEO JOANNE ANDREW McDONALD MATT DUSCI EDDOWES Company Chief Operating Head of Secretary and Officer Corporate Head of Development Corporate Affair
Slide 14: Safety
Safety Actively creating and fostering a positive safety culture For personal use only Key Lag Injury Metrics(1,2) Key Lead Injury Metrics(3,4) 5 25 4 20 3 15 2 10 1 5 0 0 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 Dec-17 Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 MT
Slide 15: Employee Engagement
Employee Engagement Above benchmark levels of engagement across a range of key metrics For personal use only FY19 Achievements 15% increase in engagement 86% reported pride in working for IGO 37% lower staff turnover rate (YoY) Strong alignment with IGO’s values 15
Slide 16: Graduate Development
Graduate Development Supporting the next generation of industry leaders For personal use only 2019 Program 9 2020 Program 12 16
Slide 17: Sustainability
Sustainability Demonstrated commitment to best in class sustainability practices For personal use only Nova hybrid solar PV-diesel facility completed – set to reduce emissions by ~6,500t CO2/year 2019 Sustainability Report published IGO included in Dow Jones Sustainability Index at 78th percentile 1
Slide 18: Clean Energy Metals
For personal use only Clean Energy Metals 18
Slide 19: Clean Energy Metals
Clean Energy Metals Investment focus on climate and environment is increasing For personal use only 1) Source: Goldman Sachs, Morgan Stanley, Citi 19
Slide 20: Nickel and copper to benefit from clean energy
Clean Energy Metals Nickel and copper to benefit most from the clean energy revolution For personal use only Leverage to clean energy Strong macro support Ni Critical cathode raw material for lithium ion batteries Increasing nickel intensity in cathodes Underinvestment in new supply Establis
Slide 21: Nickel Market
Nickel Market Market deficits expected to be positive for nickel price For personal use only Nickel Stockpiles (kt) Nickel Price (US$/tonne) 600,000 25,000 500,000 20,000 400,000 Consensus forecast nickel price range 15,000 300,000 10,000 200,000 LME Stockpile (1 January 2020) 150,690t 5,000 100,000
Slide 22: Electric Vehicles
Electric Vehicles Sales growth underpins nickel demand For personal use only EV sales forecast(1,2) EV batteries becoming more nickel intensive(3) Million 60 48M 50 40 30% 36% 72% 30 82% 73% 20 10 4M 0 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 NMC (111) NMC (433) NMC (811) NCA NCA+
Slide 23: Electric Vehicles
Electric Vehicles Multiple factors driving strong demand growth for EVs For personal use only Upward revisions in EV sales projections1 Increasing CO2 emission regulations Increasing Changing affordability consumer and vehicle preferences quality toward green alternatives 1) Source: BNEF 2019 23
Slide 24: 2Q20 & 1H20 Results Overview
For personal use only 2Q20 & 1H20 Results Overview 24
Slide 25: 2Q20 Highlights
2Q20 FY19Highlights and 4Q19 Highlights Excellent operational performance from Nova and Tropicana continues For personal use only Metal production from both Nova and Tropicana above top end of pro-rata FY20 guidance range Net Cash A$396M Underlying EBITDA New offtake agreements signed with BHP and T
Slide 26: 1H20 Financial Highlights
1H20 FY19Financial and 4Q19Results Highlights Highlights Record half yearly profit and strengthening balance sheet For personal use only Record half yearly NPAT result Cash of A$453M A$100M Net Cash of A$396M Underlying EBITDA Underlying Free Cash Flow A$271M A$206M Nova and Tropicana remain on trac
Slide 27: 2Q20 Financial Results
2Q20 Financial Results Excellent production result offset by lower realised commodity prices For personal use only Units 1Q20 2Q20 QoQ Revenue and Other Income A$M 263.1 211.6 (20%) Underlying EBITDA(1) A$M 153.9 116.7 (24%) Profit After Tax A$M 66.0 34.1 (48%) Net Cash from Operating Activities A$M
Slide 28: 2Q20 Cash Flow Reconciliation
2Q20 Cash Flow Reconciliation Nova cash flows resulted in 41% increase in cash balance QoQ For personal use only A$M 600 500 23.3 20.7 2.1 4.5 0.3 1.4 400 136.7 300 452.8 200 321.2 100 - Cash at Nova FCF Tropicana FCF Exploration Payments for Corporate and Finance Costs Lease payments Cash at 30 Sep
Slide 29: 2Q20 NPAT Reconciliation
2Q20 NPAT Reconciliation Change in QoQ Nova EBITDA primarily driven by 19% lower nickel price For personal use only A$M 70 60 50 40 49.5 66.0 30 12.2 7.3 7.0 20 1.5 0.1 0.1 3.4 34.1 10 - 1Q20 NPAT Nova Tropicana Exploration Corporate Mark-to- D&A Other Tax 2Q20 NPAT EBITDA EBITDA EBITDA market inves
Slide 30: 1H20 Financial Results
1H20 Financial Results Free Cash Flow generation continues to strengthen balance sheet For personal use only Units 1H19 1H20 Inc/(Dec) Revenue and Other Income A$M 356.4 474.7 33% Underlying EBITDA(1) A$M 130.5 270.7 107% Profit After Tax A$M 0.9 100.1 ~11,000% Net Cash from Operating Activities A$M
Slide 31: 1H20 Cash Flow Reconciliation
1H20 Cash Flow Reconciliation Nova cash generation enhanced by strong metals prices For personal use only A$M 700 600 49.8 40.4 22.9 10.9 1.2 2.6 500 28.6 47.3 206.2 400 300 452.7 200 348.2 100 - Cash at Nova FCF Tropicana Exploration Payments for Corporate Finance Lease Debt Dividend Cash at 30 Jun
Slide 32: 1H20 Segment Financial Results
1H20 Segment Financial Results Nova and Tropicana delivering outstanding financial performance For personal use only Operation Metric 1H19 1H20 Change Inc/(Dec) Revenue 215.1 317.3 102.2 48% Nova Underlying EBITDA(1) 94.0 206.8 112.8 120% Free Cash Flow(2) 88.4 206.2 117.8 133% Revenue 136.4 154.3 1
Slide 33: Nova Operation
For personal use only Nova Operation 33
Slide 34: Nova - Making A Difference
Nova Nova - Making A Difference Our management philosophy For personal use only Delivery Consistent production delivery We consistently and enduringly deliver on our promises, safely, efficiently, sustainably and reliably Safety performance not acceptable Being Better We make a difference by continu
Slide 35: Nova Delivery
For personal use only Nova Delivery 35
Slide 36: Nova – Delivery: Excellent 1H20 Result
Nova – Delivery Excellent 1H20 Result For personal use only Strong and consistent metal production Nickel Copper Cobalt in Concentrate in Concentrate in Concentrate 15,236t 6,779t 561t ▲6% vs 1H19 ▲ 4% vs 1H19 ▲ 8% vs 1H19 Sector leading cost performance Cash Costs EBITDA Margin FCF Margin A$2.52/lb
Slide 37: Track record of outperformance
Nova – Delivery Track record of outperformance For personal use only Nova Production & Cash Costs t A$ 9,000 4.50 8,000 3.98 8,375 4.00 3.84 7,906 7,574 7,724 7,000 7,344 7,513 3.50 6,854 6,000 3.00 5,961 2.78 2.68 5,000 2.59 2.50 2.42 2.22 4,000 4,500 4,454 2.00 1.94 1.79 3,731 3,000 3,482 3,462 3,
Slide 38: Performing in line with FY20 guidance
Nova – Delivery Performing in line with FY20 guidance For personal use only Metric Units 1H20 Result FY20 Guidance Comment Nickel in concentrate t 15,236 27,000 – 30,000 On track to meet FY guidance Copper in concentrate t 6,779 11,000 – 12,500 On track to meet FY guidance Cobalt in concentrate t 56
Slide 39: Mining
Nova – Delivery Mining For personal use only Flexibility Capital development substantially complete enabling mining from multiple fronts Consistency Steady state operations with predictable production and cost performance De-risked Life-of-Mine Majority of Reserve in Proved Category 39
Slide 40: Underground schematic
Nova – Delivery Underground schematic For personal use only 40
Slide 41: Capital development substantially complete
Nova – Delivery Capital development substantially complete For personal use only Mining Development Metres A$M 3500 25 3000 FY19 20 4,382 metres 2500 1,386 metres 1,712 1,322 15 2000 1,425 1,313 1500 10 1,539 1000 934 1552 1498 845 1,064 5 1207 500 1033 869 815 430 439 388 129 2 18 0 0 1Q18 2Q18 3Q1
Slide 42: Processing plant fully ramped up and delivering
Nova – Delivery Processing plant fully ramped up and delivering For personal use only Ore Mined and Milled (kt) Metal Production (t) kt t 480 9,000 Thousands 460 8,000 8,375 460 7,906 7,574 7,724 7,344 7,513 440 7,000 6,854 420 6,000 5,961 409 411 400 5,000 399 396 390 393 380 388 387 4,000 4,500 4,
Slide 43: Resource & Reserves
Resource & Reserves Significant nickel resource remains in situ For personal use only Mineral Resource Estimate (kt Ni)1 Ore Reserve Estimate (kt Ni) 1 0 50 100 150 200 250 300 0 100 200 300 End of CY18 270 End of CY18 219 Resource 0 Resource 1 Reserve -6 Cut off 0 Costs 0 Mined -36 Mined -36 End of
Slide 44: Nova – 1H20 Financial Summary
Nova – 1H20 Financial Summary Quarterly production exceeds top end of pro-rata guidance range for all metals For personal use only Metric Units 1Q20 2Q20 1H20 Pro-rata Guidance1 Nickel in concentrate t 7,724 7,513 15,236 13,500 - 15,000 Copper in concentrate t 3,490 3,289 6,779 5,500 - 6,250 Cobalt
Slide 45: Nova – 1H20 Financial Summary
Nova – 1H20 Financial Summary 19% fall in nickel price QoQ impacted financial performance For personal use only Nova Production 2Q20 Nova Cash Flow Reconciliation Tonnes A$/lb A$M 9,000 $3.00 160 8,000 $2.59 140 4.3 $2.22 $2.50 7,000 $2.42 120 6,000 $2.00 67.6 100 $1.50 5,000 $1.50 80 2.8 4,000 8,37
Slide 46: Nova – Financial Performance
Nova – Financial Performance Strong cash build since commencement of commercial production For personal use only Quarterly Financial Performance A$M A$M 600 550 180 Cumulative Free Cash Flow 500 A$550M 130 400 300 80 200 2Q20 benefited from improved commodity prices 30 100 1Q18 2Q18 3Q18 4Q18 1Q19 2
Slide 47: Delivering strong margins
Nova – Financial Performance Delivering strong margins For personal use only EBITDA Free Cash Flow 140 80% 160 120% 70% 140 120 100% 120 60% 100 80% 100 50% 80 80 60% 40% 60 60 40% 30% 40 40 20% 20% 20 20 10% 0% - - 0% (20) -20% 1Q18 2Q18 3Q18 4Q18 1Q19 2Q19 3Q19 4Q19 1Q20 2Q20 1Q18 2Q18 3Q18 4Q18 1
Slide 48: Safety
Safety Renewed focus following a period of poor performance For personal use only Key Lag Safety Metrics 25 20 15 10 5 0 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 TRIFR SPIFR HPIFR 1) IGO reports safety metrics in accordance with Australian Standard AS 1885.1:1990 which incorporates fatalitie
Slide 49: Safety improvement program
Safety Detailed safety improvement program in place For personal use only 1 Having fit for purpose management system We create a safe work environment that has a 2 A safe, efficient and productive workplace positive impact on our people's wellbeing Having a culture that is the product of 3 behaviour
Slide 50: Nova Being Better
For personal use only Nova Being Better 50
Slide 51: Operational Excellence
Nova – Being Better Operational Excellence For personal use only Our Continuous Program of Improvement Objectives 1 2 3 Productivity Efficiencies Cost Reductions Enablers 1 2 3 Culture Technology Systems & Processes 51
Slide 52: Strong cost performance
Nova – Being Better Strong cost performance For personal use only Quarterly Cash Cost Performance (A$/lb Ni) Unit Costs (A$/tonne) 8.00 A$/tonne 180 9,000 6.00 160 8,000 140 7,000 3.98 4.00 3.84 120 6,000 2.68 2.78 2.59 2.42 1.94 100 5,000 2.00 2.22 1.79 1.50 80 4,000 157 155 144 144 143 148 - 60 3,
Slide 53: Recoveries stabilising
Nova – Processing Recoveries stabilising For personal use only Nickel and Copper Recoveries 90% Stabilised recoveries 89.0% with numerous 88% 87.1% 86.8% improvements 87.0% 86.8% 86.8% 86.8% 86.4% 85.6% 87.0% 86% 87.0% 87.0% 86.4% Metal Recoveries (%) 87.1% 84% Major improvement 81.8% 85.3% program
Slide 54: Future Capital Expenditure
Nova – Financial Performance Future Capital Expenditure For personal use only FY20 Outlook – Capital Development Mostly Complete Metric Unit 1H20 FY20 Guidance Metres Metres Sustaining/ improvement 1,800 2,500 A$M 5.8 24 – 26 Capex 1,600 Development Capex A$M 1.2 6–8 1,549 2,000 1,400 1,200 Capital
Slide 55: Management of Capital
Nova – Management of Capital Assessed on a project by project basis For personal use only Secondary Ventilation Telemetry Water – Reverse Osmosis Plant • Remote activation of secondary ventilation fans • Deferred capital of $8M from FY20 for the construction of • ~6-10% power reduction the water tre
Slide 56: Offtake Agreements
Offtake Agreements Competitive concentrate tender process undertaken in parallel to downstream study For personal use only Summary of New Offtake Terms Strong global counterparty interest for Nova concentrate BHP Billiton Nickel West Pty Ltd Trafigura Pte Ltd offtake Materially improved commercial t
Slide 57: Nova Our Systems and Technologies
For personal use only Nova Our Systems and Technologies 57
Slide 58: Smart solutions used at Nova operations
Underground EVs Personnel Tracking Surface Blasting Machine Learning Milling Advanced Data Capture, Simulator ‘Automation Drone Technology | Blaster 3000 Process Control Process and Analytics SMART SOLUTIONS USED AT NOVA OPERATIONS
Slide 59: Nova Proactively Green
For personal use only Nova Proactively Green 59
Slide 60: Greenhouse Gas Emissions
Nova – Proactively Green Greenhouse Gas Emissions For personal use only IGO Scope 1 & 2 GHG Emissions Nova Scope 1 & 2 GHG Emissions Nova Power Plant GHG Emissions 4% 1% 0% 19% 0% 41% 59% 80% 96% Nova Nickel Project NT Exploration Processing Plant WA Corporate offices WA Exploration Power Station HV
Slide 61: Solar Farm
Nova – Proactively Green Solar Farm For personal use only Fully integrated with existing diesel power plant Expected to reduce diesel usage by ~13-17% Set to reduce emissions by ~6,500t CO2/year 1) The Nova solar farm was developed in conjunction Zenith Energy Limited 61
Slide 62: Opportunities to reduce GHG
Nova – Proactively Green Continuing to assess opportunities to reduce GHG For personal use only Low-carbon LNG fuel conversion Potential to reduce CO2 emissions by a further ~20-25% Project would deliver reductions to C1 costs 62
Slide 63: Nova People & Culture
For personal use only Nova People & Culture 63
Slide 64: Our People, Our Culture
Our People, Our Culture Culture is fundamental to our success For personal use only 13% Improvement in Employee Engagement 11% Improvement in pride working for IGO with a score of 80% 4% over past 12 months Decrease in turnover; currently ~18% Talent Leadership Communication 15% Female employment Ma
Slide 65: Community
Community Making a Difference For personal use only Supporting emergency services during recent bushfires in Shire of Dundas Highly engaged with Ngadju people, the traditional owners Ongoing support for local businesses and community organisations DFES helicopter refueling at Nova Aerodrome – Decemb
Slide 66: Vertically Integrated
For personal use only Vertically Integrated 66
Slide 67: Downstream Processing
Vertically Integrated Downstream Processing For personal use only IGO Process™ technologically advanced and cost competitive process for converting nickel sulphide concentrate to nickel sulphate Received global interest in the technology Provided leverage during off-take negotiations 67
Slide 68: Downstream Processing
Vertically Integrated Downstream Processing For personal use only High metal extraction Lower cost (1) Lower emissions(1) Lower waste(1) 1) Compared to existing alternative processes to convert nickel concentrate to nickel sulphate 68
Slide 69: Study Outcomes
Study Outcomes Strong financial outcomes based on 70% nickel payability For personal use only Key Assumptions Outcomes Project type/location Western Australia Total Capital Cost (inclusive of all direct, indirect, owners A$530M costs + 10% contingency) Concentrate feed source Nova Operating Costs A$
Slide 70: Next Steps
Next Steps Assessing opportunities to collaborate with partners For personal use only Integration of the IGO Process™ and cathode material production Potential to link mining company, cathode producer and battery company Exploring global partnership with flexibility in current off-take arrangements
Slide 71: Tropicana
For personal use only Tropicana 71
Slide 72: A significant Australian gold producer
Tropicana A significant Australian gold producer For personal use only CY18 Gold Production – Australian Gold Producers 800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 0 1) Source: S&P Market Intelligence 72
Slide 73: Tropicana Geological setting
Tropicana Geological setting For personal use only 1) Modified from geological mapping or the GSWA 2) ESA satellite photograph taken 29 December 2019 73
Slide 74: Tropicana Highlights
Tropicana Highlights 1H20 gold production ahead of pro-rata guidance For personal use only Metric Units 1Q20 2Q20 1H20 Pro-rata Guidance(1) Gold produced (100%) koz 123.3 133.9 257.3 225,000 – 250,000 Gold Sold (IGO 30%) koz 38.9 38.6 77.6 67,500 – 75,000 Cash cost A$/oz 741 698 719 700 – 780 AISC A
Slide 75: Consistent underlying EBITDA and strong margins
Tropicana Consistent underlying EBITDA and strong margins of 66% For personal use only Tropicana Production (100% ) and AISC 2Q20 Tropicana Cash Flow Reconciliation A$M oz A$/oz 160,000 $1,200 60 $1,066 140,000 $990 $950 $948 $1,000 50 120,000 13.0 $800 40 100,000 2.5 80,000 $600 30 132,945 133,932
Slide 76: Mine schematic
Tropicana Mine schematic For personal use only Boston Shaker Tropicana Havana BS 04 Havana South BS 03 Stg 2 Stg 3 Stg 1 Tropicana Underground Potential N 1 km Havana South Havana Underground Potential Underground Potential 0.3 g/t Wireframe 3.0 g/t Grade Shell 76
Slide 77: Production and Cost History
Production and Cost History Consistently delivering high margin gold production For personal use only Tropicana Production and Cost Performance oz A$/oz 140,000 1,400 136,891 135,224 132,945 133,932 1,200 130,000 125,100 1,000 120,000 123,236 123,320 121,195 800 114,060 114,252 110,000 110,509 600 1
Slide 78: Processing and Recoveries
Processing and Recoveries Balancing the trade-off between throughput and recoveries For personal use only Ore Milled (‘000 t) Gold Recovery ‘000 t % 2,300 90.50% 2,200 90.1% 90.00% 2,100 89.6% 2,000 89.4% 89.50% 89.3% 1,900 89.2% 89.4% 89.1% 89.1% 1,800 89.0% 89.00% 88.8% 1,700 88.8% 1,600 88.7% 88.
Slide 79: Processing and Maintenance Costs
Processing and Maintenance Costs Costs trending lower as milled tonnes have increased For personal use only Processing and Maintenance Costs 30 9 8 25 7 20 6 A$/tonne milled 5 Million Tonnes 15 4 10 3 2 5 1 0 0 2013 2014 2015 2016 2017 2018 2019 Maintenance Cost per tonne milled Processing cost per
Slide 80: Resource and Reserves
Resource and Reserves 7 million ounce gold resource remains For personal use only Mineral Resource Estimate (koz. Au)1 Ore Reserve Estimate (koz. Au) 1 koz. koz. 0 2,000 4,000 6,000 8,000 10,000 0 1,000 2,000 3,000 4,000 5,000 End of End of CY18 7,700 3,740 CY18 Resource -20 Resource 140 Reserve -40
Slide 81: Tangible achievements to optimise Tropicana
Tropicana Tangible achievements to optimise Tropicana For personal use only Plant optimisation Second Ball Mill Derisked circuit Increased throughput HPGR optimised Improved Recovery Increased leach capacity 2016 2017 2018 2019 2020 Long Island Strategy – Grade streaming Boston Shaker Unde
Slide 82: Mill Enhancement
Mill Enhancement Progressive improvement, increased ~47% from original design For personal use only Tropicana mill enhancement Mt Capacity optimisation Plant Matching plant to ore body 9 optimisation 8.6 8.1 8 0.7 7.4 7 0.8 6.6 0.8 6 5.8 5.5 5 Original Plant Original Plant 2014 - 2015 2016 - 2018 Se
Slide 83: Boston Shaker Underground
Boston Shaker Underground Development progressing to schedule For personal use only Summary Mining Method • Conventional mechanised mining • Underhand sublevel open stoping LOM Physicals • Stope production rate approx. 1.1Mtpa • 6.6Mt (2.7Mt in Ore Reserve) • 3.85g/t (3.60g/t in Ore reserve) • 814ko
Slide 84: Underground opportunity
Underground opportunity Potential for additional underground mines at Tropicana and Havana South For personal use only 1) Refer: Annual Update of Exploration Results, Mineral Resources and Ore Reserves released to ASX on 30 January 2020 84
Slide 85: Havana Underground
Havana Underground Brownfields exploration points to strong potential for underground For personal use only Highlighted Drill Holes 36m @ 4.71 g/t (169 g*m) 19m @ 7.69 g/t (146 g*m) 30m @ 3.87 g/t (116 g*m) 23m @ 4.95 g/t (114 g*m) 34m @ 3.35 g/t (114 g*m) Study Underway 1) Refer: Annual Update of E
Slide 86: Exploration Highlights
Exploration Highlights Increasing focus on regional exploration program For personal use only Recent regional drilling program consisted of RC drilling at Voodoo Child, Wild Thing and Electra; with RC and diamond drilling at New Zebra: New Zebra • More strong gold intersected confirming mineralisati
Slide 87: Exploration
For personal use only Exploration 87
Slide 88: Enduring commitment to exploration
Enduring commitment to exploration Increased exploration budget in FY20 to accelerate organic growth opportunity For personal use only FY20 Exploration Budget A$6M A$3M A$4M A$26M A$3M A$66M A$24M Nova Fraser Range Tropicana West Kimberley Lake Mackay Other Greenfields & Generative 88
Slide 89: Exploration Project Pipeline
Exploration Project Pipeline Commitment to unlock the mines of the future For personal use only IGO Exploration Pipeline Battery metal deposit styles Ni-Cu-Co DeBeers Cu-Co (Au) (+Ni-Co) Greenbushes Li Generative West Kimberley Lake Mackay East Kimberley Ni sulphide Generative Yeneena Merlin Raptor
Slide 90: Exploration: Nova & Fraser Range
For personal use only Exploration Nova & Fraser Range 90
Slide 91: Nova & Fraser Range
Nova & Fraser Range Opportunity to unlock significant value through discovery For personal use only Mafic / ultramafic intrusions with nickel/copper sulphides identified along the entire belt VMS Copper/Zinc and Gold prospects also identified Systematic exploration program to unlock the mines of the
Slide 92: Parallels to other belt scale mineralised systems
Nova & Fraser Range Parallels to other belt scale mineralised systems For personal use only Albany Fraser Belt (0.3Mt Ni metal) Thompson Belt (2.7Mt Ni metal) 92
Slide 93: Nickel sulphide systems and intrusion networks
Nova & Fraser Range Nickel sulphide systems are usually part of a larger intrusion network For personal use only Eagle (view looking east)1 Voisey’s Bay (view looking west)2 1) Source: Lundin Mining Corp. Technical Report on the Eagle Mine, dated April 26, 2017, Figure 8-2 2) Source: Lightfoot et at
Slide 94: Exploration Techniques
Exploration Techniques Leveraging various tools to enhance exploration success For personal use only Spectrem and Low Temp SQUID MLEM Aeromagnetics Ground Gravity Complex 3D Seismic Detailed Lithogeochemical Mapping 94
Slide 95: 3D model driven by seismic data
Exploration Techniques 3D model driven by seismic data has helped identify intrusive networks For personal use only Interpreted Nova intrusive system 95
Slide 96: Technology
Technology Harnessing and developing new technology to enhance exploration success For personal use only Rapid hyperspectral scanning mineral mapping DHEM Probes A potential breakthrough to maximise seismic Potential to reduce noise in DHEM data measurements 96
Slide 97: Nova Near Mine
Nova Near Mine Significant opportunity to unlock value through discovery For personal use only 97
Slide 98: Underground drilling the Nova Deeps
Nova Near Mine Underground drilling the “Nova Deeps” For personal use only 7 underground holes drilled in 2Q20 Encouraging results from NBU1987 • Narrow Ni-Cu-Co sulphide breccia ~50m below Nova • Deeper down(1): 1.18m @ 1.11% Cu, 0.2g/t Au, 12g/t Ag (from ~342m) Follow up drilling in 3Q20 1) Source
Slide 99: Brownfields potential southwest of Nova
Nova Near Mine Brownfields potential southwest of Nova For personal use only Nova - Bollinger Strong drilling results southwest of Nova Kaon 1 Kaon 2 Disseminated and blebby magmatic nickel and copper sulphides in numerous holes (A & B below) Follow-up drilling planned for 3Q20 Griffin Chimera Aster
Slide 100: Fraser Range Exploration Program
Fraser Range Exploration Program Extensive work program ahead For personal use only Within 30km of Nova • Test priority surface and downhole EM targets (e.g. Oregon, Stella, Washington, Wineye, etc.) • Continue with LT SQUID MLEM on all ELs around Nova Mining Lease • Complete AC drilling across tene
Slide 101: Fraser Range Discoveries
Fraser Range Discoveries IGO well positioned should these prove viable For personal use only Creasy – Silver Knight1 Legend – Mawson2 Mineral Resource 4.3Mt @ 0.8% Ni, 0.6% Cu, 0.04% Co Demonstrates potential of the Fraser Range to host multiple magmatic nickel sulphide deposits 1) Source: DMIRS GSL
Slide 102: Exploration: Lake Mackay
For personal use only Exploration Lake Mackay 102
Slide 103: Lake Mackay
Lake Mackay Belt-scale multi-commodity opportunity For personal use only Belt scale land position in the Northern Territory Land position >18,000km2 of granted ELs and EL applications Grimlock, Phreaker and Arcee prospects identified 1) Lake Mackay is a joint venture between IGO, Prodigy Gold NL and
Slide 104: Grimlock nickel-cobalt laterite
Lake Mackay Grimlock nickel-cobalt laterite(1) For personal use only Nickel / cobalt / manganese in extensive surface laterite blanket Metallurgical test work conducted to understand leachability at atmospheric pressure – initial results encouraging Shallow drilling planned in 2020 1) Source: Refer
Slide 105: Arcee gold prospect
Lake Mackay Arcee gold prospect(1) For personal use only Orogenic shear-hosted gold mineralisation Gold in bedrock extends over 500m – zone open to north-west Gold in soils extends over 2km 1) Refer ASX announcement released by Prodigy Gold Limited (PRX) on 12 December 2019 titled - Lake Mackay JV U
Slide 106: Exploration: West and East Kimberley
For personal use only Exploration West and East Kimberley 106
Slide 107: Kimberley Projects
Kimberley Projects Geologically similar to Fraser Range – exploring for more Nova's For personal use only Systematic exploration planned, targeting nickel, copper and cobalt Landholding expanded to ~13,000km2 across West and East Kimberley Proven mineralised belts with Savannah Mine and Merlin disco
Slide 108: West Kimberley
West Kimberley Belt scale position with work programs underway For personal use only 38,500 line-kilometres of regional aeromagnetic and radiometric survey completed 1) The West Kimberley JV is a joint venture between IGO and Buxton Resources Limited 108
Slide 109: East Kimberley
East Kimberley Expanded land position over ~8,000km2 For personal use only Large tenure position surrounding Panoramic Resources’ Savannah Ni-Cu-Co operation Bouguer Gravity Image Ground opportunistically staked to establish belt-scale position in proven nickel belt Review of extensive historic open
Slide 110: Exploration: Other Projects
For personal use only Exploration Other Projects 110
Slide 111: Raptor Project – Northern Territory
Raptor Project – Northern Territory First mover on prospective nickel-copper-cobalt belt For personal use only ~17,000km2 land position along Willowra Gravity Ridge Aeromagnetic-radiometric survey commencing imminently Targeting outcropping to shallow-covered Palaeoproterozoic geology 111
Slide 112: Frontier Project – Greenland
Frontier Project – Greenland Generative project focused on tier-1 copper discovery For personal use only Maiden systematic exploration field program conducted during 2019 Prospects with widespread copper identified from detailed rock sampling program Three high-priority areas of interest identified
Slide 113: Exploration: People & Culture
For personal use only Exploration People & Culture 113
Slide 114: People
People Best in class team focused on delivering exploration success For personal use only Diverse team with broad skills and experience 97% retention rate over past two years Focus on safety as 2020 field season commences 114
Slide 115: M&A Update
For personal use only M&A Update 115
Slide 116: Panoramic Takeover Offer
Panoramic Takeover Offer Disciplined approach to M&A For personal use only Launch of conditional Offer Lapse public takeover offer Offer Period 17 January 2020 4 November 2019 • Offer conditions designed to • PAN breached various of IGO • Public disclosures by PAN following protect IGO shareholders
Slide 117: Finance
For personal use only Finance 117
Slide 118: Capital management
Capital management Capital Management Strategy For personal use only Maintaining a strong balance sheet • Current low debt and robust liquidity ratios • Sustain operations in cyclical price environments • Invest in growth and replenish and acquire new assets Capital to sustain the Capital to grow •
Slide 119: Capital management & cash returns
Capital management & cash returns Record return to shareholders in FY19 For personal use only FY19 Allocation Free Cash Flow & Dividend History 300 278 9 250 8 182 ~20% 200 7 138 150 Dividend cents / share 6 100 FCF (A$'M) 5 50 4 ~60% ~20% 0 3 (50) (113) 2 (100) (142) (150) 1 2 1 1 1 2 2 8 6 (200) 0
Slide 120: Tax Losses
Tax Losses FY19 Tax Losses (A$561M) For personal use only Tax Losses & Loss Bundles Tax loss utilisation and Available Fraction 800 • Tax Loss Bundles characterise tax losses as either wholly 700 generated by IGO (Group losses) or acquired in prior year’s 600 corporate transactions. Transferred loss
Slide 121: Tax Losses: Factors impacting cash tax
Tax Losses Factors impacting the payment of Cash Tax For personal use only Factors resulting in higher tax payable, and earlier tax loss utilisation • Higher commodity prices, weaker AUD:USD • Higher profitability and margins, higher grade, recoverability and product payabilities Factors resulting i
Slide 122: By-product credits and impact on Cash Costs
By-product credits and impact on Cash Costs Nova Cash Costs For personal use only FY20 Guidance Unit cost components – 1H20 cash costs • IGO issued the following FY20 guidance in the June 2019 Quarterly Report: FY20 Mining Operation Units Guidance Range Nickel in concentrate t 27,000 to 30,000 Coppe
Slide 123: AISC and implications for cash flow
AISC and implications for cash flow All-In-Sustaining Costs For personal use only What is included? • IGO has adopted the World Gold Council definition of AISC. These include: ─ Cash costs comprising: Mining, processing, general & administrative costs, transport, treatment and refining charges, silv
Slide 124: AISC and implications for cash flow
AISC and implications for cash flow All-In-Sustaining Costs For personal use only 1H20 Reconciliation – AISC vs Tropicana Free Cash Flow (FCF) • Notional AISC represented by 1H20 sales of 77.5koz x AISC of A$1,007/oz = A$75.4M • Waterfall chart demonstrates various non-cash items to arrive at actual
Slide 125: Lease Accounting
Lease Accounting New Accounting Standard AASB16 - Leases For personal use only Lease Recognition Lease Measurement • Effective date for IGO – 1 July 2019 • The lease liability is measured as the present value of the future lease payments. The lease payments are to be • At the inception of a contract
Slide 126: Lease Accounting: 1H20 financial impact
Lease Accounting 1H20 Financial impact of the new leasing standard For personal use only Tropicana RoU Asset A$11.4M Metric Entity Impact of adoption • Present Value of Monthly fixed charges of Pacific Nova A$1.7M Energy Power Purchase Agreement over the term EBITDA A$3.3M Tropicana A$0.8M of t
Slide 127: Making a Difference
For personal use only We believe in a world where people power makes amazing things happen. Where technology opens up new horizons and clean energy makes the planet a better place for every generation to come. We are bold, passionate, fearless and fun - a smarter, kinder, more innovative company. Ou
Slide 128: Appendix 1: Mineral Resources - Nova
Appendix 1: Mineral Resources - Nova Nova Operation – Mineral Resource estimate for the end of CY18/19 31 December 2018 31 December 2019 JORC Source Nickel Copper Cobalt Nickel Copper Cobalt For personal use only Class Mass Mass (Mt) (%) (kt) (%) (kt) (%) (kt) (Mt) (%) (kt) (%) (kt) (%) (kt) Undergr
Slide 129: Appendix 1: Mineral Resources & Ore Reserves – Tropicana
For personal use only Appendix 1: Mineral Resources & Ore Reserves – Tropicana Tropicana Gold Mine – 100% Mineral Resources CY18/19 Tropicana Gold Mine – 100% Ore Reserves CY18/19 31 December 2018 31 December 2019 31 December 2018 31 December 2019 JORC JORC Gold Gold Estimate Mass Gold Mass Gold Est