Highfield Resources Limited · ASX:HFR
Highfield Resources — Investor Presentation (May 2019)
27 slides from Highfield Resources's investor presentation, May 20, 2019
Slide 1: Corporate Presentation May 2019
For personal use only Corporate Presentation May 2019
Slide 2: Competent Persons Statement for Muga Potash Project
For personal use only COMPETENT PERSONS STATEMENT FOR MUGA POTASH PROJECT This presentation was prepared by Mr Peter Albert, Managing Director of Highfield Resources. The information in this presentation that relates to Ore Reserves is based on information prepared by Dr Mike Armitage, the Chairman
Slide 3: Contents
Corporate Presentation For personal use only CONTENTS 1. Vision and Core Values 2. Corporate Summary 3. Muga Mine Competitive Attributes 4. Board and Senior Management 5. Muga Project and Permitting Progress to Date 6. Muga’s Strategic Location 7. Timeline to Production and Key Milestones 8. Muga’s
Slide 4: Highfield Resources' Vision and Core Values
Highfield Resources’ Vision and Core Values For personal use only “To build a successful, sustainable, potash business with respect for stakeholders and the environment” Commitment Respect We are committed to best practices in To act and communicate health and safety, the environment, collaborativel
Slide 5: Corporate Summary
Corporate Summary For personal use only Equity Ordinary Shares in Issue 329.5m Options 43.7m Fully Diluted 373.2m Undiluted Market Cap at A$0.70 (17/05/2019) A$230.7m Cash as at 31 March 2019 A$50.2m Enterprise Value A$180.5m / EUR€111.2m Average Daily Volume (6 months) ~120,000 Shareholders (Fully
Slide 6: Muga Mine Competitive Attributes
Muga Mine Competitive Attributes For personal use only Muga Project Update Confirms Commercial Potential Favourable Environment C1 cash costs of €104/t, including salt by-product credit Well advanced permitting approvals and strong community support NPV8 of €1.16 billion, IRR 23% Qualified and avail
Slide 7: Highly Experienced Board
Highly Experienced Board For personal use only He has over 40 years of experience. He was a manager for Shell He has over 35 years of experience in the mining industry. He Derek Carter Peter Albert was CEO for Jinchuan Group International Resources Group and Burmine Ltd before founding Minotaur Gold
Slide 8: Firmly Committed and Skilled Management
Firmly Committed and Skilled Management For personal use only Peter Albert Managing Director & CEO Sixto Jiménez Geoalcali Board Independent Non-Executive Director Ricardo Pérez Mike Norris John Claverley Javier Olloqui Olivier Vadillo External Relations & Sixto Jiménez, born in Chief Financial Offi
Slide 9: Muga Project Progress to Date
Muga Project Progress to Date For personal use only 01 02 03 04 05 06 Completed mine A third-party project Updated Mineral Updated capital cost Signing of an updated Updated Ore Reserve design optimisation review by Micon Resource Statement (capex), operating cost MOU with Acciona Estimate for Muga
Slide 10: The Muga Mine – Environmental Approval
The Muga Mine – Environmental Approval Recent achievements For personal use only • All work, reports and submissions in relation to the Environmental Approval completed • Continuous dialogue with the Environmental Authority in recent weeks, multiple meetings and exchanges of information • Advice fro
Slide 11: Muga Mine Project update in figures
Muga Mine Project update in figures For personal use only The updated Project continues to show strong financial metrics and positions Muga as potentially one of the highest margin potash mines globally 01 Two phase mine development 05 EBITDA of approximately €300 million per annum at full productio
Slide 12: Muga's location is one of its major assets
Muga’s location is one of its major assets For personal use only Proximity to the local premium markets of France and Spain On the doorstep of the European domestic market Competitive access to the large markets in the Americas Muga Mine Major MOP trade routes Muga Mine MOP trade routes Distance Des
Slide 13: Muga's location is one of its major assets
Muga’s location is one of its major assets For personal use only 7 Mt Muga Mine MOP trade routes • The Muga mine will be close to key demand areas of 4 Mt Europe 1,000 kt • With extremely competitive and versatile export options Total Europe – Truck or Ship 650 kt 400 kt Production • Quick delivery
Slide 14: Timeline to production and key milestones
Timeline to production and key milestones For personal use only Construction and commissioning of phase 1* Estimated timeline: 2 years from commencement of construction Month of Project Item pre 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 Preliminary Work High Voltage Site Prepa
Slide 15: Muga's competitive position on the cost curve against world peers
Muga’s competitive position on the cost curve against world peers For personal use only FOB Cost curve forecast for 2024 (real US$) 350 300 C1 Costs Components Euros/tonne of MOP Mining 38.15 Processing 47.74 250 Salt treatment 3.53 Waste and backfilling 4.85 MOP US$/t 200 Environmental & Other 3.23
Slide 16: Muga Mine Competitive margin position
Muga Mine Competitive margin position For personal use only Margin curve forecast for 2024 (real US$) 250 200 150 MOP US$/t 100 50 0 0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75 Highfield Rest of World Source: Argus Media 2024 cost forecasts (Q3 2018 dataset), Highfield Resources., ASX Release 15 O
Slide 17: Favourable Local Environment
Favourable Local Environment For personal use only Facilities Layout • Marginal farm land with natural terrain features, Offices allowing low impact development Dry process plant ROM • Compact site development • Close to world class local infrastructure – roads, ports, water and power Access to port
Slide 18: Rehabilitation Plan
Rehabilitation Plan For personal use only Minimal environmental impact assists social acceptance • Restoration plan designed to progressively reinvigorate the project site during and after mine operations • Salt by-product sold and/or residue placed underground • Zero salt tailings on surface at the
Slide 19: A sharp focus on Environmental, Social and Governance factors
11. A Implementing our Social sharp focus on Environmental, Sustainable Strategy and Governance factors toAsecure sharp afocus long term investment on ESG factors to secure a long term investment For personal use only Setting an example • Forética, the most important sustainability institution in Sp
Slide 20: Local stakeholder engagement is key to a successful project
Local stakeholder engagement is key to a successful project For personal use only Mayors of the region, community members and Company Open Doors Event – October 2017 The Company welcomed over 200 people representatives in information session on August 2018 from local communities Working sessions, in
Slide 21: Potash Market Overview: demand steadily increasing
Potash Market Overview: demand steadily increasing For personal use only 22% increase in global demand since 2012 to 2017 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 2012 2013 2014 2015 2016 2017 2018 Africa & Middle East Europe Other Latin America & Caribbean Brazil North America Other Asia
Slide 22: The future for potash demand looks positive
The future for potash demand looks positive Crop production and population growth For personal use only 2.0 10.0 1.8 9.0 1.6 8.0 1.4 7.0 Billions of tonnes 1.2 6.0 Billion 1.0 5.0 0.8 0.6 The consensus view of potash market 4.0 3.0 0.4 analysts is around 2.5% growth p.a. 2.0 0.2 1.0 0.0 0.0 1980 198
Slide 23: Potash Market Overview: price recovery
Potash Market Overview: price recovery For personal use only European prices have maintained a premium to other prices Tight local supply due to mine closures and high cost local producers have maintained the European price premium 450 Prices are expected to remain strong as current market fundament
Slide 24: The future for potash demand looks positive
The future for potash demand looks positive For personal use only Arable land per person has been decreasing steadily over the years With global population continuing to grow this trend is expected to continue This increases the need for higher crop yields and therefore the requirement for fertilise
Slide 25: Upside Potential – Other Projects
Upside Potential – Other Projects For personal use only Basin of projects with shared characteristics of Muga Potash Mine Location of Highfield’s Muga, Vipasca, Pintanos, Izaga and Sierra del Perdón Projects in Northern Spain
Slide 26: Summary – Highfield Resources
Summary – Highfield Resources For personal use only Significant long term upside Muga Project Update data confirms low capital cost to production Very strong community and local government support High margin driven by technical factors and project location Experienced team of mine builders and oper
Slide 27: For personal use only
For personal use only www.highfieldresources.com
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