Peninsula Energy Limited · ASX:PEN
Peninsula Energy — 2013 Mines and Money Conference Hong Kong
36 slides from Peninsula Energy's conference presentation, Mar 21, 2013
Slide 1: Company Presentation announcement cover letter
For personal use only 21 March 2013 Companies Announcement Office Via Electronic Lodgement COMPANY PRESENTATION Please find attached a copy of the presentation made by Peninsula Energy Limited's Executive Chairman, Mr John (Gus) Simpson at the 2013 Mines and Money Conference in Hong Kong today. The
Slide 2: 2013 Company Presentation - Emerging Producer
For personal use only 2013 Company Presentation EMERGING PRODUCER
Slide 3: Disclaimer & Competent Person
Disclaimer & Competent Person For personal use only 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 containe
Slide 4: The World Needs Energy
The World Needs Energy For personal use only • Expanding economies require more energy • 1.7billion of world population without electricity Source: International Energy Agency 3
Slide 5: Current and Future Reactors: Electricity Generation and Uranium Consumption
Current and Future Reactors: Electricity Generation and Uranium Consumption For personal use only The Current Number of Nuclear Reactors Under Construction is the Highest since the inception of the Commercial Nuclear Power Industry. Nuclear Generation Capacity will increase from 374,108 Mwe currentl
Slide 6: Increase in Chinese Nuclear Generation
Increase in Chinese Nuclear Generation For personal use only China’s nuclear generation grid will increase from 14,000 Mwe currently to a total 80,000 Mwe by the end of 2020. China produces little uranium of its own and, like India, possesses no currently commercially mineable deposits despite a sig
Slide 7: Chinese Uranium Imports
Chinese Uranium Imports For personal use only During past 4 years, China has spent over US$6 billion to import large quantities of uranium, with 44% of Kazakhstan production going to China, far in excess of their current requirements. Kazakhstan’s huge increase in uranium production largely absorded
Slide 8: World Primary Production v Uranium Consumption
World Primary Production v Uranium Consumption For personal use only For more than 20 years, uranium consumption has exceeded • Downblended primary production, with the difference being made up of weapons grade three sources of secondary supply: material from Russia 100,000 • Re-enriched or 90,000 P
Slide 9: Company Overview
Company Overview For personal use only Emerging uranium producer with established project pipeline • Flagship Lance Projects in Wyoming Lance Wyoming USA • JORC Resource of 54mlbs U3O8 • 2.2mlbs U3O8p.a. ramping up over 4 years • Low Capex – Initial US$69m; Total $130m • US$305 million pre-tax NPV8%
Slide 10: Business Plan
Business Plan For personal use only • Mirror the requirements of the power utilities • Power utilities want security of supply; – This means multiple suppliers with multiple sources in different jurisdictions that are preferably in stable secure countries; – Supply partner with long life mines in US
Slide 11: Implied Market Valuation
Implied Market Valuation For personal use only Production Market cap Pre-Fukushima Market cap Company 2011A Market cap (US$/lb prod) market cap (US$/lb prod) (U3O8 lbs) Cameco 22.4m US$8,400m 375 US$14,324m 639 Paladin 5.7m US$ 962m 169 US$ 3,677m 645 Uranium One 10.7m US$2,590m 242 US$ 5,704m 533 P
Slide 12: Corporate Overview
Corporate Overview For personal use only Capitalisation Share price history Shares on issue 2,953m Share price 3.3c Market capitalisation US$97m Cash US$ 19m Debt (Undrawn) US$ 22m Enterprise value US$100m Shareholding Shares % holding Pala Investments 577m 19.85% BlackRock Funds 293m 10.00% Gus Sim
Slide 13: Directors
Directors For personal use only Board of Directors Gus Simpson Strong strategic leader, extensive background in resources, corporate Executive Chairman finance and management; 25 years experience in USA, Asia, Africa and Australia Alfred Gillman Experienced geologist with strong exploration and reso
Slide 14: Management
Management For personal use only Management Corporate & USA Gus Simpson Strong strategic leader, extensive background in resources, corporate finance and Executive Chairman management; 25 years experience in USA, Asia, Africa and Australia Alfred Gillman Experienced geologist with strong exploration
Slide 15: Management RSA
Management Management RSA For personal use only Glenn Black Senior management engineer; 30 years experience with De Beers in mine construction and COO, CEO South Africa operations in Africa John Simpson Senior mining engineer , 40 years experience, 20 years of which were at a senior mine Mining Engi
Slide 16: Uranium Mining in Wyoming
Uranium Mining in Wyoming For personal use only WYOMING VERY SUPPORTIVE OF URANIUM EXTRACTION 15
Slide 17: Lance – Development Model
Lance – Development Model For personal use only • ISR is a low cost non-disruptive method of recovering uranium as yellow cake • Building a 2.2mlbs per year ISR operation • Inclusive of – Ion exchange facility – centralised resin stripping, drying and packaging plant at Ross (CPP) – Remote ion excha
Slide 18: Lance – Process Schematic
Lance – Process Schematic For personal use only PROVEN TECHNOLOGY – ISL PRODUCES 42% OF WORLD URANIUM
Slide 19: Lance – Financials
Lance – Financials For personal use only Capex by Product. Phase US$ Financial Metrics – Steady State US$ pa US$/lb Gross revenue 178m 62.33* Phase 1: month 1- mth 18 Ross Production Unit 69m Royalties and indirect taxes 17m 7.83 (750klbs pa) Operating costs 18m 8.29 Restoration and closure costs 7m
Slide 20: Project Funding
Project Funding For personal use only • $18.9m Cash; • $22m undrawn Notes from Blackrock Funds; • Wyoming IDB application up to $70m, 7 year term, low interest rate bonds • Blackrock first-right-refusal up to $80m notes; • $120m would see Wyoming project funded to profitability. HIGH DEGREE OF FUNDI
Slide 21: Lance – Permitting Schedule
Lance – Permitting Schedule For personal use only • NRC Source Material Licence − Technical reports completed − Environmental reports completed − Licence application deemed complete − Environmental and technical review complete − BLM acknowledged NRC lead − Grant of draft SML - December 2012 − Grant
Slide 22: Lance – Uranium Sales
Lance – Uranium Sales For personal use only • PEN Marketing company formed TBA Director – Sales and Marketing TBA Director – Utilities TBA CEO • First sale contract entered into in February 2011 – USA utility – WAP $75.60 per lb – 7 year contract – first delivery 2014 • Planned sales structure – 40%
Slide 23: Lance – Development Schedule
Lance – Development Schedule For personal use only 2012 2013 PROJECT EVALUATION ✔ ✔ ✔ ENGINEERING / PROCUREMENT ✔ ✔ PERMITTING Deep Disposal Wells ✔ Permit To Mine ✔ Source Material License (SML) ✔ FUNDING Equity - $10/$14m ✔ ✔ Project Debt - $20/$108m ✔ CONSTRUCTION Pre SML License ✔ Post SML Licen
Slide 24: Lance – Exploration Potential
Lance – Exploration Potential For personal use only • 13 historic resources • 22 roll fronts extend for a combined linear strike length of 194 miles (312km) • Exploration potential 158-217mlbs U3O8 LARGE RESOURCE POTENTIAL - 70+ YEARS MINE LIFE 23
Slide 25: Lance – Rapid Resource Growth
Lance – Rapid Resource Growth For personal use only 60,000,000 2,250 No. PEN Holes Inferred 1,854 4,738 No. NuBeth Holes 4,738 50,000,000 Indicated Measured 1,106 4,738 40,000,000 805 36,513,114 4,738 36,783,402 lbs U3O8 30,000,000 600 4,738 30,178,789 22,454,321 20,000,000 281 4,738 15,955,169 12,6
Slide 26: Karoo – Geological Setting
Karoo – Geological Setting For personal use only • Sandstones of the Adelaide Subgroup (Beaufort Group) • Extends from NE of Western Cape, across SE of Northern Cape, and into Free State • Stretches east to Cradock in the Eastern Cape includes smaller satellite area located to the ENE of Bloemfontei
Slide 27: Karoo Projects
Karoo Projects For personal use only Located in the Karoo region of RSA, approx. 400km to 600km E-NE of Cape Town 7,800 km2 over Permian sandstones 32,176 hectares of freehold land Freehold land covers majority of historic mineralisation Known uranium and molybdenum mineralised province Ownership: P
Slide 28: Karoo – Development Model
Karoo – Development Model For personal use only Historic Completed 2011-12 Planned 2013-14 • Drill-defined 99mlbs U3O8 • 1,245 holes re-probed or drilled by • JORC Code-compliant resource at 1,050 ppm Peninsula for QAQC and JORC 50mlbs U3O8 • 9,850 holes drilled by resource estimate • High grade 1,0
Slide 29: Karoo JORC Code-compliant Resource
Karoo JORC Code-compliant Resource For personal use only Maiden JORC Code-compliant Resource January 2013 Classification eU3O8 Tonnes eU3O8 eU3O8 (ppm) (millions) (ppm) (million lbs) CUT-OFF Indicated 600 6.9 1,020 15.7 Inferred 600 14.8 1,050 34.4 Total 600 21.7 1,040 50.1 Note: Totals may not sum
Slide 30: Karoo – Development Model: Open Pit and Decline Mining
Karoo – Development Model For personal use only Open Pit and Decline Mining • Multiple production faces Alkaline Added Water Added with central processing facility at Rystkuil • All sites within hauling distance • Planning development in 2016/2017 • Continue to delineate 250-350mlbs Exploration Targ
Slide 31: Karoo – Development Schedule
Karoo – Development Schedule For personal use only 2010 2011 2012 2013 2014 2015 2016 2017 Resource Definition ✔ (JORC conversion) Internal Conceptual Study Ext. Scoping Study ✔ PFS/BFS Project Financing Construction Commissioning Production Expanded Resource ✔ ✔ Drilling DEVELOPMENT TARGET C16/C17
Slide 32: Karoo Near Term Potential
Karoo Near Term Potential For personal use only Western Sector U3O8 Mo Deposit Tonnage Average Average Grade U3O8 U3O8 Average Mo (kg) Mo (lbs) Thickness (m) (%U3O8) (kg) (lbs) Grade (%Mo) Site 22 914,000 1 0.14 1,280,000 2,811,000 Site 45 3,151,000 1 0.07 2,206,000 4,863,000 Reitkuil 1,270,000 1 0.
Slide 33: Investment Analysis
Investment Analysis For personal use only • The uranium sector is coming off a historic low • Increased demand and tightening supply will lift the whole uranium sector • Uranium producers attract a significant premium • Peninsula is a near term uranium producer with high liquidity, high margins and
Slide 34: Corporate
Corporate For personal use only ASX: PEN, PENOC Telephone: +61 8 9380 9920 Facsimile: +61 8 9381 5064 Peninsula Energy Limited ABN 67 062 409 303 Website www.pel.net.au Directors Gus Simpson - Executive Chairman Capital Structure Alf Gillman - Technical Director 2,953 million shares Neil Warburton –
Slide 35: Long Term Demand Increasing
Long Term Demand Increasing For personal use only Currently there are 65 reactors under construction TWh and 80 net new reactors by 2021 600 431 511 Other* 500 China 400 India 300 Russia + E. Europe** 200 Asia 100 Americas Europe 0 2012 2021 *Iran, Pakistan, South Africa, Turkey and UAE **Armenia, B
Slide 36: New Uranium Supply Required
New Uranium Supply Required For personal use only Required New Supply of 440mlbs U3O8 over next 10 year 2,500 Required Supply 2,000 Existing Secondary Mlbs – 10 years Supply 1,500 Existing Primary Production 1,000 Strategic Inventory Building 500 World Consumption 0 World Demand World Supply 35
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