Iron Road Ltd · ASX:IRD
Iron Road — Investor Presentation (May 2014)
25 slides from Iron Road's investor presentation, May 2014
Slide 1: Central Eyre Iron Project: Underpinning Regional Renewal
Central Eyre Iron Project Underpinning Regional Renewal www.ironroadlimited.com.au May 2014
Slide 2: Cautionary Statements
Cautionary Statements Forward Looking Statements This announcement contains certain statements with respect to future matters and which may constitute "forward-looking statements". Such statements are only predictions and are subject to inherent risks and uncertainties which could cause actual value
Slide 3: Cautionary Statements
Cautionary Statements Modelling based upon 25 year mine life, consisting of: • Initial 17 years using Proven and Probable Mining Reserve of 2,071Mt @ 15.5% iron (200x100m, 100x50m diamond drill spacing); • Further eight years using 28% Measured, 24% Indicated and 48% Inferred Resources of 1,303Mt @
Slide 4: Underpinning Regional Renewal
Underpinning Regional Renewal Development phase ready Iron Road is ready to build South Australia’s next major development. The CEIP will provide economic, employment and infrastructure benefits to open up opportunities for the Eyre Peninsula and wider State. www.ironroadlimited.com.au 4
Slide 5: Long Life Magnetite Project
Long Life Magnetite Project 1950+ Construction 700+ Long term operations www.ironroadlimited.com.au 5
Slide 6: Central Eyre Iron Project (CEIP)
Central Eyre Iron Project (CEIP) 100% owned Iron Road $100 million definitive feasibility study completed 21.5 million tonnes per annum production 2018 production commences +25 years minimum mine life High quality product reduces steel mill pollution Integrated mine, rail and port development www.ir
Slide 7: Definitive Feasibility Study Key Outcomes
Definitive Feasibility Study Key Outcomes Capital Cost Operating Cost Annual Revenue Capital Intensity US$3.98B US$44.33 US$2.8B US$185 (mine, corridor & port) (FOB)/t (concentrate sales) (per annual tonne) Mine Life NPV (12.5%) Project IRR 25+ years $US2.69B 21% (minimum) (ungeared, post-tax) (unge
Slide 8: Innovative Paths Realised Through DFS
Innovative Paths Realised Through DFS Reduced mine footprint Efficient operations Deep water port Export opportunities • Mine footprint reduced • Modularisation • Selected site doesn’t • Almost 50 million by 2610 hectares reduces project risk on require dredging tonnes per annum multiple fronts • Al
Slide 9: Highly Competitive Operating Costs
Highly Competitive Operating Costs • FOB operating costs (ex- State royalty) of US$44.33 per dry metric tonne • Normalising cost curve for prices received, the CEIP is placed in the second quartile of the 2018 price adjusted CFR China cost curve CEIP • Competitive with recent large- scale Pilbara de
Slide 10: Iron Ore Market
Iron Ore Market • China increasingly working to improve energy efficiencies and air quality • Strategic concern for Chinese steel industry to secure high quality magnetite feedstock in order to meet pollution reduction and energy efficiency goals • CEIP high quality feedstock allows: Less power us
Slide 11: Supportive State and Federal Governments
Supportive State and Federal Governments • August 2013 – Major Development status declared by Deputy Premier Mr John Rau • April 2014 – Major Project Facilitation Status declared by Federal Minister for Infrastructure and Regional Development Mr Warren Truss • Iron Road is the only current South Aus
Slide 12: CEIP To Be A Catalyst For New Opportunities
CEIP To Be A Catalyst For New Opportunities • Dedicated community team • Local events and community sponsorships • Keeping communities informed through: – Community information sessions – Regular updates in the local press – Presentations to community groups, councils and government agencies • Work
Slide 13: Employment and Infrastructure Benefits
Employment and Infrastructure Benefits • Peaking at 1950 jobs during construction 1950+ • Approximately 750 long-term operations roles Construction • Additional capacity for other exporters – both 700+ minerals and agriculture Long term operations • Opens up deep water port access to the state INFRA
Slide 14: About CEIP Operations: Mining
About CEIP Operations: Mining Initial 25 year mine life confirmed 21.5 million tonnes per annum High quality 67% iron concentrate Premium iron blending feedstock for sinter, which feeds the majority of blast furnaces In pit crushing and conveying Gravity separation circuit reduces power demand Effec
Slide 15: About CEIP Operations: Corridor & rail network
About CEIP Operations: Corridor & rail network Heavy-haul railway, 148 kilometres long 25 tonne axle-load capacity Transporting 10,000 tonnes of iron concentrate from mine to port Ore cars will be covered and comprise a secure bottom chute for unloading Potential to connect to national rail network
Slide 16: About CEIP Operations: Cape Hardy Port
About CEIP Operations: Cape Hardy Port Deep water port requires no dredging Initial 70 million tonnes per annum capacity Third party opportunities for export capacity Supports Panamax and Capesize vessels Two berths and single shiploader support efficient turnaround times 1,100 hectares of land read
Slide 17: Next Steps, Ready To Build
Next Steps, Ready To Build • Finalising government submissions and applications • Building and strengthening stakeholder relationships • Discussions continue with the north Asian steel industry • Project participation and offtake discussions progressing with the recent announcement of the DFS findin
Slide 18: New Opportunities for South Australia
New Opportunities for South Australia • DFS completed and Iron Road ready for new building phase • High quality product relevant to customers’ strategic needs • Underpin further opportunities through export opportunities and new projects • Low operating costs ensures long term viability • Fully inte
Slide 19: Delivering Australia's Next Fully Integrated Iron Supply Business
Disclaimer Delivering Australia’s Next Fully Integrated Iron Supply Business Subscribe to alerts online www.ironroadlimited.com.au www.ironroadlimited.com.au 19
Slide 20: Appendices
Appendices www.ironroadlimited.com.au 20
Slide 21: Key Financial Parameters
Key Financial Parameters Key Financial Assumptions (real 2013 terms) Capital cost estimate (incl. contingencies) US$3.98 billion Pre-stripping and preparatory mining works US$0.48 billion Capital intensity US$185 per annual tonne FOB operating cost (ex state royalty) US$44.33/dmt (dry metric tonne)
Slide 22: Key Operating Parameters
Key Operating Parameters Mine life • 25 years Steady state production • 21.5Mtpa of concentrate • Ore mined • Mine strip ratio Mining 3.57 billion tonnes 1.22 : 1 (waste : ore) over life of mine • Product size of greater • Power demand of 260 • Water requirement of 14 Processing than -130 micron (p8
Slide 23: CEIP Resource Statement
CEIP Resource Statement CEIP Global Mineral Resource Tonnes Fe SiO2 Al2O3 P Location Classification (Mt) (%) (%) (%) (%) Measured 2,222 15.69 53.70 12.84 0.08 Murphy South/Rob Roy Indicated 474 15.6 53.7 12.8 0.08 Inferred 667 16 53 12 0.08 Boo-Loo Inferred 328 17 52 12 0.09 Total 3,691 16 53 13 0.0
Slide 24: CEIP Reserve Statement
CEIP Reserve Statement CEIP Global Mineral Resource Tonnes Fe Location Classification (Mt) (%) Proved 1,871 15.6 Murphy South/Rob Roy Probable 200 15.1 Total 2,071 15.5 The information in this report that relates to Reserves estimated for Murphy South / Rob Roy (MSRR) is based on and fairly represen
Slide 25: Large Scale, Long Life Project
Large Scale, Long Life Project 3,000 Largest Measured + Indicated magnetite Mineral Resource in 2,500 Australia. Underpins long life M+I Resources - tonnes (millions) operation: 2,000 • Mineral Resource 1,500 Resource Category Measured (tonnes) 3.7Bt @ 16% Fe* Indicated (tonnes) • Exploration Target