Highfield Resources Limited · ASX:HFR
Highfield Resources — Investor Presentation (January 2019)
27 slides from Highfield Resources's investor presentation, January 2019
Slide 1: Corporate Presentation
Corporate Presentation January 2019
Slide 2: Competent Persons Statement
COMPETENT PERSONS STATEMENT FOR MUGA POTASH PROJECT This update was prepared by Mr Peter Albert, Managing Director of Highfield Resources. The information in this update that relates to Ore Reserves is based on information prepared by Dr Mike Armitage, the Chairman of SRK Consulting (UK) Limited. Dr
Slide 3: Contents
Highfield Resources Limited CONTENTS 1. Vision and Core Values 2. Corporate Summary 3. Muga Mine Competitive Advantages 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 Competitive Posit
Slide 4: Highfield Resources' Vision and Core Values
Highfield Resources’ Vision and Core Values “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, collaboratively with transparency, a
Slide 5: Corporate Summary
Corporate Summary Equity Ordinary Shares in Issue 329.5m Options 43.7m Fully Diluted 373.2m Undiluted Market Cap at A$0.64 (29/01/2018) A$210.9m Cash as at 31 December 2018 A$55.2m Enterprise Value A$155.7m / EUR€97.5m Average Daily Volume (6 months) ~190,000 Shareholders (Fully Diluted) Spanish in-
Slide 6: Muga Mine Competitive Advantages
Muga Mine Competitive Advantages 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 available local labour mark
Slide 7: Highly Experienced Board
Highly Experienced Board 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 Ltd. He has Managing
Slide 8: Firmly Committed and Skilled Management
Firmly committed and skilled management Firmly Committed and Skilled Management 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 Ch
Slide 9: Muga Project Progress to Date
Muga Project Progress to Date 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 including work by Inte
Slide 10: Environmental Permitting Moving to Conclusion
Environmental Permitting Moving to Conclusion Original Submitted updated Submission of EM received all Environmental environmental Reports from all EM requested document to EM requested reports from Ministry in Madrid submission to the relevant clarification on only (April 2017) documentation and re
Slide 11: Permitting Process – Next Steps
Permitting Process – Next Steps The Company continues to remain confident of receiving its DIA , Mining Concession and construction permits Mining Concession Construction Permits • Town Halls • Following a positive DIA the Department • Water Authority of Mines can consider the award of the • Power c
Slide 12: Muga Mine Project update in figures
Muga Mine Project update in figures 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 production 02 Approximately 500
Slide 13: Muga's location is one of its major assets
Muga’s location is one of its major assets 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 Destination (Days) Countr
Slide 14: Muga's location is one of its major assets
Muga’s location is one of its major assets 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 times to customers Dem
Slide 15: Timeline to production and key milestones
Timeline to production and key milestones 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 Preparation Underground Box
Slide 16: Muga's competitive position on the cost curve
Muga’s competitive position on the cost curve against world peers 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$/t 200 Environmental & Other 3.23 Sub Total 97.51 150 G
Slide 17: Muga Mine Competitive margin position
Muga Mine Competitive margin position Margin curve forecast for 2024 (real US$) 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 Oct. 2018 Corporate Pre
Slide 18: Favourable Local Environment
Favourable Local Environment • 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 portals GMOP & SMOP Brine ponds • Qualified
Slide 19: Rehabilitation Plan
Rehabilitation Plan 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 end of planned mine o
Slide 20: Implementing a Sustainable Strategy
11.A Implementing sharp focus onour Environmental, Sustainable Strategy Social and Governance factors A sharp focus on ESG factors to secure to secure a longaterm long term investment investment Setting an example • Forética, the most important sustainability institution in Spain has recognised Geoa
Slide 21: Local stakeholder engagement is key to a successful project
Local stakeholder engagement is key to a successful project 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, information talks, and s
Slide 22: Potash Market Overview: demand steadily increasing
Potash Market Overview: demand steadily increasing 20% increase in global demand since 2012 to 2017 70,000 60,000 50,000 40,000 Kt 30,000 20,000 10,000 - 2012 2013 2014 2015 2016 2017 China North America Brazil Southeast Asia West Europe Other South Asia India FSU Other Latin America Rest of World E
Slide 23: Potash Market Overview: price recovery
Potash Market Overview: price recovery Mine closures in Europe and slower ramp up of new mines has tightened the market and prices have started recover to 2017 320 300 EUR/t 280 Prices are expected to 260 remain strong as USD/t current market fundamentals are 240 220 forecast to continue 200 Forecas
Slide 24: The future for potash demand looks positive
The future for potash demand looks positive 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 fertilisers All forecasts point
Slide 25: Upside Potential – Other Projects
Upside Potential – Other Projects 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 Corporate Presentation 25
Slide 26: Summary – Highfield Resources
Summary – Highfield Resources 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 operators Advancing enviro
Slide 27: www.highfieldresources.com.au
REGISTERED OFFICE 169 Fullarton Road Dulwich SA 5065 Australia SPAIN HEAD OFFICE Avenida Carlos III, 13-15, 1B, 31002 Pamplona, Spain T +34 948 050 577 | F +34 948 050 578 FURTHER INFORMATION Peter Albert Managing Director T +34 628 590 109 Olivier Vadillo Investor Relations T +34 609 811 257 27 www
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