rhyolite ridge definitive feasibility study announcement ... · managing director investor &...
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www.ioneer.com
INVESTOR PRESENTATION
Rhyolite Ridge Definitive Feasibility Study Announcement
ASX:INR
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April, 2020
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This presentation has been prepared as a summary only and does not contain all information about ioneer Ltd’s (ioneer or the Company) assets and liabilities, financial position and performance, profits and losses, prospects, and the rights and liabilities attaching to ioneer’ssecurities. The securities issued by ioneer are considered speculative and there is no guarantee that they will make a return on the capital invested, that dividends will be paid on the shares or that there will be an increase in the value of the shares in the future.
ioneer does not purport to give financial or investment advice. No account has been taken of the objectives, financial situation or needs of any recipient of this presentation. Recipients of this presentation should carefully consider whether the securities issued by ioneer are an appropriate investment for them in light of their personal circumstances, including their financial and taxation position. Investors should make and rely upon their own enquiries before deciding to acquire or deal in the Company's securities.
Forward Looking Statements
Various statements in this presentation constitute statements relating to intentions, future acts and events which are generally classified as “forward looking statements”. These forward looking statements are not guarantees or predictions of future performance and involve known and unknown risks, uncertainties and other important factors (many of which are beyond the Company’s control) that could cause those future acts, events and circumstances to differ materially from what is presented or implicitly portrayed in this presentation.
For example, future reserves described in this presentation may be based, in part, on market prices that may vary significantly from current levels. These variations may materially affect the timing or feasibility of particular developments.
Words such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates”, “potential” and similar expressions are intended to identify forward-looking statements.
ioneer cautions security holders and prospective security holders to not place undue reliance on these forward-looking statements, which reflect the view of ioneer only as of the date of this presentation.
The forward-looking statements made in this presentation relate only to events as of the date on which the statements are made. Except as required by applicable regulations or by law, ioneerdoes not undertake any obligation to publicly update or review any forward-looking statements, whether as a result of new information or future events. Past performance cannot be relied on as a guide to future performance.
Competent Persons Statement
In respect of Mineral Resources and Ore Reserves referred to in this presentation and previously reported by the Company in accordance with JORC Code 2012, the Company confirms that it is not aware of any new information or data that materially affects the information included in the public report titled “Rhyolite Ridge Ore Reserve Increased 280% to 60 million tonnes” dated 30 April 2020 and released on ASX. Further information regarding the Mineral Resource estimate can be found in that report. All material assumptions and technical parameters underpinning the estimates in the report continue to apply and have not materially changed.
In respect of production targets referred to in this presentation, the Company confirms that it is not aware of any new information or data that materially affects the information included in the public report titled “ioneer Delivers Definitive Feasibility that Confirms Rhyolite Ridge as a World-Class Lithium and Boron Project” dated 30 April 2020. Further information regarding the production estimates can be found in that report. All material assumptions and technical parameters underpinning the estimates in the report continue to apply and have not materially changed.
No offer of securities
Nothing in this presentation should be construed as either an offer to sell or a solicitation of an offer to buy or sell ioneer securities in any jurisdiction, or be treated or relied upon as a recommendation or advice by ioneer.
Reliance on third party information
The views expressed in this presentation contain information that has been derived from publicly available sources that have not been independently verified. No representation or warranty is made as to the accuracy, completeness or reliability of the information. This presentation should not be relied upon as a recommendation or forecast by ioneer.
Lithium Carbonate Equivalent
The formula used for the Lithium Carbonate Equivalent (LCE) values quoted in this presentation is: LCE = (lithium carbonate tonnes produced + lithium hydroxide tonnes produced * 0.88
Note
All $’s in this presentation are US$’s except where otherwise noted.
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James D. CalawayNon–Executive Chairman
Bernard RoweManaging Director
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COMPELLING PROJECT ECONOMICS CONFIRMED BY COMPREHENSIVE DFS
WELL-DEFINED AND RELIABLE OPERATING COST
ALL-IN SUSTAINED CASH COST AT THE BOTTOM OF THE GLOBAL COST CURVE
LONG-LIFE RESOURCE WITH VERIFIED EXPANSION POTENTIAL
U.S. ADVANTAGE AND LOW-RISK, MINING-FRIENDLY LOCATION IN NEVADA
CLEAR PATH TO COMPLETION WITH THOROUGHLY VETTED CAPITAL ESTIMATES
SUSTAINABLE PROJECT
www.ioneer.comThe DFS base case lithium carbonate equivalent (LCE) prices averaged ~US$13,000/tonne and boric acid prices averaged US$710/tonne.All annual figures are on an average year basis over 25.24 years 5
Annual Revenue
US$422MAnnual EBITDA
US$288M
Annual After-tax Cashflow
US$193M
After-tax NPV (8% real):
~US$1.27B
Unlevered After Tax IRR
~21%
Estimated Capex
US$785M
www.ioneer.comSource: Roskill for all producing lithium brine and mineral operations shown on this cost curve, except for ioneer estimate sourced from the Rhyolite Ridge DFS. Costs as shown are all-in sustaining costs. The Rhyolite Ridge all-in sustaining costs were based on the same methodology as the Roskill cost estimates.(Cost includes Conversion Cost to Li2CO3, Royalties, Freight CFR China, Assumes spot FX for RMB, AUD, ARS, CLP)
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-
1,000
2,000
3,000
4,000
5,000
6,000
7,000
8,000
9,000
10,000
0 50 100 150 200 250 300 350 400
US$
LC
E
1,000 Metric Tonnes
2019 LCE Cost Curve (US$/metric tonne)
ioneer Brine Mineral
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ioneer market study conducted as part of DFS.Source: Bloomberg
31.5%
28.1%
24.9%
20.0%
15.9%14.6% 14.5%
12.8%
7.6%
Met Coal Oil Natural Gas Nickel Lithium¹ Copper Zinc Aluminum Boron
Historical Price Volatility | 5 Years
www.ioneer.com 8LCE revenue is higher than the assumed lithium price due to conversion of LiOH to LCE by approximately 10%The additional cost variance is due to state tax differentials at different lithium revenue levels
$8,961 $8,735
US$/tonne LCE
LCE Revenue Boric Acid Revenue Product Cost $/t LCE (ex Co-Product)
$23,135
$18,659
$9,924 Margin
$14,173 Margin
Assumed Lithium Price of $15,000/t Assumed Lithium Price of $11,000/t Product Cost $/t LCE (ex Co-Product)
$8,861
ALL IN SUSTAINING CASH COST US$2,510
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Annual Mining:
2.53M Tonnes
Annual Lithium Hydroxide:
22,000 Tonnes
Years 4-26
Annual Boric Acid:
174,400 Tonnes
Years 1-26
Annual Lithium Carbonate Equivalent:
32,000 Tonnes
Years 1-26
Figures are in metric tonnesFigures calculated over average LOMLithium Hydroxide production replaces Lithium Carbonate after year 4Total LCE of 32,000 tpa is based on annual LOM Revenue of $422 million divided by LCE realised price of $13,200/tonne
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Rendered Engineering Model
Ore Handling/ Sizing and Storage
Reagents
Boric Acid Circuit
Sulphur Supply
Plant Utilities
Power Plant
SulphuricAcid Plant
Lithium Carbonate Circuit
Vat Leach PlantEvaporation/ Crystallization
Lithium Hydroxide Circuit (Year Four)
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Long Life of Mine:
63.8MOre Mined
Over 26 Years
Large Ore Reserve1:
60.0MTonnes
Large Mineral Resource1:
146.5M Tonnes
1 For Mineral Resources and Ore Reserve referred to in this presentation, see Company announcement titled “Rhyolite Ridge Ore Reserve Increased 280% to 60 million tonnes” dated 30 April 2020, for further information. Mineral Resource estimates include Ore Reserves
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$35
$16
$17
$28
$33
$18
$10
$17
$12
$599
$695
$785
575
600
625
650
675
700
725
750
775
800
Mill
ion
s U
S$
PFS Estimate
Power Generation
Impurity Removal 1
Mine Equipment & Sulphur
Trailers
Sales Tax & Commissioning
DFS Estimate
+ New Scope
EVP/CRZ Pkg
Increase
VAT & Tank
Lining
Spent Ore
Storage Facility
Freight, etc.
GrowthDFS Final Estimate
NEW SCOPE
GROWTH
www.ioneer.com 141 See Company announcement titled “Outstanding Results from Rhyolite Ridge Pre-Feasibility” dated 23 October 2018, for further information.
Total Annual Improvement:
US$30MTo the Bottom Line
Operating Cost Per Tonne Decreased:
US$8 Annual Savings Approximately:
US$20M
Lithium Carbonate Recovery Increased
From:
82%-85%Savings Approximately:
US$10M
www.ioneer.comAll dates and times are indicative and subject to change.
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• Complete DFS
• Execution Engineering Services (EES) begin
• Finalize permitting submissions for project
• Complete financing plan
• Award long lead items
• Major contracts in negotiation
• Complete financing
• Full notice to proceed
• Site mobilization
• Release equipment fabrication
• Engineering Complete
• Begin concrete construction
• Steel and tank erection begin
Q2 2020 Q3 2020 Q2 2021 Q3 2021 Q2 2023
• Mechanical completion
• Commission plant
• Permanent power available
• First product shipment
Near-Term Timeline
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Low emissions
Low water usage
Small mine footprint
Energy-efficient equipment
Commitment to sustainability
Zero C02 power co-generated at site, low greenhouse gas emissions.
Project design implements best-in-class water utilization while recycling the majority of water usage.
No evaporation ponds or tailings dams.
Low Greenhouse Gas emissions: 0.19 tons CO2e per ton Li2Co3 produced.
All baseline studies (14) for EIS completed over 2 years. Funding 5 year growth study at University of Nevada (UNR) for the successful propagation of Tiehm’s buckwheat.
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0
1,000,000
2,000,000
3,000,000
4,000,000
5,000,000
6,000,000
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040
Total Demand Total Supply
18Source: Benchmark Mineral Intelligence 2020
Rhyolite Ridge Begins Production
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Ample funding in place through at least 2021, ensuring Project timeline
DFS completion allows informed acceleration of strategic funding process
Strong financial position and completion of DFS enables ioneer to manage through the global COVID-19 environment
ioneer remains committed to achieving fair valuation for the Project which will maximize value to shareholders
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Bernard Roweioneer Ltd
Jane Munday / Megan MooreFTI Consulting
Grace AltmanFTI Consulting
Managing Director Investor & Media Relations (Australia)
Investor & Media Relations (USA)
T: +61 419 447 280 T: +61 488 400 248 /+ 61 434 225 643
T: +1 917 208 9352