the foremost cobalt project generator and...
TRANSCRIPT
The Foremost Cobalt Project Generator and Developer in North America
CruzCapitalCorp.com
BKTPF—USA | A2DMG8—Germany | CUZ—TSX.v
• Certain statements contained in this presentation, including all statements that are not historical facts, contain forward-looking statements and forward looking information within the meaning of applicable securities laws. Such forward-looking statements or information include, but are not limited to, statements or information with the respect to Cruz Cobalt Corp. (“Cruz” or the “Company”) overall objectives and strategic plans, work programs, exploration budgets and targets and minerals resource estimates. Readers should review all of the Company’s public disclosure including its Annual Information Form and the risk factors contained therein filed on www.sedar.com
• Often, but not always, forward-looking statements or information can be identified by the use of words such as “plans”, “expects”, or “does not expect”,
“is expected” “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “does not anticipate”, or “believes” or variations of such words and phrases or statements that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. With respect to forward-looking statements and information contained herein, we have made numerous assumptions including that, among other things, no significant adverse changes will occur to our planned project expenditures, that there will be no significant delays of the completion of our planned exploration programs; as to the continuing availability of capital resources to fund our programs; and that the company will not experience any adverse legislative or regulatory changes. There are numerous uncertainties inherent in estimating mineral reserves and mineral resources, including many factors beyond the Company’s control. Such estimation is a subjective process, and the accuracy of any reserve or resource estimate is a function of the quantity and quality of available data and of the assumptions made and judgment used in engineering and geological interpretation. Although we have attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in the forward looking statements or information, there may be other factors that cause actions, events or results not to be as anticipated or intended. Also, many of the factors are beyond the control of Cruz. Accordingly, readers should not place undue reliance on forward-looking statements or information. Although management believes that the assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that any forward-looking statements or information referenced herein will prove to be accurate.
• Cruz undertakes no obligation to reissue or update any forward-looking statements or information as a result of new information or events after the date hereof except as may be required by law. All forward-looking statements and information herein are qualified by this cautionary statement.
Cautionary Statement
Our Vision
“Cruz Cobalt Corp is focused on acquiring and developing high-grade Cobalt projects in
politically stable, environmentally responsible and ethical mining jurisdictions, essential for
the rapidly growing rechargeable battery and renewable energy sectors.”
Overview: Cobalt Quick Facts
Please click here to see Cruz’s video about cobalt
Why Cobalt? • Cobalt is a crucial metal for manufacturing high energy
density Lithium-ion batteries (LIB)
• Without cobalt, we would not be able to have long-lasting charges on electric vehicles (EV), laptops or smart phones
• Growing demand, supply uncertainty & responsible sourcing concerns are creating an opportunity for a cobalt boom
Cobalt is Critical to LIB Energy Density
• The use of lithium-ion batteries (LIB) in the rapidly growing electric vehicle (EV) market has become the most important growth driver for cobalt demand, as many more batteries will be required in the coming years
• The rechargeable battery segment has become both the largest and potentially fastest growing end-use of cobalt
Cobalt Demand Dominated by LIB Growth • >50% consumption
in rechargeable batteries – up from 1% of market in mid 1990’s
• Total cobalt demand to exceed 120,000 tonnes per annum by 2020, up approximately 30% from the 93,950 tonnes consumed in 2016 (Darton Commodities, 2016)
Source: Darton
• Expectation for projected battery consumption will account for ~60% of all cobalt demand in 2020, representing a 58% increase in battery demand from 2016 levels (Darton Commodities, 2016).
Fueled by Growth in Global EV Market • EV’s expected to account for up to
25% of the market by 2025
• Market adoption accelerating as more manufacturers offer EV’s with larger scale production and a reduction in the cost EV battery pack systems
• China is driving adoption with investment, incentives, infrastructure & punitive measures for internal combustion engine (ICE) vehicles
• Governments worldwide are announcing future bans on ICE’s
10
0
200
400
600
800
1,000
1,200
1,400
1,600
1,800
2,000
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
US$
/kW
h
Lithium-ion Battery Automotive System Stationary Energy System
Source: UBS Deutsche Bank, Tesla, Visual Capitalist, Bloomberg New Energy Finance, Seeking Alpha and PwCCF Analysis
Average Price of Li-ion Batteries continues to decrease
Electric Vehicle Market Penetration is expected to Continue Growing
Goal $100/kWh
$240/kWh competitive @
$3/gallon gas
EVs approaching ICE cost parity
Battery cost of US$140/kWh
achieved & targeting US$100
Battery cost of US$6,000/carvs. engine cost of US$5,500
Market adoption accelerating as more manufactures offer EV’swith larger scale production
EVs expected to account for up to 25% of market by 2025
China driving EV adoption with investment, incentives & punitive measures for ICE’s
Governments announcing ICEfuture bans
31% CAGR
46% CAGR
0
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4
6
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2015 2016 2017E 2018E 2019E 2020E 2021E 2022E 2023E 2024E 2025E
Europe US China Japan ROWSource: Company disclosures, UBS estimates
BEV+PHEV
0% 20% 40% 60% 80% 100%
Volkswagen
Daimler
BMW
Schaeffler (accelerated)
UBS
Conti
GKN
Valeo (high)
Valeo (base)
Schaeffler (base)
Faurecia
Delphi
BEV (P)HEV ICE (incl. mild hybrid)Source: UBS estimates
The LIB Megafactories are Coming
• 20+ Battery Megafactories announced or under construction with >1GWh production, 10 are in China • 2016 LIB industry capacity 120 GWh with at least 265 GWh to be added by 2020 • The $5 Billion Tesla Gigafactory (35 GWh) requires ~7,000 t/yr of cobalt & Benchmark estimates CATL will
require 23,000 t/yr of cobalt by 2020
The Cobalt Supply Problem? • Supply chain concerns with >60% of global cobalt production
from a single country - the politically unstable Democratic Republic of Congo (DRC)
• DRC has a history tarnished by internal conflict, civil war and deeply rooted corruption. DRC is well-documented for using unethical mining practices including child labour, resulting in cobalt becoming the new conflict mineral (blood cobalt)
• Strong possibility of future geopolitical risk with potential supply disruptions in DRC resulting in higher cobalt prices
• China controls the majority of refined global cobalt output and is reliant on the DRC for over 90% of its cobalt supply
• 98% of cobalt is mined as a by-product of copper & nickel, only 2% from primary cobalt mining
• There has been no new North American supply of Cobalt has come on-line in over 45 years
• Cobalt price has bottomed & market deficit
projected in 2017 extending for foreseeable future is creating significant Cobalt price per pound upside potential
• Since 2016, Cobalt prices have increased from under $10 per pound to over $29 per pound and have broken out to new 9-year highs
• We feel that cobalt prices could have the same type of parabolic move like lithium has had
• Similar dynamics that have driven lithium prices higher are present in cobalt and that is why Cruz has established itself as a first mover in the sector
Cobalt vs. Lithium Prices
We’ve seen it happen before…
• Due to geo-political instability in the Democratic Republic of Congo (DRC), during 2006-2008 we saw cobalt prices soar from below $15/pound to well above $50/pound in a matter of months.
• CRU projects current deficit to continue supporting prices between US$27-US$33/lb or higher to 2026
Why Cruz? The Cobalt Solution… • As an early mover in the Cobalt space
Cruz was able to acquire 9 of the best available, under-developed, historically high-grade Cobalt prospects across North America
• Cruz has significant exposure to Cobalt prices by exploring for and developing economic sources of high-grade Cobalt in politically stable, environmentally responsible and ethical mining jurisdictions
• Multiple work programs are currently underway in North America
The Coleman Cobalt Prospect, ON • The Coleman Cobalt Prospect consists
of approximately 1,265 contiguous acres in the Larder Lake mining division of Ontario
• According to the Province of Ontario mineral file, the property returned historic COBALT showings and appear to be an extension of the Tretheway veins. (historic data, needs to be reconfirmed)
• Management has commenced
explorations on this property utilizing the flow through funds on hand. Cruz has recently completed an airborne survey over the 4 Ontario cobalt prospects which has identified 6 primary cobalt targets
The Bucke Cobalt Prospect, ON • The Bucke Cobalt Prospect consists of
approximately 1,580 contiguous acres in the Larder Lake mining division of Ontario
• According to a Province of Ontario Mineral file, the property returned historic COBALT & silver showings on this cobalt-focused prospect. (historic data, needs to be reconfirmed)
• Management has commenced explorations on this property utilizing the flow through funds on hand. Cruz has recently completed an airborne survey over the 4 Ontario cobalt prospects which has identified 6 primary cobalt targets
The Johnson Cobalt Prospect, ON • The Johnson Cobalt Prospect consists
of approximately 900 acres in the Kirkland Lake mining district of Ontario
• According to a Province of Ontario Mineral file, the property returned historic COBALT, silver, nickel & copper showings (historic data, needs to be reconfirmed)
• Management has commenced
explorations on this property utilizing the flow through funds on hand. Cruz has recently completed an airborne survey over the 4 Ontario cobalt prospects which has identified 6 primary cobalt targets
The War Eagle Cobalt Prospect, BC
• The 4,935 acre War Eagle Prospect, according to a Province of British Columbia Mineral file, encountered historic COBALT, nickel and copper showings (historic data, needs to be reconfirmed)
• Management expects to commence exploration on this property shortly, utilizing the flow through funds already on hand to fully assess this property.
MNFILE showings
MNFILE showings
The Idaho Star Cobalt Prospect, ID
• The 880 acre Idaho Star cobalt prospect in Idaho, United States is located approximately nine miles southwest of Saltese, Montana, and 19 miles southeast of Wallace, Idaho. This prospect consists of 44 contiguous claims within the prolific Idaho cobalt belt.
• Geological data was gathered showing this prospect area to have been active for mining of cobalt, silver and copper in the past, which was the reason for the acquisition.
• Cruz has recently mobilized crews and commenced work programs on its 100-per-cent-owned Idaho Star cobalt prospect.
The Chicken Hawk Cobalt Prospect, MT
• The Chicken Hawk cobalt prospect consists of 94 contiguous lode claims covering approximately 1,940 acres and is located in Deer Lodge county, Montana.
• Cobalt, the primary targeted commodity of the Chicken Hawk, is occurring in the pyritized andesite and as cobaltian arsenopyrite; the sulphides are pnuematolytic in origin. The 94 claims surround 4 patented claims, no less than 15 prospects, and 3 adits.
• Management believes that the cobalt trend in the Western USA snakes its way through Idaho, into Montana and up into Southern B.C.
• Cruz has recently mobilized crews and commenced work programs on its 100-per-cent-owned Chicken Hawk cobalt prospect in Montana, USA.
Clayton Valley, NV - Lithium Assets • Cruz has exposure to the lithium market through
its strategically located property in Clayton Valley, Nevada
• As an early mover in this play, Cruz is one of only four companies (Albermarle, Pure Energy & Sienna Resources) to have access to the deepest parts of the only lithium brine basin in production in North America
• Pure Energy Minerals Ltd. (PE.v) has signed a lithium supply agreement with Tesla Motors Inc. (TSLA-Nasdaq)
• Pure Energy’s (PE.v) PEA forecasts average annual production of approximately 10,300 tonnes (“t”) of lithium hydroxide or 9,100 t lithium carbonate equivalent (“LCE”)
Thank You Please contact us for more information:
604-899-9150
CruzCobaltCorp.com
BKTPF:USA | A2DMG8:Germany | CUZ:TSX.v