Annual General Meeting Presentation 23 November 2016 Pilgangoora - - PowerPoint PPT Presentation

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Annual General Meeting Presentation

23 November 2016

Pilgangoora Lithium: An Emerging Near Term Production Project

Disclaimer

This presentation has been prepared by Altura Mining Limited (“Altura” or the “Company”). It should not be considered as an invitation or offer to subscribe for or purchase any securities in the Company or as an inducement to make an invitation or offer with respect to those securities No agreement to subscribe for securities in the Company will be entered into on the basis of with respect to those securities. No agreement to subscribe for securities in the Company will be entered into on the basis of this presentation. This presentation is provided on the basis that none of Altura nor its respective officers, shareholders, related bodies corporate, partners, affiliates, employees, representatives and advisers make any representation or warranty (express or implied) as to the accuracy, reliability, relevance or completeness of the material contained in the presentation and nothing contained in the presentation is, or may be relied upon as, a promise, representation or warranty, whether as to the past or the future. The Company hereby excludes all warranties that can be excluded by law. The presentation contains forward looking information and prospective financial material which is predictive in nature and may p g p p p y be affected by inaccurate assumptions or by known or unknown risks and uncertainties, and may differ materially from results ultimately achieved. All references to future production, production targets and resource targets and infrastructure access are subject to the completion of all necessary feasibility studies, permitting, construction, financing arrangements and infrastructure-related agreements. Where such a reference is made, it should be read subject to this paragraph and in conjunction with further information about the Mineral Resources, Ore Reserves and Exploration Results, as well as the Competent Persons' Statements. All persons should consider seeking appropriate professional advice in reviewing the presentation and all other information with respect to the Company and evaluating the business, financial performance and operations of the Company. Neither the provision of the presentation nor any information contained in the presentation or subsequently communicated to any person in provision of the presentation nor any information contained in the presentation or subsequently communicated to any person in connection with the presentation is, or should be taken as, constituting the giving of investment advice to any person.

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C h a r g i n g f o r w a r d w i t h L i t h i u m

Altura Mining

Altura Mining Limited (ASX:AJM) is an emerging low-cost developer of lithium concentrates with its 100%

• wned Pilgangoora project. Altura has a market capitalisation of A$179m.

Altura's flagship project is the world class Pilgangoora hard-rock lithium project located in the Pilbara region of Western Australia. The Company completed a Definitive Feasibility Study in September 2016, with the construction of the mine planned to start in Q1 2017 with commissioning and production with the construction of the mine planned to start in Q1 2017 with commissioning and production expected to commence in Q4 2017. Additionally, Altura has other non-core coal assets in Indonesia, which as previously announced by the Company it intends to divest

Capital Structure (as at 21 November

2016)

AUD

Company, it intends to divest.

Altura share price performance since 1 Jan 2016 (A$/share) 2016)

Shares on issue 1,231.8M Share price $0.15 Market capitalisation $179M Market capitalisation $179M Cash (end September 2016) $13.4M

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C h a r g i n g f o r w a r d w i t h L i t h i u m

Source: CommSec as at 21 November 2016

Pilgangoora – Location

Easy access to market via 130km road haul to Port Hedland's Utah Point

• Proximity to port and existing infrastructure

y p g gives the Pilgangoora project a distinct advantage

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C h a r g i n g f o r w a r d w i t h L i t h i u m

Pilgangoora – the asset

• Pilgangoora is a world class low cost lithium project

located in the Pilbara region of Western Australia,

Pilgangoora

g expected to start project commissioning by the end of 2017

• Altura's 100% owned Pilgangoora will be the fourth

d i lithi i i A t li producing lithium mine in Australia

• DFS for Pilgangoora was completed in Q3 2016

identifying 39.2Mt of resource at 1.02% Li2O and 20 3Mt of reserves at 1 06% Li O *

Pilgangoora Lithium District Pilgangoora

20.3Mt of reserves at 1.06% Li2O

• The Pilgangoora deposit will be extracted by open pit

methods enhanced by the shallow and thick mineralisation allowing spodumene ore to be extracted

Mt Marion Mt Cattlin

g p from the commencement of mining

• Based on the Definitive Feasibility Study, Pilgangoora

will have a mine life of 13 years based on current

Mt Cattlin

reserves, producing an average of 220ktpa of 6% Li2O spodumene concentrate at a low cash cost of ~A$316/t FOB

Greenbushes

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C h a r g i n g f o r w a r d w i t h L i t h i u m *Refer to ASX announcements 22 and 26 September 2016

2016 Milestones delivered

The 2016 year has delivered significant milestones in the growth and progression of Altura…

AJM Market Capitalisation increased by over 500% from $35m to $180m AJM Market Capitalisation increased by over 500% from $35m to $180m Strong cash position with a successful $20m capital raising to rapidly advance the Pilgangoora Lithium Project Mineral Resource estimate (JORC 2012) increased by 50% to 39 6mt @ 1 02% Li2O (400kt contained Li2O) * Mineral Resource estimate (JORC 2012) increased by 50% to 39.6mt @ 1.02% Li2O (400kt contained Li2O) Maiden Ore Reserve estimate (JORC 2012) of 20.3mt @ 1.06% Li2O (215kt contained Li2O) * Altura has assembled a vastly experienced in-house project delivery team to bring the project into production

y p p j y g p j p

Binding Offtake Agreement for a minimum of 100ktpa of 6% Li2O concentrate to China - Lionergy Memorandum of Understanding for an additional minimum 100ktpa of 6% Li2O concentrate - OptimumNano Expansive tenement package providing resource upside potential - In place landholder access agreements

(Pastoral and Native Title) – 2 X Mining Leases granted

Definitive Feasibility Study completed Q3 2016 highly impressive return on investment low cost Definitive Feasibility Study completed Q3 2016 – highly impressive return on investment – low cost Significant alliance with large Chinese battery producer in Shaanxi J&R Optimum Energy – set to

become Altura’s largest shareholder

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C h a r g i n g f o r w a r d w i t h L i t h i u m *Refer to ASX announcements 22 and 26 September 2016

Share placement and alliance

Altura has recently announced a Subscription and Cooperation Agreement with leading Chinese battery manufacturer Shaanxi J&R Optimum Energy share to raise A$41.6M (before costs)* y p gy ( )

• Landmark alliance formed with one of China’s leading battery producers significantly de-risks the Altura’s

Pilgangoora Lithium Project - J&R Optimum will hold 19.9% of Altura post completion

• Issue price of 13.6 cents which represents a 8.8% premium to the last closing price and a 4.6% premium to the

30 day VWAP

• Shares to be issued in two tranches: an initial tranche of 123 million shares and a second tranche of 183 million

shares Extraordinary General Meeting (EGM) to be held to approve the issue of the Tranche 2 shares

• J&R Optimum is listed on the Shenzhen Stock Exchange with a current market capitalisation of RMB 25 billion

(equivalent to approximately A$5 billion). ( q pp y )

• Existing offtake partners Lionergy Limited with Binding Offtake Agreement (BOA) and now J&R Optimum form a

strategic supply chain model based on Altura Lithium production – further BOA to finalised for 100% production

• $
• Altura’s proforma cash position of circa A$50M post completion will allow commencement of mine construction

upon receipt of final statutory approvals – expected Q4 2016

• Process provides a strong lead to potential debt funding providers

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C h a r g i n g f o r w a r d w i t h L i t h i u m *Refer to ASX announcement 8 November 2016

Share placement and alliance

Altura and Shaanxi J&R Optimum Energy have now formed a strong alliance that allows each company to link upstream raw battery material supply and downstream battery production company to link upstream raw battery material supply and downstream battery production

• J & R Optimum Energy and Altura Alliance signing

ceremony – Beijing 16 November 2016

• Likeminded strategy to advance growth in both

companies

• Key milestone for Altura by providing a platform to

Key milestone for Altura by providing a platform to secure partners to allocate 100% of lithium concentrate offtake

• Plan to develop Altura’s Pilgangoora Lithium Project

Plan to develop Altura s Pilgangoora Lithium Project in conjunction with additional China based lithium carbonate conversion capacity

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2017 Key deliverables

2017 to be a transformative year as Altura develops its World Class lithium project and prepares for first production to offtake partners p p p p

Construction of Pilgangoora Lithium Project – commence Q1 2017 post delivery of funding package and

statutory approvals

Strong Balance Sheet with estimated cash position of $50m by January 2017 Development of commercial contracts training and employment with stakeholder and native title partners Development of commercial contracts, training and employment with stakeholder and native title partners Further Binding Offtake Agreement to cover 100% of Pilgangoora lithium concentrate production Following 11 month construction period – commissioning of Altura’s Pilgangoora Lithium Project in Q4 2017

Following 11 month construction period commissioning of Altura s Pilgangoora Lithium Project in Q4 2017

Further development of relationship with offtake partners (Lionergy and J&R Optimum Energy) Expansion of lithium inventory via exploration and evaluation and / or acquisitions

p y p q

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Pilgangoora – Development

Altura Pilgangoora Lithium Project – Pit - Waste Rock Dump and Tailings Storage Facility 3D Model

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Project Economics

Altura Pilgangoora Lithium Project DFS Key Results*

• The DFS highlighted a very

attractive project with a long mine p j g life of 13 years, producing an average of 220ktpa of spodumene concentrate over the LOM at a low cash cost of A$316/t

• Even assuming a spodumene

concentrate price of US$539/t (compared with recent sales i f US$600/t) th prices of approx. US$600/t), the project has an assessed pre-tax NPV of A$411m (1)

• IRR of 58% with project payback

1. Net Present Value (NPV) is pre-tax and on a real basis, at a 10% discount rate

• IRR of 58% with project payback

period of 1.8 years

2. Average annual ore feed based nominal 1.4Mtpa capacity; process and mechanical design of the plant allows for 15% engineering contingency on the nominal throughput of 1.4Mtpa, allowing capacity to be maintained at 1.45Mtpa and to peak at 1.54Mtpa. 3. EBITDA is after allowing for Native Title and Royalties 4. Price based on FOB forecast equivalent - refer to Market and Pricing section 5. Total Cash Cost FOB / tonne product are defined as all cash costs to free on board, excluding royalties, interest, tax and depreciation.

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6. Including sustaining capital and pre-development capital **

*Refer to ASX announcement 26 September 2016

Pilgangoora – Development

• Mining is uncomplicated as a conventional single open pit and the processing to produce spodumene concentrate is not

regarded as a complex procedure

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C h a r g i n g f o r w a r d w i t h L i t h i u m

regarded as a complex procedure

Pilgangoora – Further Exploration

Altura has achieved substantial success post DFS Mineral Resource and Ore Reserves estimate completion – with many thick and high grade intercepts * as detailed below: Altura has achieved substantial success post DFS Mineral Resource and Ore Reserves estimate completion – with many thick and high grade intercepts * as detailed below:

12 @ 1 70% Li O f 71 (PRC322) i 3 @ 2 71% Li O f 72

p y g g p p y g g p

• 12m @ 1.70% Li2O from 71m (PRC322) inc 3m @ 2.71% Li2O from 72m
• 24m @ 2.21% Li2O from 63m (PRC325) inc 18m @ 2.54% Li2O from 67m
• 10m @ 1.64% Li2O from 44m (PRC327)
• 7m @ 1 89% Li O from 108m (PRC348) inc 3m @ 2 46% Li O from 110m
• 7m @ 1.89% Li2O from 108m (PRC348) inc 3m @ 2.46% Li2O from 110m
• 16m @ 1.35% Li2O from 62m (PRC352) inc 5m @ 1.98% Li2O from 70m
• 8m @ 2.08% Li2O from 125m (PRC372)
• 47m @ 1 68% Li2O from 98m (PRC378)

47m @ 1.68% Li2O from 98m (PRC378)

• 16m @ 1.29% Li2O from 103m (PRC381) inc 5m @ 1.71% Li2O from 106m
• 18m @ 1.34% Li2O from 48m (PRC384)
• 18m @ 1.50% Li2O from 102m (PRC386) inc 3m @ 2.18% Li2O from 107m

@

2

( ) @

2

• 16m @ 1.42% Li2O from 97m (PRC387) inc 5m @ 2.02% Li2O from 104m
• 50m @ 1.40% Li2O from 111m (PRC390)

* Refer to ASX announcement 22 September 2016

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C h a r g i n g f o r w a r d w i t h L i t h i u m Refer to ASX announcement 22 September 2016

Project Timeline

The pathway to production and milestones are:

 Definitive Feasibility Study (DFS) – completed in September 2016

Definitive Feasibility Study (DFS) completed in September 2016

 Grant of Mining Lease (ML) – completed August 2016  Mining Proposal lodged September 2016  Alliance and significant Subscription and Cooperation Agreement with leading Chinese battery manufacturer Shaanxi J&R

Alliance and significant Subscription and Cooperation Agreement with leading Chinese battery manufacturer Shaanxi J&R Optimum Energy share to raise A$41.6M (before costs)

• Progress non-binding MOU with OptimumNano to reach binding agreement and secure offtake close to 100% of planned

production Delivery of complete project funding package focus now on planned debt proportion

• Delivery of complete project funding package – focus now on planned debt proportion
• Commence onsite construction on approval of Mining Proposal, planned to occur by December 2016
• Commissioning in 4th Quarter 2017
• First production of spodumene in 1st Quarter 2018

April: published FS and commenced DFS January: commence construction July: Native Title Agreement signed October: Financing LOI with Lionergy Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 co e ced S September: DFS l d December: commissioning and first December: Project

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C h a r g i n g f o r w a r d w i t h L i t h i u m Completed production from Pilgangoora financing complete

Reserve and Resource estimates

• The Reserve and Resource estimates below is based on the Definitive Feasibility Study

JORC Category Cut-off Li2O (%) Tonnes (Mt) Li2O (%) Fe2O3 (%) Contained Li2O (tonnes) Measured 0.40

• Indicated

0.40 30.56 1.04 2.00 318,000 Inferred 0.40 8.60 0.95 2.05 82,000 Total Resource 0.40 39.16 1.02 2.01 400,000 Proved 0.40

• Probable

0.40 20.30 1.06 1.96 215,000 Total Reserve 0.40 20.30 1.06 1.96 215,000

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C h a r g i n g f o r w a r d w i t h L i t h i u m *Refer to ASX announcement 22 September 2016

Competent Persons Statement

Pilgangoora – Western Australia

The information in this report that relates to the Mineral Resource for the Pilgangoora lithium deposit is based on information compiled by Mr Stephen Hyland and Mr Bryan Bourke. Mr Hyland is a Fellow of the Australasian Institute of Mining and Metallurgy and Mr Bourke is a Member of the Australian Institute of Geoscientists. Mr Hyland is a principal consultant at Hyland Geological and Mining Consultants and has sufficient experience that is relevant to the style of mineralisation under consideration and to the activity of mineral resource estimation to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Bourke is the Exploration Manager of Altura Mining Limited and has had sufficient experience that is relevant to the style of mineralisation and to the type of deposit under consideration to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Hyland and Mr Bourke consent to the inclusion in the report of the matters based on this information in the form and context in which it appears. consent to the inclusion in the report of the matters based on this information in the form and context in which it appears. The information in this report that relates to the Ore Reserve for the Pilgangoora lithium deposit is based on information compiled by Mr Jake

• Fitzsimons. Mr Fitzsimons is a Member of the Australasian Institute of Mining and Metallurgy. Mr Fitzsimons is a principal consultant at

Orelogy Consulting Pty Ltd and has sufficient experience that is relevant to the style of mineralisation under consideration and to the activity of

• re reserve estimation to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration
• re reserve estimation to qualify as a Competent Person as defined in the 2012 Edition of the Australasian Code for Reporting of Exploration

Results, Mineral Resources and Ore Reserves. Mr Fitzsimons consents to the inclusion in the report of the matters based on this information in the form and context in which it appears. The Company confirms that it is not aware of any new information or data that materially affects the information in included in the ASX announcement on 22 September 2016. Further, all material assumptions and technical parameters underpinning the mineral resource and

• re reserve estimates in those announcements continue to apply and have not materially changed.

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Units 5 & 6, 25 Hamilton Street
 S bi WA 6008 A t li Subiaco, WA 6008 Australia Phone: +61 8 9488 5100
 Fax: +61 8 9488 5199
 f @ E-mail: info@alturamining.com a l t u r a m i n i n g . c o m