Company Presentation Completion of Bankable Feasibility Study Iggy - PowerPoint PPT Presentation

Altech Chemicals Limited (ASX:ATC) Company Presentation Completion of Bankable Feasibility Study Iggy Tan Managing Director

To be a world leading producer of high purity alumina (HPA) Our Vision

Sapphire & Ruby - natural form of high • purity alumina (HPA) Formed by mother nature like diamonds • Sapphire • Colour from impurities Extremely hard – no. 9 on Mohs scale Gemstone • Third hardest mineral behind diamond • Scratch-resistant artificial sapphire • glass made from HPA

• Purified alumina (Al 2 O 3 ) Greater than 99.99% (4N) purity • Maximum allowable impurities of 100ppm • Smelter Grade Alumina (SGA) ~ 99.5% (5,000 ppm • What is HPA? impurities mainly sodium) Bayer Process uses sodium hydroxide (NaOH) • • Sodium impurity is problem for electronics industry SGA – Smelter Grade Alumina

• HPA is placed in an autoclave Heated to >2,000 o C melting point under • intense pressure Artificial • Forms single crystal sapphire (boule) Allowed to cool slowly – 22 day cycle • Sapphire Diamond cutting equipment to cut sapphire • Process shapes Heat & scratch resistant •

High Price Smelter Grade High Purity High Purity High Purity Alumina Alumina Alumina Alumina for Purity SGA 99.5% HPA 99.9% (3N) HPA 99.99% (4N) HPA 99.999% (5N) $0.4 per Kg $1 -10 per Kg $10-50 per Kg $50-150 per Kg Our Target Business

Welcome to the World of HPA Sodium Lamps Hybrid Cars Display Screens Abrasives Ultrafiltration Ceramic Electronic Substrates Tools Special Semiconductors Ceramics HP Refractory Polishing Cosmetics Medical Abrasives Separation Headlights Membranes LED Lighting Optical Lenses Industrial Military Aerospace

High Purity Alumina Applications Phosphor Semi Other LEDs Based Uses of HPA conductors Applications Applications 99.99% 4N Smartphone Others Phosphor sapphire glass is 7% 16% a new market Semiconductors 22% LED 55% Source: Technavio Research “2014 -2018 Global High-purity Alumina Market”

Technavio Research Global HPA demand 19,040tpa in 2014 • • Expected to increase to 48,230tpa by Demand 2018 for HPA • Growing at a CAGR of 28%

HPA Demand & Growth Forecast 60.0 50.0 48.2 39.9 40.0 Demand 32.4 30.0 25.3 for HPA 19.0 20.0 14.1 10.0 0.0 2013 2014 2015 2016 2017 2018 Volume ktpa Source: Technavio Research “2014 -2018 Global High-purity Alumina Market” Global shipments of LED lamps forecast to increase from 864 m in 2015 to 4.1 billion by 2024 - Navigant Research Source: 'LED Lighting: Global Outlook'

Estimate 30g 1 of HPA in an iPhone sapphire • glass screen HPA • 500 million smartphones sold per year If sapphire glass technology was implemented • Demand from o It would require about 15,000tpa of HPA Smartphones o That’s four of our proposed 4,000tpa plant There will be a HPA supply deficit • 1 Altech Estimates

High end Vertu TI with sapphire crystal screen • Rest will follow • Smartphones Sapphire Crystal Screen

sapphire glass apple watch & iphone 7

More Sapphire Display Factories

70% of HPA demand - Asia Pacific region • (APEC) • Region for the world’s manufacturing Altech’s HPA plant (Malaysia) well-positioned • HPA to service APEC region Geographic Transport, customer service, technical • Demand credibility Americas 14% Europe, Middle East, Africa 16% Asia Pacific 70%

• Six largest HPA producers 3 Chinese, 1 Japanese, 1 Sth African, 1 French • Sumitomo Chemical , 3,020 Current HPA Others (15), 3,570 Huantou, 800 Sasol, 1,800 Producers Dailian Rall, 600 Nippon Light Metal, 1,100 Hebei Pengda, 3,000 Baikowski, 1,200 Xuancheng Jing Rui, Zibo Xinfumeng, 2,500 1,200 Technavio Research

Altech’s Differentiation Current HPA Producers Alumina Alumina Aluminium Refinery Smelter Dissolution Bauxite Smelter Grade Alumina 99.8% Aluminium Metal 99.99% HPA Or other high purity Al compounds ALTECH HPA PLANT One Single Process Step Aluminous Clay 99.99% HPA

• Processed by mother nature • Very low Iron (Fe) due to weathering • Silica is non reactive – easily removed Low-impurity Bauxite Canadian Altech Darling HPA HPA Aluminous Clay Range * Project Project Feedstock Al 2 O 3 (%) 34.5 22.77 30.5 SiO 2 (%) 21.5 53.29 56.3 Fe 2 O 3 (%) 21.2 8.36 0.7 TiO 2 (%) 2.00 0.98 0.7 K 2 O (%) 0.24 3.41 0.1 NaO (%) 0.005 1.42 0.1 Typical Mean Analysis

Altech owns 100% of deposit in W Aust • Low environmental impact • Meckering • Previously mined for kaolin – trial pit Aluminous Clay • Low stripping ratio 65Mt JORC Resource • Deposit 130kms from Fremantle Port •

• Use a standard HCl leach process Developed in 1980’s by alumina industry • Couldn’t compete with Bayer SGA costs • Altech’s But great at producing HPA (no sodium ions) • HPA • However little demand of HPA in 1980s Process Demand of HPA is here today •

New HPA Demand + Established Process + Great Deposit + Experienced People  Shareholder Value Altech Experienced People High Purity Business Deposit New Demand Strategy (Electronics) Established HPA HCl Process “the last piece of the puzzle is in place”

• Started development work in early 2011 Many studies and testwork programs • No issues about producing 99.99% HPA • Development Supporting lab pilot plant test work • • Hydromet process not complex Program Conventional proven plant and equipment • To Date Bankable Feasibility Study completed •

Altech HPA Process WESTERN AUSTRALIA Campaign Mining ROM Filter Press Beneficiated Screening Kaolin To Fremantle Dryer > 0.5mm Drum Scrubber Shipping Calcined Clay Feed Storage Hydrochloric Acid Cooler Calciner HCl Gas Polishing Milling Filter Filter 600 C MALAYSIA Screening Stage 1 Crystalisation Acid Leach Vessels Limestone & Lime Neutralised Centrifuge Silica Residue Sale to Microniser HCl gas Cement Plant Neutralising Generator Filter Tank High Purity Clean Alumina HCl Condenser 99.99% HCl HCl water water HCl Gas Gas HCl Centrifuge Centrifuge Centrifuge 1100 C 400 C Calciner Roaster Cooler Stage 3 Cooler Dryer Polishing Stage 2 Crystalisation Filter Crystalisation

Meckering Operation

Meckering Plant Filtration Drum Scrubber Oversize Disposal Dryer Screening Filtration ROM Feed Dryer Baghouse

Beneficiated Kaolin Shipping

Tanjung Langsat Industrial Park, Johor • Bahru (Malaysia) Al clay feedstock shipped from WA • HPA Site • Operating costs ~40% lower than Location Australia • Capital costs expected to be 50-60% lower

Malaysian HPA Operation HPA LOCATION • Hydrochloric acid, sulphuric acid, power & natural gas International container sea-port & Singapore • Investment incentives •

Malaysian HPA Operation Acid Leach Cooler Silica Neutralisation Feed Calciner Beneficiated Kaolin Warehouse Silica Removal Purification Jet Milling & Bagging Roaster Final Product Calciner Product Product Cooler

Capital cost estimate US$76.9 m • Payback period 3.8 years • Pre-tax NPV 10 of US$326 m • Highly • Highly attractive IRR of 30.3% Attractive LT sale price forecast of US$23,000/t for 99.99% • (4N) product BFS Opex of US$8,140/tonne • EBITDA of US$59.4 million •

“It is not often that you see the NPV Highly (US$ 326m) of a project, 4 times the multiple of the capital cost estimate Attractive (US$77m)” Iggy Tan MD BFS

Bottom quartile for operating costs – Why? 1. We own our feedstock Bottom 2. Large scale economy 4,000 tpa – one train Quartile 3. Main reactant HCl re-used 4. Minimal impurity removal costs for Op Costs 5. Plant in low cost country (Malaysia)

Commenced discussions with Asian banks • Targeting around $55 m project debt • Structured project finance options • Project • Europe based bonds Finance Product off take phase • MIDA tax incentives • • Detailed engineering & permitting

“HPA will be part of the next “new age materials boom” like rare earths, lithium and graphene” Iggy Tan MD

Right Place Right Time Right Feedstock Right Technology Thank you