TSX.V: IMA | OTCQX: IMAHF FEASIBILITY STUDY REVEIW MAY 2016 www.imineralsinc.com OTCQX: IMAHF TSX.V: IMA
Forward Looking Statements This presentation may contain forward-looking statements which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance, or achievements of I-Minerals to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Forward looking statements may include statements regarding exploration results and budgets, resource estimates, work programs, strategic plans, market price of industrial minerals or other statements that are not statements of fact. Although I-Minerals believes the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to have been correct. Various factors that may affect future results include, but are not limited to, fluctuations in market prices of minerals, foreign currency exchange fluctuations, risks relating to exploration, including resource estimation and costs and timing of commercial production, requirements for additional financing, political and regulatory risks, and other risks described in I-Minerals ’ management discussions and analyses as filed on SEDAR and EDGAR. Accordingly, undue reliance should not be placed on forward-looking statements OTCQX: IMAHF TSX.V: IMA
Minerals for Economic Growth • US domestic reporting issuer located in mining friendly Idaho • Feasibility Study confirms IMA will be a low cost producer of four unique high value industrial minerals: K-spar, high purity quartz, kaolin, halloysite all contained in one deposit • minerals are consumed in manufacturing of products that are consumed in housing and infrastructure – sectors that are key contributors to the economic recovery o K-spar: N.A. class; used in glazes tiles and sanitaryware o Quartz: N.A. class; used in high end glass Kaolin: N.A. class; � metakaolin = pozzolan used in cement o o Halloysite: world class; plastics, polymers, life sciences • Almost two-thirds of “ ore ” mined is processed into saleable mineral products OTCQX: IMAHF TSX.V: IMA
Strong Economics, but valuation disconnect • Valuation disconnect: Minerals are not COMEX traded causing opaque pricing : Market Cap <US$20 million; FS (after tax) NPV US$250 million • Easy mine to build: most process equipment “ off the shelf ” short lead time to production (~1.5 year after FS funded) • Straight forward State of Idaho permitting: Non-metallic mine, no EIS • Low Cost : FS: $108.3m initial CAPEX; contract mining. • Robust after tax economics: $250 NPV(6%); 25.8%IRR • Strong EBITDA forecast by FS: $44.98m LoM average Operating Income • Experienced Management led by Thomas Conway (Newmont) • Large insider ownership of ~40% led by Allen Ball ~38% • Valuation disconnect severed on production? Opportunity for re-rating? November 2014 Imerys acquired S&B at 9.2 times EBITDA OTCQX: IMAHF TSX.V: IMA
Helmer-Bovill Project • Location: Latah County, Idaho; ~110 miles South of Spokane, WA • Brownfield project: previously mined - logged; excellent infrastructure; o Power / gas: 5 miles from mill site o State highway on property boundary; <100 miles to Interstate o Rail: 50 miles to Lewiston (BN& UP); trunk lines to Spokane (UP); o Tidewater Access to Portland by barge via Snake/Columbia Rivers or truck via Interstate 84 or to Seattle via Interstate 90 • Supportive community - economically depressed resource based county • Land Tenure: Idaho Department of Land Mineral leases. Subject to 5% royalty to State Education Fund � State ’ s financial interest aligned with I-Minerals. OTCQX: IMAHF TSX.V: IMA
MINERAL PRODUCTS OTCQX: IMAHF TSX.V: IMA
CLAY MINERALS – formed by weathering of Na-feldspar Halloysite [Al 2 Si 2 O 5 (OH) 4 ·2H 2 O] • Biodegradable tubular morphology • I-Minerals halloysite world class: high aspect ratio; low heavy metals no crystalline silica, • Traditional uses porcelain / ceramics • Emerging uses: plastics/polymers (strength, weight), life sciences (delivery mechanism, cosmetics), Environmental(nanoporous membranes for separation) Kaolin [Al 2 Si 2 O 5 (OH) 4 ] • Kaolin calcined (heated to +800 o c), bonded water evaporates � • Metakaolin = a pozzolan -a silicate-based material that consumes calcium hydroxide (lime) to produce additional calcium silicate hydrate, the material responsible for holding concrete together. Consuming lime increases the strength and density of concrete, decreases efflorescence; virtually eliminates alkali-silica reaction. • Metakaolin is currently sourced from S.E. USA = expensive. • Fly ash (from coal) a low cost alternative; environmental issues. OTCQX: IMAHF TSX.V: IMA
SAND MINERALS Quartz [SiO 2 ] Value determined by purity (SiO 2 % and how impurities react in melt tests) and fineness of the grind I-Minerals has achieved 99.98% SiO 2 purity through flotation - the low end of high purity quartz market Applications: solar glass, LCD monitors/flat panels, specialty lighting. Removal of a few ppm of Ti opens higher value markets: fiber optics, LED lighting K (Potassium)-Feldspar [KAlSi 3 O 8 ] ( “ K-spar ” ) Value: determined alkali content, purity, K 2 O%, grind I-Minerals K-spar products are best in class: very high K 2 O, very low iron, high alumina (Al) Applications: ceramic bodies and glaze (tiles, sanitary ware, tableware); technical ceramics (aerospace, medical, military), flux in high temperature glazes OTCQX: IMAHF TSX.V: IMA
MINERAL PRODUCT VALUES Market Size (000s tons) (1) Price and Revenue Estimates Geographic IMA Market % FS Price Mineral Min Max Market Target Growth $ Min $ Max Revenue Growth � (2) � (3) Halloysite 150 180 Global 15 300 +2500 22.5% � (4) � (5) Kaolin 50 +250 Western US 45 100 500 13.5% � � (6) Quartz 800 1000 US & Asia 108 50 750 46.0% � � (8) 48 (7) K-spar 200 250 US 100 500 18.0% FS Pricing developed weighted average “ basket price ” of $316 per ton of product FS costs calculated to be $92 per ton of product or $56 per ton of ore Notes (1) Based upon study by Charles River Associates (5) IMA price growth as shift ceramic apps to metakaolin (2) Increased use in plastics polymers key (6) Demand for HPQ off as solar growth currently slow (3) IMA best purity and aspect ratio (7) Imerys closed Monticello GA plant removed 50k tons (4) Metakaolin makes in roads into fly-ash market (8) N.A. production @$240/t Custer- lower grade; +$250/T FOB Spain for IMA comparable K-spar OTCQX: IMAHF TSX.V: IMA
MINING & METALLURGY OTCQX: IMAHF TSX.V: IMA
Simple Mining “ Ore ” is a fine white clayey sand created by the weathering of Thatuna Granodiorite, a unique border phase of the of the Idaho Batholith. Weathering takes place to depths of 75 to 200 feet; little overburden, shallow pits Ore is excavated without drilling or blasting using contract miners utilizing 3 yd 3 excavator and 30 ton trucks Short haul to process facility -10 minute cycle time; mining during daylight hours only. Mining Costs $14.50 / ton product OTCQX: IMAHF TSX.V: IMA
Basic Flow Sheet (developed at Ginn and MRL Pilot Plants) 1. Wet Screen separation clay washed from Sand 2. Quartz K-Spar Sand Fraction • K-spar is floated; quartz sunk via basic flotation • Quartz fraction is ground finer and then re-floated � TrueQ1 product, re-floated up to 2 more times to remove residual K-spar to make high purity quartz products (TrueQ3) 3. Kaolinite Halloysite Clay Fraction • Halloysite is separated from kaolinite with centrifuge • Proprietary flotation � +90% halloysite product • Halloysite slow dried to preserve tubular shape • Kaolin calcined (heated to 900 0 C) to make Metakaolin Processing costs $58.50/t product OTCQX: IMAHF TSX.V: IMA
Project Layout OTCQX: IMAHF TSX.V: IMA
Site Isometric View from East OTCQX: IMAHF TSX.V: IMA
Plant Area General View from the North OTCQX: IMAHF TSX.V: IMA
ECONOMIC VALUATION OTCQX: IMAHF TSX.V: IMA
Bovill Kaolin Feasibility Study Results (March 2016) Completed by GBM Engineers LLC, (overall project management, process plant and infrastructure design; OPEX and CAPEX) with other services provided by HDR Engineering, Inc. (all environmental components; hydrology / hydrogeology; road design); Tetra Tech, Inc. (tailings storage facility design); Mine Development Associates (mine modelling; ore scheduling; mineral reserve estimation); and SRK Consulting (U.S.) Inc. (mineral resource estimation). INITIAL CAPEX US$ 108.3 million SUSTAINING CAPITAL Life of Mine $11.7 million Before Tax: NPV 6 $US 385.8 million IRR 31.6 % After Tax: NPV 6 $US 249.8 million IRR 25.8 % Payback 3.7 years Avg. LoM Operating Income $44.98m ~= EBITDA OTCQX: IMAHF TSX.V: IMA
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