cif presentation 2011
DESCRIPTION
TRANSCRIPT
2
THIS DOCUMENT IS STRICTLY CONFIDENTIAL AND IS BEING PROVIDED TO YOU SOLELY FOR YOUR INFORMATION BY AMG ADVANCED METALLURGICAL GROUP N.V. (THE “COMPANY”) AND MAY NOT BE REPRODUCED IN ANY FORM OR FURTHER DISTRIBUTED TO ANY OTHER PERSON OR PUBLISHED, IN WHOLE OR IN PART, FOR ANY PURPOSE. FAILURE TO COMPLY WITH THIS RESTRICTION MAY CONSTITUTE A VIOLATION OF APPLICABLE SECURITIES LAWS.
This presentation does not constitute or form part of, and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquire securities of the Company or any of its subsidiaries nor should it or any part of it, nor the fact of its distribution, form the basis of, or be relied on in connection with, any contract or commitment whatsoever.
This presentation has been prepared by, and is the sole responsibility of, the Company. This document, any presentation made in conjunction herewith and any accompanying materials are for information only and are not a prospectus, offering circular or admission document. This presentation does not form a part of, and should not be construed as, an offer, invitation or solicitation to subscribe for or purchase, or dispose of any of the securities of the companies mentioned in this presentation. These materials do not constitute an offer of securities for sale in the United States or an invitation or an offer to the public or form of application to subscribe for securities. Neither this presentation nor anything contained herein shall form the basis of, or be relied on in connection with, any offer or commitment whatsoever. The information contained in this presentation has not been independently verified. No representation or warranty, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy or completeness of the information or the opinions contained herein. The Company and its advisors are under no obligation to update or keep current the information contained in this presentation. To the extent allowed by law, none of the Company or its affiliates, advisors or representatives accept any liability whatsoever (in negligence or otherwise) for any loss howsoever arising from any
use of this presentation or its contents or otherwise arising in connection with the presentation.
Certain statements in this presentation constitute forward-looking statements, including statements regarding the Company's financial position, business strategy, plans and objectives of management for future operations. These statements, which contain the words "believe,” “expect,” “anticipate,” “intends,” “estimate,” “forecast,” “project,” “will,” “may,” “should” and similar expressions, reflect the beliefs and expectations of the management board of directors of the Company and are subject to risks and uncertainties that may cause actual results to differ materially. These risks and uncertainties include, among other factors, the achievement of the anticipated levels of profitability, growth, cost and synergy of the Company’s recent acquisitions, the timely development and acceptance of new products, the impact of competitive pricing, the ability to obtain necessary regulatory approvals, and the impact of general business and global economic conditions. These and other factors could adversely affect the outcome and financial effects of the plans and events described herein.
Neither the Company, nor any of its respective agents, employees or advisors intend or have any duty or obligation to supplement, amend, update or revise any
of the forward-looking statements contained in this presentation.
The information and opinions contained in this document are provided as at the date of this presentation and are subject to change without notice.
This document has not been approved by any competent regulatory or supervisory authority.
Cautionary Note
3
Critical Raw Materials – AMG’s activities
1
H Hydrogen
1.0
3
Li Lithium
6.9
11
Na Sodium
23.0
19
K Potassium
39.1
37
Rb Rubidium
85.5
55
Cs Caesium
132.9
87
Fr Francium
223.0
88
Ra Radium
226.0
4
Be Beryllium
9.0
20
Ca Calcium
40.1
38
Sr Strontium
87.6
56
Ba Barium
137.4
39
Y Yitrium
88.9
57-71
89-103
21
Sc Scandium
45.0
22
Ti Titanium
47.9
40
Zr Zirconium
91.2
72
Hf Hafnium
178.5
104
Rf Rutherfordlium
261
23
V Vanadium
50.9
41
Nb Niobium
92.9
73
Ta Tantalum
181.0
105
Db Dubnium
262
24
Cr Chromium
52.0
42
Mo Molybdenum
95.9
74
W Tungsten
183.9
106
Sg Seaborgium
263
25
Mn Manganese
54.9
43
Tc Technetium
99
75
Re Rhenium
186.2
107
Bh Bohrium
264
26
Fe Iron
55.9
44
Ru Ruthenium
101.0
76
Os Osmium
190.2
108
Hs Hassium
265
27
Co Cobalt
58.9
45
Rh Rhodium
102.9
77
Ir Iridium
192.2
109
Mt Meitnerium
266
28
Ni Nickel
58.7
46
Pd Palladium
106.4
78
Pt Platinum
195.1
110
Ds Darmstadtium
269
29
Cu Copper
63.5
47
Ag Silver
107.9
79
Au Gold
197.0
111
Rg Roentgenium
272
30
Zn Zinc
65.4
48
Cd Cadmium
112.4
80
Hg Mercury
200.6
112
Uum Ununbium
277
5
B Boron
10.8
13
Al Aluminum
27.0
31
Ga Gallium
69.7
49
In Indium
114.8
81
Tl Thallium
204.4
113
Uut Ununtrium
284
6
C Carbon
12.0
14
Si Silicon
28.1
32
Ge Germanium
72.6
50
Sn Tin
118.7
82
Pb Lead
207.2
114
Uuq Ununquadium
289
7
N Nitrogen
14.0
15
P Phosphorus
31.0
33
As Arsenic
74.9
51
Sb Antimony
121.8
83
Bi Bismuth
209.0
115
Uup Ununpentium
288
8
O Oxygen
16.0
16
S Sulfur
32.1
34
Se Selenium
79.0
52
Te Tellurium
127.6
84
Po Polonium
210.0
116
Uuh Ununhexium
292
9
F Fluorine
19.0
17
Cl Chlorine
35.5
35
Br Bromine
79.9
53
I Iodine
126.9
85
At Astatine
210.0
2
He Helium
4.0
10
Ne Neon
20.2
18
Ar Argon
40.0
36
Kr Krypton
83.8
54
Xe Xenon
131.3
86
Rn Radon
222.0
57
La Lanthanum
138.9
89
Ac Actinium
132.9
90
Th Thorium
232.0
58
Ce Cerium
140.1
59
Pr Praseodymium
140.9
91
Pa Protactinium
231.0
60
Nd Neodymium
144.2
92
U Uranium
238.0
61
Pm Promethium
147.0
93
Np Neptunium
237.0
62
Sm Samarium
150.4
94
Pu Plutonium
242.0
62
Eu Europium
152.0
95
Am Americium
243.0
64
Gd Gadolinium
157.3
96
Cm Curium
247.0
65
Tb Terbium
158.9
97
Bk Berkelium
247.0
66
Dy Dysprosium
162.5
98
Cf Californium
251.0
67
Ho Holmium
164.9
99
Es Einsteinium
254.0
68
Er Erbium
167.3
100
Fm Fermium
253.0
69
Tm Thallium
168.9
101
Md Mendelevium
256.0
70
Yb Ytterbium
173.0
102
No Nobelium
254.0
71
Lu Lutetium
175.0
103
Lr Lawrencium
257.0
12
Mg Magnesium
24.3
4
CIF overview
Orebodies, estimated reserves and new potential
Current production and future expansion
Greater recovery of Tantalum from tailings
Current and future business model
New product development
Final remarks
Summary
5
CIF Overview
Founded in 1912 in Rio de Janeiro, Brazil
Bought by Metallurg Group in 1979 (now AMG)
Split into 2 entities:
CIF Mineração S.A. - Mine located in Nazareno
LSM Brasil S.A. – Metallurgical & Chemical plant located in São João del Rei
4.2MW hydropower plant (meets 100% of demand)
135 employees at Mibra mine and 220 in São João del Rei
AMG Brazilian
Holdings BV
(Netherlands)
CIF Mineração S.A. LSM Brasil
S.A.
Ta Concentrate
Feldspar
Tin
Ta and Nb Oxides
Aluminum master alloys
Aluminium grain refiners
Boron based fluoride salts
AMG Advanced
Metallurgical Group
N.V.
(Netherlands)
AMG Advanced
Metallurgical Group
N.V.
(Netherlands)
6
Tantalum (Ta) and Niobium (Nb) Activities
CIF extracts Ta and Nb containing ores from the Mibra mine and either
converts them into high-purity Ta and Nb oxides via chemical processes or
sells them as concentrate
Mibra mine, Nazareno
Production plant, São João del Rei
Acid leaching & solvent extraction
at chemical plant
7
Mibra Mine
The mine has several orebodies with Orebody A being the main source of pegmatite
(6.32 million tons)
Further exploration work on Orebody A, B & C as recommended by SRK
Activities at the mine include surface mining and gravimetric, electrostatic, and
electromagnetic concentration
MetalGrade
(g/t)
Metal Content
(million lbs)
Ta2O5 375 5.2
Nb2O5 92 1.5
Sn 283 2.1
Orebody A The Mibra mine has
an estimated
additional 11.1
million lbs of Ta2O5
in other orebodies
Mine drilling,
excavating, &
loading
8
Mineralogy
Albite (25 – 30%)
Microcline (15 – 20%)
Quartz (20 - 30%)
Spodumene (10 – 15%)
Zinnwaldite (8 – 10%)
Resource Utilization
600,000 mt/yr of
Processed Pegmatite
164,000 mt Lower grade ceramic market
120,000 mt Albite
450 mt Ta Concentrate (~30% Ta content)
36,000 mt Lithium Concentrate
240,000 mt Feldspar Mix CKS-6825
40,000 mt Feldspar By-Product CKS-6830
Certification
SRK certification through the National
Instrument (NI) 43-101 technical report
as issued on 30th July 2008
Indicated mineral resources for CIF Volta
Grande deposit “A” pegmatite of 6.32
million tons at 375 ppm Ta2O5, 92 ppm
Nb2O5, and 283 ppm Sn
Orebody A
9
Other Orebodies
Orebody A
Orebody B
Orebody C
11.6 million tons of hard orebodies
New drilling and surveys lead to existing resources much
higher than previously expected
Completion of this work is expected by Q1 2012
→ 8.6 million lbs Ta2O5 contained in ore
The Mibra mine has several other hard and soft pegmatite orebodies
Orebodies B and C-south
Kaolinized or Soft Pegmatite
7.6 million tons of soft orebodies
Mineralogy:
Quartz (50 – 60%)
Kaolinite (35 – 40%)
Kaolin resources estimated at 2.7-3.0 million tons
White Mica (1 – 5 %) and Iron Oxides (0 – 2%)
→ 2.5 million lbs Ta2O5 contained in ore
10
New Exploration Work
Orebodies A, B and C 5,933.3 meters
Orebodies A, B and C 11,283.5 m
2011
2012
11
Resource Status Orebody Volume
(million mt)
Grade
(g Ta2O5/mt)
Ta2O5 Content
(million lbs)
Indicated Orebody A 6.32 375 5.23
Estimated
* New Drilling Underway
Other Hard Orebodies 11.62 335 8.58
Estimated
•New Drilling Underway
Soft Orebodies 7.60 150 2.51
Total 25.54 290 16.32
Subject to further exploration work, which will be concluded by Q1 2012
We expect to confirm reserves for 17 years at increased production capacity (excluding soft orebodies)
Resource Status and Mine Life
Hard Orebodies Resources Reserves
(million mt)
Orebody A 6.32
Others (Balance of A, B, & C-south)* 11.62
Total Resources 17.94
Annual Pegmatite Consumption 1.06 million mt
Mine Life 17 years
12
Mibra Production
Growth based on:
Upgrading & expanding old plant (plant 2)
Greater recovery of Ta₂O₅ from tailing fines
Mine infrastructure development
Debottlenecking existing plant (plant 1)
Further development of soft orebodies
0
100
200
300
400
500
600
0
200
400
600
800
1000
1200
1400
2007 2008 2009 2010 2011e 2012e 2013e 2014e
Klb
s
00
0's
MT
Hard Pegmatite Soft Pegmatite Ta₂O₅
Note: 2013 & 2014 production expansion subject to market conditions and AMG board approval
13
Gravimetric Plants Expansion & Debottlenecking
Plant 1
Processing 600,000mt pa hard pegmatite
Expanding to 700,000mt pa by end of 2011
Modifying to handle soft pegmatite by 2013
Plant 2
Processing 180,000mt pa of pegmatite
Expanding to 360,000mt pa by December 2011
Will process hard and soft pegmatite
14
Ta₂O₅ Mass Balance In Gravimetric Process
79%
21%
100%
Coarse
Grades
42%
22%
64%
Fines
26%
18%
44%
32%
4%
36%
16%
4%
20% 56%
Total
Concentration
=
Ultrafine
Rejects
+53µm
-53µm +
5% Line 1 Line 2
15
Ta₂O₅ Contained In Tailing Fines
Mesh
#
Weight
gm % Retained
Ta₂O₅ Grade
Ta₂O₅ Content
%
Distribution
50 109 22 52 146 14
60 50 10 42 55 5
100 152 31 41 162 16
140 76 15 60 118 12
200 47 10 92 113 11
230 21 4 184 100 10
325 19 4 164 79 8
400 9 2 401 95 9
<400 12 2 472 148 15
495 100 79 1,016 100
Spirals & shaking table are less efficient at recovering Ta₂O₅ from fines
16
Recovery Of Ta₂O₅ From Tailing Fines
Cleaner
Tantalite
Plant’s
Tailings
Final
Concentrate
Tailings
Clean
Water
Tailings
(Thickener)
(Flotation)
Rougher
Centrifugal concentrator Flotation Column
Tantalum Concentrate
17
Further Development Of The Process Flow
Extraction,
Crushing &
Grinding
Gravimetric
Concentration
Magnetic
Separation
Feldspar
Raw
Material
Tin Smelting
(toll process)
Mine
Chemical Plant
Outsourced
Magnetic
Separation
Ta205
Ta Ores
Microlite &
Cassiterite
Flotation
Nb205
Tin
Blending Ta Concentrate
Mixed Feldspar
Lithium
Concentrate
Albite
Ta slag
Chemical
Processing
Orebody A
(Pegmatite)
Soft
Orebodies
(Pegmatite) Kaolin
Processing
Option
Tin
Capacitors
Capacitors
Superalloys
Ceramics
Ceramics
Ceramics
Batteries
Ceramics
Tailings
Lithium
Carbonate
Final
Products Markets
Li Concentrate
Ceramic Grade
Development phase
Pond
18
Ceramic Minerals Production
Quality control
of feldspar in
laboratory
Mibra is the largest feldspar raw material supplier to the Brazilian porcelain (chinaware) industry
19
42
84
101
118
132 133 130138
2003 2004 2005 2006 2007 2008 2009 2010 2011E
Ceramic minerals production (‘000 mt/yr)
19
Kaolin reserves estimated at 3 Million Tonnes
Pilot plant installed & operating during H1 2010
Development work with established Kaolin producer
Potential production – Phase 1:
Production: Kaolin 36,000 mt pa
Tantalite 30 klb Ta₂O₅ pa
Potential production – Phase 2:
Production: Kaolin 60,000 mt pa
Tantalite 50 klb Ta₂O₅ pa
Note: Subject to market conditions and AMG board approval
Potential Projects – Kaolin (Soft Orebodies)
Mibra Mine soft orebody
20
Potential Projects – Lithium Concentrate
Pilot plant installed and operating since Q1 2010
Targeting production of Ceramic and Chemical grade Li concentrates
R&D project to produce Lithium carbonate from flotation by-product
Working with US & European engineering companies
Process design expected by the end of 2011
Engineering design expected by the end of 2012
Targeting brine route production costs
Potential capacity:
Lithium Concentrate 36,000mt pa
Albite 120,000mt pa
Lithium Carbonate 2,400mt pa
Conditioning reagents
Flotation cells
Lithium concentrate
Note: Subject to market conditions and AMG board approval
21
150.000 Lbs/Ta2O5
140.000 ton/Feldspar
2008/2009
2010/2012
2008
Mibra Mine Strategic Plan
- Increased Ta₂O₅ production to
500klb pa
- Spodumene, Albite & Kaolin
production
- Lithium Carbonate Production
2013/2015
- 300.000 Lbs/Ta2O5
- 140.000 ton/Feldspar
- SRK Certification
- New Process Plant
LSM Brasil Hydro power plant
- Increased pegmatite processing
- New Products Development:
Spodumente, Albite, Kaolin
- Increased Ta205 production to
400klbs
- Infrastructure upgrade
Note: 2013 / 2015 expansion projects subject to market conditions and AMG board approval
22
Mibra Mine’s business model will position it as reliable long term source of Tantalum for the industry,
Multi product concept will ensure Mibra’s competitiveness, financial and environmental sustainability,
New ceramic products under development will consolidate and strengthen the business model,
CIF targeting the following production levels for Ta₂O₅:
2012 – 400klbs pa
2013 – 500klbs pa
2015 – 550klbs pa based on additional soft pegmatite production
Final Remarks