Developing the World s First Primary Scandium Mining Project

Transcription

1 Developing the World s First Primary Scandium Mining Project May 2017 NSWMC Presentation TSX: SCY

2 Cautionary Notes Forward-looking Statements This presentation contains certain statements that may be deemed "forward-looking statements". All statements in this release, other than statements of historical fact, that address future production, reserve potential, exploration drilling, exploitation activities and events or developments that the Company expects to occur, are forward-looking statements. Forward-looking statements are statements that are not historical facts and are generally, but not always, identified by the words objective, targeting, targeted, to follow, intends, anticipation, potential, plan, expect and similar expressions, or that events or conditions "will", "would", "may", "could" or "should" occur. Information inferred from the interpretation of drilling results and information concerning mineral resource estimates may also be deemed to be forward-looking statements, as it constitutes a prediction of what might be found to be present when and if a project is actually developed. Although the Company believes the expectations expressed in such forward-looking statements are based on reasonable assumptions, such statements are not guarantees of future performance and actual results may differ materially from those in the forward-looking statements. Factors that could cause the actual results to differ materially from those in forwardlooking statements include market prices, exploitation and exploration successes, continued availability of capital and financing, and general economic, market or business conditions. Investors are cautioned that any such statements are not guarantees of future performance and actual results or developments may differ materially from those projected in the forward-looking statements. Forward-looking statements are based on the beliefs, estimates and opinions of the Company's management on the date the statements are made. The Company undertakes no obligation to update these forward-looking statements in the event that management's beliefs, estimates or opinions, or other factors, should change. Definitive Feasibility Study ( DFS ) The DFS was issued on May 4, 2016, is available on SEDAR at and is entitled Feasibility Study - Nyngan Scandium Project, NSW, Australia. The DFS was authored by Lycopodium, of Brisbane, QLD, Australia along with contributions from a number of independent technical groups as to functional specialty. The DFS was done to a +15%/-5% standard of accuracy, is based on a measured and indicated resource, and established a reserve on a portion of the resource, all compliant with NI resource reporting. Resource Estimate This document uses the term resources, measured resources and indicated resources. United States investors are advised that, while such terms are recognized and required by Canadian securities laws, the United States Securities and Exchange Commission (the SEC ) does not recognize them. Under United States standards, mineralization may not be classified as a reserve unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination is made. United States investors are cautioned not to assume that all or any part of measured or indicated resources will ever be converted into reserves. Disclosure of contained kilograms is permitted disclosure under Canadian regulations; however, the SEC normally only permits issuers to report resources as in place tonnage and grade without reference to unit measures. Accordingly, information concerning descriptions of mineralization and resources contained in this release may not be comparable to information made public by United States companies subject to the reporting and disclosure requirements of the SEC. National Instrument Standards of Disclosure for Mineral Projects ( NI ) is a rule developed by the Canadian Securities Administrators, which established standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects. All resource estimates contained in this circular have been prepared in accordance with NI and the Canadian Institute of Mining, Metallurgy and Petroleum Classification System. Qualified Person Mr. Willem Duyvesteyn, MSc, AIME, CIM, a Director of Scandium International and a "qualified person within the definition of that term in NI , has approved the technical information contained in this news release. 76

3 A brief history of Nyngan Scandium located some 500km NW of Sydney In 2006, Jervois Mining re-analyses Platinum pulps (from 1989 exploration by other companies) and discovers elevated Scandium grades. In 2010, EMC Metals (since renamed Scandium International Mining Corp) signs an agreement with Jervois to acquire 50% of the Nyngan Project. A NI Mineral Resource is published as a result of further drilling. In 2013, EMC agrees to purchase 100% of the project which includes two EL s and 370 ha of land that covers the resource. EMC Metals renamed Scandium International Mining Corp (TSX:SCY) and EMC Metals Australia Pty Ltd (80% owned by SCY) is formed to hold EL s and the ML. A PEA is published in October 2014 and further drilling leads to a DFS and revised resource in The DFS and new resource were published in May Environmental site studies commenced leading to an EIS submission to the NSW Government in July A MLA was submitted in July 2016 and granted, 3 rd May, In August 2016, a Planning Agreement was established with Bogan Council. Development Consent granted in November EMC has brought this project to its current stage in 40 months.

4 Geology The Gilgai intrusive complex, which is believed to be the source of the scandium, nickel, cobalt and PGM s in the regolith, is an Alaskan-type ultramafic complex made up of a range of rock types including hornblende, monzonite, hornblendite, pyroxenite, olivine pyroxenite to duniteperidotite and is believed to be Ordovician age. A tertiary age laterite profile of the following clay types: hematitic, limonitic and saprolitic with a basement of weathered bedrock transforming to fresh bedrock below approximately 65 metres persists across the area. Some metres of alluvium covers the scandium bearing clays.

5 Mining is conventional, processing is key Conventional Mining & Processing The process flow sheet is based on proven technology and extensive independent test work Test work results conducted on Nyngan property resource material Scandium extraction process involves conventional metals separation techniques (high pressure acid leach/sx) Treating only the limonites in the early years Saprolites provide an opportunity for an increase in output Relatively small scale at 240 tpd (75,000 tpy) Full production at approx. 40 tonnes Sc₂O₃ (Scandia) Single product resource simplifies processing flow sheet / cost Independent test work has confirmed recoveries / product specs U.S. patent applications filed on key process steps 79

6 Nyngan Scandium Project Primary scandium deposit with expansion potential NI Measured & Indicated resource 1 Measured: 256 ppm Sc/t Indicated: 225 ppm Sc/t Excellent location 500km NW of Sydney 3,000 ha. EL 370 ha. surface ownership Good local infrastructure (water/power/staff) Easy access, 5km from all-weather sealed road Significant upside potential DFS outlines 20 year mine life using less than 10% of M&I resources Potential to extend the mine life 1. Resource estimate completed by Mining One, effective date using a 100 ppm Sc cut-off grade, as described in the NI technical report with an effective date of April 15, Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. See Cautionary Notes Resource Estimate. 80

7 Where Can Scandium Be Used Today? Scandium-enhanced aluminum alloys are superior performers Scandium improves most aluminum alloys Refines grain structure for strength, yet preserves desired material properties, heat tolerance, plasticity, Better properties make better alloy for: Transportation uses (weight savings) Marine applications (corrosion) Thin wall extrusions (flow rates) Lower cost structures (weldability) Defence industry uses (armour) Scandium is a superior heat stabilizer in solid oxide fuel cells (SOFCs) Dramatic life-cycle improvements (5x) Scandium works in metal halide lighting to better resemble natural sunlight Bloom Energy is the SOFC industry leader and uses scandia-based architecture for its product 81

8 The Markets? Currently, world consumption of scandium is less than 20 tonnes annually. Most of this finds application in the solid oxide fuel cell market (Bloom Energy). We believe that the aluminium alloy area is where growth will occur once a reliable and economic supply of scandium becomes available. EMC Metals (Aust.) currently has an off-take agreement with a North American R&D group who plan to take between 5 and 10 tonnes of product per annum. Further off-take agreements are being pursued. We have entered the scandium market and we have produced alloys for testing and consideration. Three applications are envisaged: extrusion, plate and castings. Transportation will be the major beneficiary because of the light weight, weldability, improved strength and enhanced surface properties. Aerospace in particular the defence area could be a major market once a consistent supply of scandium has been established. 82

9 2016 DFS Results 1 Select financial and operating results from 2016 DFS Summary NI Nyngan Scandium Project DFS Key Project Parameters Result Capital Cost Estimate (US$ M) $87.1 Average Plant Feed Grade (ppm Sc) 409 Resource Processed (tpy) 71,820 Mill Recovery (%) 83.7% Oxide Production (kg per year) 37,690 Scandium Oxide (Scandia) Product Grade % Annual Cash Operating Cost (US$ M) $21.0 Unit Cash Cost (US$/kg Oxide) $557 Oxide Price Assumption (US$/kg) $2,000 Annual Revenue (US$ millions) $75.4 Annual EBITDA (US$ millions) $49.5 NPV (10%i) (After Tax) $177.5 NPV (8%i) (After Tax) $225.4 IRR (%) (After Tax) 33.1% Payback (years) DFS completed with an effective date of April 15,

10 Corporate Structure Share structure and stock information as at 20 April 2017 Capitalization Outstanding shares (I/O and F/D) 225 million / 248 million Insider/management ownership 30% Cash Debt on balance sheet 1 Stock Information Current price Current market cap C$ 1.0 million none TSX: SCY C$0.42 C$100 million 52 week high / low C$0.48 / $0.08 Average trading volume (2016) 250,000 shares/day 1. In June 2014 the Company secured 100% ownership of the Nyngan Project by drawing on a US$2.5 million loan facility with Scandium Investment LLC, a company owned by a private US investor group. The loan was converted to a 20% equity interest in Nyngan/honeybugle in September

11 Contact Information Corporate Office 1430 Greg Street, Suite 501 Sparks, Nevada USA Phone: Contacts Edward Dickinson (CFO) George Putnam (CEO) It s not how light you make it it s how you make it light. 85