Investor Presentation June 2017 1
Executive Summary Positive Fundamentals, Simple & Compelling Project, Proven Team, Near Term Production & Excellent Investment 1 Bauxite fundamentals & strong price outlook given rising China seaborne demand Simple DSO project well located in Cape York with low operating and logistics costs 2 3 Compelling economics confirmed by 2017 BFS 4 Off-take Agreement (Xinfa) & non-binding Letter of Intent (Lubei) for ~60% 4 years production Early works now underway 5 Strong financing capability with 2 supportive cornerstone shareholders, an increasing institutional 6 investor base and strong interest from debt financiers 7 Excellent investment opportunity with first production scheduled for April 2018 2 | ASX : MMI | Investor Presentation | June 2017
Corporate Snapshot Capital Structure Share Register Share Price (15 -June-17) $0.13 Greenstone Shares on Issue 1,004.0m 20% Other Shareholders 41% Market Cap $130M Balanced Property Options Unlisted 11.7m 20% Cash (18-April-17) $21.5M 8% 11% Unsecured Debt (18-April-17) $15.0M Dadi Australian Institutions Enterprise Value $124M Share Price & Volume - LTM Board of Directors $0.18 6.0m Chairman Stephen Everett $0.16 5.0m Managing Director & CEO Simon Finnis $0.14 4.0m Non-Executive Director Philip Hennessy $0.12 3.0m $0.10 Non-Executive Director George Lloyd 2.0m $0.08 Non-Executive Director Lindsay Ward 1.0m $0.06 Non-Executive Director Mark Sawyer $0.04 0.0m Non-Executive Director Dongping Wang Mar-16 Jun-16 Sep-16 Dec-16 Mar-17 Non-Executive Director Jijun Liu 3 | ASX : MMI | Investor Presentation | June 2017
Bauxite Hills Mine Snapshot Key Statistics Construction H2 2017 Ownership: Metro (100%) First Production April 2018 Cape York, Qld Location: Start-up ~2Mtpa** Production Commodity Bauxite Operational Overview Steady State ~6Mtpa (year 4)** Production Project Overview Product Type DSO Pre Production ~$35.8m Mine Type Surface mining Capex Expansion Capex ~$36.7m Contained mineral: 92.2Mt* Costs (LOM Avg) Reserves • 144.8Mt* • Onsite: $16.4/t Resources • Incl Royalty: $23.0/t • Mine Life 17 years Status BFS completed * Refer to slide 25 **Metro confirms all material Contract mining & assumptions underpinning production target & Operations transhipment corresponding financial information continue to apply & have not materially changed as per Listing Rule 5.19.2 Workforce ~185 personnel 4 | ASX : MMI | Investor Presentation | June 2017
Simple DSO Project Operational simplicity and specialist mining and transhipment contractors enables easy to manage operations Proven, well known operator TSA to be transhipment contractor and will supply all vessels Clear vegetation & Return overburden & replace remove overburden topsoil - then revegetate Mining Strip mine bauxite Overburden (~0.5m) DSO Bauxite Horizon (~1.75m) Ironstone Mottled Zone Transportation Haul ore 5-22km to stockpile & barge loading Barge ore down the Skardon River Tranship to bulk carrier, for export 5 | ASX : MMI | Investor Presentation | June 2017
World Class Bauxite Jurisdiction Located in the world class BHM Weipa bauxite region of Weipa western Cape York, Qld Amrun Aurukun 90km north of Rio’s Weipa Cairns mine and approx 130km Townsville from Rio’s Amrun development ~10-12 Days Shipping Weipa bauxite brand well established and highly regarded in China Brisbane 6 | ASX : MMI | Investor Presentation | June 2017
Low Logistics Costs Metro’s low cost logistics are a sustainable cost advantage to China relative to competing bauxite producers 7 | ASX : MMI | Investor Presentation | June 2017
Existing Infrastructure Benefit Existing infrastructure provides numerous development advantages Port & Load Out Area Camp Site Airstrip 8 | ASX : MMI | Investor Presentation | June 2017
BFS Summary Bankable Feasibility Study Highlights* Completed by MEC Mining in March 2017 6Mtpa steady state (initial 2Mtpa)** Contract mining and transhipment 8 months per year dry season operation (April to November) 5 month construction period Key Results and Assumptions Description Result Assumption Result NPV (10% DR, Real, after tax) A$601M Annual Production rate (Steady State) 6.0Mt** IRR 81% LOM Production 92.2Mt Payback Period of Initial Capital 1.7 years Mine Life 17 years LOM Revenue A$5.6B Bauxite Price (CIF) Range US$36.36-53.88/t LOM EBITDA A$2.5B Exchange Rate (AUD/USD) 0.75 LOM Average Annual EBITDA A$145M Discount Rate 10% LOM on-site Average OPEX A$16.42/t Initial Capital Expenditure A$35.8M LOM Average OPEX including Royalty A$23.00/t LOM Average Operating Margin A$26.69/t *Refer ASX Announcement 15 March 2017 | **Metro confirms all material assumptions underpinning production target & corresponding financial information continue to apply & have not materially changed as per Listing Rule 5.19.2 9 | ASX : MMI | Investor Presentation | June 2017
Strong Cost Curve Positioning 2 nd quartile cost curve positioning provides attractive long term competitive advantage China Seaborne Bauxite Supply Full Cost Curve 2019 – Value-in-use Adjusted US$/Dmt (CFR) 1St Quartile 2nd Quartile 3rd Quartile 4th Quartile US$/DMT Source: CM Group 0.0 5.0 10.0 15.0 20.0 25.0 30.0 35.0 40.0 45.0 50.0 55.0 60.0 65.0 10 | ASX : MMI | Investor Presentation | June 2017
Near Term Production Pathway 1. 2. 3. 4. Well Established No Red Flags Early works now Production On Track For H1 2018 Pathway underway 2014 2015 2016 2017 2018 Activity Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Project Acquisition DFS for 2Mtpa Off-Take Native Title Agreement Metro Transhipment Solution Environmental Approval Gulf Gulf Acquisition JORC Resource Upgrade JORC Reserve Upgrade BFS for Bauxite Hills Mine Financing Wet Season Project Construction Mine Production 11 | ASX : MMI | Investor Presentation | June 2017
Off-take Secured & Attractive* Foundation off- take secured (Xinfa), China’s 2nd largest private bauxite importer. Summary of Xinfa Off-take Agreement covers ~50% of first 4 years production with market linked pricing. Term 4 years Lubei LOI (non-binding) for 0.5-1.0mt pa for a minimum three years Total 7Mt Tonnage Overview of Key China End Users & Port Locations – Shandong Provence Tonnage 1Mt for yr 1 | 2Mt for yrs 2 to 4 Pricing CIF basis Wu Zhanhu di Reference a Established alumina index Price Binzhou Payment Irrevocable Letter of Credit Yantai Port Terms for each shipment Zouping Weihai Port Defined parameters with bonus / Product Spec penalty arrangements Liaochen ‘Take or Pay’ Yes g Longkou Shipping Agreed annually in advance Qingdao Port Wu Summary of Lubei LOI di Term 3 years Tonnage 0.5 – 1.0 Mt pa for min 3 yrs Zibo Shandong Provence Rizhao Port Extension Mutual Agreement ~ 97% of Chinese Bauxite Imports Non-binding currently. Binding Binding agreement being negotiated Payment Market Linked pricing Structure 12 | ASX : MMI | Investor Presentation | June 2017 *Refer ASX Releases 13 Oct 2016 | 30 May 2017
Proven Management Team Metro’s Board & management have collectively been involved in the development and operation of over 30 mines globally Significant bauxite knowledge and expertise, focused on Cape York bauxite operations and product marketing into China Strategy is to develop and operate mines Simon Finnis | MD & CEO Joined Metro as CEO in early 2015 Mining executive with +30 years experience Former CEO of Grande Côte Minerals Sands operations in Senegal and responsible for $650m greenfield project development Operational Commercial Charles Easton | GM, Bauxite Hills Mine Scott Waddell | CFO & Company Secretary Geologist with +40 years experience CPA with extensive experience in global bauxite & alumina Previous GM at Thiess Past senior roles with Anglo and Rio Tinto Alcan (RTA) 5 yr at Weipa managing mine planning & refinery performance Senior roles with Metro since 2010 Duane Woodbury | Finance & Bus Dev Mike O’Brien | Project Director Banking & finance with +20 years experience Mining engineer with +40 years experience Senior roles with Macquarie & CFO of ASX listed Kingsgate +25 years Snr management experience with Anglo American & 13 | ASX : MMI | Investor Presentation | June 2017 Shell Significant equity and debt capital raising experience Colleen Fish | Environmental Manager Norman Ting | GM, Marketing Environmental scientist with +25 years experience +30 years bauxite industry & marketing experience Former Environmental Manager for Peabody, QLD Former Chairman Traxys China & Snr Exec of WOGEN UK, HK & China Joined Metro in 2012 Former Marketing Manager for Comalco (RTA) Bauxite 13 | ASX : MMI | Investor Presentation | June 2017
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