ALTECH BATTERIES LTD — Investor Presentation 2015

Jul 23, 2015

Altech Chemicals Limited (ASX:ATC)

Company Presentation Completion of Bankable Feasibility Study Iggy Tan Managing Director

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

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Our Vision
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• Sapphire & Ruby - natural form of high purity alumina (HPA)

• Formed by mother nature like diamonds

• • Colour from impurities

• • Extremely hard – no. 9 on Mohs scale

• Third hardest mineral behind diamond

• • Scratch-resistant artificial sapphire glass made from HPA

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Sapphire
Gemstone
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• O

• Purified alumina (Al2 3)

• Greater than 99.99% (4N) purity

• Maximum allowable impurities of 100ppm

• Smelter Grade Alumina (SGA) ~ 99.5% (5,000 ppm impurities mainly sodium)

• Bayer Process uses sodium hydroxide (NaOH)

• • Sodium impurity is problem for electronics industry

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What is HPA?
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SGA – Smelter Grade Alumina

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• HPA is placed in an autoclave

• Heated to >2,000[o] C melting point under intense pressure

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Artificial
Sapphire
Process
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• Forms single crystal sapphire (boule)

• • Allowed to cool slowly – 22 day cycle

• Diamond cutting equipment to cut sapphire shapes

• Heat & scratch resistant

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Smelter Grade High Purity High Purity High Purity Alumina Alumina Alumina Alumina 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

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High Price
for Purity
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Our Target Business

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Welcome to the World of HPA

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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
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High Purity
Alumina
Applications
Phosphor
Semi Other
LEDs Based
conductors Applications
Applications Uses of HPA
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”
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Technavio Research

• Global HPA demand 19,040tpa in 2014

• • Expected to increase to 48,230tpa by 2018

• Growing at a CAGR of 28%

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Demand
for HPA
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HPA Demand & Growth Forecast

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60.0
50.0 48.2
39.9
40.0
32.4
30.0
25.3
19.0
20.0
14.1
10.0
0.0
2013 2014 2015 2016 2017 2018
Volume ktpa
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Demand
for HPA
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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'

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• Estimate 30g[1] of HPA in an iPhone sapphire glass screen

• 500 million smartphones sold per year

• • If sapphire glass technology was implemented o It would require about 15,000tpa of HPA

• o That’s four of our proposed 4,000tpa plant

• There will be a HPA supply deficit

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HPA
Demand from
Smartphones
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1 Altech Estimates

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• High end Vertu TI with sapphire crystal screen • Rest will follow

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Sapphire Crystal
Screen
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sapphire glass

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a pple watch & iphone 7

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More Sapphire Display Factories

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• 70% of HPA demand - Asia Pacific region (APEC)

• Region for the world’s manufacturing

• Altech’s HPA plant (Malaysia) well-positioned to service APEC region

• Transport, customer service, technical credibility

Americas 14%

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HPA
Geographic
Demand
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Europe, Middle East, Africa 16%

Asia Pacific 70%

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• Six largest HPA producers

• • 3 Chinese, 1 Japanese, 1 Sth African, 1 French

Others (15), 3,570

Huantou, 800 Dailian Rall, 600

Nippon Light Metal, 1,100 Baikowski, 1,200 Xuancheng Jing Rui, 1,200

Sumitomo Chemical , 3,020 Sasol, 1,800

Hebei Pengda, 3,000

Zibo Xinfumeng, 2,500

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Current HPA
Producers
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Technavio Research

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Altech’s Differentiation

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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
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Aluminous Clay
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• Processed by mother nature

• Very low Iron (Fe) due to weathering

• Silica is non reactive – easily removed

	ca	s non rea	cve – e	sy rem	ove
		Bauxite	Canadian	Altech	Low - impurity
		Darling **Range ***	HPA Project	HPA Project	Aluminous C lay
	Al2O3 (%)	34.5	22.77	30.5	F eedstock
	SiO2 (%)	21.5	53.29	56.3
	Fe2O3 (%)	21.2	8.36	0.7
	TiO2 (%)	2.00	0.98	0.7
	K2O (%)	0.24	3.41	0.1
	NaO (%)	0.005	1.42	0.1
	pical Mean Analysis

Typical Mean Analysis

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• Altech owns 100% of deposit in W Aust

• Low environmental impact

• • Previously mined for kaolin – trial pit

• • Low stripping ratio

• 65Mt JORC Resource

• • 130kms from Fremantle Port

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Meckering
Aluminous Clay
Deposit
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• Use a standard HCl leach process

• Developed in 1980’s by alumina industry

• • Couldn’t compete with Bayer SGA costs

• • But great at producing HPA (no sodium ions)

• • However little demand of HPA in 1980s

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Altech’s
HPA
Process
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• Demand of HPA is here today

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New HPA Demand + Established Process + Great Deposit + Experienced People  Shareholder Value

Experienced People High Purity Deposit

New Demand (Electronics)

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Altech
Business
Strategy
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“the last piece of the puzzle is in place”

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• Started development work in early 2011

• Many studies and testwork programs

• • No issues about producing 99.99% HPA

• • Supporting lab pilot plant test work

• • Hydromet process not complex

• • Conventional proven plant and equipment

• • Bankable Feasibility Study completed

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Development
Program
To Date
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Altech HPA Process

WESTERN AUSTRALIA

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Campaign Mining
ROM
Screening Filter Press Beneficiated
Kaolin
To Fremantle
Drum Scrubber > 0.5mm Dryer
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
Microniser Sale to HCl gas
Cement Plant
Neutralising Generator
Filter Tank
High Purity
Alumina Condenser
99.99%
HCl HCl water HCl water
Gas Gas
Centrifuge HCl 1100 C 400 C Centrifuge Centrifuge
Cooler Calciner Roaster
Cooler Dryer Stage 3 Polishing Stage 2
Crystalisation Filter Crystalisation
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Clean HCl

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Meckering Operation

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Meckering Plant

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Filtration
Oversize Disposal Drum Scrubber
Screening Dryer
Filtration
ROM Feed
Dryer
Baghouse
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Beneficiated Kaolin Shipping

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• Tanjung Langsat Industrial Park, Johor Bahru (Malaysia)

• Al clay feedstock shipped from WA

• • Operating costs ~40% lower than Australia

• Capital costs expected to be 50-60% lower

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HPA Site
Location
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Malaysian HPA Operation

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HPA LOCATION
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• Hydrochloric acid, sulphuric acid, power & natural gas

• • International container sea-port & Singapore

• Investment incentives

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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
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• Capital cost estimate US$76.9 m

• Payback period 3.8 years

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• Pre-tax NPV10 of US$326 m

• Highly attractive IRR of 30.3%

• LT sale price forecast of US$23,000/t for 99.99% (4N) product

• Opex of US$8,140/tonne

• EBITDA of US$59.4 million

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

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Highly
Attractive
BFS
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Bottom quartile for operating costs – Why? 1. We own our feedstock

2. Large scale economy 4,000 tpa – one train 3. Main reactant HCl re-used 4. Minimal impurity removal costs 5. Plant in low cost country (Malaysia)

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Bottom
Quartile
for Op Costs
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• Commenced discussions with Asian banks

• Targeting around $55 m project debt

• Structured project finance options

• • Europe based bonds

• Product off take phase

• MIDA tax incentives

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Project
Finance
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• Detailed engineering & permitting

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

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Right Place Right Time Right Feedstock Right Technology

Thank you

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Forward-looking Statements

This announcement contains forward-looking statements which are identified by words such as ‘anticipates’, ‘forecasts’, ‘may’, ‘will’, ‘could’, ‘believes’, ‘estimates’, ‘targets’, ‘expects’, ‘plan’ or ‘intends’ and other similar words that involve risks and uncertainties. Indications of, and guidelines or outlook on, future earnings, distributions or financial position or performance and targets, estimates and assumptions in respect of production, prices, operating costs, results, capital expenditures, reserves and resources are also forward looking statements. These statements are based on an assessment of present economic and operating conditions, and on a number of assumptions and estimates regarding future events and actions that, while considered reasonable as at the date of this announcement and are expected to take place, are inherently subject to significant technical, business, economic, competitive, political and social uncertainties and contingencies. Such forward-looking statements are not guarantees of future performance and involve known and unknown risks, uncertainties, assumptions and other important factors, many of which are beyond the control of our Company, the Directors and management. We cannot and do not give any assurance that the results, performance or achievements expressed or implied by the forward-looking statements contained in this announcement will actually occur and readers are cautioned not to place undue reliance on these forward-looking statements. These forward looking statements are subject to various risk factors that could cause actual events or results to differ materially from the events or results estimated, expressed or anticipated in these statements.

Competent Person Statement

Technical information in this report is based on information compiled by Mr Michael O’Mara, B.Sc. Geology, Altech Chief Geologist and a member of the Australasian Institute of Geoscientists. Mr O’Mara has sufficient exploration experience which is relevant to the styles of mineralisation and types of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’ (“JORC 2004”). Mr O’Mara consents to the inclusion in this release of the matters based on his information in the form and context in which it appears.