Announcement PDF RareX - Becoming a Top Australian Rare Earths Deposit Scoping Study and Company Update September 2022 Jeremy Robinson Managing Director 1 Adding Value at each step 60 59 Neodymium Praseodymium Nd Pr Disclaimer & Competent Person’s Statements This presentation contains summary information about RareX Limited (REE) and is current as of 12 September 2022 and is authorised for release by the Board. The information in this presentation is of a general background and does not purport to be complete. This presentation is not investment or financial product advice (nor tax, accounting or legal advice) and is not intended to be used for the basis of making an investment decision. The information contained in this presentation has been prepared without taking into account the objectives, financial situation or needs of individuals. Investors should obtain their own advice before making any investment decision. REE has prepared this document based on information available to it at the time of preparation. No representation or warranty, express or implied, is made as to the fairness, accuracy or completeness of the information, opinions and conclusions contained in this presentation. For further information, please contact Managing Director, Jeremy Robinson. Investor Relations Jeremy Robinson, MD P: +61 8 6383 6593 E: Info@rarex.com.au This presentation contains certain “forward-looking statements”. Forward looking statements can generally be identified by the use of forward looking words such as, “expect”, “should”, “could”, “may”, “predict”, “plan”, “will”, “believe”, “forecast”, “estimate”, “target” and other similar expressions. Indications of, and guidance on, future earnings and financial position and performance are also forward-looking statements. Forward-looking statements, opinions and estimates provided in this presentation are based on assumptions and contingencies which are subject to change without notice, as are statements about market and industry trends, which are based on interpretations of current market conditions. Forward-looking statements including projections, guidance on future earnings and estimates are provided as a general guide only and should not be relied upon as an indication Media Enquiries Nicholas Read, Read Corporate P: +61 8 9388 1474 or guarantee of future performance. This presentation contains statements that are subject to risk factors associated with REE and the mining exploration industry. It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a range of variables which could cause actual results or trends to differ materially. REE disclaim any intent or obligation to publicly update any forward-looking statements, whether as a result of new information, future events or results or otherwise. To the maximum extent permitted by law, REE, their related bodies corporate (as that term is defined in the Corporations Act 2001 (Cth)) and the officers, directors, employees, advisers and agents of those entities do not accept any responsibility or liability including, without limitation, any liability arising from fault or negligence on the part of any person, for any loss arising from the use of the presentation or its contents or otherwise arising in connection with it. Competent Person’s Statements: The information in this presentation relating to the Mineral Resource estimate for the Cummins Range Rare Earths Project is extracted from the Company’s ASX announcement dated 19 July 2021. REE confirms that it is not aware of any new information or data that materially affects the information included in the original announcement and that all material assumptions and technical parameters underpinning the Mineral Resource estimate continue to apply. The Company confirms there have been no material changes to exploration results since first reported in accordance with Listing Rule 5.7. The information in this announcement that relates to the Exploration Target is based on and fairly represents information compiled by Mr Guy Moulang, an experienced geologist engaged by RareX Limited, and is extracted from the Company’s ASX announcement dated 16 February 2022. Mr Moulang is a Member of the Australian Institute of Geoscientists and has sufficient experience relevant to the style of mineralisation and type of deposit under consideration and to the activity to 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”. Mr Moulang consents to the inclusion in this announcement of the matters based on this information in the form and context in which it appears. REE confirms that it is not aware of any new information or data that materially affects the information included in the Exploration Target announcement and that all material assumptions and technical parameters underpinning the Exploration Target continue to apply. The information in this presentation relating to the scoping study, production target and forecast financial information for the Cummins Range Rare Earths Project is extracted from the Company’s ASX announcement dated 12 September 2022. REE confirms that it is not aware of any new information or data that materially affects the information included in the original announcement and that all material assumptions and 2 technical parameters underpinning the production target and forecast financial information continue to apply. RareX HQ A: Unit 6, 94 Rokeby Rd Subiaco WA 6008 Australia E: Info@rarex.com.au Corporate Snapshot Capital Structure ASX Code OTCQB Share Price (05.09.2022) Shares on Issue Market Capitalisation Cash & Investments (Q2-22) Enterprise Value Shareholders REE REEEF A$ 0.059 570m A$ 34.76m A$ 10.3m A$ 24.46m Top 40 Shareholders Number of Shareholders Substantial Shareholder ~39% ~5,370 Simon Lee AO (6.3%) 0.12 0.11 Board and Management Chairman Managing Director Non-Executive Director Non-Executive Director Exploration Manager GM Projects Head of Corporate Development Company Secretary 3 0.10 John Young Jeremy Robinson Shaun Hardcastle Cameron Henry Guy Moulang James Durrant Michael Prassas Oonagh Malone 0.09 0.08 0.07 0.06 0.05 April22 Mar22 Jun22 Jul 22 Aug 22 Sep22 RareX Value Proposition Each EV & E-Mobility Solution Requires Rare Earths Electric Trains, E-Buses, E-bikes, EV's. They all use NdPr – NdFeB permanent magnets either in the drivetrain itself or in interior applications, due to better weight-performance attributes and higher overall efficiency. Rare Earth is a Strategic Mineral The European, Canadian, American, Korean, Japanese and Australian Governments acknowledge how import it is do diversify the global rare earth supply chain from the global Chinese dominance (mining to magnet). In this context governmental resources and funds have been allocated to assess potential investment targets. Best recent Australian example is the $1B government backing for Iluka’s Eneabba rare earth refinery. Becoming a Top 3 Australian Rare Earths Deposit Substantial resource with potentially significant upside. Outstanding recent exploration results have confirmed high-grade extensions at depth and along strike. Additional drilling program commenced Q2-2022 approx. 30,000 metres. Clear Path for Growth Well funded, highly leveraged to the booming global rare earths sector, with a quality asset in a Tier-1 location with Tier-1 partners and a clear growth strategy to become a sustainable low carbon rare earth producer. 4 “ RareX’s vision is to be one of the top world’s leading rare earth material supplier outside of China for the global NdFeB permanent magnet industry, providing high quality, sustainable, ethical produced materials and services through an integrated low carbon footprint operation & corporate business model reflecting our ESG commitments through a continuous improvement process to our, partners, customers, shareholders, employees and to the communities in which we operate. Adding Value at Every Step of our journey to our projects and stakeholders The Rare X Team ” Excellent Scoping Study Results Highlights  Strong financials  Significant production profile of sustainably, Australian produced rare earth and phosphate products with local placement opportunities  Scoping Study base only on current 2021 Indicated and Inferred Resources with 85% of the mine plan in the Indicated category  Study considers the utilisation of gridconnected hydroelectric power for refinery operations, a potential world first for rare earth refineries  Board approves commencement of PreFeasibility Study Capex (AUD '000) 430m NPV8 (AUD '000) IRR (pre-tax, nom) Payback Life Of Mine (LoM) LOM EBITDA (AUD '000) 633m 29.2% 2.85 Years 12 Years 1,900m Unit cost per TREO Unit cost per TREO (inc credits) 26.58 USD/kg 6.09 USD/kg TREO Produced (dry) NdPr produced per year *including By-Product Credit 7,908t* 1,485t* The information in this presentation relating to the scoping study, production target and forecast financial information for the Cummins Range Rare Earths Project is extracted from the Company’s ASX announcement dated 12 September 2022. REE confirms that it is not aware of any new information or data that materially affects the information included in the original announcement and that all material assumptions and technical parameters underpinning the production target and forecast financial information continue to apply. 5 Cummins Range - 100% owned 6 Location Kimberley region, Western Australia Tier-1 mining jurisdiction Mine Site Close to Halls Creek. Open pit LOM Strip Ratio of 1:2.2. Annual 500 Ktpa flotation concentrator at site producing two product streams 36 ktpa @ 15%TREO of rare earth mineral concentrate and 130 Ktpa @ 32% P2O5 and 2.5% TREO of phosphate mineral concentrate. Capex ~200m AU$ Geology The predominantly well understood monazite hosted rare earth mineralisation. Carbonatite & pyroxenite with occasional massive glimmerite Resource & Exploration target 18.8mt at 1.15% TREO + 0.14% Nb2O5, including 6.5mt at 1.98% TREO + 0.21% Nb2O51. Exploration Target of 23Mt to 41Mt at 1.6% to 2.4% TREO2 is in addition to current resource Permits & Licence Exploration licence obtained. Mining application started including the required surveys Rare earth Refinery A hydroelectric powered rare earth refinery facility is envisaged which produces 8,9 Ktpa 52% mixed rare earth carbonate product (MREC) with a by-product of 13.5 Ktpa, 54% P2O5 merchant grade phosphoric acid. Capex ~229m AU$ 1. Indicated 11.1Mt at 1.32% TREO + 0.17% Nb2O5; Inferred 7.7Mt at 0.88% TREO + 0.11% Nb2O5 2. The potential quantity and grade of the Exploration Target is conceptual in nature, and there has been insufficient exploration to estimate a Mineral Resource and it is uncertain if further exploration will result in the estimation of a Mineral Resource. The Exploration Target has been developed following a diamond drilling program completed in 2021. A 15,000m diamond drilling program designed to test the Exploration Target is on track for completion this calendar year. Drilling throughout 2022 continues to confirm this target. The average grade of the primary mineralisation below the current Resource is 2% TREO and therefore a range of 1.6% and 2.4% is provided around that figure to account for uncertainty. Wyndham Refining Facility MREC and Phosphoric Acid Production Cummins Range basket price distribution  A hydroelectric powered rare earth refinery facility  Standard acid bake – water leach – rare earth carbonate plant Tb 9% CeLa SEG 3% 2% Dy 11%  Producing 8.9kt of Mixed Rare Earth Carbonate “MREC” (52% TREO) and 13.5kt of phosphoric acid (54% P2O5)  MREC will be in demand with high NdPr, Dy and Tb  Potential for the world’s first hydroelectric powered rare earth refineries  Potential for phosphoric acid to be further value added into fertilizer products for use in local industry 7 NdPr 75% Upcoming milestones and key catalysts 2022 A B C Initiation of PFS Initiation of advanced metallurgical programme Initiation of renewable hydro power purchase agreement D E F Initiation of land purchase agreement for the rare earth refinery at the port Initiation of business development activities for offtakes discussions for phosphate and rare earth. Orebody geochemistry definition. G H Mining licence negotiation protocol agreement with Jaru PBC Completion of 2022 drilling season 2023 A B C D E F G H I J K L M N Metallurgical, geotechnical Environmental and socioand resource drilling economic baseline programme assessments Fertiliser plant scoping study Initiation of Pilot plant Completion of rare earth refinery land purchase agreement Maiden Ore Reserve 8 Mineral resource estimate expansion including rare earths and phosphates Completion of advanced metallurgical programme Pre-feasibility study complete Business development activities materially advanced on Phosphate and Rare Earth Oxide separation facility scoping study Mining licence agreement with Jaru complete Completion of renewable hydro power purchase agreement Environmental referral complete Vision to move forward  Execute Pre-Feasibility Study - start Q3-2022  Investigating further ways in which RareX can develop the Project in a manner which is carbon-neutral or produces minimal carbon emissions  Project to be largely powered by already installed hydroelectricity and renewables  Longer term, the Project has the potential to support electrified logistic solutions charged from hydroelectricity  Remaining diesel use at site can be transitioned to full electrification over time given appropriate renewable energy installations  Phosphate by-product will be used in the agricultural sector – much of it locally – increasing crop yields and the RareX is investigating the established carbon credit mechanisms 9 The Team Jeremy Robinson Managing Director 10 is the founder of RareX that was acquired by Sagon. Mr Robinson has worked in both the capital markets and inhouse for junior and mid-cap mining companies for the past 15 years. Mr Robinson is an experienced mining executive having held senior roles at Mungana Goldmines Limited and Apex Minerals Limited. Mr Robinson holds a Bachelor of Commerce from the University of Western Australia majoring in Corporate Finance, Investment Finance and Marketing. James Durrant General Manager Projects James is a Mining and Mechanical Engineer with a background in Tier 1 and Junior mining company operational leadership and project development, across Africa and Australia, having started his career with BHP Billiton. James is experienced in greenfield project development from exploration through to development. His experience includes leading the engineering, socioenvironmental and infield investigation programmes Guy Moulang Head of Exploration Mr Guy Moulang has more than 15 years’ experience in technology metals, base metals and gold exploration. Mr Moulang has a Bachelor of Science from James Cook University and is a Member of the Australian Institute of Geoscientists (AIG). Mr Moulang spent 10 years at Kagara Ltd where he played an integral role in taking Kagara from an ASX-listed junior to an ASX 200 company with a market capitalisation of A$1.5b. Gavin Beer Lead Consultant Metallurgist Mr Gavin Beer has more than 30 years’ experience in technical and operational roles in the mining industry with the last 12 being exclusively within the Rare Earth and Technology Metals sector. Mr Beer is a Chartered Professional and a Member of the Australian Institute of Mining and Metallurgy and is qualified as a Competent Person for both JORC and NI 43-101 reporting with respect to his metallurgical expertise. Michael Prassas Head of Corporate Development Michael is a highlyexperienced sales, marketing, and business development manager with a deep interest in the transition to a zerocarbon economy and the advancement of the emobility industry – drawing on more than 25 years’ experience in the automotive & rare earth sectors. He has held management roles at AW Europe in Germany, TomTom, BP in Netherlands, Solvay/ Rhodia in France and Peak Resources & Hastings in Australia. Our ESG Commitment  RareX announced its Maiden ESG framework in September 2021 developed in conjunction with industry leader PricewaterhouseCoopers  RareX has aligned itself with the World Economic Forum “WEF” Principles  RareX already contributes 3.5% of its annual exploration expenditure the Kimberley sustainable development trust for the benefit of the Jaru People on whose land it operates 11 RareX has an important role to play in supplying rare earth minerals that are crucial for the low carbon economy, such as electric vehicles and wind turbines, as well as advanced technology for telecommunications and military purposes ESG Framework NdPr Enabling Decarbonisation Of Our Society NdFeB permanent magnet motors are crucial in reducing greenhouse gas emissions as they are at the heart of so many electric mobility solutions. Green, clean electric mobility solutions require ethical, sustainable, transparently produced NdPr. Each electric vehicle contains ~1kg of NdPr oxide 12 Each direct drive permanent magnet wind turbine requires ~200kg NdPr oxide per megawatt Global EV Megatrend continues to accelerate… Timeline of Strategic OEM Targets for EVs Automaker EV & Battery Invest Globally “ Global carmakers now target to spend US $515b for EV’s & batteries. Including Tier 1 suppliers, investments should have surpassed US$ 1 Trillion. ” 13 Source: https://www2.deloitte.com/uk/en/insights/focus/future-of-mobility/electric-vehicle-trends-2030.html https://www.reuters.com/business/autos-transportation/exclusive-global-carmakers-now-target-515-billion-evs-batteries-2021-11-10/ https://www.iea.org/reports/global-ev-outlook-2021/trends-and-developments-in-electric-vehicle-markets#abstract Source: www.iea.org Supported by global legislation to drive net zero targets and to ban the internal combustion engines “ More and more countries have a clear roadmap to phase out internal combustion engine (ICE) vehicles. More than 30 countries have clear electrification targets or ICE bans for cars. ” 14 Perth 2025 2026 2027 2030 2032 2035 Sydney 2040 Source: https://cleantechnica.com/2021/01/02/31-countries-states-and-cities-have-ice-bans-in-place/ Translating into an emerging deficit of NdPr supply “ Each electric vehicle requires ~1 kg NdPr oxide for the drivetrain solution and accessories. With every incremental, additional sales of 5.5m EVs the world needs another Rare earth producer equivalent to the annual output of Lynas* By 2030 the worlds needs ~5, by 2040 ~11 additional producers. ” 15 WW PASSENGER CARD OUTLOOK / BNEF Global BEV & PHEV SALES / EV VOLUMES 11 5 Source: https://bnef.turtl.co/story/evo-2021/page/4/1?teaser=yes Source: https://www.ev-volumes.com/country/total-world-plug-in-vehicle-volumes/ Equivalent to annual output o1 Lynas in 2021 = 15761 REO = 5,462 NdPr oxide By Product Opportunity Tapping Into The High Value LFP Battery & Phosphate Market  The RareX product suite consists of rare earth and potentially also of phosphate products with local placement opportunities  The phosphate market shows strong momentum due to Covid and the recent geopolitical turmoils including the Ukraine war. Furthermore, the perspective on global supply chains has changed and onshoring and local supply chain solutions are desired.  Gas prices are expected to increase further and will drive fertilizer prices.  Additionally, we believe in the significant demand growth for phosphates not only because of the agriculture demand but also because of the automotive market and the emerging application of the lithium-ironphosphate (LFP) market 16 Source:: • • • CRU data and different market source for Phosphate Rock demand forecast and pricing information https://ark-invest.com/articles/analyst-research/lithium-iron-phosphate-batteries/ https://www.spglobal.com/commodityinsights/en/market-insights/latest-news/energy-transition/081622-ubs-raises-lfp-global-battery-market-share-outlook-to-40-by-2030 RareX Investment Proposition The Right Market & Timing  Strong connection to the decarbonisation and CO2 reduction roadmaps and rising regulatory requirements and targets across the globe  Asian Metals NdPr price Dom. China per kg US$ 88 (05.9.22) ; US$ 48 (12.10.20); 2022 max price 175 USD (01.03.22 )  Strong governmental financing support for critical materials and in particular for rare earths projects The Right Company  Well-funded with cash and investments  RareX EPV compared to its peers is significantly undervalued The Right Project & Jurisdiction  Significant Exploration Target of 23-41Mt at 1.6-2.4% TREO  Confirmation of high-grade primary mineralisation  Massive resource growth expected in 2022/23 The Right Team 17  Recent addition of Michael Prassas to the team  Further continuous team expansion planned “ Rare earth and NdPr (Neodymium and Praseodymium) are an integral part of the electric mobility and renewable energy thematic. NdPr is a core enabler of highly efficient electric rare-earth NdFeB permanent magnet synchronous motors, a core pillar for the global decarbonisation and Co2 reduction roadmaps of our governments and industries. As the global green transformation continues to accelerate and governments clearly have expressed their desire to support diversification of the global rare earth supply chain, RareX is confident to play a vital role in this market to mitigate the upcoming emerging NdPr supply shortage. Adding Value at Every Step Jeremy Robinson RareX Founder and Managing Director ” Directors John Young Jeremy Robinson Shaun Hardcastle Cameron Henry Non-Executive Chairman Managing Director Non-Executive Director Non-Executive Director Company Secretary Oonagh Malone RareX HQ Unit 6, 94 Rokeby Road Subiaco Western Australia 6008 ABN 65 105 578 756 Telephone (08) 6383 6593 Email info@rarex.com.au Website rarex.com.au 18 THANK YOU ANNEX 19 Cummins Range Site Mining and Concentrating  Simple low-cost open pit with LOM Strip Ratio of 1:2.2  Initial mining inventory of 6.3mt @ 1.9% TREO (0.4% NdPr)  500,000tpa flotation concentrator at site producing two product streams  36,00tpa rare earth concentrate at 15.0% TREO and  130,000tpa phosphate concentrate at 32% P2O5 and 2.5% TREO  Both products trucked to Wyndham for further refining or direct export 20 Exploration Update Major Extension of Mineralisation  Drilling is ongoing at Cummins Range with diamond drilling now moving to infill drilling on the Rare Dyke to allow conversion to a resource.  Sample transport and assay turnaround remains an issue with initial assays expected in the coming weeks. Exploration Target of 23Mt to 41Mt at 1.6% to 2.4% TREO is in addition to current resource of 18.8Mt at 1.15% TREO 21 Northern Phosphate Zone Drilling Expands Phos Dyke Phosphate Zone at Cummins Range Phosphate zone extended up to 200m to the north-east, highlighting opportunity for future. Valuable by-product stream alongside a rare earths operation. Highlights  Identified significant extensions to the highgrade zone of primary phosphate mineralisation  Strong phosphate mineralisation logged in the form of coarse apatite in ultramafic rocks in recent  Assays awaited for all RC holes 22 Strong Apatite (light brown) mineralisation (>15% apatite) in phoscorite. Hole CDX0093 at 107m – 114m Example of Phoscorite in core, Apatite= light brown, Diopside=green, Magnetite=dark grey, Phlogopite=black