Investor Presentation May 2013 - Northland Resources

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Investment Case Kaunisvaara project to be realised Flexible financing structure Strong project in an attractive location Project substantially de-risked Iron Ore market Remains Attractive • Proposed bondholder-led restructuring provides total new financing of USD 497 million 1 • Projected to ensure project is fully funded on budget assumptions, and expected to secure realization of Kaunisvaara Project • Enables Northland to emerge from Reorganisation within 6-8 weeks, subject to necessary approvals and proposed timeline • Second Lien Convertible Bond represents de facto equity buffer, convertible from July 2013 and mandatory conversion provisions upon refinancing of the New First Lien Bond 2 • No cash interest or amortization of debt until completion of Kaunisvaara Capex program • Strong cashflow conversion once project is fully realized, with limited maintenance capex and significant tax credits available • High-grade, low-impurity iron ore concentrate, achieving premium pricing • Mining location with stable regulatory regime and access to existing logistics infrastructure • 30% annual production increase opportunity identified for Process Line 1 • Upside from Pellivuoma and Hannukainen prospects • Commissioning of first line completed, first three shipments delivered to end-users • Initial indications confirming production volumes and product quality • Up to 100% of volume sold under off-take contracts for 7-10 years • Logistics chain performing as planned, still on some temporary solutions • 75% of remaining Capex until end-2014 is on fixed-price contracts • Key assumptions underlying funding need are considered conservative in a historical context • Iron ore demand continues to grow driven by China • New supply estimates continuously revised downwards • Kaunisvaara concentrate is market leading on grade and impurities 1) Comprising USD 337m net New contemplated bond money, USD 114m Supplier Credit (excluding VAT), approx USD 30m (subject to FX movements) DSA release, USD 16m bondholder funding during Reorganisation. 2) Can be mandatorily converted to equity from 16 July 2018 subject to full refinancing of the New 1 st lien bond 16
Agenda Investment thesis Northland Resources and the Kaunisvaara Project Key Financials Market Overview Risk Factors Appendix 17 17
Page 1 and 2: STRICTLY PRIVATE & CONFIDENTIAL THI
Page 3 and 4: Disclaimer (cont’d) This Presenta
Page 5 and 6: Key Risk Factors Relating to the Gr
Page 7 and 8: Transaction Background • Budget p
Page 9 and 10: Indicative Commercial Terms of the
Page 11 and 12: Funding Sources and Capital Structu
Page 13 and 14: Governance Changes to Give Creditor
Page 15: Northland in Transition from Projec
Page 19 and 20: Northland is listed in Oslo Share o
Page 21 and 22: First concentrate from Kaunisvaara
Page 23 and 24: Kaunisvaara Project Overview Kaunis
Page 25 and 26: Production to Reach 4 dmtpa in Q3 2
Page 27 and 28: Strong Logistics Partners Ramping U
Page 29 and 30: Kaunisvaara Premium Concentrate Exp
Page 31 and 32: Potential production upside Upgrade
Page 33 and 34: Further Growth Potential - Hannukai
Page 35 and 36: Update on Operating Cost Expectatio
Page 37 and 38: Projected Capital Expenditure Until
Page 39 and 40: Sources and Uses starting 1 Jan 201
Page 41 and 42: Budget Assumptions in a Historical
Page 43 and 44: Forecast Iron Ore Supply Being Revi
Page 45 and 46: Kaunisvaara Concentrate - Quality L
Page 47 and 48: Risk Factors Risks related to the p
Page 49 and 50: Risk Factors (cont’d) Risks relat
Page 51 and 52: Risk Factors (cont’d) Litigation
Page 53 and 54: Risk Factors (cont’d) Other risks
Page 55 and 56: Risk Factors (cont’d) Other risks
Page 61 and 62: Northland expected to emerge from R
Page 63 and 64: Main terms of the restructuring of
Page 65 and 66: Profit & Loss Statement 2012 Year e
Page 67 and 68:
Kaunisvaara Mineral Reserve Stateme
Page 69 and 70:
Management Team Executive Team Karl
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Investor Presentation May 2013 - Northland Resources

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