Orocobre : 2019 AGM Presentation - ORE ASX Announcement_2019 AGM Presentation_ASX_FINAL.pdf

AGM PRESENTATION

22 NOVEMBER 2019

DISCLAIMER

This investor presentation ("Presentation") has been prepared by Orocobre Limited ("Orocobre" or "the Company"). It contains general information about the Company as at the date of this Presentation.

The information in this Presentation should not be considered to be comprehensive or to comprise all of the material which a shareholder or potential investor in the Company may require in order to determine whether to deal in shares. The information in this Presentation is of a general nature only and does not purport to be complete.

This Presentation does not take into account the financial situation, investment objectives, tax situation or particular needs of any person and nothing contained in this Presentation constitutes investment, legal, tax or other advice, nor does it contain all the information which would be required in a disclosure document or prospectus prepared in accordance with the requirements of the Australian Corporations Act. Readers or recipients of this Presentation should, before making any decisions in relation to their investment or potential investment in the Company, consider the appropriateness of the information having regard to their own objectives and financial situation and seek their own professional investment, legal and taxation advice appropriate to their particular circumstances.

This Presentation is for information purposes only and does not constitute or form part of any offer, invitation, solicitation or recommendation to acquire, purchase, subscribe for, sell or otherwise dispose of, or issue, any entitlements, shares or any other financial product. Further, this Presentation does not constitute financial product or investment advice (nor tax, accounting or legal advice), nor shall it or any part of it or the fact of its distribution form the basis of, or be relied on in connection with, any contract or investment decision.

The distribution of this Presentation in other jurisdictions outside Australia may also be restricted by law and any restrictions should be observed. Any failure to comply with such restrictions may constitute a violation of applicable securities laws.

Certain statements in this Presentation are forward-looking statements. You can identify these statements by the fact that they use words such as "anticipate", "estimate", "expect", "project", "intend", "plan", "believe", "target", "may", "assume", "should", "could", "predict", "propose", "forecast", "outlook" and words of similar import. Indications of, and guidance on, future earnings and financial position and performance are also forward-looking statements. Forward-looking information may include, but is not limited to, the successful ramp-up of the Olaroz Project, and the timing thereof; the design production rate for lithium carbonate at the Olaroz Project; impacts of weather and climatic conditions, the expected brine grade at the Olaroz Project; the Olaroz Project's future financial and operating performance, including production, rates of return, operating costs, capital costs and cash flows; the comparison of such expected costs to expected global operating costs; the ongoing working relationship between Orocobre and the Provinces of Jujuy and Salta in Argentina; the on-going working relationship between Orocobre and the Olaroz Project's financiers, being Mizuho Bank and JOGMEC and the satisfaction of lending covenants; the future financial and operating performance of the Company, its affiliates and related bodies corporate, including Borax Argentina S.A. ("Borax Argentina"); the estimation and realisation of mineral resources at the Company's projects; the viability, recoverability and processing of such resources; timing of future exploration of the Company's projects; timing and receipt of approvals, consents and permits under applicable legislation; trends in Argentina relating to the role of government in the economy (and particularly its role and participation in mining projects); adequacy of financial resources, forecasts

relating to the lithium, boron and potash markets; potential operating synergies between the Cauchari Project and the Olaroz Project; the potential processing of brines from the Cauchari Project and the incremental capital cost of such processing, expansion, growth and optimisation of Borax Argentina's operations; the integration of Borax Argentina's operations with those of Orocobre and any synergies relating thereto and other matters related to the development of the Company's projects and the timing of the foregoing matters.

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DISCLAIMER (CONT.)

Forward-looking statements are based on current expectations and beliefs and, by their nature, are subject to a number of known and unknown risks and uncertainties that could cause the actual results, performances and achievements to differ materially from any expected future results, performances or achievements expressed or implied by such forward-looking statements, including but not limited to, the risk of further changes in government regulations, policies or legislation; that further funding may be required, but unavailable, for the ongoing development of the Company's projects; fluctuations or decreases in commodity prices; uncertainty in the estimation, economic viability, recoverability and processing of mineral resources; risks associated with development of the Olaroz Project; unexpected capital or operating cost increases; uncertainty of meeting anticipated program milestones at the Olaroz Project or the Company's other projects; risks associated with investment in publicly listed companies, such as the Company; risks associated with general economic conditions; the risk that the historical estimates for Borax Argentina's properties that were prepared by Rio Tinto, Borax Argentina and/or their respective consultants (including the size and grade of the resources) are incorrect in any material respect; the inability to efficiently integrate the operations of Borax Argentina with those of Orocobre; as well as those factors disclosed in the Company's Annual Report for the financial year ended 30 June 2019 and Sustainability Report 2018 available on the ASX website and at www.sedar.com.

No representation, warranty or assurance (express or implied) is given or made by the Company that the forward-looking statements contained in this Presentation are accurate, complete, reliable or adequate or that they will be achieved or prove to be correct.

Subject to any continuing obligation under applicable law or relevant listing rules of the ASX, the Company disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements in this Presentation to reflect any change in expectations in relation to any forward-looking statements or any change in events, conditions or circumstances on which any such statements are based. Nothing in this Presentation shall under any circumstances create an implication that there has been no change in the affairs of the Company since the date of this Presentation.

US investors should note that while the Company's reserve and resource estimates comply with the JORC Code, they may not comply with Industry Guide 7, which governs disclosures of mineral reserves in registration statements filed with the US Securities and Exchange Commission ("SEC"). In particular, Industry Guide 7 does not recognise classifications other than proven and probable reserves and, as a result, the SEC generally does not permit mining companies to disclose their mineral resources in SEC filings. You should not assume that quantities reported as "resources" will be converted to reserves under the JORC Code or any other reporting regime or that the Company will be able to legally and economically extract them.

To the maximum extent permitted by law, the Company, the lead manager and their respective related bodies corporate and affiliates, and their respective directors, officers, partners, employees, agents and advisers expressly disclaim all liability (including without limitation, liability for negligence) for any direct or indirect loss or damage which may be suffered by any person in relation to, and take no responsibility for, any information in this Presentation or any error or omission therefrom, and make no representation or warranty, express or implied, as to the currency, accuracy, reliability or completeness of the information contained in this Presentation.

By attending an investor presentation or briefing, or by accepting, accessing or reviewing this Presentation, you acknowledge and agree to the terms set out in this disclaimer.

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BUSINESS SNAPSHOT

SDJ (100%)

• Production - Q1 FY20 of 3,093 tonnes (FY19: 12,605 tonnes)
• • New ponds will support brine quality
  • Focus on Safety, Quality and Productivity - and cost reduction
• Sales - Q1 FY20 of 3,108 tonnes (FY19: 12,080 tonnes)
• • Average sales price of US$7,111/tonne FOB1
• Q1 FY20 margin of 31%2 affected by price received
• FY20 production expected to be at least 5% higher than FY19
• Q2 FY20 product pricing is expected to be US$6,200-6,500/tonne FOB1
• Expansion continues with pond construction and plant engineering

Orocobre

• Group statutory FY19 net profit of US$54.6 million (underlying profit of US$24.8 million and underlying EBITDAIX of US$54.1 million)
• Orocobre corporate cash of US$223.5 million at 30 September 2019

Price (US$/tonne)

$8,220

$7,111

Q4 FY19

Q1 FY20

Production (tonnes)

3,093

2,293

Q1 FY19

Q1 FY20

Sales (tonnes)

3,108

2,144

Q1 FY19

Q1 FY20

1. Orocobre reports price as "FOB" (Free on Board) which excludes insurance and freight charges included in CIF (Cost, Insurance, Freight) pricing. Therefore, the Company's reported prices are net of freight (shipping), insurance, sales commission and export taxes. FOB prices are reported by the Company to provide

clarity on the sales revenue that is recognized by SDJ , the joint venture company in Argentina.	4
2. Excludes royalties, export tax and head office costs.

STRATEGY

VISION: BE A WORLD CLASS SUPPLIER OF LITHIUM CHEMICALS

To be a world class lithium supplier, Orocobre will focus on three key areas:

Safety

Deep

Understanding of

the Process

Productivity

Quality

Existing strategic initiatives remain the focus:

• Production from Stage 1
• Stage 2 Expansion
• Naraha Lithium Hydroxide Plant
• Basin and resources

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OLAROZ LITHIUM FACILITY

OLAROZ STAGE 1 PRIORITIES

• Plant management has a focus on safety, quality and productivity with a renewed leadership team
• • Safety
  • Quality - meet rising customer requirements in areas such as packaging quality assurance, chemical product consistency etc.
  • Productivity - reagent use, equipment availability, recovery
  • Cost reduction is a priority
• Operating strategy will focus on brine quality
• • Brine concentration remains better than same time in last two previous years
  • Incremental pond area will stabilise concentrations
• Product development
• • Development of low specific impurity products for customers of industrial product

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OLAROZ STAGE 2 EXPANSION PROJECT

• Design capacity of up to 25,000 tonnes per annum (tpa) of industrial grade lithium carbonate
• Will supply Naraha with feedstock for conversion to battery grade lithium hydroxide
• Construction underway with commissioning expected H1 CY21
• Capital expenditure of US$295 million including US$25 million contingency1
• Operating costs are expected to be less than Stage 1 as only industrial grade lithium carbonate will be produced from Stage 2

Key financing terms:

• US$180 million provided by Mizuho Bank
• Interest rate less than 4%
• 3 year principal holiday, further 6.5 year repayment schedule
• Until completion, Orocobre agreed with TTC to hold US$135 million of cash in a separate reserve account to support the TTC guarantee for the debt
• At completion JOGMEC to assume 82.35% guarantee obligation and ORE cash will be available for corporate purposes

1. Excludes VAT and working capital.

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NARAHA LITHIUM HYDROXIDE PLANT

CONSTRUCTION UNDERWAY AT NARAHA

• ORE holds a 75% economic interest in the 10,000 tpa Naraha Lithium Hydroxide Plant
• Operating costs (excluding industrial grade lithium carbonate feedstock) are estimated at approximately
  US$1,500/tonne
• Total capital costs ~JPY9.5 billion1 (US$90 million, excluding VAT)
• Equity and debt funding in place for JPY10.1 billion1 (US$96.2 million) which provides a significant buffer
• Subsidies of approximately US$27 million have been secured from the Japanese government
• EPC contractor Veolia has commenced construction
• Commissioning expected to commence in H1 CY21
• A cathode manufacturing plant is already in operation in the immediate vicinity and plans have been announced to develop a battery manufacturing facility nearby

1. The EPC contract and all financing is denominated in Japanese Yen and has been converted at a JPY/US$ exchange rate of 105.

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BORAX ARGENTINA

BORAX ARGENTINA

• Operational profit of US$0.2 million in FY19
• Strong focus on cost control pays off with costs at, or near all time lows
• Continued strong sales growth
• Product diversification delivering value for customers
• Provide secure locally sourced product for customers
• A number of long term agreements developed with strategic corporate customers and a renewed focus on Southern Cone markets (Chile, Argentina, Paraguay, Uruguay)

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SUMMARY

FY19 production of 12,605 tonnes, FY20 production expected to be approximately 5% higher than FY19

• Olaroz Stage 2 Expansion finance is now complete, construction of ponds is well advanced, finalising process engineering
• 10,000 tpa Naraha Lithium Hydroxide Plant has commenced construction

Operational improvement program clearly defined and currently being implemented

Lithium chemical prices are lower than previous periods but long term fundamentals remain intact

1. Excludes royalties, export taxes and head office costs.

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MEETING RESULTS

RESULTS SUMMARY

1.	Adoption of the Directors' Remuneration Report for the	FOR	AGAINST	ABSTAIN
	year ended 30 June 2019	109,419,995 (93.91%)	7,091,388 (6.09%)	560,078
		FOR	AGAINST	ABSTAIN
2.	Election of Director - Mr. Richard Seville	122,117,935 (98.68%)	1,630,956 (1.32%)	412,407
		FOR	AGAINST	ABSTAIN
3.	Re-election of Ms. Leanne Heywood as a Director	123,199,672 (99.58%)	519,593 (0.42%)	422,033
		FOR	AGAINST	ABSTAIN

4. Re-election of Mr. Fernando Oris de Roa as a Director

		123,250,467 (99.60%)	499,446 (0.40%)	411,385
5.	Approval of Amendments to the Employee Performance	FOR	AGAINST	ABSTAIN
	Rights and Options Plan	115,386,248 (94.48%)	6,736,401 (5.52%)	1,108,650
6.	Approval of the granting of Performance Rights to the	FOR	AGAINST	ABSTAIN
	Managing Director and CEO, Mr. Martín Pérez de Solay	116,372,102 (94.03%)	7,394,885 (5.97%)	394,311
7. Approval for the giving of Retirement Benefits to the	FOR	AGAINST	ABSTAIN
	Managing Director and CEO, Mr. Martín Pérez de Solay	121,899,916 (98.60%)	1,730,025 (1.40%)	531,357
		FOR	AGAINST	ABSTAIN

8. Approval of Non-Executive Director's Share Rights Plan

116,340,003 (98.69%)

1,539,715 (1.31%)

507,021

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