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Page 1: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 1[xx]

GALAXY RESOURCES LIMITED

2018 Lithium & Energy Storage ConferenceNovember 2018

ASX:GXY

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Page 2: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 2[xx]Galaxy Resources Limited (ASX:GXY)

Disclaimer

This document contains forward looking statements concerning the projects owned by Galaxy. Statements concerning mining reserves and resources may also be deemed to be forward looking statements in that they involve estimates based on specific assumptions. Forward-looking statements are not statements of historical fact and actual events and results may differ materially from those described in the forward looking statements as a result of a variety of risks, uncertainties and other factors. Forward-looking statements are inherently subject to business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause the Company’s actual results to differ materially from those expressed or implied in any forward-looking information provided by the Company, or on behalf of, the Company. Such factors include, among other things, risks relating to additional funding requirements, metal prices, exploration, development and operating risks, competition, production risks, regulatory restrictions, including environmental regulation and liability and potential title disputes. Forward looking statements in this document are based on Galaxy’s beliefs, opinions and estimates of Galaxy as of the dates the forward looking statements are made, and no obligation is assumed to update forward looking statements if these beliefs, opinions and estimates should change or to reflect other future developments. There can be no assurance that Galaxy’s plans for development of its mineral properties will proceed as currently expected. There can also be no assurance that Galaxy will be able to confirm the presence of additional mineral deposits, that any mineralization will prove to be economic or that a mine will successfully be developed on any of Galaxy’s mineral properties. Circumstances or management’s estimates or opinions could change. The reader is cautioned not to place undue reliance on forward-looking statements. Data and amounts shown in this document relating to capital costs, operating costs, potential or estimated cashflow and project timelines are internally generated best estimates only. All such information and data is currently under review as part of Galaxy’s ongoing operational, development and feasibility studies. Accordingly, Galaxy makes no representation as to the accuracy and/or completeness of the figures or data included in the document. Not For Release in US This presentation does not constitute an offer of securities for sale in any jurisdiction, including the United States. Any securities described in this presentation may not be offered or sold in the United States absent registration or an exemption from registration under the United States Securities Act of 1933, as amended, following the preparation of required documents and completion of required processes to permit such offer or sale.

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CONTACT INFORMATIONLevel 4 / 21 Kintail Road, Applecross, Western Australia 6153 PO Box 1337, Canning Bridge LPOApplecross WA 6953T: +61 8 9215 1700F: +61 8 9215 1799E: [email protected]

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Page 3: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 3[xx]Galaxy Resources Limited (ASX:GXY)

Galaxy Overview

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Page 4: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 4[xx]Galaxy Resources Limited (ASX:GXY)

Company Highlights

▪ One of the premier global lithium opportunities with existing production and a world class asset development pipeline

▪ Robust free cashflow from Mt Cattlin operations delivers continued strengthening of financial position and supports future development initiatives across the portfolio

▪ Multi-project portfolio provides diversified exposure across hard rock and brine lithium assets in Australia, Argentina and Canada

▪ Revised feasibility study at flagship Sal de Vida Project in Argentina supports low cost, long life project with robust economics; project funding well advanced

▪ James Bay in Canada is a high quality development asset, with feasibility underway for both upstream and downstream operations

▪ Highly credentialed Management and Board with a deep industry knowledge and a history of building successful mining companies

▪ Existing relationships with customers in key markets through Galaxy’s position as a major global supplier of high quality lithium

▪ Robust lithium macro trends with surging demand from lithium ion battery applications and a lagged supply-side response

4

Mt Cattlin Operations – Australia

En route to Sal de Vida lithium project – Argentina

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Page 5: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 5[xx]Galaxy Resources Limited (ASX:GXY)

Corporate Snapshot (ASX: GXY)

5

Financial Information (2018.11.14) Share Price Performance (1 year)

Share price A$2.57

Number of shares (undiluted)1,2 407.5m

Market Capitalisation A$1,047.3m

Cash (30-Sep-18)3 A$75.7m

Debt (30-Sep-18) Nil

Net cash (30-Sep-18) A$75.7m

Enterprise Value A$971.6m

Investor %

Ausbil IM 9.0%

Blackrock Group 5.9%

Board and Management 2.4%

Top 20 shareholders 42.3%

Top Shareholders (Oct 2018)

Shareholder Type and Geographical Breakdown (Oct 2018)

Source: IRESSNotes:1 Excludes 16.7m unlisted options on issue at various vesting and expiry dates with

exercise prices between A$2.78 and A$3.662 Excludes 2.9m share appreciation rights3 Cash and liquid securities

47.2%

6.2%

2.4%2.2%

16.2%

25.9%

Institutional BrokersBoard & Management Corporate stakeholdersPrivate investors Other

38.1%

12.1%8.0%5.1%

8.2%

28.4%

Australia/New Zealand North AmericaUnited Kingdom Asia/Middle EastEurope Not reported

The leading global pure play lithium company with diversified asset base, strong institutional support and a diversified global investor base

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5

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15

20

25

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1.0

2.0

3.0

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Nov-17 Feb-18 May-18 Aug-18 Nov-18

Volume (m)Share price (A$)

Volume GXY

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Page 6: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 6[xx]Galaxy Resources Limited (ASX:GXY)

Diverse Asset Portfolio

6

Mt Cattlin, WA, Australia –Hard Rock

Sal de Vida, Catamarca province, Argentina – Brine

James Bay, Quebec, Canada – Hard Rock

▪ 100% owned

▪ Lithium hard rock development

▪ Indicated Mineral Resource: 40.3mt at 1.4% Li2O

▪ Feasibility underway for integrated upstream and downstream operation

▪ 100% owned

▪ Lithium and potash brine project with a reserve of 1.1mt LCE, 4.2mt KCl

▪ Feasibility completed; closing POSCO transaction and finalizing project funding and strategic partnerships

▪ Early development works to continue in H2 2018

▪ Optimization works and engineering underway

▪ 100% owned

▪ Throughput capacity expanded to 1.6mt p.a.

▪ c.123kt of lithium concentrate (15.4kt LCE) produced year to date (up to 30-Sep-18)

▪ Yield optimization commissioning underway, targeting improved recoveries of 70-75%

Lithium value-adding production heavily concentrated in Asia – current and future capacity anticipated to continue to be dominated by China

▪ Current commissioned and planned capacity – 85% still expected to be in Asia

▪ China produces >50% of global lithium cathodes

▪ Galaxy uniquely positioned, having historically served major customers in the battery materials as a result of its former Jiangsu operations

Source: BNEF

With a portfolio of both hard rock and brine based lithium assets, Galaxy is an established producer with a strong project development pipeline, and is well networked with key customers within key global lithium markets

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Page 7: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 7[xx]Galaxy Resources Limited (ASX:GXY)

Perspectives On The Lithium-Ion Battery Value Chain

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Page 8: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 8[xx]Galaxy Resources Limited (ASX:GXY)

Total Output (2017)

~144GWh

~52% @ China

8

Lithium-Ion Batteries – Key Demand Drivers

▪ Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing consumer demand and mandatory government policies globally

▪ The dominant use for LiBs, with an expected 5x growth through to 2020

Electric Vehicles - 58GWh @ 2017 (China Share 62%)

Rapid growth in lithium demand driven by the disruptive consumption of LiB adoption beyond 3C applications, broadening to transportation and storage

Energy Storage Systems (“ESS”) – 11GWh @ 2017 (China Share 38%)

Consumer Electronics (“3C”) – 75GWh @ 2017 (China Share 44%)

Main Applications Of Lithium-Ion Battery Consumption

▪ ESS has emerged as a key resource in managing grid stability and supporting growing penetration of renewable energy, projected to grow to 50GWh by 2020

▪ Consumption potential may outpace electric vehicles in the medium term

▪ High levels of consumption and rapid obsolescence supports solid baseline of demand for lithium in the future

▪ New growth in adoption across non-computing applications

Source: EVTank, BNEF, Company Estimates

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Page 9: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 9[xx]Galaxy Resources Limited (ASX:GXY) 9

New Energy Vehicles – China

Global growth in electric vehicles continues to be led by China and supported by the enforcement of increasingly stricter government standards on emissions

▪ China has already produced c.879K vehicles in YTD 2018,representing 70% growth year-on-year

▪ New subsidy scheme implemented in June rewards longer range / higher energy density vehicles

▪ China targeting 20% NEV penetration by 2025 (c. 7mm NEVs p.a. of total projected production of 35mm vehicles)

— At 7mm vehicles p.a., implies additional demand of 280kt LCE by 20251

Quarterly production of New Energy Vehicle in China

0

100

200

300

400

Q1 Q2 Q3 Q4

2016 2017 2018

Production target of at least 1.1mm NEVs in China this year, representing 38% growth YoY

▪ A total of 3,835 NEV models have been approved by the central government (647 passenger NEVs)

▪ Range Getting Further: c.80% of approved passenger vehicles (“PV”) had a range of 300km+ (7 models over 400km)

▪ NEV Battery Intensity: Average battery size 45kWh in 2017, expecting to increase to 50kWh in 2018

▪ Batteries Density Increasing: 79.6% of approved PVs has an energy density >140Wh/kg (avg. of 146Wh/kg)

216197 207 204 196

218

257

216 223249 247

263 260

321294

276

328 339312

331

104 104 115 112 119 123 127 125 114129 127 131 131 138 139 133 140 143 142 146

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50

100

150

200

250

300

350

400

1 2 3 4 5 6 7 8 9 10 11 1 2 3 4 5 6 7 8 9

Average Range (km) Energy Density (Wh/kg)

2017 2018

Performance Of 2017/2018 Type Approved NEV PVs

Batch 9 Type Approved NEVs

Source: CAAM, CJ Securities, Bloomberg, MIT, GFSECNotes: 1. Assumes an average EV battery capacity of 50kWh and an average lithium intensity of 0.8

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Page 10: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 10[xx]Galaxy Resources Limited (ASX:GXY) 10

New Energy Vehicles – Rest Of The World

Globally, automakers and governments are executing aggressive growth strategies and enforcing mandatory policy that will support a rapid acceleration of EV adoption

Monthly Sales Of Plug-In Vehicles In USA

35% growth YoY to August

72% growth YoY to OctoberInvesting more than €50bn as it pushes to electrify all 300 range models by 2030

Introducing 2 new EVs in the next 18 months, and at least 20 new “all electric vehicles” by 2023

Plans to introduce 12 new BEVs by 2022 and support autonomous vehicle development

Plans to offer 25 electrified models by 2025, with 12 of those model being battery electric vehicles

Targeting 5.5 million EVs, including 1 million BEVs by 2030

US$11bn investment and 40 electrified vehicles by 2022

Delivered 83,500 vehicles in Q3 2018; plans to add 3 new production lines at the Nevada by year end

Mercedes-Benz announced plans to for 50 EV models 2022; Daimler to invest US$12bn in EVs

Automaker Targets

Monthly Sales Of Plug-In Vehicles In Europe

Global EV stock surpassed 4 million globally in August,Next 1 million vehicles could be reached within 6 months

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10,000

20,000

30,000

40,000

50,000

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT

2016 2017 2018

Source: EV Volumes; Inside EVs, Company announcements

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30,000

40,000

50,000

JAN FEB MAR APR MAY JUN JUL AUG SEP

2016 2017 2018

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Page 11: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 11[xx]Galaxy Resources Limited (ASX:GXY) 11

China – New Subsidy Program

Renewed NEV subsidies have accelerated transition of major EV cathode and battery technology – strong continued growth in NEVs despite overall subsidy value decline

▪ Updated NEV subsidies, valid through to 2020, promotes longer range vehicles and higher energy density batteries

▪ Baseline subsidy based on vehicle range (km); subsidy multiplier based on specific energy of battery (Wh/kg)

▪ Continued growth in penetration despite subsidy value reduction (RMB116bn in 2017 to RMB66bn in 2018)

▪ Advanced battery technologies required in order meet the new performance criteria

▪ Has incentivized downstream manufacturers to shift production lines to high nickel intensity cathode chemistries

NEV Cars

Source: Broker Research, Government Websites

E-Buses

▪ Minimum vehicle range increased to 200km

▪ Additional requirements: battery mass ratio, charging speed and battery energy density

▪ NEV growth predominately driven by fleet procurement policies → end user less sensitive to price

Specific Energy (Wh/kg)

Vehicle Range (km) 90-105 105-120 120-140 140-160 160+

>80 - - - - -

100-150 - - - - -

150-200 - 9,000 15,000 16,500 18,000

200-250 - 14,400 24,000 26,400 28,800

250-300 - 20,400 34,000 37,400 40,800

300-350 - 27,000 45,000 49,500 54,000

400+ - 30,000 50,000 55,000 60,000

NEV Subsidies Based on Vehicle Range and Specific Energy of Battery (RMB)

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Page 12: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 12[xx]Galaxy Resources Limited (ASX:GXY) 12

China NEV Growth - Not Reliant On Subsidies

Mandatory policy measures and consumer incentives further encouraging NEV adoption; China targeting the 100% phase out of internal combustion engine (“ICE”) vehicles

▪ China enforces licensing and driving restrictions on ICEs

▪ Certificate of entitlement required to purchase a vehicle – US$15k for individual; US$30k for company (Shanghai)

▪ The right to purchase an ICE vehicle is subject to a lottery

— Success rates: 4% (Shanghai); 0.2-0.3% (Beijing)

▪ None of the above applies to prospective NEV owners

▪ New licensing restrictions expected to be applied to other major cities, taxi operations and logistics fleets expected to undergo further electrification

Mandatory Policy – Targeting OEMs

Source: Broker Research, Government Websites, MIT, GFSECNotes:1. Assumes 3 credits per vehicle

Encouraging Further Consumer Adoption

China is targeting NEV production of 7 million vehicles per annum by 2025

Equivalent to a NEV penetration rate of 20%

▪ NEV credit system mandating manufacturers to meet certain production quotas

— 10% in 2019; 12% in 2020

— Implies NEV passenger vehicles of 1.4mm (2019) and c.2.0mm (2020)1

▪ Credits earned per vehicle depend on vehicle range, battery energy density and energy efficiency

▪ Higher performance NEVs are incentivized by higher credits, encouraging adoption of advanced battery technology

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Page 13: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 13[xx]Galaxy Resources Limited (ASX:GXY) 13

Europe – Regulatory Incentives

The European Commission is enforcing increasingly stricter emissions standards and proposes to reduce CO2 emissions from vehicles 40% by 2030 (year of reference 2021)

Supportive Policy

▪ EU legislation sets mandatory emission reduction targets

— Promoting the rapid shift to Plug-In vehicles

▪ Mandatory target to reduce EU fleet-wide emissions for new cars by 2030 by 40% (↑ from previous 30% target)

— Intermediate target of 20% by 2025

▪ Manufacturers who exceed these targets are fined

— €95 from the first gram of exceedance onwards from 2019

▪ Super credits for low emission cars (<50g CO2/km) accruing as of 2019

Capital Funding

▪ EU battery development project incentivizes governments to provide funding support for EV cell manufacturing

— European Fund for Strategic Investment – European Investment Bank

— €22bn in regional funds

— €200mm Horizon 2020 fund

— €800mm in project construction facilities

Maximum CO2 Emissions Threshold (g CO2/km) For Passenger Vehicles

Source: Broker Research, Government Websites, Climate Protection

130

9581

66

2014 2021 2025 2030

Select Target Timelines For Ceasing ICE production

Avg. emissions of new car sold in 2017 = 118.5g CO2/km

2025 – Current EV penetration >40%

2030 – Ban on new ICE vehicle sales

2025 – Ban on registration of ICE vehicles

2040 – Ban on new ICE vehicle sales

2040 – Ban on new ICE vehicle sales

2020 – Ban on new ICE vehicle sales

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Page 14: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 14[xx]Galaxy Resources Limited (ASX:GXY) 14

Energy Storage Systems (“ESS”)

Storage sector growth encouraging over past 12 months – represents a potential step change in the already rapid growth in overall lithium demand

▪ Market expected to grow rapidly over the coming decade in line with accelerating adoption of renewable energy

▪ Market growth estimates for total battery electrical storage (“BES”) systems within ESS applications vary widely

— LiB based storage to grow to 50GWh by 2020, 300GWh by 2025

— Bloomberg New Energy Finance estimates US$548bn to be invested into battery capacity by 2050

▪ Lithium-ion battery technologies have several advantages in seizing market share of BES technologies

— LiB already a commercially mature technology

— Large scale EV battery manufacturing is driving down costs

▪ The Global Energy Storage Database (IRENA), indicates 27% of tracked ESS project capacity to be LiB technology

▪ Battery chemistries adopted will vary based on application

— Chinese manufacturers favoring LFP / NCM / LTO

— China ESS sector still at nascent stage (est. ~5GWh)

Source: Company announcements, BNEF, IRENA, US DOE, Investment Banking ResearchNotes:1. Li-ion battery size of 60kWh 2. LFP – Lithium Iron Phosphate, NCM = Nickel Cobalt Manganese, LTO = Lithium Titanium Oxide

2,000 Tesla Model 3 equivalents1

Indicative Scale of Selected ESS Projects

Legend

Project Operator / Partners Energy Storage

HornsdalePower Reserve

Moss Landing Energy Storage

Vistra Moss Landing Energy Storage

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Page 15: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 15[xx]Galaxy Resources Limited (ASX:GXY)

26%

36%

21%

8%

9%

41%

24%

16%

9%

10%

15

Cathode – Trend Analysis & Chemistry

Demand for ternary cathode materials (NCA/NCM)2 expected to outpace growth rate in the broader market, mainly driven but increased adoption in EV segment

▪ Concerns around ethical cobalt supply and increased energy density demands from automotive battery manufacturers supporting push towards nickel-rich ternary cathode (NCM 811) and NCA cathode chemistries

▪ Becoming increasingly apparent that future demand for cathode will comprise a wide range of chemistries given the performanceand technical challenges (costs, safety etc.) associated with adopting NCM811 and NCA

— This is promoting R&D investment into other high performance cathodes such as LNO2 and LiFeF3, as well as new production methods for chemistries such as LFP2

Cathode Mix Transitioning From LFP to Ternary

Source: Avicenne Energy, Investment Banking ResearchNotes:1. Battery grade LCE demand based on UBS estimates2. LFP = Lithium Iron Phosphate, NCM = Nickel Cobalt Manganese, LNO = Lithium Nickel Oxide, NCA = Nickel Cobalt Aluminum, LiFeF3 = Lithium Iron Fluoride

2016 2025E

Implied Cathode Demand (Based On LiB GWh Projections)1

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500

1,000

1,500

2,000

2,500

3,000

2016 2025

Battery Grade LCE (kt) Implied cathode volume (kt)

kt

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Page 16: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 16[xx]Galaxy Resources Limited (ASX:GXY) 16

Cathode – Geographical Expansion

Expansions being front loaded in order to build out capacity for the expected accelerating growth in future demand of battery materials▪ LiB demand will drive cathode capacity expansion, substantial investment now to ensure cathodes do not bottleneck value chain

▪ China expected to still make up the majority share (c.50%-60%) of installed GWh demand, however geographical diversity is a key focus of cathode manufacturing expansion as the lithium-ion value chain begins to evolve in specific global regions

▪ Geographical diversity of raw material supply also a core consideration in improving the cost of efficiencies of localized supply chains

— Core strength of Galaxy’s diversified project portfolio is its ability have specific projects focused on service particular global regions

Company2016 Capacity

(t)Expansion capacity (t) Cathode

Umicore 12,000 163,000 NCM (variety)

BASF / TODA 18,000 68,000 NCM (variety)

JMAT - 10,000 eLNO

Sumitomo M&M 22,200 32,400 NCA

LG Chem 8,000 82,000 NCM

Shanshan 10,000 130,000 NCM (variety)

Easpring 10,000 60,000 NCM (variety)

Reshine 3,000 27,000 NCM, NCA

Jinhe 15,000 120,000 NCM

Xiamen Tungsten Co 7,000 35,000 NCM

GEM 15,000 15,000 NCM

Zhenhua E-chem 10,000 40,000 NCM

POSCO 6,000 59,200 NCM

Total 841,600

Select Announced NCM/NCA Capacity Additions Through 2021

Source: Company Announcements, Investment Banking Research

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Page 17: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 17[xx]Galaxy Resources Limited (ASX:GXY)

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135

21

46

17

Global Lithium-Ion Battery Capacity

Current global battery production has surpassed 200GWh and is estimated to grow to 1.1TWh by the end of 2025 – further expansion plans announced recently in China

Source: BMI Mineral Intelligence, Company disclosure

Global Battery Capacity Forecast to 2028

2018221GWh

94

405

81

79207

631

148

112

2023e658GWh

50GWh Navada, USA

Constructing 7.5GWh Hungary

7.5GWh Hungary

22GWh Poland

2425

63

5025

Qinghai 24GWh Nanjing 1

35GWh

Nanjing 2 28GWh

Xian 25GWh

50GWh

FunengTechnology

Ganzhou25GWh

Selected Battery Manufacturing Gigafactories (Completed or in Construction)

2028e1,103GWh

Battery manufacturers building out localized supply chains

41 gigafactories completed or planned through to 2028

14GWh Germany

>5GWh Hungary

20GWh KoreaFor

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Page 18: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 18[xx]Galaxy Resources Limited (ASX:GXY)

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200

400

600

800

1,000

1,200

2016 2017 2018 2019 2020 2021 2022 2023 2024 2025

Non LiB applications LiB applications

Lithium Carbonate Demand (kt LCE)

Source: Global Investment Bank and Broker research, Bloomberg New Energy FinanceNotes:1. Assumes a greenfield capital intensity of US$15,000/tonne LCE

Investment Bank 3 2025 demand projection: c.824kt

Investment Bank 2 2025 demand projection: c.912kt

Investment Bank 1 2025 demand projection: c.1,000kt+

▪ Demand projected to continue to grow at a CAGR of 15%-20%+ (2017-2025)

▪ Consensus incremental demand growth of c.640kt+ LCE implies required annual supply growth of 80ktpa LCE for market balance

▪ Major supply side challenges continue to include number of “shovel-ready” projects, capital available to finance those projects (US$9.6bn worth of investment required1), construction and commissioning delays (common) and product quality hurdles

▪ Execution of expansions will be challenging – not just for greenfield projects, but also brownfield expansions from current producers, as evidenced recently

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Global Lithium Demand

Lithium demand projected to grow up to 5x from historical volume of c.200kt LCE p.a. to over 1,000kt LCE of projected demand by 2025

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Page 19: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 19[xx]Galaxy Resources Limited (ASX:GXY)

Supply – The Rhetoric Vs. Reality

Source: Investment Banking Research, Company disclosure Notes:1. As at 30 September 20182. Includes shipments completed in early October 3. Assumes 8 tonnes of lithium concentrate per 1 tonne of LCE 4. Analyst estimates

19

Supply side response continues to lag – delays in project construction, commissioning and capacity expansions, as well as product quality issues remain a challenge

Project

First Production Guidance

Actual First

Shipment

2018E Sales(LCE)

2018TD Sales1

(LCE)

Atacama na na 55kt 30.5kt

Pilgangoora3 Q1 2018 Q4 2018 11kt 1.1kt2

Pilgangoora3 Q4 2017 Q4 2018 16kt 0.7kt2

Bald Hill3 Q1 2018 Q2 2018 17kt 4.7kt2

Olaroz na na 17kt 8.9kt

La Negra 24 2016 2017 14kt Est. 6kt

Wodgina3,4 Q4 2018 na85kt DSO

6kt22kt DSO

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▪ Supply growth continues to disappoint

— Combination of operational, execution and financing challenges

▪ Development assets coming online late and are facing continued ramp-up and commissioning challenges

— Operating costs higher than anticipated in study work

▪ Environmental, licensing and execution challenges have led to delays in several greenfield project expansions

▪ Highly leveraged balance sheets and expensive cost of capital pose high risk in a lower commodity price environment

▪ Australian concentrate or DSO out of the ground does not necessarily translate to effective chemical LCE’s supplied into the China market

Delays in Key Project Constructions and Expansions

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Page 20: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 20[xx]Galaxy Resources Limited (ASX:GXY)

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20,000

40,000

60,000

80,000

100,000

120,000

140,000

20

15 S

tart

- C

hin

aP

rice

Big

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Li2

CO

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rice

Lith

ium

Car

bo

nat

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rice

Lith

ium

Hyd

roxi

de

Pri

ce

Gross Pricing/t

Net Pricing/t

Lithium Pricing Trends

20

Weaker lithium spot pricing in China contrasted with continued robust ROW pricing for most of 2018 - broader support from long term fundamentals

Source: CLA, Company Estimates, CJ Securities

Lithium Carbonate Price Comparison (RMB/t) – November 2018

Historical Lithium Prices (RMB/t) Historical Lithium Prices Since Jan 2018 (RMB/t)

US$6.1K

US$10.0K

US$15.1KUS$16.5K

Quarterly South American Contract Prices (US$/t)

10,000

11,500

13,000

14,500

16,000

17,500

4Q 2017 Q1 2018 Q2 2018 Q3 2018South American Producer 1 South American Producer 2

2018 contract pricing at all time highs – Price stability QoQ

First positive uptick in Li2CO3

price in 2018 signaling the bottom of the price cycle

40,000

80,000

120,000

160,000

200,000

BG Li2CO3 BG LiOH

60,000

100,000

140,000

180,000

Jan-18 Mar-18 May-18 Jul-18 Sep-18 Nov-18

BG Li2CO3 BG LiOH

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Page 21: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 21[xx]Galaxy Resources Limited (ASX:GXY)

Lithium Pricing Outlook

— From low quality Qinghai brine

— Delays in new supply coming online from greenfield projects

— New chemical converter facilities also encountering delays

— Brownfield expansions not performing to plan

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Lithium spot prices in China have now stabilized and are expected to recover through the remainder of Q4 2018; ROW contract prices remain close to all-time highs

Key Drivers Of Price Recovery In China

Price Trend Reversal Underway In China, Coupled With Strong Seasonal NEV Data In Q4

Reduced Production

NEV Growth Drivers Into 2019

— NEV energy densities and battery capacities increasing for recent and newly launched models

— Increasing adoption in China, taxi operations and further license restrictions

— Bus and commercial fleets expected to maintain strong growth

Strong Downstream Demand

— NEV sales and production globally expected to finish strong for Q4 2018

— China targeting 1.1 million NEVs for 2018

— Production of battery materials normalizing following recent destocking

Low Inventory Levels Throughout Chain

— Destocking has led to reduced inventories and is now largely complete

— Mid-stream material manufacturers back to nominal inventory

— Incremental demand requirements expected to allow for inventory build

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Slide 22[xx]Galaxy Resources Limited (ASX:GXY)

Project Update

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Page 23: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 23[xx]Galaxy Resources Limited (ASX:GXY)

1 Cash margin per tonne sold is calculated as revenue from the sale of spodumene, minus cash costs of production (including selling and marketing costs), divided by tonnes of spodumene sold

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Mt Cattlin Operations

Mt Cattlin continues to deliver strong EBITDA margins and significant free cashflow from operations to support development and growth project funding

▪ Weaker production in 3Q 2018 primarily due to lower feed grade coupled with reduced recoveries

— Result of permitting delay to allow planned mining access east of Floater Road

— Permits now granted and mine plan corrected

▪ Recovery in production volumes expected in 4Q 2018 given improvements in head grade and recovery associated with ore east of Floater Road

▪ Commissioning of the yield optimization circuit commenced in mid November

— Commissioning and ramp up throughout 4Q 2018

— Optimization benefits to be realized in 1Q 2019

— Targeting increased recoveries of 70 – 75%

▪ C.30,000m drill program underway in support of exploration, resource and reserve development

▪ Reverse circulation (“RC”) and resource specific infill drilling largely complete

— Updated resource and reserve estimates expected early 1Q CY2019

▪ Greenfield drilling continues on drill targets identified through geophysical surveying

Operational Performance

and Optimization

Exploration

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408455 439

534

411

1Q'17 2Q'17 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18

23.533

47.152.1

43.9 47.9

31.2

1Q'17 2Q'17 3Q'17 4Q'17 1Q'18 2Q'18 3Q'18

CategoryTonnage

(Mt)Grade

(% Li2O) Grade (ppm

Ta2O5) Li2O

Tonnes

Measured 1.50 1.22 226 18,200

Indicated 8.90 1.23 151 109,200

Inferred 1.40 1.44 264 20,200

Total 11.80 1.25 174 147,600

Mt Cattlin Resource Estimate (Cut-Off Grade of 0.4 % Li2O)

Spodumene Produced (kt)

Cash Margin Per Tonne Sold (US$/t)1

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Page 24: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 24[xx]Galaxy Resources Limited (ASX:GXY)

Sal de Vida – Overview

Reserve category

Time period

TonnesLi total mass

Tonnes equivalent

Li2CO3

Tonnes K total mass

Tonnes equivalent

KCl

Proven 1-6 34,000 181,000 332,000 633,000

Probable 7-40 180,000 958,000 1,869,000 3,564,000

Total 40 years 214,000 1,139,000 2,201,000 4,197,000

Source: Revised Sal de Vida DFS – August 2016. Assumes 500mg/L Li cut off

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Sal de Vida Reserve Estimates

Location

Sal de Vida, Salta & Catamarca, Argentina

Source: Sal de Vida – Updated Feasibility Study – May 20181. Includes capital cost of the potash production facility and associated infrastructure of US$28mm2. Payback from first lithium carbonate production

▪ Located in the Puna region of northwest Argentina within the lithium triangle, home to >50% of global lithium production

― Adjacent to Livent’s Fenix operations which has been producing for over 20 years

▪ Considered a premier lithium and potash brine development project globally, exhibiting superior resource chemistry

― One of the shortest pathways to market of any of the world’s brine development projects

▪ Revised feasibility reaffirmed technical superiority and potential as a highly profitable operation

― 40+ year initial life

― Lowest quartile opex of US$3,144/t LCE (post KCl credits)

― Pre-production capital costs of US$474mm1

― Post-tax NPV8% real of US$1.48bn with a c.3 year payback2

▪ Binding agreement executed for the sale of the northern tenements for US$280mm (pre-tax) substantially derisks funding

▪ Galaxy has appointed JP Morgan as its financial advisor to evaluate strategic partnership options for Sal de Vida

One of the world’s largest and highest quality undeveloped brine deposits with significant expansion potential

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Page 25: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 25[xx]Galaxy Resources Limited (ASX:GXY) 25

▪ Binding agreement executed with POSCO to sell a package of tenements in the north of the Salar de Hombre Muerto for US$280mm (pre-tax)

— Proceeds will be available to fund the development of Sal de Vida

— Substantially derisks project funding

— Provides a funding buffer as further strategic discussions are finalized

▪ Final conditions for closing being completed with transaction settlement expected imminently

— US$257mm of the acquisition funds currently in escrow

— US$23mm differential is to satisfy a tax installment and a deferred settlement amount

— Funds will be drawn down upon receipt of the tenement transfer deeds by the Salta and Catamarca mining courts

▪ Galaxy retains 100% of the southern tenements in the salar (“Sal de Vida”), located exclusively in the Province of Catamarca

— The retained tenements include mineral reserves of 1.1mmt LCE

▪ Galaxy and POSCO will explore potential synergies on a commercial basis, across various development and operational initiatives

Map of Salar del Hombre Muerto Tenements Area Sold (Blue) and Tenement Area Retained (Red)

Binding agreement executed with POSCO to sell northern package of tenements for US$280mm

Sal de Vida – POSCO Transaction OverviewF

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Slide 26[xx]Galaxy Resources Limited (ASX:GXY) 26

Galaxy continues to bolster the project development team with project execution personnel and advance project engineering

Engineering and Construction▪ Construction of a demonstration pond system has

commenced

▪ Detailed geotechnical work study is underway

▪ Drilling of a further 4 wells to extend our insight into hydraulic nature and extent of brine at depth

▪ Finalizing details of plan to execute on a Front End Engineering Design (“FEED”) phase during 2019

Project Execution Strategy

Human Resources

Corporate and StrategicProduct Qualification

▪ Project Director identified to lead detailed engineering and construction phases

▪ Engaged an independent panel of technical specialists to advise on processing aspects of the FEED phase

▪ A Project Management Consultant (“PMC”) has been selected and engagement is being finalized

— Immediately broadens technical bandwidth and essential project execution frameworks

▪ Project funding substantially derisked following sale of northern tenements for US$280mm

▪ Formal Process to assess strategic partnership options nearing completion

▪ Offtake discussions continuing

▪ Corporate office being established in Catamarca City

▪ Semi-continuous pilot operation has been restarted

— Pilot operation to be integrated with pond system once construction complete

— Some features of the plant to upgraded over the coming months

▪ Test work will allow for product qualification with prospective customers, process refinement and operator training

Sal de Vida – Development UpdateF

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Page 27: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 27[xx]Galaxy Resources Limited (ASX:GXY)

James Bay – Overview

▪ Lithium pegmatite project located in James Bay, Québec, Canada, 100% owned by Galaxy

▪ Located in a mining friendly jurisdiction with a low cost of energy and good infrastructure nearby

▪ Project comprises 5 sets of claim blocks with an upgraded mineral resource of 40.3Mt @ 1.40% Li2O (100% Indicated)

▪ Feasibility work has commenced, and encompasses an integrated upstream and downstream operation within Québec

― Feasibility work to take advantage of Mt Cattlin and Jiangsu1 experience to draw synergies for engineering and process flow sheet design

▪ Environmental and Social Impact Assessment (“ESIA”) submitted in October 2018

▪ Project associated with low cost of power given the major Hydro-Québec infrastructure within the region

― A “Pre Work” agreement established with Hydro-Québec to advance engineering related project power supply

▪ Pre-Development Agreement (“PDA”) terms have been finalized and agreed with the Cree Nation

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James Bay, Quebec, Canada

James Bay Location

Long Section of James Bay Pegmatite Swarm

Provides additional expansion capacity to capitalise on future lithium demand growth,with the potential to supply the North American/European markets

1. Previously owned and Chinese downstream operation (sold to Tianqi in 2015)

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Page 28: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 28[xx]Galaxy Resources Limited (ASX:GXY)

Outlook & Growth Catalysts

MT CATTLINProduction & optimization

▪ Yield optimisation works once completed, expected to allow operations to target future recoveries of 70% - 75%

▪ Exploration work to facilitate further resource definition and further extension and maximization of mine life

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▪ Positive outlook reinforced, as demand continues to be robust from NEV sales in China and increasing penetration in ROW

▪ Mass energy storage systems emerging as an important new growth sector

▪ Continued expansion of further cathode and battery manufacturing capacities

MACRORobust lithium demand

JAMES BAYProject development

▪ Feasibility study work for integrated upstream and downstream operation

▪ Comprehensive test work program underway with local feedstock material, leveraging Mt Cattlin experience

SAL DE VIDAField work, offtake & project financing

▪ Completion of the POSCO transaction on the northern tenement package

▪ JP Morgan advising on strategic partnership options for Sal de Vida

▪ Progressing optimisation program and early development works

Growth initiatives across all divisions - expanding production at Mt Cattlin, advancing Sal de Vida through development, progressing James Bay feasibility

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Page 29: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 29[xx]Galaxy Resources Limited (ASX:GXY) 29

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Page 30: For personal use only · 2018-11-15 · Global EV penetration forecast to reach 15%+ by 2025, underwritten by rapidly increasing ... beyond 3C applications, broadening to transportation

Slide 30[xx]Galaxy Resources Limited (ASX:GXY)

Competent & Qualified Persons’ Statement

Competent Person Statement

Sal de Vida Any information in this report that relates to the estimation and reporting of the Sal de Vida Project Mineral Resources and Mineral Reserves is extracted from the report entitled “Sal De Vida: Revised Definitive Feasibility Study Confirms Low Cost, Long Life and Economically Robust Operation ” created on 22 August 2016 which is available to view on www.galaxylithium.com and www.asx.com.au. The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and that all material assumptions and technical parameters underpinning the Mineral Resources and Mineral Reserves estimates in the relevant market announcement continue to apply and have not materially changed. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement.

James Bay The information in this report that relates to the estimation and reporting of the James Bay Mineral Resources is extracted from the ASX announcement dated 4 December 2017 which is available to view on www.galaxylithium.com and www.asx.com.au. The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and that all material assumptions and technical parameters underpinning the Mineral Resources in the relevant market announcement continue to apply and have not materially changed. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement.

Mt CattlinThe information in this report that relates to the estimation and reporting of the Mt Cattlin Project Mineral Resource and Ore Reserve is extracted from the ASX announcements entitled “Mt Cattlin Resource Update – Clarification,” and, “Mt Cattlin Resource & Reserve and Exploration Update,” dated 20 August 2018 and 23 March 2018, respectively. Both announcements are available to view on www.asx.com.au. The Company confirms that it is not aware of any new information or data that materially affects the information included in the original market announcement and that all material assumptions and technical parameters underpinning the Mineral Resources and Mineral Reserves estimates in the relevant market announcement continue to apply and have not materially changed. The Company confirms that the form and context in which the Competent Person’s findings are presented have not been materially modified from the original market announcement.

Caution Regarding Forward Looking InformationThis document contains forward looking statements concerning Galaxy. Forward-looking statements are not statements of historical fact and actual events and results may differ materially from those described in the forward looking statements as a result of a variety of risks, uncertainties and other factors. Forward-looking statements are inherently subject to business, economic, competitive, political and social uncertainties and contingencies. Many factors could cause the Company’s actual results to differ materially from those expressed or implied in any forward-looking information provided by the Company, or on behalf of the Company. Such factors include, among other things, risks relating to additional funding requirements, metal prices, exploration, development and operating risks, competition, production risks, regulatory restrictions, including environmental regulation and liability and potential title disputes.Forward looking statements in this document are based on Galaxy’s beliefs, opinions and estimates of Galaxy as of the dates the forward looking statements are made and no obligation is assumed to update forward looking statements if these beliefs, opinions and estimates should change or to reflect other future developments.

Not For Release in the United StatesThis announcement has been prepared for publication in Australia and may not be released in the United States. This announcement does not constitute an offer of securities for sale in any jurisdiction, including the United States and any securities described in this announcement may not be offered or sold in the United States absent registration or an exemption from registration under the United States Securities Act of 1933, as amended. Any public offering of securities to be made in the United States will be made by means of a prospectus that may be obtained from the issuer and that will contain detailed information about the company and management, as well as financial statements.

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