Yeah, I think so. Ladies and gentlemen, shareholders of Nickel Industries, welcome to this annual general meeting of Nickel Industries. My name's Norman Seckold, and I'll be chairing today's meeting. It's gone 11:00 A.M., so a quorum is present, so I declare the meeting open. Today's meeting has been convened in accordance with the Corporations Act. The notice of this meeting has been sent to shareholders and is taken as read. All resolutions today will be decided by way of a poll, including valid proxies submitted before the meeting. Computershare has been appointed to scrutinize for each poll. The blue voting cards will be collected, and the poll will be conducted after the business of the meeting has been completed. The formal results of the poll will be notified to the ASX after the meeting and will be posted on the company's website.
As chairman of the meeting, and I'm being appointed as proxy for shareholders entitled to vote, as stated in the notice of meeting, I will be voting all directed proxies in accordance with the directions provided by shareholders. Where authorized, I will vote all undirected proxies in favor of each resolution before the meeting today. I'd like to introduce your board of directors who are with us in the meeting today. Joining us either in person or via Zoom or webcast are my fellow directors, Managing Director Justin Werner, CFO Chris Shepherd, James Crombie, Dasa Sutantio, Muliady Sutio, Haijun Wang, Binghe Xiang, and Yuanyuan Xu, as well as Company Secretary Richard Edwards on my left. Investor Relations, where is Cameron?
He's on Zoom.
Oh, he's on the Zoom. Sorry. Also with us, from the company's auditor, KPMG, are Adam Twemlow and Jess Rutherford. When you registered your attendance this morning, you would have been issued with an attendance card. People with a blue card are shareholders entitled to speak and vote at the meeting. Your blue card will serve as your voting form and will be collected at the end of the meeting. People with a yellow card are shareholders entitled to speak but not vote at the meeting. People with a white card are visitors. I now propose to deal with the formal business of the meeting. There'll be a pause for members to ask questions about the business of the meeting and later about the company's activities. If we can now move to the slide summarizing the proxies received.
The first item of business as set out on the notice of meeting is to receive and consider the annual report and statutory financial statements for the year ended 31 December 2023. Are there any questions in relation to the financial statements or the report? If there's no further discussion on this, we can record that the annual report and statutory accounts have been received and adopted. Resolution 1, set out on the notice of meeting, is to consider a non-binding extraordinary resolution, the adoption of the remuneration report as set out in the company's annual report. Are there any questions or comments in relation to this resolution? The proxy votes received on this resolution are currently displayed on the screen, and I declare the poll open for Resolution 1.
Please record your vote by placing a mark in the for or against or abstain box for Resolution 1 on the blue card provided. Okay. Resolution 2 is set out on the notice of meeting. It's an ordinary resolution to consider, and if thought fit, to reelect Dasa Sutantio as a director. Dasa is required by the corporation's law and the company's constitution to retire and offer himself for reelection. Are there any questions or comments in relation to this resolution? The proxy votes received for this resolution are currently displayed on the screen, and I declare the poll open for Resolution 2. Please record your vote by placing a mark in the for or against or abstain box for Resolution 2 on the blue card provided. Resolution 3 is set out on the notice of meeting.
It's an ordinary resolution to consider, and if thought fit, to reelect Muliady Sutio as a director. Muliady is required by the corporation's law and the company's constitution to retire and offer himself for reelection. Are there any questions or comments in relation to this resolution? The proxy votes received on this resolution are currently displayed on the screen, and I declare the poll open for Resolution 3. Please record your vote by placing a mark in the for or against your abstain box on Resolution 3 on the blue card provided. Resolution 4 is set out on the notice of meeting. It's an ordinary resolution to consider, and if thought fit, to reelect Haijun Wang as a director. Haijun is required by the corporation's law and the company's constitution to retire and offer himself for reelection.
Are there any questions or comments in relation to this resolution? The proxy votes received on this resolution are currently displayed on the screen, and I declare the poll open for Resolution 4. Please be good enough to record your vote by placing a mark in the for or against your abstain box for Resolution 4 on the blue card provided. Resolution 5 is set out on the notice of meeting. It's an ordinary resolution to consider, and if thought fit, to reelect Bingh e Xiang as a director. Bing He is required by the corporation's law and the company's constitution to retire and offer himself for reelection. Are there any questions or comments in relation to this resolution? The proxy votes received on this resolution are currently displayed on the screen, and I declare the poll open for Resolution 5.
Please record your vote by placing a mark in the for or against or abstain box for Resolution 5 on the blue card. Resolution 6 is set out on the notice of meeting. It's an ordinary resolution to consider, and if thought fit, to reelect Yuanyuan Xu as a director. Yuanyuan is required by the corporation's law and the company's constitution to retire and offer himself for reelection. Are there any questions or comments in relation to this resolution? The proxy votes received on this resolution are currently displayed on the screen, and I declare the poll open for Resolution 6. Please be good enough to record your votes now by placing a mark in the for or against or abstain box for Resolution 6 on the blue card provided. In a couple of minutes, I'll close the polls.
Please ensure that you've cast your vote on all resolutions, and that you hand your blue voting card to the registry personnel now coming round to collect them.
Thank you.
Is there anybody else with the blue voting card who'd like to vote first?
I've got them. Okay. Thank you. Ladies and gentlemen, voting is now closed. The results will be made available on the ASX later today. I now declare the formal business of the meeting closed, but your questions are very welcome. Justin will also be giving a presentation as soon as we deal with any questions.
I've just got one question. I noticed that the last director had a lot of votes against her. And I noticed she had a degree in fashion. I'm all for women and cultural diversity on the board. But how can that happen?
Blue?
Blue?
Yeah, Michelle.
Okay. I just noticed the last director had a lot of against her. And I just looked her up, and I know she had a degree in fashion, which I love fashion 'cause I'm a girl. But I don't know how is that related to mining? I noticed that she also does marketing, which is great. And, you know, you need to market nickel. But I just noticed there was quite a few against her. And, I just wanted to know, does she add a lot to the board?
Oh, there's a good point. There's some history in this. And when pre-IPO of the company, her family made a substantial, I think Justin reminded me, $23 million investment in the company. And she was appointed to get some, you know, to broaden her experience. She's been a very valuable director. She's been a good contributor to our operations, you know, our governance. The family still retains the holding. And that's the history. But she's a very good director and.
Cool.
Yeah.
And if I could just add, we probably need to update her resume. She's now working for one of the leading private equity groups in China.
Yeah.
So she's now transitioning into the finance and commodities side of the business. So yeah, she's been given an opportunity. And as Norm pointed out, they were very early supportive investors. And so, you know, we welcome her role on the board.
Okay.
You'll see her expanded resume on the website, but the annual report did not have that.
I just think it's unfortunate that when you look at 'cause I always like to see what the directors do. So it's always good if you see, you know, mining engineer, geologist, etc., etc., tick, tick, tick, tick. And, you know, like, I'm a girl. I love fashion. But I just thought it was sort of left of field. And then I noticed that there were quite a few people against her, which is very bad 'cause I think you need more women on the board. And, I'm all pro-women 'cause I'm a woman. And,
Voting patterns are interesting things. Like.
Yeah.
These negative votes generally come from faceless institutions that you can't.
Yeah.
Really trace back to who it is, what their motives are. They don't talk to us about it. They just lob them in. And you have this.
Fantastic.
No.
I'm happy. There are quite a few questions being answered.
No, no. But it's just one of the vagaries of public companies.
Sure.
Particularly with large institutional.
Sure.
Shareholders. Yeah.
Definitely.
Oh, well, thank you. If no, I'm sorry. Yep.
the AGM.
Here I can check one.
Can you hear me?
Yes.
Please use the microphone so online can hear you as well.
The AGM highlights wanting to broaden your customer base. Obviously, your who you're supplying to is a big customer. But is your direction or your focus is broadening the customer base or just maintaining the status quo? How much of a priority is to you wanting to broaden the customer base? The transition into the HPAL investment is for a number of reasons. Firstly, we see superior margins from an HPAL business. We see a further diversification of the nickel products that we produce. And we think that gives us strength in the market where, you know, we see opportunities in certain segments of the nickel market where we can sell into to perhaps capture better margin opportunities. In the HPAL market, we have significantly lower carbon intensity. And also, we have a diversified customer base.
We don't see Tsingshan being the sole offtaker of our nickel pig iron as a risk. But unfortunately, some of the ratings agencies do. Some of our investors perceive it to be a risk. And so the diversification into class one and intermediates will allow us to diversify that customer base. And, you know, we're talking to the tier one sort of global EV and OEM names as potential customers. And so, look, I think that adds further validation to our project and also the dramatic changes that have been undertaken in Indonesia in terms of the nickel processing landscape that's been developed there. Okay. Well, if there's no further questions, thank you, ladies and gentlemen, for your attendance at the AGM today. Thanks, Norm. I have a short presentation, which I'll deliver.
Full year 2023 highlights: record group EBITDA of $403 million. Record nickel production of 131,126 tons. That was double our 2022 number. Record mine production of 13.4 million wet metric tons. Pleasingly, record mine EBITDA of $87.9 million, which I will touch on a little bit later on. We announced a final dividend of AUD 2.5 cents per share, which brought full year dividend to AUD 4.5 cents per share. Subsequent to the year-end, we announced an on-market share buyback of up to $100 million over the next 12 months. We maintained throughout the course of the year a very strong balance sheet. That was boosted via an AUD 943 million placement to United Tractors. They are a blue-chip listed Indonesian conglomerate. Ultimate beneficial owner is Jardine Matheson, the Fortune 500 global company.
history of being a long-term investment partner and a significant footprint across Asia. We also announced a $400 million facility with Bank Negara Indonesia, one of Indonesia's largest banks. And the first time that an Indonesian bank has come in and financed a HPAL project. Looking over the course of the year by quarter, you can see at the beginning of the March quarter, we produced 27,398 tons of nickel. And you can see the progressive ramp-up over the course of the year moving to the December quarter where you can see we produced 36,273 tons of nickel. So December quarter was really the only full quarter of 2023 that we were fully ramped up.
If you look at the white and the green bubbles above those bar charts, if we just come back to March, you can see in March, the average LME nickel price for that period was 25,973 tons. And green bubble chart, our EBITDA from operations was $113.2 million. Moving over to December, the average LME price had declined 60% to 17,288 dollars a ton. Whereas our EBITDA from operations actually rose by almost 30% to $135.4 million.
So I think over the course of of last year and more recently, I think we've demonstrated that throughout the cycle in all environments because we sit at the very bottom end of the cost curve and because of the diversified nature of the nickel products that we sell, that, you know, we can retain being a very profitable company and very strong margins. Just to set the backdrop of where we operate in Indonesia, Indonesia's grown from only a few years ago producing 7% of the world's nickel to last year producing 55% of the global nickel output. So we tend we like to think of Indonesia as what Western Australia or the Pilbara is to iron ore or the Middle East is to oil and gas.
There's really nowhere else, in the world that is as well endowed with nickel resources as Indonesia. And that growth is set to continue with some estimates having Indonesia at 75% of global nickel output, by the end of this decade. If you look at the names that have invested in-country, you can see it's not just Chinese. It's a mixture of North American and European. And there's up to $50 billion of committed and actual investment all along the value chain, not just in nickel mining but in refining, in batteries. You can see Hyundai there, for example. They've broken ground on the first electric vehicle plant in Indonesia. You have European names like BASF, Eramet. You have Ford. There was a recent announcement from Stellantis of a possible HPAL venture into Indonesia.
So, you know, those names, as I said, European, North American, Korean, Japanese, significant investment is now going in-country, into Indonesia. In terms of safety, our company-wide 12-month rolling lost-time injury rate was 0.23, which is at the end of March 2024, which is significantly lower than the World Steel Association average of 0.65. Our company-wide 12-month rolling total recordable injury rate was 1.14, again, significantly lower than the World Steel Association average of 3.66. We are recognized as a leader in sustainability in ESG in Indonesia. And I'll touch on that in the following slide. But this slide just shows the carbon intensity of an Indonesian HPAL. And that particular HPAL is HNC, which you can see there in the green. We hold a 10% interest in that.
The carbon intensity and this is from a group called Skarn out of Europe. They're an independent group. These are all their own independent numbers. HNC came in last year at 6.97 tons of carbon per ton of nickel, almost half of the Australian peer average, which was 11.07. So in fact, there was only one Australian nickel operation that was slightly lower than our interest in our Indonesian HPAL. For our new ENC HPAL, our target is to get right down to the very bottom to the very left-hand side of that curve. And I'll talk about how we're going to achieve that in a moment. In terms of ESG, we have the highest MSCI ESG rating for any Indonesian-based metals and mining company. We're in the second top quartile.
So 69% worldwide of ESG performers for the metals and mining industry group as rated by S&P. So MSCI, S&P, again, these are all independent groups that have done their own audits. These, these aren't our internal numbers. These are audits from recognized, independent groups. The middle column there, the green PROPER Rating, we're very proud of this. We're one of only two nickel mines in Indonesia that has a green PROPER Rating. That is issued by the Indonesian Ministry of Environment and Forestry. The only other nickel mining operation that has a green PROPER Rating is Vale. And they've been operating in Indonesia since the 1970s. We achieved the highest score of all nickel mining companies. And we achieved the fourth highest score amongst all commodities and all mining companies, across Indonesia. And we're striving to be the first company to achieve gold.
There's a number of initiatives that we're undertaking to achieve that. In terms of our carbon reduction initiatives, we were the first mining company to successfully trial the use of electric vehicle haul trucks in Indonesia. We have a binding operational lease and service agreement to offtake power from Indonesia's largest solar project to date. Those numbers will actually probably increase to around 255 MW peak and about 80 MWh of battery energy storage system. Off the back of our achievements and some of the work that we've done, we were invited to present at the COP28 Climate Summit in Dubai at the end of last year. Again, one of only two Indonesian mining companies that was invited to present. It was there that we took the opportunity to announce our target of a 50% reduction in carbon intensity by 2035 and net zero by 2050.
Just to briefly summarize our operations, we operate out of two industrial parks, IMIP, which is in the island of Sulawesi on the left there, and IWIP, which is on the island of Halmahera, which you can see on the right there. Halmahera almost looks like a carbon copy, just smaller in size. But both of these islands, extremely well endowed with nickel laterite resources. You can see, Hengjaya Nickel, Ranger Nickel, Angel Nickel, Oracle Nickel. That was the basis of the growth of the company. And that was rotary kiln electric furnaces producing nickel pig iron for the stainless steel market, in China. And all of that NPI is offtake by Tsingshan. And they have an irrevocable undertaking to purchase all of it at the market price.
Moving to the last two columns, you can see Huayu Nickel Cobalt and Excelsior Nickel Cobalt. This is now our transition into HPAL. Different processing technology. RKEF is pyrometallurgical, requires a lot of heat, which requires a lot of power. High-pressure acid leach is a hydrometallurgical process. So it actually uses acid to dissolve nickel and cobalt and other elements into solution. And it's recovered that way. What that will do is it will further diversify our product mix. So it will give us the opportunity to produce MHP, sulfate, and cathode. If you look at the second line from the bottom there, all of our operations have significant tax holidays which have been granted, ranging in duration from seven years up to 15 years, and all of them with an additional two years at 11%.
So it's a very attractive fiscal regime, which has allowed a very quick payback on the investments that we've made to date. The ENC project, this is really the next phase of our growth. We've executed an agreement for a, it's a third-generation Indonesian HPAL. It will have a capacity of 72,000 tons. It will be the first HPAL globally to produce three of the key Class 1 nickel products. So that's MHP, nickel sulfate, and nickel cathode. We are fully funded for our 55% interest. Shanghai Decent, which is Tsingshan, holds the remaining 45%. We have just commenced a process with one of the tier one investment banks, where we've reached out looking for equity and offtake partners in ENC, which would potentially see Shanghai Decent sell down from 45% to around 20%.
That process has had a very good response so far. We've had a response from about 16 of the leading EV and battery makers and trading houses. And that's all ex-China. So this is North American, European, Korean, and Japanese companies. As with every project that we have done historically with Tsingshan, it comes with a construction guarantee. And I can't overstate the importance and the value of that construction guarantee. The CapEx is $2.3 billion on a 100% basis. So with a CapEx guarantee, our 55% interest at $1.265 billion is fixed. We don't pay any more. Tsingshan takes the risk on any CapEx increases. It also extends past more than just a CapEx guarantee. It's a nameplate guarantee and a timeframe guarantee of no more than 2 years to construct.
Construction started in October of last year. Again, we also benefit from a 15-year tax holiday. How is that being funded? I mentioned the $943 million placement that was done at $1.10 to United Tractors last year. That was at the time at a 28% premium to the share price. And then also the loan facilities from BNI and which has been successfully syndicated out to a number of Asian and international banks, and as well as the strong cash flow from our existing operations. Just to further highlight the value of a CapEx guarantee, you can see on the left there ENC and the capital intensity, sitting around $30,000 per ton of nickel produced. You can see all of the projects on the right-hand side there.
That capital intensity is significantly higher in cases, you know, in excess coming over to the far right there of over $100,000 per ton of nickel in capacity. The shaded red bar is the announced CapEx increases. A good sort of more recent example is probably the Odysseus mine, which was acquired by IGO for AUD 1.1 billion. That came with a CapEx bill of AUD 300 million to develop. Within six months of acquisition, that had blown out to AUD 800 million. You have mines like Horizonte in Brazil, again, got halfway through the build and announced that they'd run out of money. And they were going to need almost another AUD 1 billion to continue and went into receivership. So we're already at the lowest capital intensity. But we have that CapEx guarantee.
Our operations are also underpinned by a world-class ore body, which is the Hengjaya Mine. So you can see where we sit. This is global nickel resources. So we're a top 10 known global nickel resources. So we currently have 3.7 million tons of contained nickel metal within the Hengjaya Mine. There is still significant further exploration upside. And we believe that that number probably will be somewhere close to 5 million tons of contained nickel metal. To put that into some perspective, we produced 131,000 tons of nickel. We have 3.7 million tons of nickel in the ground, only a short distance from our operations. And in fact, our mine is the closest large tonnage, high-grade mine.
So there's significant mine supply over many, many years that is available from our Hengjaya mine, which we own an 80% interest in. And we are now starting to see through the ramp-up of the mine. It is delivering significant EBITDA to the business. I mentioned last year, it delivered $87.9 million of EBITDA. $42 million of that came in the fourth quarter of last year. And that is a result of we've now built a haul road about 15 kilometers in length, which links our mine with the industrial park. And so that has allowed us to take our ore sales from around 3.5 million tons to we're targeting 10 million tons this year. We are also making applications.
We've submitted a revised feasibility and environmental study to increase that again to 22 million tons for 2025 with the aim of hitting that rate by the end of 2025. So again, you can see at a 42 million quarterly run rate at 10 million tons per annum, the plan is to more than double that by the end of 2025. So, you know, the mine is a significant contributor to the business. And it provides a number of other benefits, particularly for any investment partners. It provides traceability, which is a key for many investors, is what is the source of the ore? How is it being mined? Is it being mined sustainably and responsibly?
You can see from the awards and the ratings that we have that we're a recognized ESG leader in Indonesia in terms of mining. Just like to touch on the HPAL space in Indonesia currently. I think there's been a lot of reports of, you know, significant HPAL capacity coming online. And that has put a bit of an overhang on the market. The actual reality of what is occurring in country is very different. And I'll just touch on that here. So in terms of operating plants, we have Huayu Nickel Cobalt at the top there already in operation. And that's the project that we are a 10% shareholder in. If I just skip to other operating HPALs, there's Halmahera Persada Lygend, QMB, and PT Hua Fei. They're all in operation.
If you look at actual HPALs that are funded and under construction, there's only a handful of those. You have ENC, which is obviously our project, fully funded, under construction. You have Obi Nickel, which is an expansion of the Halmahera Persada Lygend project. And then you have Blue Sparking Energy, which is another project in IWIP. And then you have there is one other project on there, much smaller one, 30,000 tons, which is an expansion of the QMB project. If you take those three projects and they all average around sort of 65,000 tons each, you're looking at about call it 200,000 tons of new nickel capacity coming online in Indonesia from HPALs that are under construction and that are fully funded.
If you put this against the backdrop of what's happening globally, this is the list of announced shuts or projects and mines that are in care and maintenance globally. And you can see in the blue there, that number totals up to 450,000 tons. So there's significant supply coming out globally that's not yet being replaced by new capacity coming online in Indonesia. And certainly, we're seeing from a lot of the analysts a revision in terms of what their forecast surpluses are. And in fact, some are certainly forecasting that we'll be in a deficit much sooner than was predicted previously. When you look at these other projects globally, some of them, their OpEx costs are around $24,000 a ton.
You know, even at today's nickel price of $20,000 a ton, it still has a long way to go before I think these projects ever come back online if they ever do and become viable. So where do we sit currently in terms of our nickel production? We're at 118,000 tons, moving to 157,000 tons annually. And this is our attributable nickel production. That makes us the largest listed pure diversified nickel producer globally. We've only been a public company a little over five years. In that period of time, you can see we've surpassed the likes of BHP on 56,000. They've been mining in Kambalda since 1967. That rapid growth has been achieved off the back of really those CapEx guarantees that I touched on earlier.
In the period of five years, we've raised over $2 billion in equity, $1 billion in debt. And we actually are now Australia's largest foreign investment into Indonesia. So we've surpassed ANZ Bank. But again, it has been off the back of CapEx guarantees, project execution, and delivery. If you look further left on that chart, I actually think we'll surpass Vale. But they're not a pure nickel producer. They're obviously diversified. And then you start to get into Norilsk, Russian, sanctioned, uninvestable, Jinchuan, Chinese, Delong, Chinese, and Tsingshan, our largest partner but also Chinese. So if you're looking for a nickel investment of size and scale that is now diversifying into the Class 1 nickel space for the EV battery market, you know, there's really only one name of any size and scale.
And we occupy the bottom end of the cost curve. This is just really a summary of the 2023 highlights. Again, it was a busy year, a number of acquisitions, a number of fundings, a number of ESG awards. And we look forward to continuing that output throughout the course of this year. So finally, again, Nickel Industries is the largest listed pure diversified nickel producer. We have a very diversified asset base. We're now transitioning the business into HPAL. And the reason that we're doing that is because of the superior margins that we believe can be captured there, the significantly lower carbon intensity, and obviously the diversified customer base. And we are the recognized ESG leader in Indonesia. And so thank you with that. Happy to hand over to any questions.