developing markets for our metal - oxford platinum lecture 2015
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Developing markets for our metal Anglo American Platinum Oxford, 15 May 2015
Kleantha Pillay, Head of Market Development, Anglo American Platinum
1
PLATINUM
Agenda
Anglo American Platinum and developing markets for our metal 1
3 Partnering for success: London Hydrogen Network Expansion Project
Supporting the adoption of fuel cell vehicles a priority 2
3
PLATINUM
Anglo American Platinum is a leading producer of primary platinum and
other Platinum Group Metals (PGMs)
7%
63%
Minor PGMs
We mine, refine & market
Platinum Group Metals (PGMs)
We account for ~26%1 of
global refined platinum supply
Our metals are widely used in
industry from autocats to fuel cells
4
High octane fuel
Fertilizers
Paint & adhesives
Glass display
Auto catalysts
Jewellery
Platinum
Iridium
Ruthenium Osmium
Rhodium
Palladium
Osmium
76
Os
Sources of
refined
platinum
Refined
platinum
2014 ('000 ounces)
Implied
global
market share
South Africa 3480 48%
Russia 727 10%
Zimbabwe 384 5%
North
America 364 5%
Other 127 2%
Secondary
supply 2148 30%
Total 7230 100%
Anglo
American
Platinum
1890 26%
Southern
Africa 3864 53%
1 Production and market share estimates are based on data from Johnson Matthey, Industry and AAPL public reports
PLATINUM
New demand for PGMs is created through investment in research,
product development, commercialisation and marketing
Investment
model
Direct into
universities/
research facilities
Direct investment Equity investment Indirect investment and/or
advocacy programmes, leveraging
partners with similar interests
Profit pool
Example
Projects
FC : Fuel cell Co / Leveraged funding
FC mining
equipment
FC Rural
Electrification
5
Research Early stage
businesses
Mature
businesses
Product
development
FC Vehicle
We proactively develop markets for our metal,
investing in opportunities across product lifecycle & geography
Overview of our current portfolio
PLATINUM
Agenda
Anglo American Platinum and developing markets for our metal 1
3 Partnering for success: London Hydrogen Network Expansion Project
Supporting the adoption of fuel cell vehicles a priority 2
6
PLATINUM
Fuel cell electric vehicles offer the largest opportunity for Platinum
0
10
20
30
BEV GLDV (US) GLDV (EU) DLDV (US) DLDV (EU) FCEV
2011
2020
2025
Source: Platinum Group Metals for Light duty vehicle, US DOE, 2014
Fractions of Pt, Pd and Rh for US vehicles in 2020 and 2025 based on Tier 3 emissions standard and engine sizes of 2.5 & 2.2 litres respectively
Fractions of Pt, Pd and Rh for EU vehicles in 2020 and 2025 based on euro 6 adoption and engine sizes of 1.4 & 1.3 litres respectively
Grams PGM by powertrain for light duty vehicles
0
10
20
30
BEV GLDV (US) GLDV (EU) DLDV (US) DLDV (EU) FCEV
0
10
20
30
BEV GLDV (US) GLDV (EU) DLDV (US) DLDV (EU) FCEV
7
PLATINUM
In a 100M units automotive
market by 2020…
…even a small share of
FCEVs…
… creates a sizeable PGM
demand
68 60
74 77 82 85
105
2008 2009 2010 2011 2012 2013 2020
Global automotive production volume
(m units)
+5%
+3%
20.0%
1.0%
0.5%
0.1%
Market share of
FCEV in total
car market (%)
20 000 000
1 000 000
500 000
100 000
Global Pt
demand in
tons
% of global Pt
supply
>40%
4-8%
2-6%
0-1%
# of FCEV
production
p.a.
100+ tons
10 - 30
5 - 15
1 - 3
Source: BCG , Anglo American Analysis
Technology selection & demonstration is happening now. Next 5-10 years is crucial!
The rate of fuel cell adoption can have a significant impact on platinum
demand in the medium to long term
8
PLATINUM
Agenda
Anglo American Platinum and developing markets for our metal 1
3 Partnering for success: London Hydrogen Network Expansion Project
Supporting the adoption of fuel cell vehicles a priority 2
9
PLATINUM
To be successful, fuel cell vehicles must overcome three main barriers
Cost competitiveness
1
Fuel cell applications must
achieve at least cost parity
when compared to competing
technologies
Infrastructure accessibility
3
Supporting infrastructure must
be accessible, convenient and
‘familiar’
Consumer acceptance
2
Consumer perception around
safety, and other technology
misconceptions must be
addressed
10
PLATINUM
Anglo American Platinum is partnering with and supporting companies
and programmes working to address these barriers
Cost competitiveness
1
Infrastructure accessibility
3
Consumer acceptance
2
The London Hydrogen Network Expansion Project (LHNE)
11
PLATINUM
The London Hydrogen Network Expansion (LHNE) project aims to expand
FCEV use in the UK
Anglo American Platinum is supporting the LHNE project through leasing, using
and demonstrating one of the four Hyundai ix35 fuel cell vehicles
• Test and prove vehicle
reliability and operating costs
• Retrofit six ICE delivery vans
to enable duel fuel (H2 and
other) for use by a London
delivery company
• Deploy and demonstrate
four Hyundai ix35 passenger
fuel cell vehicles
• Build one new hydrogen fuel
station in/near central
London (within the M25
motorway)
• Upgrade the Heathrow H2
re-fuelling station from 350
bar to 700 bar (the pressure
standard adopted by major
automotive companies)
Cost competitiveness
1
Infrastructure accessibility
3
Consumer acceptance
2
12
PLATINUM
13
Innovative business models and leadership required to accelerate roll-out
of refuelling stations
Source: ITM Power
• California targeting 68 stations to support early
adopters (~20,000 FCEVs)
• Germany targeting 400 stations by 2023
• Hydrogen refuelling technology available
• Existing manufacturing partners and capabilities
• Retail & distribution partners available
• ‘First-mover’ disadvantage means that
innovative business models and leadership is
required
A small number of concentrated
stations is enough to support early markets
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