Energy Resources of Australia (ERA) Investor Presentation summary

Executive summary and capital raising rationale

• ERA is launching a pro rata renounceable entitlement offer to raise up to $880m at $0.002 per share, primarily to fund rehabilitation of the Ranger Project Area through approximately Q3 2027.

• The Independent Board Committee determined an equity raise is the only practicable funding solution after considering alternatives such as asset sales, debt, and government trust fund drawdowns, all of which were unsuccessful.

• Rio Tinto has provided a binding pre-commitment to subscribe for $760m, and over 90 investors were contacted during market soundings.

• ERA expects to breach its minimum cash reserve in Q4 2024 and deplete cash by early 2025 without this raise.

• The offer is an interim solution; further funding will likely be required by Q3 2027.

Offer structure and shareholder impact

• The offer is a 19.87-for-1 pro rata renounceable entitlement, with up to 440bn new shares offered at a significant discount to recent trading prices.

• Eligible shareholders (excluding Rio Tinto) can apply for additional shares via a shortfall facility; any remaining shares may be placed via a shortfall bookbuild.

• Rio Tinto is restricted from acquiring shares beyond its entitlement and may increase its voting power up to 99.2% if other shareholders do not participate.

• If Rio Tinto reaches 90% ownership, it intends to proceed with compulsory acquisition of remaining shares at $0.002 per share, subject to regulatory and expert review.

• Significant dilution is expected for non-participating shareholders, and free float may decrease, impacting liquidity.

Use of proceeds and financial position

• Proceeds will fund planned Ranger rehabilitation activities through Q3 2027, with $846m expected to be spent on rehabilitation and $59m on non-rehabilitation costs.

• ERA's current cash is $128m, with $126m in bank guarantees and $522m in a government trust fund that is not accessible in the near term.

• The rehabilitation provision as of 30 June 2024 is $2,402m (discounted), with actual costs potentially higher due to uncertainties in scope, schedule, and external factors.

• ERA has no current income and is reliant on third-party funding.