Transcript
PDAC Presentation
March, 2012
Forward Looking Statement
The following information may contain forward looking statements. Forward looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statement. Forward-looking information is subject to known and unknown risks, uncertainties and other factors that may cause Oremex Silver Inc., Oremex Gold Inc., Llave Oro Inc., Mogul Ventures Corp., Honker Gold or Vulture Peak Gold LP actual results, level of activity, performance or achievements to be materially different from those expressed or implied by such forward looking information. Such factors include, but are not limited to: uncertainties related to historical resource estimates, work expenditure commitments; ability to raise sufficient capital to fund future exploration or development programs; changes in economic condition or financial markets, regulatory, political and competitive developments; technological or operational difficulties or an inability to obtain permits required in connection with maintaining, or advancing projects; and labour relation matters
Cervello Capital Inc.
3 | www.cervellocapital.com
• Toronto-based private merchant bank
• Global expertise and focus in the junior
resource sector
• We provide: seed capital, technical, board
and managerial leadership, guidance
through the go-public process, capital
markets advisory services to international
resource projects of interest
• Successful track record of taking
international projects through this
process by focusing on:
» Asset quality
» Technical expertise
» Creation of an appropriate
capital structure
• Operational experience:
Argentina, Brazil, Bolivia, Chile,
Colombia, Mexico, Mongolia,
and the United States.
Technical Leadership
MICHAEL R. SMITH, R.G.
• Over 20 years of international mining operations experience. Served as Chief Mine Geologist for Barrick Gold Corp. at the Goldstrike Mine in Nevada. Founding CEO, discovered and led exploration of Continental Gold’s (TSX: CNL) Buritica Project.
DAVID A. TERRY, PH.D., P.GEO.
• Over 20 twenty years of international experience in the natural resource sector with major and junior resource companies. David’s focus has primarily been on exploration and development of precious and base metal deposits in North and South America.
BALMER ECHEVERRI
• Geological engineer with Masters degree in Economic Geology. Over 10 years of mining experience mainly in Colombia. Former Country Manager at Barrick-Colombia, led discovery of the 7 million oz. Marsella deposit.
BILL FEYERABEND
• Over 30 years of experience in exploration and development around the world. A member of the American Institute of Professional Geologists.
JOHN E. DREIER
• Founder and President of public and private companies. Played key roles in the discovery and exploration of the Green Springs, Little Bald Mountain gold deposits and the Sanchez and Piedras Verdes copper deposits. Managed exploration projects throughout the Americas.
TSX VENTURE: OAG
OTCQX: ORAGF
FRANKFURT: OSI
5 | TSX Venture: OAG | www.oremexsilver.com | www.cervellocapital.com
Developing Silver Resources in Mexico
Presented by: John Carlesso, Executive Chairman
Developing Silver
Resources in Mexico
6 | TSX Venture: OAG | www.oremexsilver.com | www.cervellocapital.com
• Oremex Resources Inc. was renamed Oremex Silver Inc. in Q3, 2011 to reflect pure silver focus
» Spin-out of gold projects listed as Oremex Gold Inc. (TSX.V: OAU)
• Portfolio of silver projects includes mineral resource of 50.8M oz. of silver with P.E.A at the Tejament project
• All projects are in mining / capital-friendly jurisdictions
• Pursuing strategy to unlock unrecognized value and creating shareholder value through the distribution of Oremex Gold Inc. shares
• Experienced Board and Management team
» Successful track record of mine building in Mexico with seasoned ability for new project evaluation / acquisition
Focus on the exploration and development of silver projects along the highly
productive mineralized belt that made Mexico the largest silver-producing
country in the world
La Purisima shaft at the Chalchihuites property
7 | TSX Venture: OAG | www.oremexsilver.com | www.cervellocapital.com
Project Locations
TEJAMEN (Durango State)
• Flagship property with 50.8M oz
NI 43-101 compliant resource
with P.E.A
• Viability of open pit, heap leach
operation (Snowden Report, ’06)
• Potential to expand resource
SAN LUCAS (Durango State)
• Similar geology as Tejamen but with base
metals
• Further drilling to establish resource and
follow up high grade zones, 1,856 g/t Ag
CHALCHIHUITES (Zacatecas State)
• Located in prolific silver producing district
» Grades up to 3,800 g/t Ag, 0.99 g/t Au
+1.6% Pb
• Skarn and CRD manto system with past
production of high-grade silver-zinc-lead
• Q4, 2011: Acquired 392.53 hectares of additional
concessions adjacent to Chalchihuites
• Q1, 2012: Completing underground drill program
• On strike with and adjacent to First Majestic
Silver’s (NYSE: AG) Del Toro Project (within 4km)
EL SOL (Durango State)
• Potential for silver-rich,
base metal skarns
• Adjacent to Southern Silver’s
Cerro Las Minitas
• Strong IP geophysics
demonstrating buried intrusive
and sulfide mineralization
indicate excellent drill
targets
Tejamen Project
Perimeter potential
LOS MANTOS
open pit
Vein outcrops
CERRO PRIETO
• Flagship project
• 100% mineral rights
• Surface access being negotiated
• Wardrop Report (2006) defines 50.8M oz. silver
› 22Mt at 69 g/t silver
• Snowden Report (2006) outlines viability of open pit, heap leach operation
› 10,000 TPD
› Estimated CapEx USD $45M
› 2:1 strip ratio
› 3.5 - 4.0M oz. silver per year
Operating cost scenario of $5.75/tonne
› Cash operating cost of $4/oz Ag
Block model shows Los Mantos remains open to the south
and east
Significant exploration upside in feeder veins beneath Los
Mantos and Cerro Prieto deposits, grades 6m of 1,400 g/t Ag,
with about 5% lead & zinc
8 | TSX Venture: OAG | www.oremexsilver.com | www.cervellocapital.com
Value Underpinning
Oremex Silver Unchanged
9 | TSX Venture: OAG | www.oremexsilver.com | www.cervellocapital.com
Advancing High Potential Gold Assets in México
TSX VENTURE: OAU
FRANKFURT: OM8
10 | TSX Venture: OAU | www.oremexgold.com | www.cervellocapital.com
Presented by: David A. Terry, Ph.D., P.Geo., CEO & President
SHAREHOLDER APPROX.
SHARES APPROX. %
Oremex Silver Inc. 14,000,000 40.5%
Black Birch (CPC) 3,342,520 9.7%
New from Financing 17,200,000 49.8%
Total Basic 34,542,520
Options & Warrants 2,568,502
Financing Warrants 8,600,000
Fully Diluted 45,711,022 Oremex Gold Inc.
• Approx. 34.8 million shares issued
• $2.6 million cash (Dec.30.2011)
• Fully diluted: 47 million
Oremex Gold Spin-out Structure
Portfolio of Gold Projects
in Mexico’s Prolific Mining Belt
Canadian gold exploration and development company created from the spin-out of gold assets owned by Oremex Silver Inc. (formerly Oremex Resources Inc.) in 2011. The company has a portfolio of 100% owned gold properties in the prolific mining regions of Mexico. • Intent to dividend Oremex Gold Inc.
shares to Oremex Silver Inc. shareholders in the new year
11 | TSX Venture: OAU | www.oremexgold.com | www.cervellocapital.com
Project Locations
12 | TSX Venture: OAU | www.oremexgold.com | www.cervellocapital.com
Exploring and advancing exciting early stage projects within Mexico’s
emerging Sierra Rosario Gold Belt. The company’s projects, new
management team and experienced Board of Directors represent a platform
for value and growth creation in well-established, mining-friendly regions.
SANTA CATARINA (Sinaloa State)
• Located in the prolific Sierra Rosario Gold
Belt
• Massive sulphide deposit: 20m of 3.2g/t Au,
hosted in carbonates
• Surface sampling has yielded up to 2.1m @
20.5 g/t gold
• Drill program to commence in 2012
• JV with Oro Mining Ltd. (TSX.V - OGR) to
acquire 75% interest in the surrounding
29,000 hectares of the Concordia/ Guasima
Projects
SANTA CATARINA
SAN LUCAS CERRO DEL ORO
NAVIDAD
MACO
CERRO DEL ORO (Zacatecas State)
• Located in historical Melchor
Ocampo gold mining district
• Widespread gold mineralization
• Ongoing detailed surface sampling
and geological mapping program
Cerro del Oro
• Two concessions totaling 78.9
hectares in northern Zacatecas
state
• Concessions cover the core of
the historical Melchor Ocampo
gold mining district
• Widespread gold mineralization
• Assay highlights:
» 1.7 meters at 6.77 g/t Au, 48.2
g/t Ag, 1.21% Cu and 11.4%
Zn and
» A 2 x 2 meter panel sample at
2.16 g/t Au and 7.0 g/t Ag
• Conducting a detailed surface
sampling and geological mapping
program
Planning underground drilling program and a geophysical program
to refine drill targets for a Phase I surface drilling program
Company Highlights
• Uniquely Positioned
» Five, 100% owned properties in the prolific
mining regions of Mexico
» Mining, capital-friendly jurisdictions
» Well financed with attractive share structure
• Exploration Upside
» Highly prospective, early stage gold
projects hosting multiple targets
» Located in well-known gold mining districts
» Significant drill program planned for current
year
• Focused Growth Platform
» Management & Board with a successful
track record of exploration, development
and discovery in Mexico as well as
elsewhere in Latin America
San Lucas Property
14 | TSX Venture: OAU | www.oremexgold.com | www.cervellocapital.com
• Mexico has a growing economy and attractive mining legislation
» Canadian companies represent ~70% of all mining companies in Mexico
• Developing 100% owned flagship asset, Black Hills thermal coal
project located in Middle Gobi.
• Extensive Russian exploration history and the recently completed
drill program will resulted in an initial NI 43-101 compliant
resource of 89.6 million tons of Inferred Resources in Ovdog
Hudag coal deposit.
15 | www.mogulvc.com | www.cervellocapital.com
Presented by: Steve Khan, CFA, MBA, Executive Chairman
Mongolia Overview
• Home to some of the world’s largest
natural resource deposits including
coal, gold and copper
• Next door to the biggest consumer of
commodities in the world – China
• Mining is the most important sector
“contributes 30% of GDP and 70% of
exports”(1)
• Mongolian government focused on
long-term development of resource-
related sectors and favorable policies
towards business and foreign
investments
16 | www.mogulvc.com | www.cervellocapital.com
Source: (1) the Ministry of Mineral Resources & Energy of Mongolia
• Stable business-friendly democracy: 20 year uninterrupted history
of peaceful and democratic government
• Homogenous country with minimal risk of ethnic or religious conflict
Drilling Camp, 2011
Black Hills Project Key Advantages
17 | www.mogulvc.com | www.cervellocapital.com
• Strategic location
close to existing rail line
(parallel line planned)
providing ready access
to Chinese markets
• Open pit accessible
thermal coal resources
with expected low strip ratio
• NI 43-101 compliant Inferred
Resource of 89.6 Mt from
2,370m of drilling in
14 holes at Ovdog
Hudag deposit
• Property has potential for presence of other
commodities (Cu, Fe)
• Excellent potential to significantly expand the projects’ coal resources through:
» Infill and step-out drilling at Ovdog Hudag deposit where substantially larger historical resources were delineated by Russian work in the 1960s and 1970s through more detailed drilling
» Ovdog Hudag Coal Deposit remains open to the north
» Drilling of the Ikh Ulaan Nuur deposit 7km NNE of Ovdog Hudag (86.4 Mt*1)
» Testing the undrilled area between the two known deposits
» Phase II drill program planned to commence April 2012
» Potential for copper deposit demonstrated by surface sampling of skarn grading up to 6% Cu
Company Objectives
18 | www.mogulvc.com | www.cervellocapital.com
Recent & Upcoming Milestones
19 | www.mogulvc.com | www.cervellocapital.com
H1 2011 H2 2011 Q1 2012 Q2 2012
TRANSACTION
Completed due diligence, property review, Title Opinion, private financing, closed TS LLC purchase, RTO agreement with TSX listed CPC
Complete audit and prepare info Circ. Received approvals and signed an order for issuance of the mining license
Complete public RTO, close Pubco. funding – public listing
EXPLORATION
Complete initial independent historical review of coal occurrences
Complete drill program to confirm coal characteristics and historical work
Completed NI 43-101 report Implement NI 43-101 recommended program
ACQUISITION
Completed acquisition of TS coal project
Review other potential coal acquisitions
DEVELOPMENT
Confirmation drilling of Black Hills
Confirm resource and expand drilling
A Premier Gold Explorer in Colombia
20 | www.llaveoro.com | www.cervellocapital.com
Presented by: Balmer Echeverri, VP Exploration
Value Creation
• Large scale gold project acquisitions identified
• Located in Antioquia state
• Very prolific gold region over past several hundred years
• A premier Colombian-based team with a track record of significant exploration success
» Identified, assembled, negotiated and advanced exploration on Continental Gold’s key assets (TSX: CNL)
• Strong Board with extensive experience building companies and creating shareholder value in the capital markets
• Advancing the public listing process
• Majors nearby:
» AngloGold Ashanti (NYSE: AU), Continental Gold (TSX: CNL), B2 Gold (TSX: BTO)
21 | www.llaveoro.com | www.cervellocapital.com
Pre-IPO
Financing $3.4M @ $0.20
Shares
Outstanding 28,709,850
Fully Diluted 40,009,881
Warrants 8,500,000 @ $0.30
Options 2,800,031 @ $0.20
Projects
22 | www.llaveoro.com | www.cervellocapital.com
POPALES PROJECT • 150 km NW of Medellin in the prolific Cauca Belt
• Multiple gold bearing veins identified through
preliminary exploration
» Mineralization very similar to Buritica’s 4Moz
deposit
• Drill ready project with high grade vein and bulk
mining potential
• Grades up to 68 g/t Au
• Altered rock between veins assayed up to 13 g/t Au
EL RAYO PROJECT • Located approximately 55km NE of Medellin
• Open cut exposes a shear zone ~11m wide, length
appears to be 1+km
• Chip samples yielded 4.2 g/t Au to 16.6 g/t Au
• Two mineralized zones identified:
• 200m by 50m of gold anomalies ranging
0.1 – 5.4 g/t Au
• 270m by 170m ranging
0.1 – 2.6 g/t Au
LLAVE ORO INC. PROPERTIES
Popales Geochemistry
• Widespread mineralization
indicates:
» Large hydrothermal system and
» Provides numerous drill targets
• Copper and silver mineralization is
associated with gold mineralization
• Mineralization very similar to
Continental Gold’s Buritica 4Moz.
deposit
Popales & Buritica
Comparison
Illustrations: Top: Popales Veins Bottom: Buritica Veins
24 | www.llaveoro.com | www.cervellocapital.com
100 m
• Multiple gold bearing veins identified through
preliminary exploration
• Grades up to 68 g/t Au
• Altered rock between veins assayed up to
13 g/t Au
• Drill-ready project with 7 drill holes
identified
• High grade vein and bulk mining potential
• Distribution and type of high-grade veins at
Popales is very similar to Buritica’s 4Moz. Au
deposit
• Identified 45 high-grade Buritica-like veins
Overview
• Early-stage investment opportunity
• Start-up level valuation
• Significant catalysts and activity during
2012
• Ongoing program
» Geological mapping and sampling
» Both Popales and El Rayo have multiple
“drill ready” targets
» Final stages of permitting
» Continued due diligence on additional
project acquisitions
» Advancement of go–public process
• Best in class team with vast expertise in
Colombia
• Still “early days” in Colombia
25 | www.llaveoro.com | www.cervellocapital.com
Sample from high grade vein, Popales
Potential to Hold a Multi-Million Tonne
Vein Type Gold Deposit
26 | www.cervellocapital.com
Presented by: John E. Dreier, CEO
Investor Highlights
• Multimillion, bulk-mineable ounce Gold
potential in Alaska
» In the prolific Tintina Gold Belt
» Potential to hold a multi-million
tonne vein type deposit with gold
values ranging up to 80 or 90g/t Au
• Previously explored
• NI 43-101 report (Jan.30.2011)
• Multiple bulk minable targets
identified by surface work and drilling
• Proven track record: strong team of
mining and financial professionals
• Infrastructure: modern mining camp
and landing strip 10km away, former
USAF fighter base 70km away
27 | www.cervellocapital.com
29.3M oz
6.7M oz
16.5M oz
• In the Tintina Gold Belt
(near Galena, Western Alaska)
• Discovered in 1981 by Anaconda
• 20 claims totaling 1,295 hectares
• Vein is defined by 200 surface samples and 10 diamond drill holes
• Year round exploration possible given common light snowfall to the
area
Tintina Gold Belt
Discovery Outcrop
28 | www.cervellocapital.com
• Two known northeast trending gold veins: Main and West
» Cumulative exposure over 150m
» Main Vein: continuous train 1km along strike and 170m vertical interval
• Historical exploration has barely identified the potential of the mineralized gold deposit
» Historic exploration traced the vein to a max. depth of 50m below surface
• Mineralization is open to the North, South and at depth
29 | www.cervellocapital.com
Exploration Potential
Past Exploration Work
• 1981 – 1983: geological mapping,
ground magnetometer, IP and
MAXMIN EM survey, geochemical
sampling and 10 diamond drill holes
totalling 1,001.2 m completed
» 4 of 10 holes reached the Main
Vein
• Values range: 1m grading 3.8 g.t Au;
5m grading 9.28 g/t Au; subinterval
grading up to 14.5 g/t Au
• Two bulk samples (160 and 72.7lbs)
collected along the Main Vein ave.
29.14 g/t Au and 29.48 g/t Ag
• Anaconda drill holes hit Gold in the
Main Vein and disseminated
mineralization near the vein
30 | www.cervellocapital.com
• Staged exploration program determined
» Objective: test the potential of the Honker veins
at depth to determine the large-scale potential
of the mineral system
• Shareholder value creation: through acquisition
and development of superior west-coast based
minerals projects
• Leverage Cervello Capital relationship and use
Honker Gold Project as the asset for a public launch
• Proposed Phase I Work Program
Milestones & Objectives
Geological mapping to locate additional targets
Estimated Budget:
$1.5M Complete 1,500m of core drilling to locate high-grade ore
zones along the Main Vein and bulk tonnage deposits adjacent
to the vein
Main Vein Sample
31 | www.cervellocapital.com
• Limited partnership investment vehicle structured
to maximize the distribution of cash flow from gold production
at the Vulture Gold Mine
• The mine, which has produced 340,000 ounces of gold
over its operational history, has a gold resource of 328,000 ounces
(non-NI 43-101 compliant) and is expected to be a low-capex,
low-cost, open pit operation
32 | www.vulturepeakgold.com | www.cervellocapital.com
Presented by: Michael R. Smith, R.G., Manager
• Low capex, low-cost and near-term,
open pit gold production
• Primary investment objective =
cash flow distribution
• Project payback less than 18 months
• 328,000 ounce base case with
additional resource upside
• Breakeven cash flow at $450 gold
• Examining ability to provide unit
holders option to accept physical
delivery
• Some upfront tax benefits with
limited partnership structure
• NPV at $1,500 Gold = $88 million
Investor Focus
33 | www.vulturepeakgold.com | www.cervellocapital.com
• Block model and Resource Estimate created based on drill data from 89 holes to
a depth of 200 to 500 feet, deposit extends to at least 650 feet down dip
• Vulture Peak Gold conducted panel sampling and surveying of mine workings to
a depth of 650 feet
Resource Block Model
34 | www.vulturepeakgold.com | www.cervellocapital.com
Potential Production Scenario
• Base case of 328,000 oz. Au
• Assumes no additional Resource delineated
• Objective of reaching 50,000 oz/yr production over 5 year period, assuming no resource expansion
• Cash cost/oz anticipated to be between US $400 and $450
• Positive preliminary metallurgical testing completed July, 2011 by Resource Development Inc., (Denver)
• Met testing indicates all ores leachable at various crush and grinds
• Ore available at mining start to load on leach pads and mill high grade
• Expected Capex • Roughly $25M
• Finance any potential expansion and milling through cash flow
• Projected startup early 2013
Old ore car and high grade mineralization underground
35 | www.vulturepeakgold.com | www.cervellocapital.com
Preliminary Estimate Cash
Flow Model
36 | www.vulturepeakgold.com | www.cervellocapital.com
VULTURE MINE
DCF YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 TOTAL
REVENUE
Processed Ore
Ounces 19,545 48,864 48,864 48,864 48,864 29,320 244,321
% Recovery 0.74 0.74 0.74 0.74 0.74 0.74
Recovered Ounces 14,401 36,003 36,003 36,003 36,003 21,603 180,016
$$ @ $1200/oz Au $17,280,907 $43,203,594 $43,203,594 $43,203,594 $43,203,594 $25,923,571 216,018,855
$$ @ $1500/oz Au $21,601,134 $54,004,493 $54,004,493 $54,004,493 $54,004,493 $32,404,464 270,023,569
$$ @ $1800/oz Au $25,921,361 $64,805,391 $64,805,391 $64,805,391 $64,805,391 $38,885,357 324,028,283
COSTS
Property Payment $3,275,000 $3,275,000
Drilling $400,000 $100,000 $500,000
Engineering $300,000 $200,000 $500,000
Permitting $300,000 $100,000 $400,000
Payroll & facilities
constr. $400,000 $400,000 $800,000
Leach Pad Constr.
Tonnes 3,600,000 720,000 720,000 720,000 720,000 720,000 7,200,000
Leach Constr.
@ $2.16/t + mill $10,900,000 $1,440,000 $1,440,000 $1,440,000 $1,440,000 $1,440,000 $18,100,000
Water Supply $1,000,000 $1,000,000
Site Preparation $2,623,000 $2,623,000
Operating @ $7.90/t $7,704,000 $13,867,200 $13,867,200 $13,867,200 $13,867,200 $13,867,200 $1,000,000 $78,040,000
$4,675,000 $23,027,000 $15,307,200 $15,307,200 $15,307,200 $15,307,200 $15,307,200
$1,000,000 $105,238,000
OPERATING
CASH FLOW
$$ @ $1200/oz Au -$4,675,000 -$23,027,000 $1,973,707 $27,896,394 $27,896,394 $27,896,394 $27,896,394 $24,923,571 $110,780,855
$$ @ $1500/oz Au -$4,675,000 -$23,027,000 $6,293,934 $38,697,293 $38,697,293 $38,697,293 $38,697,293 $31,404,464 $164,785,569
$$ @ $1800/oz Au -$4,675,000 -$23,027,000 $10,614,161 $49,498,191 $49,498,191 $49,498,191 $49,498,191 $37,885,357 $218,790,283
DCF: $1,500/ oz Au at 10% discount: $88,000,000
$100,000 Investment
Scenario
37 | www.vulturepeakgold.com | www.cervellocapital.com
Notes Assumes $5 million raised at $30 million pre money value
Assumes no additional resource is added to the project
Assumes all costs as estimated
SHARE
AT YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 CUMULATIVE
$1200
/oz AU $ (15,586.45) $ (76,772.02) $ 6,580.34 $ 93,006.58 $ 93,006.58 $ 93,006.58 $ 93,006.58 $ 83,095.19 $ 369,343.37
$1500
/oz AU $ (15,586.45) $ (76,772.02) $ 20,983.98 $ 129,016.77 $ 129,016.77 $ 129,016.77 $ 129,016.77 $ 104,702.48 $ 549,395.09
$1800
/oz AU $ (15,586.45) $ (76,772.02) $ 35,387.61 $ 165,026.97 $ 165,026.97 $ 165,026.97 $ 165,026.97 $ 126,309.78 $ 729,446.80
Investment Structure & Summary
• Vulture Peak LLC acts as a General Partner to Vulture Peak Gold LP
• Provides turnkey management for development of project
• Separate US LP within Canadian LP structure
• Up to $5 million equity to be raised within the Company
• Proceeds will advance Vulture through Compliant Resource calculation to Feasibility Study
• Major Capex requirement will be raised through Project Finance, Credit Facility, Production Streaming
• Project payback: less than 18 months
• 328,000 oz base case with additional resource upside
• Breakeven cash flow at $450 Gold
• Primary investment objective = cash flow distribution
• Examining ability to provide unit holders option to accept physical delivery
• Some upfront tax benefits with LP structure
• NPV at $1,500 Gold = $88 million
38 | www.vulturepeakgold.com | www.cervellocapital.com
Blast hole drilling, 2012
Thank You.
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