View
3
Download
0
Category
Preview:
Citation preview
1
SABINA GOLD & SILVER CORP.
Developing the high- grade Goose Mine at the Back River Gold District.
The work done on Back River over thelast two years offers opportunity to bringhigher-grade ounces in earlier in themine life, providing for increasedproduction profile and economics andreduced payback; improving on analready top tier project.
This work will form the basis of anupdated Feasibility Study and ResourceEstimate due Q1/21.
November 2020
Forward Looking InformationStatements relating to our belief as to the results of exploration activities, timing of receipt of necessary authorizations and licenses,the availability of project financing, the timing of the start of construction and the first gold pour, and the results of furtheroptimization studies to the feasibility study, the potential tonnage and grades and contents of deposits and the potential productionfrom and viability of Sabina’s properties are forward looking information within the meaning of securities legislation of certainProvinces in Canada. Forward looking information are statements that are not historical facts and are generally, but not alwaysidentified by the words “expects,” “plans,” “anticipates,” “believes,” “intends,” “estimates,” “projects,” “potential,” “opportunities,”and similar expressions, or that events or conditions “will,” “would.” “may,” “could,” or should occur. The forward looking informationis made of the date of this video. This forward looking information is subject to a variety of risks and uncertainties which could causeactual events or results to differ materially from those reflected in the forward looking information, including, without limitation: theeffects of general economic conditions; changing foreign exchange rates; risks associated with exploration and project development;the calculation of mineral resources and reserves; risks related to fluctuations in metal prices; uncertainties related to raising sufficientfinancing to fund the planned work in a timely manner and on acceptable terms; changes in planned work arising from weather,logistical, technical or other factors; the possibility that results of work will not fulfill expectations and realize the perceived potentialof the Company’s properties; risk of accidents, equipment breakdowns and labour disputes; access to project funding or otherunanticipated difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in the work program; titlematters; government regulation; obtaining and receiving necessary licenses and permits; the risk of environmental contamination ordamage resulting from Sabina’s operations and other risks and uncertainties including those described in Sabina’s annual informationform for the year ended December 31, 2019 available at www.sedar.com
Forward looking information is based on the beliefs, estimates and opinions of Sabina’s management on the date the statements aremade. Sabina undertakes no obligation to update the forward looking information should management’s beliefs, estimates oropinions, or other factors, change, except as required by applicable law
2
With Major permits and social license received, Sabina is shovel ready
3
Why Sabina?
*1 2019 average grade of open pit and U/g deposits with gold as primary commodity in M&I. S&P Global Intelligence
Advanced, large, high grade -6 g/t open pits vs world average of 1.2 g/t*1
A mining district in a stellar jurisdictionNunavut, Canada
Critical project components de-riskedProject optimizations underway to increase production profile and enhance economics
Robust economics at US$1150 gold –significant leverage to increasing gold price
Well funded with exceptional peopleC$75m at Q2/2020
Back River Gold Project
4
Based on 2014 resource estimate not including three new high-grade
discoveriesThere are few advanced gold projects that are large, high grade, district scale and in good jurisdictions.
Back River is advanced engineered, permitted and has obtained social license
The Investment Opportunity
Development Companies By Size and Grade
RBC Capital Markets – Aug 23/20
Nunavut, Canada –Over 4 decades of
prosperity in mining
0
1
2
3
4
5
6
7
8
1998 2002 2007 2009 2010 2012 2015
Gold ResourceMillions oz
Indicated Inferred
Back River – Deposits are Well Drilled , Well Understood and Open. Over 568,000 meters of drilling completed. Opportunities to increase resources and optimize reserves with infill drilling
6
Under Sabina
Ownership
*See mineral reserves and resources estimate slide 30 for details
Mineral Resource EstimateOct/14 Tonnes (kt) Au (g/t) Metal (koz Au)
Measured 10,273 5.27 1,740
Indicated 17,969 6.22 3,593
Measured and Indicated 28,242 5.87 5,333
Inferred 7,750 7.43 1,851
Mineral Reserve Estimate Aug/15 Classification Tonnes (kt) Au (g/t) Au (koz)
Total Open PitProven 6,983 5.97 1,340
Probable 1,885 5.52 335
Total UndergroundProven 20 9.52 6
Probable 3,471 7.37 822
Total Back River
Property
Proven 7,003 5.98 1,346
Probable 5,356 6.72 1,157
80% of open pit reserve is in Proven Category
1980’s & 90s 1997-2009 June 2009 2010-2014
George & Goosedeposit discoveries
Project owned by Arauco, Kinross, Miramar & DPM
Project acquiredby Sabina
+325% resourcegrowth under Sabina
Measured & Indicated
Inferred
Infill drilling for new resource estimate underway
Back River A District Scale Gold Opportunity100% OWNED BY SABINA
Significant extended productionopportunities exist through:
❑ Deposits not included in first mine plan(at both Goose and George)
❑ Low risk resource opportunities with infill program
❑ Increase production profile by bringing forward higher-grade underground resources
❑ Numerous blue sky and brownfield targets
❑ Continued greenfield and generativeexploration future
Back River Property
80 Km
Kilometres
0 12.5 25
LEGEND
Inuit Owned Land
Camp
Area of Interest
Claim
Lease
Surface
Subsurface and Surface
George Project
BootBoulder
Goose Project
Del
Bath
7
George Property Existing Mineral Resources:
Indicated 1.1m oz @ 5.6 g/t
Inferred 980k oz @ 6.32 g/t
Included in prior Feasibility ~600 k oz
Port
Significant existing resources at George on 20km of largely unexplored iron formation offering opportunity for another mining complex on the Back River district
QA/QC Slide 30
Back River is Permitted, Shovel Ready and Offers Robust Economics
8
❑At US$1150 gold price and $.80 FX generates 24.2% after tax IRR (9/15 Feasibility Study)
❑Simple executable first mine produces ~200,000 Oz per year for ~12 years. Expanded mine life demonstrated.
❑Fully permitted and shovel ready. Strong government and community support;
❑Social license in hand
Sabina has one of the lowest capital intensity ratios relative to peers
CAD millions After Tax 5% discount
FS gold price sensitivity NPV IRR Payback
USD 2,100, forex 0.758 $ 1,817 58.3% 1.0
USD 2,000, forex 0.758 $ 1,686 55.6% 1.1
USD 1,900, forex 0.758 $ 1,555 52.8% 1.2
USD 1,800, forex 0.758 $ 1,423 49.9% 1.3
USD 1,700, forex 0.758 $ 1,290 46.9% 1.4
USD 1,600, forex 0.758 $ 1,159 43.7% 1.5
USD 1,500, forex 0.758 $ 1,027 40.4% 1.6
25% 56% 57% 73% 80% 97% 117%
575%
1,162%
Orla Sabina Gold Standard Cardinal Orezone Belo Sun Rubicon INV Falco
Initial Capital Expenditures as a % of Market Capitalization
High-Grade Open Pits are among the lowest cost gold producersMine Country Owner Processed
Grade
Q418
(Au g/t)
C1 Cash
Costs
Q418
(US$/0z)
2018
Annual
Productio
n
(Au Oz)
Kumtor Kyrgzstan Centerra
Gold Inc.
5.5 $319 535,000
Red
Rabbit
Turkey Ariana
Resources
PLC
5.2 $349 20,000
Pueblo
Viejo
Dominica
n Republic
Barrick
Gold Corp.
4.2 $425 580,000
Svetloye Russia Polymetal
Internatio
nal PLC
3.5 $265 135,000
Lihir Papua
New
Guinea
Newcrest
Mining
Ltd.
3.1 $663 900,000
9
Sep/15 Feasibility Study – Goose Project, Back River
❑ Projected to produce 250,000 ounces of gold from years 1 – 8 from a combination of three open pits (72%) and one underground (28%)
❑ With 6.2 g/t Au open pits, total cash costs are forecast at US$534 per ounce.
❑ Life of mine all in sustaining costs, including initial capital, sustaining and closure capital are estimated at US$763 per ounce.
❑ Three new discoveries since Feasibility Study have demonstrated opportunity for extended mine life
Source: Company public documents. See QA/QC Slide 29
Significant Work Completed to advance the project
10
Key Milestones on the Project since the Feasibility Study
❑ Full permits and social license received
❑ Built infrastructure to support construction and operations
❑ Basic engineering done. Detailed engineering commenced
❑ Metallurgical testing to support design of flow sheet.
❑ 3 new discoveries, higher grade opportunities
❑ Advancement of a Project Debt term sheet
❑ Gold price increase from ~C$1,438/oz in our FS to C$2,575/oz significantly impacting project economics
❑ Internal studies revisiting mine scheduling to increase economics, production profile and lower payback period 11
Environment, Permitting and Social License Achieved
12
❑ Completed Environmental Assessment Process – Project certificate received▪ Wildlife Monitoring and Mitigation new standard for Nunavut▪ Caribou protection plans are “State-of-the-Art in Arctic
Canada” – Paul Emingak, ED. KIA
❑ All Major authorization for construction and operation received.
❑ Finalized Agreements with landowner Kitikmeot Inuit Association (KIA)▪ Will provide training, jobs, contracting opportunities and
royalty payments to Kitikmeot Region▪ 20 year lease▪ KIA an aligned shareholder▪ Regional wealth creation initiative payments – creating jobs
outside of the mining industry – new precedent in Nunavut
❑ Environmental Assessment process completed
❑ Unprecedented support from communities
Continuing to utilize our treasury prudently as we advance the project
13
❑ Logistics and supply route❑ Construction of Port and Winter
Ice Road completed. Equipment moved from Port to Goose Site
❑ First 10 million litre fuel tank constructed
❑ Internal Studies❑ FS utilizes only 2.3m of 7.3 m oz
resource & 3 new discoveries since
❑ Opportunities to adjust mine scheduling to bring in higher grades earlier and increase production profile
❑ Negotiated Project Debt on favourableterms❑ Contingent on access to equity❑ In a state of readiness to execute at the
right time
Opportunities for 2020 and beyond!
14
Evolving The Goose Project Gold System – The First Mine
Targeting 10 Million Ounces of Gold in Banded Iron Formation
LLAMA UMWELT GNS HACKLESECHOKOGOYOK NUVUYAK
DifTarget
525 mLlama Plunge
Extension
Dif Target
OpenOpen
VaultOpen
Open
-1000m
-500m
GOOSE MAIN
DifTarget
Hook
Resource MI&I
Drill Target
2017-2019 DDH
Umwelt
Llama
Vault NuvuyakOpen
3600 m
>1200 m
>4000 m
GooseMain
Approximated Plunge Length of Banded Iron Formation Stratigraphy
Combined Resource plunge length
De-risked discoveries plunge length
Untested upside potential plunge length
5.2 Moz
+Moz
++Moz
Average BIF potential of
1.4 Moz Gold per 1000 m
Extension
1000m 600m 900m
200m 1500m 800m400m 500m1500m1600m
Three new discoveries in the last three years
V2 Zone
Umwelt High Grade Corridor – 2020 drilling
16
❑ High-grade corridor within current under ground resource extending up and down plunge from the Vault zone
❑ Initial 2020 drill hit grades are 2x to 3x the Umwelt resource of 7g/t with widths sufficient to minimize dilution
❑ Upper Vault zone identified below the bottom of the open pit providing opportunity for additional higher-grade ounces to come in earlier in the mine life
Inclined section of the Umwelt underground mineralization showing gram meter intercepts and
2020 drilling results to date.
17
Opportunities to add further underground at Umwelt, Llama, Nuvuyak & Goose Main later in the Mine Plan – target: 300k oz/year producer
❑ Discovery drilling has been widely spaced, testing interpretation and hypotheses from historic drilling & desk top work
❑ To drill off new discoveries would require:To Inf: 32,000 meters = ~$20mTo Ind: 81,000 meters = ~$48m
❑ High level internal upside studies have been completed to target increased production at similar throughput to determine potential economic impact and plans for infill drillingFigure2: Plan map of the Goose property showing the 1st derivative airborne magnetic survey overlain by the cross axial quadrature 5500
electro-magnetic airborne survey. Selected targets defined by geophysical responses, known gold occurrences and by prospective lithology are shown by yellow-dotted ellipses.
The Goose Project offers flexibility to adjust mine scheduling to impact production profile and economics
Exploration Decline Ramp at Umwelt to further explore high grade corridor
18
❑ Under current Feasibility Study, underground at Umwelt comes online in year 3 (after payback)
❑ Since the Feasibility Study, exploration at Umwelt has demonstrated higher grades at depth (both up and down plunge from Vault)
❑ These high-grade zones need to be verified with close spaced drilling and/or bulk sample from underground
❑ Portal preparations being undertaken this year with collaring in early 2021.
If this drilling is successful it could potentially provide for the earlier release of high-grade ores to the mine plan and positively impact
the production profile and project economics.
Ramp will take approximately three years to complete with initial underground drilling beginning in 2022
19
Preparation underway on box cut and shop pad for underground ramp
Laydown area for Portal Machine Shop
Box Cut for ramp Portal area
Construction on underground exploration ramp to begin spring 2021
20
Pre-Development Activities at Site 2020
21
Extension of all-weather Airstrip from 3,000 feet to 4,500 feet
Facilitates the use of large capacity cargo and transport aircraft to support development and future operations with better efficiencies in cost and timing
22
The first of several scheduled Hercules Aircraft flights lands on extended all weather strip.
Equipment for underground development being transported from Yellowknife.
Aerial view of 2020 pre-development activities
23
Hackett Silver Royalty
Significant potential cash flow at no costfrom silver royalty.
❑ 22.5% x 190 million ounces of silver = cash equivalent of ~3 million ounces of silver per year; and
❑ 12.5% x of silver production after 190 million ounces
24
0
20
40
60
80
100
120
140
160
PRECIOUS METALSBASE METALS
To
nn
es
( m
illi
on
s)
Data source: alley et al. , Mineral deposits of Canada, 2007 and selected company websites. Metal distribution using
Wardrop PEA metal prices, 2.00 Cu, 0.80 Zn, 0.50 Pb, 14.00 Ag, 600 Au
Sabina mineral resource estimate:
❑ Indicated resources of 25 million tonnes at 4.2% Zn and 130 g/t Ag
❑ Inferred resources of 57 million tonnesat 3% Zn and 100 g/t Ag
60km west of Back River, one of world’s largest undeveloped silver rich VMS deposits
QA/QC – slide 31
Investment Highlights and Catalysts
❑ Continued drilling results
❑ Commencement of detailed engineering
❑ Updated feasibility and resource estimate due Q1, 2021
❑ Continued pre-development earthworks to prepare for underground ramp
❑ Ready for financing window to make a production decision 25
Back River is a Company Maker
+1800%
This Bull Gold Market?
Sabina is fortunate to own one of the best development projects in the sector. Shovel ready, district scale, large high grade and in Canada: positioned for a re-rating once a production decision is made
Sabina Share Price 2005-current
Sabina is Poised for a re-rating once a production decision is made
26
No Value ascribed for:❑ Multi-generational district owned
100% by Sabina – imbedded growth❑ Premier jurisdiction❑ Remaining ounces in mineral
resource estimate & exploration upside
❑ Opportunity for revised mine plan to release high-grade ore earlier in mine life enhancing economics and production profile and reducing payback period
❑ Hackett River Royalty – option on silver for the future
❑ Environmental and Social Licenses in hand
BACK RIVER IS A COMPANY MAKER AND A COVETED PROJECT
Sabina is here
Capital Structure & CoverageSabina Gold & Silver Corp.
Symbol SBB
Listed exchange OTCQX
Market capitalization ~C$850million
Shares outstanding ~325million
Shares outstanding (diluted) ~340 million
Cash (Q3/20) ~C$65 million
Debt None
52 week trading range C$.71 -$2.66
Recent Price ~C$2.50
Analyst Coverage
BMO Capital Markets Andrew Mikitchook
Paradigm Capital Don MacLean
Cormark Securities Brock Colterjohn
RBC Capital Markets Mark Mihaljevic
Canaccord Kevin MacKenzie
Echelon Partners Ryan Walker
TD Securities Arun Lamba
Industrial Alliance George Topping
Cantor Fitzgerald Matt O’Keefe
National Bank Financial John Sclodnick
Sprott Capital Partners Chris Tonkin Major Shareholders Holdings (I&O)
Dundee Precious Metals 9.8%
Sun Valley Gold 8.5%
Zhaojin 9.9%
Wheaton Precious 4.3%
Management (options incl.) 1.8%
27
Average 12 month
target price C$3.55
Management & Board
Combined exploration, mine development, permitting operations & capital markets experience in over 87 projects & companies
Executive Management
Bruce McLeodPresident, CEO & Director
Elaine BennettVP Finance & CFO
Nicole HoellerVP Communications & Corp. Secretary
Technical Management
Angus CampbellVP Exploration
Matthew PickardVP Environment & Sustainability
Walter Segsworth (Chairman)
David Fennell
James Morton
Anthony Walsh
Anna Stylianides
Leo Zhao
David Rae
Bruce McLeod, President & CEO
Board of Directors
28
29
Thank you!
Recommended