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TSX: AQA
OTCQB: AQARF
Focused on
Gold-Rich Projects
in the United States
Corporate PresentationMay 2020
Disclaimer
This presentation contains certain forward‐looking statements within the meaning of applicable Canadian securities legislation. In certain cases, forward‐looking
statements can be identified by the use of words such as "plans", "expects" or "does not anticipate", or "believes", or variations of such words and phrases or
statements that certain actions, events or results "may", "could", "would", "might" or "will be taken", "occur" or "be achieved" and similar expressions suggesting future
outcomes or statements regarding an outlook.
Forward‐looking statements relate to any matters that are not historical facts and statements of our beliefs, intentions and expectations about developments, results
and events which will or may occur in the future, without limitation, statements with respect to additional upside potential of the Project and the potential for
underground mining activities at the Project and benefits associated therewith, statements with respect to the expected project economics for the Project, such as
estimates of life of mine, total production and average production, metal production and recoveries, C1 cash costs, AISC, capital and operating costs, pre- and post-tax
IRR, pre- and post-tax NPV and cash flows, the potential conversion of Inferred Mineral Resources into Indicated Mineral Resources, any projections outlined in the
Feasibility Study in respect of the Project, the permitting status of the Project and Aquila’s future exploration and development plans and associated timelines.
These and other forward‐looking statements and information are subject to various known and unknown risks and uncertainties, many of which are beyond the ability of
Aquila to control or predict, that may cause their actual results, performance or achievements to be materially different from those expressed or implied thereby, and
are developed based on assumptions about such risks, uncertainties and other factors set out herein. These risks include those described under the heading “Risk
Factors” in Aquila’s most recent annual information form and its other public filings, copies of which can be under Aquila’s profile at www.sedar.com. Aquila expressly
disclaims any obligation to update forward‐looking information except as required by applicable law. Such forward‐looking information represents Aquila’s best
judgment based on information currently available. No forward‐looking statement can be guaranteed and actual future results may vary materially. Accordingly, readers
are advised not to place undue reliance on forward‐looking statements or information. Furthermore, Mineral Resources that are not Mineral Reserves do not have
demonstrated economic viability.
None of EBITDA, all-in sustaining costs (“AISC”), or free cash flow (“FCF”) have a standardized meaning under IFRS. See “Non-IFRS Measures” in the Company’s
news release dated August 1, 2018. Financial evaluation includes financial impacts of the Company’s silver stream with Osisko Gold Royalties (OGR) but does not
include the financial impact of its gold stream with OGR for which the majority of the upfront payments have yet to be received and for which there is uncertainty
regarding the exact timing of these payments. See the Company’s Q1 2019 Financial Statements and MD&A available on SEDAR for additional details regarding the
gold stream.
Andrew Boushy, Senior Vice President, Projects for Aquila Resources, is the Qualified Person for the Company as described in National Instrument 43-101 and is
responsible for the technical contents of this presentation.
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INVESTMENT HIGHLIGHTS
3 TSX: AQA
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Advancing development of 100%-owned Back Forty Project in Michigan
Favorable metal exposure to Gold and Zinc
Well-established and safemining jurisdiction
Granted key Permits including Mining Permit and Wetlands Permit
Strong shareholder base
Exploration upside:
• Near deposit
• Prospective projectson the Penokean Belt
Aquila CAPITAL STRUCTURE
4
Current Capital Structure
Share Price (As of May 4, 2020) C$0.13
Avg. daily vol. (3-mth) (TSX + OTCQB) 156,000
52-week range C$0.07 – $0.23
Shares O/S 339M
Market Cap. C$14M
Year End December 31
Cash position @ December 31, 2019 US$4.0M
Balance of Osisko payments owing US$40M
Major Institutional Shareholders
Orion 28.7%
Ruffer 12.8%
Hudbay 10.5%
TSX: AQA
OTCQB: AQARF
52-Week Stock Chart (C$) – Closing Price
Analyst Coverage
Cormark Securities Stefan Ioannou
-
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
$-
$0.05
$0.10
$0.15
$0.20
$0.25
May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20
FOCUSED ON GOLD-RICH PROJECTS IN THE US
Back Forty
• Gold and Zinc
• Pre-construction
phase
Prospective projects
located in Wisconsin
• Bend
• Copper-Gold
Exploration
• Reef
• Gold Exploration
Located along the
Penokean Volcanic Belt
Region is experiencing a
mining resurgence
5
Attractive Pipeline of Projects in
HIGHLY PROSPECTIVE DISTRICT
TSX: AQA
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BACK FORTY Flagship Project
100%-owned Gold- and Zinc-rich deposit
Re-acquired from Hudbay in Q1 2014
Open Pit Feasibility Study completed August 2018
Granted key permits including
Mining Permit and Wetlands
Permit
Attractive exploration upside
Near deposit
Underground expansion
(open at depth)
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$294M $208M 28.2% $677/oz AuEq CAPEX NPV IRR AISC
OPEN PIT FEASIBILITY STUDY (at $1,300/oz gold)
$95M >INVESTED TO DATE• Exploration
• Technical reports
• Land acquisitions
• Permitting activities
• Engineering
Back Forty PRODUCTION HIGHLIGHTS
7
45%
31%
16%
8%
Revenue by Product
Zinc Concentrate
Copper Concentrate
Doré
Lead Concentrate
41%
41%
10%6%
2%
Revenue by Metal
Gold Zinc
Copper Silver
Lead
BENEFITS OF POLYMETALLIC DEPOSITS
DIVERSE REVENUE STREAMS
Provide Natural Hedge
135,000 oz. of gold produced in Year 1
Base Case Metal Prices: Gold: $1,300/oz; Zinc: $1.20/lb; Silver: $20.00/oz; Copper: $3.00/lb; Lead: $1.00/lb
Payable Production
Metal Life of Project Average Annual
Gold (K oz) 468 67
Zinc (K lbs) 512,198 73,171
Copper (K lbs) 51,109 7,301
Silver (K oz) 4,458 637
Lead (K lbs) 24,183 3,455
Production Parameters
Project Life 7 years
Throughput 4,800 tpd
Strip Ratio (life of project) 4.3:1
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Back Forty Open PitMINERAL RESERVE ESTIMATE
8
70% OF RESERVES
are in Proven Category
1. CIM definitions were followed for the Mineral Reserve Estimate.
2. The Mineral Reserve Estimate used average long term metal prices
of $1,250/oz gold; $20.00/oz silver; $1.15/lb zinc; $1.00/lb lead; and
$3.00/lb copper.
3. A Mineral Reserve is defined within a mine plan, with pit phase
designs guided by Lerchs–Grossmann (LG) pit shells, after dilution
and mining loss adjustments.
4. The Mineral Reserve Estimate is derived from Measured and
Indicated Mineral Resources only.
BACK FORTY MINERAL RESERVE ESTIMATE AS OF FEBRUARY 6, 2018
Gold equivalent grade 4.3 g/t
Zinc equivalent grade 6.7%
Category Ore Mt
NSR $/t
Gold g/t
Silver g/t
Zinc %
Lead %
Copper %
Proven 8.12 $120 1.95 18.4 3.02 0.13 0.35
Probable 3.53 $85 1.63 29.3 1.76 0.41 0.10
Proven + Probable 11.65 $109 1.85 21.7 2.64 0.21 0.28
5. Metallurgical recovery used was a variable function of the rock type
and metal grade.
6. The Mineral Reserve Estimate for the Project will be comprised of
eight different ore types that will be processed either though a
flotation concentrator or cyanide leach plant. NSR cut-off values
applied are: Ore 1 - $16.50/t, Ore 2,3,4,7,8 - $16.00/t,
Ore 5 - $17.50/t, and Ore 6 - $28.50/t.
7. The life-of-mine strip ratio is 4.3:1 including the pre-construction
period.
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Back Forty CAPITAL AND OPERATING COSTS
Sustaining capital of $111M
Mine closure costs of $75M
(starting in Year 8)9
PREPARED WITH SUPPORT FROM GLOBALLY RECOGNIZED EXPERTSINCORPORATES BEST PRACTICES IN ALL ENVIRONMENTALLY SENSITIVE AREAS
Capital Costs Summary
Area $M
Indirect Construction 19
Common Plant 20
Oxide Plant 33
Sulphide Plant 59
TMF/WRFs 39
Infrastructure 33
Mining 25
Management Costs 22
Owner costs 13
Subtotal 263
Contingency (12%) 31
Total 294
Operating Costs Summary
Life of Project
($M)
$/t Ore
Gross Revenue 1,437 123
Realization Charges 180 15
NSR (Base Case) 1,256 108
Mining 160 14
Processing 184 16
G&A 27 2
Total Site Opex 371 32
C1 cash costs of $499/oz gold eq. or $0.46/lb zinc eq.
Net C1 cash costs of -$590/oz gold or -$1.73/lb zinc
AISC of $677/oz gold eq. or $0.62/lb zinc eq.
Net AISC of -$171/oz gold or -$1.34/lb zinc
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PROCESS FLOWSHEET
10
SULPHIDE ORE PROCESSING (4,000 tpd)
OXIDE ORE PROCESSING (800 tpd)
Ore from Mine
or Stockpile
Primary
Crushing
SAG/
Ball Mill
Flotation
Plant
Ore from Mine
or Stockpile
3 Stage
Crushing
Ball Mill Leach
Plant
Tailings
Tailings
Conc – 80.6% Recovery
Conc – 91.7% Recovery
Conc – 81.5% Recovery
Au – 91.6% Recovery
Ag – 68.6% Recovery
CuZnPb
Au/Ag Doré
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Back Forty FUTURE DRILL PROGRAM TARGETS
11
Deposit Open at Depth
400 m
700 m
MAJOR INTERCEPTS
IN THIS AREA
LK-479
8.7m @ 6.0 g/t Au, 245
g/t Ag 5.9% Zn
LK-504
7.4m @ 7.3 g/t Au, 190
g/t Ag 1.5% Zn
2016 ZONE
PINWHEEL NW
LOWER DEEP ZONE
UPPER DEEP
ZONE
TUFF ZONE
EXTENSION
MAJOR
INTERCEPTS
IN THIS AREA
LK-479
69.7m @ 1.12 g/t Au,
27 g/t Ag 0.4% Cu,
1.3% Zn
Including
6.2m @ 6.4 g/t Au,
94 g/t Ag
LK-484
31m @ 6.32 g/t Au, 34 g/t
Ag, 0.47% Pb, 1.8% Zn
Including
17m @ 13.8 g/t Au,
69 g/t Ag
LK-502
54m @ 0.86 g/t Au, 51 g/t
Ag, 0.78% Pb, 1.86% Zn
Including
22.5m @ 1.49 g/t Au, 49
g/t Ag, 0.77% Pb, 2.0% Zn
NS Zone Conversion
Lone Pine South
TSX: AQA
OTCQB: AQARFLOOKING NORTH
Funds a Significant Portion of Pre-Construction Activities
and Project Capital
US$65M FINANCING with Osisko Gold Royalties
INVESTMENT BY OSISKO
US$10M equity private placement
US$55M gold stream with
staged payments:
• US$7.5 million on closing
(received Nov. 10, 2017)
• US$7.5 million on receipt of all
material permits and receipt of
a positive feasibility study (received
Oct. 5, 2018)
• US$10 million following a positive
construction decision for Back Forty
• US$30 million upon the first
drawdown of a project debt
finance facility
KEY GOLD STREAM TERMS
Osisko will purchase 18.5% of the
refined gold from Back Forty until
105,000 ounces of gold have been
delivered
• Thereafter the percentage will
be reduced to 9.25% of the
refined gold
Ongoing payment: Osisko will pay
the Company 30% of the spot price
of gold on the day of delivery, subject
to a maximum payment of US$600
per ounce.
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VALUE CREATION MILESTONES
✓Obtain Wetlands Permit
✓Complete Open Pit Feasibility Study
Advance Pre-Construction Activities
• Permit amendments
• Legal challenges
Evaluate underground mine expansion
Basic and Detailed Engineering
Expand owner’s team
Raise project capital and consider strategic alternatives
Continue to expand underground resource
Develop additional assets on the Belt
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Attractive Pipeline of Projects in
HIGHLY PROSPECTIVE DISTRICT
NEXT GENERATION ASSETS in Wisconsin
BEND COPPER-GOLD PROJECT
100%-owned VMS occurrence located
in the Penokean Volcanic Belt
>14,000 meters of historical drilling
delineating a non-43-101 compliant
resource*
• 2.7M tonnes grading, 2.4% copper,
1.4 g/t gold and 13.7 g/t silver in
copper zone
• 1.12M tonnes grading, 4.7 g/t gold
and 0.31% copper in gold zone
Aquila drilling in 2012 indicates
major expansion
REEF GOLD PROJECT
100%-owned, high-grade gold
mineralization potentially amenable
to low-cost, open-pit mining
Historic drilling delineated a
non-43-101 compliant resource*
of 140,564 contained gold ounces
(412,410 tonnes @ 10.6 g/t)
• Phase III drill program to expand
and define resource
Aquila drilling shows broad zones of
gently-dipping mineralization open in
all directions
14 * The Company is not treating the historical estimates as current mineral resources or mineral reserves and the historical estimates should not be
relied upon or understood to indicate the existence of reserves or resources.
NEW MINING LAW APPROVED December 2017TSX: AQA
OTCQB: AQARF
MANAGEMENT TEAM Experienced & Committed
15
BARRY HILDRED, CEO
Currently a director and Past-Chair of The Children's Aid
Foundation of Canada. Founder and Former President of TMX
Equicom. 25+ years of capital markets experience.
STEPHANIE MALEC, CFO
15+ years of experience combining accounting, financial
reporting, public markets and mining sector work. Previously
with Malbex Resources, Starfield Resources, Dundee Precious
Metals, Falconbridge and PriceWaterhouseCoopers.
DAVE CAREW, Director of Corporate
Development and Investor Relations
Former VP Corporate Development and Investor Relations at a
TSX-V listed developer and previously a mining industry-
focused investment banker. 10+ years of capital markets
experience.
Committed to
UNLOCKING AQUILA’S POTENTIAL
MICHAEL WELCH, COO
More than 30 years of experience. Previously Managing
Director of Lundin’s Somincor Operations, including the
Neves-Corvo copper and zinc mine in Portugal. Prior to that he
was GM of Lundin's Eagle Mine in Northern Michigan. Formerly
VP Operations for Xstrata Nickel’s Raglan Operation in Quebec.
ANDREW BOUSHY, P.Eng., SVP Projects
More than 25 years of experience in major capital project
delivery, engineering design, strategic business planning,
construction and operational optimization. Worked domestically
and internationally in various project, construction and
consulting roles. Mr. Boushy has held senior roles with Ausenco
Canada and Xstrata Nickel (now Glencore).
DAVID ANDERSON, General Manager
25 years of experience in environmental monitoring, impact
assessment, regulatory affairs and permitting, and most recently
served as the Director of Environment for Highland Copper’s
Copperwood project.
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LEADERSHIP TEAM Strong Board
16
EDWARD MUNDEN, Chairman
Currently a Director and Co-Founder of private investment company
and a Director of Mustang Minerals. Co-founded a NASDAQ-traded
energy company and held senior positions until it was sold in 2001.
35+ years of experience in energy, mining and technology industry.
BARRY HILDRED, CEO
Currently Chairman of Children's Aid Foundation of Canada. Founder
and Former President of TMX Equicom. 20+ years of capital markets
experience.
KEVIN DROVER
Currently President & CEO of Aurcana Corporation since 2014. 40+
years of experience in management, operations and project
development with mining companies with assets around the world,
including Kinross Gold, Benz Mining, Oracle Mining and Glencairn
Gold.
ANDREW W. DUNN
Currently Managing Partner of Canadian Shield Capital. Previously
spent 27 years at Deloitte and served as Vice Chair of Deloitte Canada
and Chair of its Client Cabinet.
DIRECTORS INCLUDE EXPERIENCED MINING VETERANS
WITH DEVELOPMENT AND OPERATIONS EXPERIENCE
JACQUES PERRON
Currently a Director of Centerra Gold, Victoria Gold and TMAC. Over
30 years of technical and operations experience in the mining industry.
Previously CEO of Thompson Creek and St Andrew Goldfields.
JOSEPH DE LA PLANTE
Mining executive with public company experience in all aspects of the
mine development cycle. Former Vice President Corporate
Development of Osisko Gold Royalties, where he played a key role in
the company’s IR, corporate development and financing activities.
IAN PRITCHARD
Currently Chief Operating Officer of Belo Sun Mining and SVP
Technical Services at Troilus Gold. Brings more than 30 years of
industry experience with a particular focus on project and operations
management.
PAMELA SAXTON
Business executive with over 35 years of experience in public
company finance roles, primarily in mining, software and oil and gas
and most recently as EVP and CFO of Thompson Creek. Currently
serves as a Trustee and Vice President of the Viola Vestal Coulter
Foundation, which provides scholarships to colleges and universities
with a focus on mining. Past Chair for the Colorado Association of
Commerce and Industry.
TSX: AQA
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CONTACT INFORMATION
BARRY HILDRED
Chief Executive
Officer
Aquila Resources
647.943.5673
DAVE CAREW
Director of Corporate
Development & IR
Aquila Resources
647.943.5677
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APPENDIX
Back Forty MINERAL RESOURCE ESTIMATE
19
Category Tonnes (1,000)
Au (g/t)
Au (K oz)
Ag (g/t)
Ag (K oz)
Zn (%)
Zn (M lb)
Cu (%)
Cu (M lb)
Pb (%)
Pb (M lb)
Measured 7,943 2.04 522 20.4 5,214 3.34 584.3 0.35 61.2 0.17 30.0
Indicated 8,680 1.80 504 28.7 8,013 2.95 563.8 0.29 55.8 0.34 64.9
M&I 16,623 1.92 1,026 24.7 13,227 3.13 1,148.1 0.32 116.9 0.26 94.9
Inferred 1,129 3.42 124 43.2 1,568 1.03 25.7 0.35 8.7 0.44 11.0
~94% OF RESOURCES
are in M&I Category
(1) Mineral Resources are estimated as of February 6, 2018. See Aquila news release dated February 7, 2018 for a complete summary of the 2018 Minerals
Resource Estimate.
(2) Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability.
(3) The Inferred Mineral Resource in this estimate has a lower level of confidence that that applied to an Indicated Mineral Resource and must not be converted
to a Mineral Reserve. It is reasonably expected that the majority of the Inferred Mineral Resource could be upgraded to an Indicated Mineral Resource with
continued exploration.
(4) The Mineral Resource was estimated using CIM guidelines and include the Mineral Reserve.
(5) Metallurgical type Oxide (all gold domains and leachable Gossans) is leachable, while all other metallurgical types are flotable.
(6) The Mineral Resource Estimate was based on metal prices of US$1,375/oz gold, US$22.27/oz silver, US$1.10/lb zinc, US$3.19/lb copper and US$1.15/lb
lead. An NSR cut-off of $21/tonne was used for the floatable portion of the in-pit resource and an NSR cut-off of $22/tonne was used for the leachable portion
of the in-pit resource. An NSR cut-off of $70/tonne was used for the out of pit portion of the resource. See Aquila news release dated February 7, 2018.
BACK FORTY MINERAL RESOURCE ESTIMATE AS OF FEBRUARY 6, 2018 (1-6)
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R3
TuffR1
TuffR0
R2.1
TuffR2
Rhyolite
Main Zone
Tuffaceous sediments
Main QFP
Tuff Zone Massive Sulfide Sp+Gn
Pinwheel Zone Gossan
Tuff Zone massive sulfide
PINWHEEL
NORTH
TUFF ZONE
EXTENSION
Deep Zone
2016 ZONE
EXTENSION
Future Drill Target Areas
Idealized Pit Outline
100-200m
100-200m
200-700m
50-150m 50-150m Pinwheel massive sulfide and gossan
DEEP ZONE
TARGETS
Back Forty GEOLOGIC CROSS SECTION
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Back Forty SENSITIVITY ANALYSIS
21
Base Case-15%
Base Case Base Case+ 15%
Gold ($/oz) 1,105 1,300 1,495
Zinc ($/lb) 1.02 1.20 1.38
Silver ($/oz) 17.00 20.00 23.00
Copper ($/lb) 2.55 3.00 3.45
Lead ($/lb) 0.85 1.00 1.15
Pre-Tax
NPV @ 6% 102 259 416
IRR 17.9% 32.0% 44.1%
After-Tax
NPV @ 6% 79 208 332
IRR 15.5% 28.2% 38.9%
Payback Period (years) 3.3 2.2 1.5
ECONOMICALLY VIABLE
Against Commodity Price Fluctuations
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Back Forty SITE PLAN
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Based on Purchase of Hudbay’s
51% INTEREST IN BACK FORTY
MILESTONE PAYMENTS to Hudbay Minerals
AMOUNT
C$3 Million
C$2 Million
C$2 Million
C$2 Million
TIMELINE
Payable upon completion of financing tied to start of
construction at Back Forty
Up to 50% payable in Aquila shares
Payable 90 days after start of commercial production
Payable 270 days after start of commercial production
Payable 450 days after start of commercial production
First milestone payment due by January 2024
1% NSR was repurchased from Hudbay in April 2015
concurrent with Orion transaction
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