A Gold Miner in the Making
March 2017
Goose Gold Project, Back River, Nunavut, Canada
A Gold Miner in the Making March 2017 2 Forw rward Looking In - - PowerPoint PPT Presentation
Goose Gold Project, Back River, Nunavut, Canada A Gold Miner in the Making March 2017 2 Forw rward Looking In Information Statements relating to our belief as to the timing of completion of the environmental assessment, the results of the
March 2017
Goose Gold Project, Back River, Nunavut, Canada
Statements relating to our belief as to the timing of completion of the environmental assessment, the results of the final public hearings, the timing of receipt of a project certificate and permits and the timing of the start of construction and the first gold pour, and the results of further optimization studies to the feasibility study, the potential tonnage and grades and contents of deposits and the potential production from and viability of Sabina’s properties are forward looking information within the meaning of securities legislation of certain Provinces in Canada. Forward looking information are statements that are not historical facts and are generally, but not always identified 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 information is made of the date of this presentation. This forward looking information is subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward looking information, including, without limitation: the effects 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 sufficient financing 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 potential of the Company’s properties; risk of accidents, equipment breakdowns and labour disputes; access to project funding or other unanticipated difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in the work program; title matters; government regulation; obtaining and receiving necessary licenses and permits; the risk of environmental contamination or damage resulting from Sabina’s operations and other risks and uncertainties including those described in Sabina’s annual information form for the year ended December 31, 2016 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 are made. Sabina undertakes no obligation to update the forward looking information should management’s beliefs, estimates or opinions, or other factors, change, except as required by applicable law
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replenish supply
A scarcity of gold and de-risked gold projects make Sabina one of the few highly leveraged undervalued
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DISTRICT OPPORTUNITY Current Mine Life ~ 12 years LOM Gold Production 2.3M oz M&I 5,333M oz Au Inferred 1,851M oz Au
(at both Goose and George)
exploration future
Back River Property 80 Km
Kilometres 12.5 25
LEGEND
Inuit Owned Land Camp Area of Interest Claim Lease Surface Subsurface and Surface
George Project Boot Boulder Goose Project Del Bath 4
1 2 3 4 5 6 7 8 1998 2002 2007 2009 2010 2012 2015
Gold Resource
Millions oz
Indicated Inferred
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Under Sabina Ownership
*See mineral reserves and resources estimate slide 29 for details
Mineral Resource Estimate Oct/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 Pit Proven 6,983 5.97 1,340 Probable 1,885 5.52 335 Total Underground Proven 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 & Goose deposit discoveries Project owned by Arauco, Kinross, Miramar & DPM Project acquired by Sabina +325% resource growth under Sabina
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15.77 8.67 6.21 3.26 3.06 2.67 2.30 1.65 1.60 1.04 1.03 5 10 15
+5 Moz Development Gold Assets in the Americas
Total Resource gold grade g/t
UG OP/UG UG UG/OP UG/OP OP OP OP OP OP OP
Notes: Total 2P, Measured, Indicated & Inferred gold resources larger than ~5 million ounces; excludes by-products. Source: Company Technical Reports
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Event Date Start of Permitting 2012 Final EIS Submitted 2015 Final Public Hearings – (Regulators, GN, GNWT, KIA, Community Representatives all agree project should proceed) April 2016 NIRB Recommendation to INAC – Project should not proceed at this time June 2016 INAC Disagrees with NIRB. Project sent back for further review Jan 2017 Sabina Files FEIS Addendum Feb 16, 2017 NIRB Formally Accepts FEIS Addendum – Provides timeline Feb 23, 2017
“[it is]… our intention to ensure that the assessment would be expeditious and would result in a new report which focuses on the areas of deficiencies identified by the Ministers (rather than all aspects of the previous assessment being revisited).”
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Ryan Barry Executive Director, NIRB
What happens next?
Event Date NIRB initiates the Technical Review of the project proposal and requests final written submissions from interested parties Feb 23, 2017 NIRB issues notice of Final Hearing (60 day public notice requirement) Mar 2017 Parties submit final written submissions to the NIRB Apr 24, 2017 Sabina submits its response to final written submissions to NIRB May 15, 2017 NIRB facilitates a Technical Meeting via teleconference (optional step to be utilized if deemed necessary/appropriate) May 24, 2017 Parties file presentations for Final Hearing (tentative date only) May 27, 2017 NIRB Final Hearing (tentative dates only) May 31 – Jun 3, 2017 NIRB issues the updated Final Hearing Report for the Back River Project proposal. Jul 2017
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Area Concern Updated Submission To NIRB Caribou and Terrestrial Wildlife
Although Project does not come into contact with Bathurst Herd and has little overlap with Beverly Herd, if Caribou change migration the project could have a negative impact on declining caribou herd populations. Enhanced Wildlife Mitigation and Monitoring Plan including additional
a shift in migration and calving grounds. Comparisons to other arctic projects showing best in class approach. Completed detailed third party reviews with industry experts.
Freshwater Aquatic Environment
How can we minimize impacts on fish populations in the project area? Updated plans for draining lakes/ponds and removal of fish from waterbodies affected by the project, additional detail also provided on plans for to offset removal of fish by providing increased access for fish in other
Marine Environment
Regulatory oversight for bulk fuel shipping, and being able to respond quickly enough should there be accidents/spills. Enhanced detail on plans for bulk fuel transport and transfer at the Marine Laydown Area, as well as additional detail on emergency response planning. Further detail and clarity provided on responsibilities of various government ministries.
Water Quality
(Ground and Surface)
Quality and handling of project contact water. Enhanced detail and clarification on site water quality objectives, including additional discussions with regulators and comparisons to other arctic projects.
Climate and Meteorology
Impact of climate change on waste rock and tailings storage after the mine has closed (permafrost warming). Comparison to other Arctic projects showing best in class approach and adaptive management plans (increased monitoring of rock to be able to mitigate before negative events happen). Completed detailed third party reviews with industry experts.
“…As a result, KIA recommends that the Report be returned to the Board under paragraph 12.5.7.(e) with your [Minister of INAC] instructions to focus any further investigations on matters related to the Project’s impacts on caribou and the best approaches to mitigation of such impacts.”
Stanley Anablak President, Kitikmeot Inuit Association
“In the GN’s opinion, it is possible to develop terms and conditions to address the concerns expressed by the NIRB
terrestrial wildlife, including caribou. Accordingly, referring the Final Hearing Report back to the NIRB for further review and public hearings may be the most responsible and expeditious way forward, and the one that provides the best opportunity to advance responsible development to provide economic opportunities for Nunavut’s communities while respecting Inuit societal values and protecting the integrity of our land, water and wildlife.”
Government of Nunavut
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Significant Gold Production
Simplified Mine Plan
Primarily Open Pit
3,000 tonnes per day
targeting less on site labour.
Infrastructure
Credible Relevant Benchmarking
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For QA QC see slide 29 for details
BACK RIVER - SEPT 2015
*LOM All-In Cash Cost includes initial, sustaining and closure capital QA/QP (see slide 35)
Pre-Tax NPV(5%) & IRR
C$699M / 28.2%
After-Tax NPV(5%) & IRR
C$480M / 24.2%
Payback
2.9 years
Mill Throughput
3,000 tpd
6.30 diluted g/t Au
Gold Recovery
93.0%
Mine Life
11.8 years
250,000 oz/year
Summary Results @US$1,150/oz Gold/ C$0.80 Exchange
198,000 oz/year
On-Site Op. Costs
C$114.58/t milled
Total Cash Cost
US$534/oz
All-In Sustaining Cost
US$620/oz
LOM All-In Cash Cost*
US$763/oz
Pre-Production Capital
C$415M
Sustaining Capital
C$185M
Closure Capital
C$64M
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Sensitivity to Capex & Opex
SENSITIVITIES & OPTIMIZATIONS
*LOM All-In Cash Cost includes initial, sustaining and closure capital QA/QP (see slide 35)
January 5, 2017 spot Au and FX = ~CAD $1,562, IRR = 28%, NPV $605M (after-tax)
Sensitivity to Gold Price and Exchange Rate
NPV 5%, (C$M), IRR %, Post-Tax
Operating Costs
Base Case +10% +20% Capital Costs
715 653 592 529 468 36.2 34.1 32.0 29.7 27.3
659 591 536 474 415 31.8 29.9 27.8 25.6 23.4 Base Case 603 542 480 418 356 28.1 26.2 24.2 22.1 20.0 +10% 547 486 425 362 300 24.8 23.3 21.1 19.1 17.0 +20% 492 430 369 306 245 21.9 20.2 18.3 16.4 14.4
NPV 5%, (C$M), IRR %, Post-Tax
Exchange Rate: US$:C$ 0.70 0.725 0.75 0.80 0.85 0.90 Gold Price (US$/oz) $ 1,000 472 421 375 289 210 140 23.9 22.2 20.5 17.4 14.3 11.3 $ 1,150 687 630 577 480 394 317 30.9 29.1 27.4 24.2 21.2 18.4 $ 1,250 832 769 711 606 513 430 35.1 33.3 31.6 28.3 25.3 22.5 $ 1,350 977 910 846 732 631 542 39.1 37.3 35.5 32.2 29.1 26.3 $ 1,500 1,191 1,117 1,048 923 809 710 44.5 42.7 41.0 37.6 34.5 31.6
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process and infrastructure layout and design
increase mine life with existing resources
exploration opportunities
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AN ACTIVE MINING REGION
Source data: GN, DOE 2003 - 2014
Pine Point Cullaton Raglan Nanisivik Mine Polaris Mine Mary River
George
LEGEND
Project Current or Past Producing Mines Communities Kitikmeot Region
Snap Lake Diavik Ekati Lupin Mine Jericho Hope Bay Amaruq Meadowbank Meliadine Ulu
Goose Hackett
Yellowknife Gjoa Haven Ekaluktutiak Cambridge Bay Omingmaktok (Bay Chimo) Kugluktuk
western North America or in China will be consolidated at Vancouver, BC
eastern North America or Europe will be consolidated at Becancour, QC
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MARINE ROUTES
Source data: GN, DOE 2003 - 2014
Arctic Class Transport Ship Arctic Class Barge
Montreal MLA
LEGEND
Western Shipping Route Mackenzie River Barge Route Eastern Shipping Route
4,171 NM @ 7Kt = 25 Day Transit ~1,550 NM @ 5Kt = 13 Day Transit Hay River Vancouver
Western Shipping Route Mackenzie River Barge Route
3,360 NM @ 10.4Kt = 13.5 Day Transit
Eastern Shipping Route
in Q4 Year -2
working on 2 fronts (starting at Goose and the MLA)
freight and fuel from the MLA to the Goose site
are required annually for freight and fuel from the MLA to Goose (~45 days)
WINTER ROADS
Source data: GN, DOE 2003 - 2014
Winter Road Transport Truck
Kilometers 10 20 1:450,000
TCWR Winter Road Connector Winter Road
LEGEND
Marine Laydown Area TCWR Winter Food Connector Winter Road Winter Road, George Tie-in Option 1 Winter Road, George Tie-in Option 2 BIPR Winter Road Connector Haul and Access Road Potential Development Area Federal Watershed Delineation Bathurst Inlet – Burnside River Upper Black River Queen Maud Gulf – Elice River Inuit Owned Lands Subsurface and Surface Surface
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Opportunities:
GEORGE PROPERTY
Back River Property
Kilometres 12.5 25
Goose Project
Existing Mineral resources:
Indicated 1.1m oz @ 5.6 g/t Inferred 980k oz @ 6.32 g/t Included in 6KFS ~600 k oz
Significant existing resources at George on 20km
Back River district
George Project
50 Km
LEGEND
Inuit Owned Land Camp Port Site George to BIPR Road Option BIPR Road Winter Road George to Goose Option Winter Road Port to Goose Option Winter Road Port to Goose Option Surface Subsurface and Surface
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little to no work
from field work, grab samples and limited drilling
Source data: GN, DOE 2003 - 2014
19 Boot Boulder George Goose
5,000 10,000 15,000 Meters
Locale 1 Locale 2 Takrark Oar Opener Piglet Player Ayers Grizzly Cumquat Falcon Feass Llama Umwelt Camp Zone Goose Main LCPN LCPS
LEGEND
Mineral Occurences Banded Iron Formation Lease Outline Claim Outline
new discovery to demonstrate additional mine life
drilling planned in two 5-week campaigns starting late spring
EXPLORATION 2017 Goose 2017 Target Areas
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Umwelt and LLama.
Llama underground not in the current development plan.
the high grade Vault zone will test resource growth potential near limits of planned underground infrastructure.
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Kogoyok and Echo is under drilled over 2 + km strike length.
300m current depth of drilling and to the east where step-out drilling indicates continuation of the mineralized zone.
Other field work focusses on mapping and sampling at Goose, Boot and Boulder properties
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Source: http://www.moneyweb.co.za/mineweb/gold-miners-are-running-out-of-metal/
20 40 60 80 100 120 140 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Gold Discoveries
Total Resource gold grade g/t
EXPLORATION FAIL
Amount of gold found by miners has plunged 85% over the past decade
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50 100 150 200 250 300 350 400 450 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
LOM Annual Production (Koz/yr) After-Tax IRR (%) at $1,200/oz
After-Tax IRR and LOM Annual LOM Production Matrix
Source: Company public information and Cormark Securities based on internal modelling of these projects at US$1200 gold and $0.75 US$:C$ Exchange. As at July 2016
Few projects with after tax IRR >30% with production ~200,000 oz per year at US$1200 gold price
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MAX BSX VIT DNA NCA GQC AMM SBB (3,000 tpd case) ICG PVG
0% 50% 100% 150% 200% 250% 300% 350% 400% 450% 500% PG TXGD TX20 SBB AMM LYD DNA ICG XRC ORE ITH BSX MAX CNL VIT WRN
SBB vs Peers – 12 month rolling comparison
Peers Median +121% Peers Average +146% SBB +51% Difference vs. Average
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Executive Management
Bruce McLeod President, CEO & Director Elaine Bennett VP Finance & CFO Nicole Hoeller VP Communications & Corp. Secretary
Technical Management
Angus Campbell VP Exploration Wes Carson VP Project Development Matthew Pickard VP Environment & Sustainability Bruce McLeod (Pres. & CEO) Roy Wilkes (Chairman) David Fennell Jonathan Goodman James Morton Anthony Walsh Walter Segsworth Anna Stylianides
Board of Directors
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Sabina Gold & Silver Corp.
Symbol SBB Listed exchange TSX Market capitalization ~C$317 million Shares outstanding (pro forma after financing) ~224 million Shares outstanding (diluted) ~243 million Cash Pro-forma cash YE ~C$46 million Debt None 52 week trading range C$0.54 -$1.87 Recent Price ~C$1.45
Analyst Coverage
BMO Capital Markets Andrew Kaip Paradigm Capital Don MacLean Cormark Securities Tyron Breytenbach RBC Capital Markets Sam Crittenden Canaccord Eric Zaunscherb Haywood Geordie Mark
Major Shareholders Holdings (I&O)
Dundee Precious Metals 10.7% Sun Valley Gold 10.5% Silver Wheaton 5.3% Management (options incl.) 3.0%
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The FS was prepared under the direction of JDS Energy & Mining Inc. by leading independent industry consultants, all Qualified Persons (QP) under National Instrument 43-101.
Angus Campbell, P.Geo, Vice-President, Exploration, is a qualified person under NI-43-101 where the information relates to mineral resource estimates and Wes Carson, P.Eng Vice-President, Project Development is a qualified persons under NI 43-101 for the feasibility study and both approve the scientific and technical information contained herein. A National Instrument compliant 43-101 technical report will be filed on the project within 45 days from September 14, 2015. Further information can be found at Technical Report and Feasibility Study for the Back River Gold Property, Nunavut” dated June 22, 2015 and filed on SEDAR at http://www.sedar.com.
Qualified Person, Designation Company QP Responsibility/Role
Gord Doerksen, P.Eng. JDS Energy & Mining Inc. Executive Summary, Introduction, Reliance on Other Experts, Reserves, Infrastructure, Market Studies, Capex, Opex, Economic Analysis, Adjacent Properties, Environmental, Other Relevant Data, Interpretations, Recommendations, References, Abbreviations, Project Execution Plan, Logistics, Infrastructure, G&A Dino Pilotto, P.Eng. JDS Energy & Mining Inc. Mining Methods Andrew Fowler, MAusIMM, CP (Geo) AMC Mining Consultants (Canada) Ltd. Mineral Resource Estimates for George Dinara Nussipakynova, P.Geo AMC Mining Consultants (Canada) Ltd. Mineral Resource Estimates for Goose John Morton Shannon, P.Geo AMC Mining Consultants (Canada) Ltd. Property Description, Accessibility, History, Geology, Deposits, Exploration, Drilling, sample Preparation, Data Verification Maritz Rykaart, P.Eng. SRK Consulting (Canada) Inc. Geochemistry, Tailings Management, Water Management Stacy Freudigmann, P.Eng Canenco Canada Inc. Metallurgy, Recoveries, Process Rob Mercer, Ph.D., P.Eng Knight Piésold Ltd. Geomechanical
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