A World Class Gold Deposit in Brazil Corporate Presentation - - PowerPoint PPT Presentation

AGC:TSX-V

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A World Class Gold Deposit in Brazil

Corporate Presentation

Important Notice

These presentation materials (“the Presentation Materials”) are being supplied to you for information purposes only on Amarillo Gold Corporation (the “Company”). These Presentation Materials have been prepared by and are the sole responsibility of the Company. The Company has taken all reasonable care to ensure that the facts stated herein are true to the best of its knowledge, information and belief. These Presentation Materials are being distributed only to and are directed at (a) persons who have professional experience in matters relating to investments being investment professionals as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2001 (the “FPO”), (b) high net worth companies, unincorporated associations and other bodies within the meaning of Article 49 of the FPO or (c) persons to whom it may otherwise lawfully be communicated (together “Relevant Persons”). Any person who is not a Relevant Person or who does not have professional experience in the matters relating to investments should not act or rely on this document or any of its contents. These Presentation Materials do not constitute, or form part of, a prospectus relating to the Company, nor do they constitute or contain any invitation or

• ffer to any person to underwrite, subscribe for, otherwise acquire, or dispose of any shares in the Company or advise persons to do so in any jurisdiction,

nor shall it, or any part of it, form the basis of or be relied on in any connection with any contract. No reliance may be placed for any purpose whatsoever

• n the information or opinions contained in this document or on its completeness and no liability whatsoever is accepted for any loss howsoever arising

from any use of this document or its contents otherwise in connection therewith. Prospective investors are encouraged to obtain separate and independent verification of information and opinions contained in the Presentation Materials as part of their own due diligence. By accepting these Presentation Materials, the Recipient agrees that the information contained herein or sent herewith or made available is for information purposes only. Without prejudice to the foregoing, neither the Company, nor its advisers nor its representatives accept liability whatsoever for any loss howsoever arising, directly or indirectly, from use of this document or its contents or otherwise arising in connection therewith. The distribution of these Presentation Materials in certain jurisdictions may be restricted by law and persons into whose possession these Presentation Materials come should inform themselves about, and observe, any such restrictions. Any failure to comply with these restrictions may constitute a violation

• f the laws of any such other jurisdictions.

Some statements contained in these Presentation Materials or in documents referred to therein are or may be forward-looking statements. Actual results may differ from those expressed in such statements, depending on a variety of factors. Past performance of the Company or its shares cannot be relied on as a guide to future performance. Any forward-looking information contained in these Presentation Materials has been prepared on the basis of a number

• f assumptions which may prove to be incorrect, and accordingly, actual results may vary.

The Qualified Persons for Amarillo are Frank Baker, M. IOM3 and MAusIMM., Mr.Mike Mutchler, MAusiMM and Buddy Doyle, MAusIMM.

Important Statements

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Rolly Uloth Executive Chairman

• Mr. Uloth has over 20 years as a seasoned mining executive, as well as a business professional with over 45 years of
• experience. Rolly was President and Director of River Gold Mines in 2006. Upon the completion of the merger between

Wesdome Gold Mines and Eagle River Mines, Mr. Uloth became Chairman and then CEO from 2007 - 2010, where he led Wesdome through several of its most profitable years and reopened the Kiena Mine. In 2013, Mr. Uloth rejoined Wesdome and successfully restructured the Company and still remains on the Board. Mike Mutchler President and Chief Executive Officer

• Mr. Mutchler has over 30 years of underground and open-pit mining and project development experience, having held

various positions ranging from Laborer to Vice President. He was previously the COO for Rainy River Resources where he was responsible for the engineering studies for an 8M oz. gold project in Ontario. Mike was also the COO for Largo Resources where he led the construction and commissioning of the Maracas Vanadium Mine and Mill in Bahia, Brazil. Mike also worked on an expansion project for the Paracatu Mine in Minas Geras, Brazil when he was a VP of Project Development for Kinross Gold. Mr. Mutchler has a B.Sc. Degree in Mining Engineering from South Dakota School of Mines, an MBA from Webster University, an Executive Juris Doctorate Degree from Concord School of Law, and a Chartered Director Certificate from the Directors College at McMaster University. Hemdat Sawh Chief Financial Officer

• Mr. Sawh is a CPA, and holds an MBA, a BSc degree in Geology and a graduate diploma in Geology. Mr. Sawh has over

16 years of experience at Grant Thornton LLP, where he acted as lead supervisor for auditing teams. Mr. Sawh has over 12 years’ experience serving as CFO of Wesdome Gold Mines, Scorpio Mining, Crystallex and Goldbelt Resources, all TSX listed mining companies with assets in Canada, Mexico, Venezuela and Burkina Faso, respectively. Arao Portugal Director of Strategy Mr Portugal was instrumental in securing the main Preliminary License (SEIA equivalent) for Mara Rosa in 2016. In 2003 to 2014, Mr. Portugal held various roles including Country Manager for Yamana. From 1975 to 2003, sourcing and raw materials specialist for CVRD (now Vale). Luis Carlos F. da Silva General Manager Brazil

• Mr. da Silva has over 20 years exploration experience in Brazil managing several campaigns. He was also responsible for

drilling off several of Jaguar Mining’s Brazilian gold deposits. Frank Baker Project Manager, Mara Rosa

• Mr. Baker is a Graduate of Sheffield University with Masters in Metallurgy. Frank has over 40 years of experience in the

mining industry. Mr Baker has had the success of designing, building and commissioning five gold plants, including two in Brazil.

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Management Team

Capital Structure

Shares Outstanding 104.1 million Warrants ($0.25) 9.9 million Options ($0.28) 7.5 million Market Cap. @ $0.31 * $26 million Gold-linked Loan $10 million

Major Shareholders

Board & Management 15% Institutions 42% High Net Worth 23% Retail 20%

* As at Jan 5,2018

Corporate Information

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Investment Highlights

• Mara Rosa Project

○ 35% A/T IRR, 2.2 yr payback, NPV $178M USD @ $1200 gold ○ Trading at ~0.12x P/NAV vs. peers of ~.41X P/NAV ○ Environmental & social permit granted – backed overwhelming by community support ○ Growing reserves and mine life by infill drilling ○ Growing resources by drilling 12 km Au-in-soil anomaly and down dip Posse deposit

• Lavras do Sul Project:

Potential Game Changer /Strong Exploration Upside

○ Drilling highlight at Butia: 120m at 3.23 g/t; 192M at 1.95 g/t ○ 100 km2 intrusion: Initial resource 215,000 oz. indicated and 308,000 oz. inferred ○ Strong Au-in-soil anomalies over extensive areas allows further attention to increase.

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Key Investment Highlights

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Mara Rosa Project

World Class Gold Deposit in the Mining Friendly State of Goias

Mara Rosa Project Robust Economics

*NPV(5%) US$ 178M *Payback 2.2 Years

*IRR

35% April 2017 PFS (US$1,200 Gold)

Upfront Capex $148M USD Sustaining Capex $13.5M USD Years 1-4 Average Production 140,000 Ounces Average Annual Production 112,000 Ounces Initial Mine Life 8 Years Operating Cost per Ounce $545 USD AISC per Ounce $630 USD Mineable Reserve 997,536 Ounces

Open at depth and along strike

Final Pit Design

*Post-tax

Mara Rosa Robust Economics

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Notes:

• 1. Posse Deposit Resource @ 0.35 g/t cut-off
• 2. Source: Keith Whitehouse Member of the AUSMIM Qualified person Australian Exploration Field Services; 43-101 Technical Report: prepared by SRK Consulting, April 2017

titled “2017 Updated Pre-Feasibility Study Posse Mine Project-Mara Rosa GO” Notes:

• 1. SRK applied a 0.38 g/t Au cut-off to the block model
• 2. Dilution: 3% mining & 3% handling
• 3. All Mineral Reserves prepared by SRK have been estimated in accordance with Canadian Institute of Mining and

Metallurgy and Petroleum (“CIM”) definitions, as required under National Instrument 43-101 (“NI43-101”)

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Resource and Reserves

*AISC

$630/oz

Gold Margin

$570/oz

Gold Price

Capital Allocation (USD)

Mine Pre-Strip $15M Plant, Equipment & Facilities $57M Tailings Dam $9M Infrastructure & Buildings $13M Other & Non-tangibles $35M Contingencies $11M Working Capital $8M Total Upfront Capex $148M

* AISC = Opex + Royalties + Transportation + Refining + Sustaining Capital + G&A G&A + Royalties $6.35/tonne Processing US$10.27/tonne Mining US$12.93/tonne

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Low CAPEX & Strong Margins

Highlights

Pit Shell $1,200/oz Au Economic Model $1,200/oz Au Energy $0.08 per kWh Exchange Rate USD/BRL 3.20 Overall Costs per Tonne $29.55 CIL Recovery 92% Tax Rate 34% Throughput(max) 7,000 tpd Operating Strip Ratio 4.5:1

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Pre-feasibility March 2017

Gold / Ounce $1,000 $1,100

$1,200 $1,300

$1,400 A/T IRR 20% 28%

35% 42%

49% NPV0%

*

$130 $187 $243 $300 $357 NPV5% $84 $131

$178 $223

$273 NPV7% $69 $113 $157 $202 $254

Payback (Years)

3.5 2.7

2.2 1.9

1.7

* NPV’s in USD millions

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Robust Economics

DISCOUNTED CASH FLOW ANALYSIS

Posse Ore Body Down Dip:

• Reserves - 997,536 ozs
• Resources:

○ M&I - 262,464 ozs ○ Inferred - 310,000 ozs

• Open to the north, south and at

depth

• Potential for higher grades

Significant Land Package:

• Greenstone belt shear hosted
• 62,500 ha of exploration permits
• 2,600 ha of mining concessions
• 12 km coincident K-channel /Au

soil anomaly

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Upside Beyond Reserves

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Posse Cross Section

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Exploration Potential

POSSE TREND

• Public hearing held in 2016

demonstrated overwhelming community support.

• The main Preliminary Licence

(LP) was granted in May 2016.

• Allows the project to advance

to the Feasibility Study and begin the next permit; construction of the Installation License (LI).

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Major Permitting Milestones

Step 1 - Approved Preliminary License (LP)

• Most important and challenging part of the permit

process

• Entails environmental baseline studies, social and

environmental approval and public hearings

• Awarded by the EPA and the Judicial Ministry

Step 2 - In Progress Installation License (LI)

• Provides authorization to initiate construction
• Obtained approval of the mine development plan

which also demonstrates economic feasibility

Step 3 - Final Inspection Operation License (LO)

• Granted shortly thereafter the LI permit
• Requires inspection of the constructed mine and

plant to ensure compliance with codes and provisions

• f LP, LI

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Brazil Permitting Process

Lavras do Sul Project

Rio Grande do Sul State Potential Game Changer

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Lavras do Sul Targeting Intercepts

Digital elevation in grey, roads in black. Colour image: airborne magnetics showing geology and structure.

Looking to advance initiatives: soil sampling, geological mapping and airborne studies. Commence environmental baseline studies at Butiá.

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Drilling Highlights 120m @ 3.23 g/t

Notes: At 0.3g/t cut-off.

3D Model of Butia Zone (Leap Frog)

• Drill intercepts at Butia include 232 m

@ 1.92 g/t Au and 120m @ 3.23 g/t Au ○ Looking to recommence drilling.

• One of 19 old workings (garimpos) at

Lavras do Sul.

• Drilling results released in 2012

discovered new zones not in the resource estimate.

Source: Amarillo

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Butiá Prospect is now a focus

Source: “NI 43-101 Technical Report, Butia Prospect, Rio Grande do Sul, Brazil” prepared by Atticus & Associates, July 30, 2010

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Net Asset Value Multiple

AMARILLO TRADES AT A SIGNIFICANTLY DISCOUNTED NAV MULTIPLE

P/NAV - Average 0.41

ENTERPRISE VALUE PER OUNCE OF GOLD RESERVES

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Undervalued Reserves

EV/Reserve - Average $US77/ounce

• New management team incentivised to maximize value for

shareholders.

• World class Mara Rosa Deposit: A/T IRR 35%, 2.2 year payback,

AISC of $637/oz. Trading at a P/NAV of ~0.12x. ○ Will recommence exploration drilling to extend the mine life and update the PFS.

• Lavras do Sul Project: significant discovery given the grades and
• ver 22 targets.

○ Commencing studies to advance this exciting property. ○ Looking to follow up on intercepts of 120 m @ 3.23 g/t and 232m @ 1.95 g/t.

• Boosting marketing efforts globally given the recent positive changes

to management and relay the new strategy.

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Corporate Summary

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Board of Directors

Rolly Uloth Executive Chairman See previous biography under ”Management Team”. Mike Mutchler President and CEO See previous biography under ”Management Team”. Colin Sutherland, CA Director

• Mr. Sutherland is a CPA with over 20 years financial and operational experience. Colin served as Pres. of McEwen Mining.

During his tenure, the share price tripled. As former CEO of Archipelago Resources Plc, he led the privatization and delivered significant returns for shareholders. Mr. Sutherland has also held senior financial and executive roles with Timmins Gold, Capital Gold, Nayarit Gold and Aurico Gold. Rosty Raykov Director CEO of Fennec Pharmaceuticals, a successful publicly traded Biotechnology Company. Mr. Raykov is also a General Partner at DCML. Mr. Raykov began his career as a financial analyst in the natural resources group at Bear Stearns. He served on the board of publicly traded Wesdome Gold. He was also a Portfolio Manager, and investment Banking Analyst in NY. David Birkett Director

• Mr. Birkett is Pres. & CEO of Stratus Aeronautics, a technology company dedicated to UAV development. Mr. Birkett was

the Pres. of Alton Natural Gas Storage LP ( 2005-2105) and Alton Natural Gas Storage Ltd( 2010-2015).Mr. Birkett was President of Landis Energy Inc., a publicly traded company, until it was acquired by Alta Gas in 2010. He served as a Director of Moss Lake Gold Mines (2000-2014) until is was acquired by Wesdome Gold Mines. He has over 25 years experience with public companies in the areas of corporate development, management, finance and exploration. Buddy Doyle Director

• Mr. Doyle is a Geologist with 35 years industry experience including 23 years with Rio Tinto; a Project leader for Rio’s

Diavik discovery, won the 2007 Excellence in Diamond Exploration award. Mr. Doyle was involved in the >30M oz Lihir (Au) deposit discovery/definition team. Mr. Doyle is the co-founder of Amarillo Gold. Stephen Stow Director

• Mr. Stow had held senior financial and executive roles with Timmins Gold, Capital Gold, Nayarit Gold and Aurico Gold.

Was a former Pres.& CEO of Odin Mining & Exploration. Currently Principal of Zen Capital & Mergers Ltd since 1995, Mr. Stow has been an adviser, investor, and executive engaged in various resource driven opportunities, start-ups and has global executive experience in management of public companies.

Rolly Uloth Executive Chairman Tel: 1-416-201-2515 rolly.uloth@amarillogold.com Michael Mutchler President and CEO Tel: 1-416-294-0736 mike.mutchler@amarillogold.com Karen Mate Consultant Tel: 1-416-230-6454 karen.mate@amarillogold.com

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Contact Information