Corporate Presentation – June 2020
TSXV & BVL:TK | OTCPK: TKRFF www.tinkaresources.com
30 ZINC
Zn
65.38 47 SILVER
Ag
107.87
Ag Zn 107.87 65.38 Corporate Presentation June 2020 Disclaimer - - PowerPoint PPT Presentation
TSXV & BVL:TK | OTCPK: TKRFF www.tinkaresources.com 47 SILVER 30 ZINC Ag Zn 107.87 65.38 Corporate Presentation June 2020 Disclaimer This presentation does not constitute or form a part of, and should not be construed as an offer,
30 ZINC
65.38 47 SILVER
107.87
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This presentation does not constitute or form a part of, and should not be construed as an offer, solicitation or invitation to subscribe for, underwrite or otherwise acquire, any securities of Tinka, nor shall it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever. Readers are cautioned that the PEA is preliminary in nature, it includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves, and there is no certainty that the PEA results will be realized. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Additional work is needed to upgrade these mineral resources to mineral reserves. Certain information in this presentation contains forward-looking statements and information within the meaning of applicable securities laws (collectively "forward- looking statements"). All statements, other than statements of historical fact are forward-looking statements. Forward-looking statements are based on the beliefs and expectations of Tinka as well as assumptions made by and information currently available to Tinka's management. Such statements reflect the current risks, uncertainties and assumptions related to certain factors including but not limited to, challenges resulting from COVID-19, all costs varying significantly from estimates, production rates varying from estimates, changes in metal markets, changes in equity markets, availability and costs of financing needed in the future, equipment failure, unexpected geological conditions, imprecision in resource estimates or metal recoveries, ability to complete future drilling programs, delays in or failure to obtain the necessary permits, drilling program results varying from expectations, timing of geological reports, the Company’s ability to realize the results of the PEA, approvals from local authorities, community relations, timing and completion of any surface rights agreements, and other development and operating risks. Should any one or more of these risks or uncertainties materialize, or should any underlying assumptions prove incorrect, actual results may vary materially from those described herein. Forward-looking statements are not guarantees of future performance and accordingly undue reliance should not be put on such statements due to the inherent uncertainty therein. Except as may be required by applicable securities laws, Tinka disclaims any intent or obligation to update any forward-looking statement. The Mineral Resources disclosed in this presentation have been estimated by Mrs. Dorota El Rassi, P.Eng., an employees of Roscoe Postle Associates Inc. (RPA). Mrs. El Rassi is a Qualified Person as defined under the meaning of Canadian National Instrument 43-101 (“NI 43-101”) and independent of Tinka. Mr. William Colquhoun, Principal Metallurgical Consultant with Amec Foster Wheeler (Perú) S.A., a Wood company, a Qualified Person as defined in NI 43-101 and independent of Tinka, is responsible for the PEA results contained in this presentation. Ms Stella Searston, RM SME, a Principal Geologist Associate with Amec Foster Wheeler E&C Services, a Wood company, a Qualified Person as defined in NI 43-101 and independent of Tinka, is also responsible for the PEA results contained in this presentation. Mr. Edwin Peralta, P.E., a Senior Engineer with Wood Mining and Metals USA, a Qualified Person under NI 43-101 and independent of Tinka, is also responsible for the results of the
the metallurgical and recovery inputs contained in this presentation. Dr. Graham Carman, CEO and a Director of Tinka, and a Qualified Person as defined in NI 43-101, is responsible for other technical information in this presentation (information not directly related to the Mineral Resource Estimate or the PEA).
undeveloped zinc-silver resources in a junior
Peru - a mining belt with good infrastructure
strong economics with a modest CAPEX, and
(Mar/2020) following strategic investment by Buenaventura in Jan. 2020, no debt
resources and drilling investment (>70,000 m
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10 20 30 40 50 60 2014 2015 2016 2017 2018 2019
Resources (Mt)
Ayawilca Zinc Zone Resource Growth 2015 to 2018
Bubble size indicates contained zinc-equivalent pounds (Mlbs)
INFERRED INDICATED
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associated silver (stream financing potential) and minor lead
concentrate (92%)
deposit at surface on the Ayawilca property
mining and leaching
30 ZINC
65.38 47 SILVER
107.87
Indicated: 1.8 billion pounds zinc Inferred: 5.6 billion pounds zinc Indicated: 5.8 million ounces silver Inferred: 25.2 million ounces silver Indicated: 14.3 million ounces silver Inferred: 13.2 million ounces silver
4 km
1x 1x
COLQUI SILVER ZONE WEST AYAWILCA ZINC ZONE SOUTH AYAWILCA ZINC ZONE
SOUTH NORTH FAR SOUTH AREA metres
500 m
Ayawilca Zinc Zone (PEA 2019) Colqui Silver Zone Untested Down plunge
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(Base Case Nov. 2018 @ $55 NSR cut-off)
are also the thickest parts of the deposit and account for 47% of the total resources
Category/Area Tonnage (Mt) Zn (%) Pb (%) Ag (g/t) Contained Metal Zn (Mlb) Pb (Mlb) Ag (Moz) Indicated South 3.9 7.6 0.09 16 652 8 2.0 West 7.8 6.5 0.20 15 1,126 35 3.9 Total Indicated 11.7 6.9 0.16 15 1,778 42 5.8 Inferred South 10.2 7.9 0.27 30 1,764 61 9.9 West 5.0 6.4 0.27 17 699 30 2.8 East 11.3 5.0 0.18 14 1,238 44 5.0 Central 18.6 4.6 0.23 12 1,884 95 7.5 Total Inferred 45.0 5.6 0.23 17 5,585 230 25.2
Notes:
smelter terms, which include payable factors, treatment charges, penalties, and refining
US$1.00/lb Pb. Metal recovery assumptions were: 90% Zn, 75% In, 60% Ag, and 75% Pb. The NSR value for each block was calculated using the following NSR factors: US$15.34 per % Zn, US$4.70 per % Pb, US$0.18 per gram In, and US$0.22 per gram Ag.
[Zn(%)*US$15.34+Pb(%)*US$4.70+ In(g/t)*US$0.18+Ag(g/t)*US$0.22]
to their economic and legal feasibility. It is reasonably expected that the majority of Inferred Mineral Resources could be upgraded to Indicated Mineral Resources with continued
Measured or Indicated Mineral Resources will ever be converted into Mineral Reserves. United States investors are also cautioned not to assume that all or any part of an Inferred Mineral Resource exists, or is economically or legally mineable.
7.82% 6.46% 5.00% 4.60%
Zinc Grade by Zone
South West East Central
ANALYST COVERAGE Ian Parkinson Kevin MacKenzie George Topping
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MAJOR SHAREHOLDERS Institutional: Sentient Equity Partners 22% Buenaventura 19% IFC 9% JPMorgan UK 5% CD Fund 5% Other institutions ~5% Total institutional 65% Management & insiders 2% Retail & other 33% CAPITALIZATION Millions Shares issued 341 Options (priced at $0.25 to $0.50) 15 Fully diluted shares 356 Market capitalization (at C$0.19/share) C$65 Cash (at Mar. 31, 2020) C$22 Debt nil Enterprise value C$43
Management – Extensive Peru and Zinc Experience
President & CEO, Director
Geologist, Highly experienced in Peru (Rio Tinto, Savage, Pasminco); PhD in geology (80Moz Lihir Au). Alvaro Fernandez-Baca
VP Exploration & GM
Well respected Peru geologist, 20 years in global exploration (Gitennes, AQM Copper, Hochschild). Luis Romero
HSEC Manager
Social management specialist, 20 years experience (Hudbay, Minsur, Rio Tinto, Peru LNG). Mariana Bermudez
Corporate Secretary
20 years regulatory compliance services experience in Canada. Nick Demare
CFO, Director
CPA, CA, extensive junior board experience.
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Independent Directors
Ben McKeown
Chairman of the Board
Mining engineer, MBA, Independent director, 25 years in mining, oil & gas, private equity. Pieter Britz
Director
Professional engineer, MBA, Sentient representative; 25 years in resources and private equity investment. Mary Little
Director
Geologist and Independent director, highly experienced in Latin America, MBA; Founder of Mirasol, director at Sandstorm Gold. Raul Benavides
Director
Mining Engineer; VP Business Development for Buenaventura and son of founder.
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is an essential metal: ▪ Galvanizing steel increases its life and durability in construction and transport ▪ Zinc is also essential for manufacturing, human health, crop growth, and has battery potential
years to avoid major deficits: ▪ Zinc inventories are very low with stockpiles having been drawn down since 2013 ▪ Low zinc prices, declining mine grades, a lack of exploration, and stricter environmental regulations will lead to higher prices and a need for new zinc mines in the near future
Zinc price LME inventory
westmetall.com
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have recently ceased operations
zinc market
AISC, USD / lb Zn
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mines were closed due to COVID-19
forecast to decline with cuts over 400 kt (Teck)
being delayed due to low zinc prices and COVID-19
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past 15 years and has outperformed copper
than copper mines, resulting in lower initial capex
to galvanization of steel (~60% of demand)
energy storage in batteries, the need for which will grow as power generation shifts from fossil fuels to renewable sources
$- $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 $1.80 $2.00 May-05 Jan-06 Sep-06 May-07 Jan-08 Sep-08 May-09 Jan-10 Sep-10 May-11 Jan-12 Sep-12 May-13 Jan-14 Sep-14 May-15 Jan-16 Sep-16 May-17 Jan-18 Sep-18 May-19 Jan-20
USD per Pound
Zinc 15-year Price Chart
$- $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $4.00 $4.50 $5.00 May-05 Jan-06 Sep-06 May-07 Jan-08 Sep-08 May-09 Jan-10 Sep-10 May-11 Jan-12 Sep-12 May-13 Jan-14 Sep-14 May-15 Jan-16 Sep-16 May-17 Jan-18 Sep-18 May-19 Jan-20
USD per Pound
Copper 15-year Price Chart
Mineral Rank in World 2019 Latin America 2019 Zinc 2nd 1st Copper 2nd 2nd Tin 4th 1st Lead 3rd 1st Silver 2nd 2nd Gold 7th 1st
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50% of exports
Ayawilca Project
Las Bambas
Antamina
Central Peru zinc belt
CHILE BOLIVIA BRAZIL ECUADOR
San Rafael
Source: USGS 2019
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base metal mining district of central Peru, a major strategic advantage
major roads to ports
Antamina, the largest mine in Peru, cross the property
to multiple mines in the area
near Lima, ~200km away
Giant ore deposit Buenaventura mine
1940´s 2005 2009 2011 2012 2013 2015 2017 2018 2019 2020 Pre-Tinka
Colquipucro (“Olla de plata”) Tinka Project Staking Silver Zone Colquipucro Exploration Zinc Discovery Ayawilca Zinc Zone First Zinc Resource Ayawilca First Zinc Resource Estimation New Discovery South Ayawilca Discovery & Resource update Resource Update Ayawilca 7.3 Billion lbs Zn Tinka – PEA Capex US$262M NPV8% US$363M IRR 27.1% ~75,000 metres drilled for zinc & silver
BVN investment 19.3% equity stake
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6.0% 5.2% 6.1% 4.1% 6.8% 5.5% 12.0% 4.5% 8.0% 5.2% 10.3% 5.6% 0% 2% 4% 6% 8% 10% 12% 14% 1,000 2,000 3,000 4,000 5,000 6,000
Yauli - Volcan San Gregorio - Brocal Ayawilca - Tinka Hilarion - Nexa Chungar - Volcan Shalipayco - Nexa Florida Canyon - Nexa El Porvenir - Nexa Romina - Volcan Atacocha - Nexa San Vicente - Simsa Santander - Trevali
Zinc + Lead Grade Contained Zinc (kt)
Peru Zinc Projects - Sorted by Contained Zinc
Producing Mine Exploration PEA Stage
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against producing mines in size and grade
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plant producing zinc and lead concentrates
0.9 Moz silver
robust economics with massive leverage to zinc
$0 $500 $1,000 $1,500 $2,000
$0 $50 $100 $150 $200 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037 2038 2039 2040 2041 2042 2043 2044 Cumulative Cash Flows (US$ millions) Annual Cash Flows (US$ millions)
After-tax cash flow Pre-tax cash flow Cumulative after-tax cash flow Cumulative pre-tax cash flow
PEA metal prices: $1.20/lb Zn, $0.95/lb Pb, and $18/oz Ag
PEA Economics Pre-tax Post-tax NPV (8%) US$609M US$363M IRR 37.2% 27.1% Payback period 2.3 yrs 3.5 yrs LOM cash flow US$1,611M US$1,051M
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Resource Definition
Resource drilling and optimization (2nd half 2020)
Prefeasibility Study & Engineering Feasibility Study & Permitting
Production
mining methods, mining throughput rates, cut-off grades, etc.)
grade zinc – silver areas and to test new targets along the Colquipucro Fault
to ensure the safety of our employees, families and communities
Zinc & Silver exploration
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Drill targets 2020-2021
FAR SOUTH
mineralization is known to extend for at least 4km
allow testing of additional targets (e.g. Far South)
Not yet drilled Not yet drilled
metros meters
A’ A
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South, West, and Colqui
Colqui silver resource (oxide)
1x 1x 1x 1x
Sulphide target at depth Planned drill hole
Central Ayawilca South Ayawilca Zinc Zone (Sulphide)
2020 Planned Drill Hole
meters
B’ B
Planned drill hole
Geology legend Zinc block model values
Silver block model values Target at depth
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tested to date, resulting in three separate mineral resource estimates:
deposit with epithermal Zn-Ag-Pb vein
Indicated: 11.9 Mt @ 6.9% Zn, 15g/t Ag, 0.2% Pb Inferred: 45.0 Mt @ 5.6% Zn, 17g/t Ag, 0.2% Pb
silver oxide deposit
Indicated: 7.4 Mt @ 60g/t Ag Inferred: 8.5 Mt @ 48g/t Ag
3. Ayawilca Tin Zone – 14.5 Mt @ 0.70% Sn
Ayawilca Claim Map
Property Boundary
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Rock samples to 19% Pb, 9% Zn, and 500 g/t Ag (not yet drill permitted)
show a 2.5 km RTP mag anomaly broadly coincident with current resources
control for mineralization
and soil sampling
East Zone 3 West
Airborne Magnetics - RTP
Valley Yanapizgo Central 500 m. South Colquipucro Far South
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+ +
UNTESTED at depth
(after Rottier et al, 2016)
Cerro de Pasco (same scale)
Phyllite Limestone
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well above the average grade of Zinc Zone resource ▪ Hole A19-165: 9.0 m @ 11.9% zinc and 25.9 m @11.8% zinc and 28.7 m @ 14.0% zinc and 14.9 m @ 12.3% zinc ▪ Hole A19-163: 5.7m grading 32.6% zinc at edge of resource
▪ Hole A19-163: 13.9 m @ 128 g/t silver ▪ Hole A19-167: 7.3 m @366 g/t silver with 4.9% zinc and 7.9 m @ 150 g/t silver with 6.1% zinc
Suite 1305 - 1090 West Georgia St Vancouver, BC V6E 3V7 CANADA Ph: +1 604 699-0202 Fax: +1 604 683-1585
info@tinkaresources.com
Rob Bruggeman, Investor Relations
rbruggeman@tinkaresources.com +1 416 884-3556
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