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TSX-V: NXN
Entering the Uranium Sector
Investor Presentation July 2020
Entering the Uranium Sector Investor Presentation July 2020 - - PowerPoint PPT Presentation
1 Entering the Uranium Sector Investor Presentation July 2020 TSX-V: NXN 2 Disclaimer Information Contained In This Presentation This presentation is a summary description of NxGold Ltd. (NxGold or the Company) and its business
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Investor Presentation July 2020
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Information Contained In This Presentation This presentation is a summary description of NxGold Ltd. (“NxGold” or the “Company”) and its business and does not purport to be complete. This presentation is not, and in no circumstances is it to be construed as, a prospectus, an advertisement, or a public offering of securities. No securities regulatory authority or similar authority has reviewed or in any way passed comment upon the document or the merits of the Company’s securities and any representation to the contrary is an offence. Except where otherwise indicated, the information contained in this presentation has been prepared by NxGold and there is no representation or warranty by NxGold or any other person as to the accuracy or completeness of the information set forth herein. Except as otherwise stated, information included in this presentation is given as of the date hereof. The delivery of this presentation shall not imply that the information herein is correct as of any date after the date hereof. All dollar amounts referenced herein, unless otherwise indicated, are expressed in Canadian dollars. Cautionary Note Regarding Forward-looking Information This presentation contains "forward-looking information" and “forward looking statements” within the meaning of applicable Canadian securities laws. Forward-looking information and statements include, but are not limited to, statements with respect to, planned exploration activities, the future interpretation of geological information and cost of such exploration activities, future financings, the future price of gold, and requirements for additional capital. Generally, but not always, forward looking information and statements can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, or “believes” or the negative connotation thereof or variations of such words and phrases or statement that certain actions, events or results “may”, “could”, “would”, “might” or “will be taken”, “occur” or “be achieved” or the negative connation thereof. Forward-looking information and statements are based on our current expectations, beliefs, assumptions, estimates and forecasts about the Company’s business and the industry and markets in which it operates. Such forward information and statements are based on numerous assumptions, including among others, the availability of financing, the accuracy of previous exploration records and results, that the results of planned exploration activities are as anticipated, the price
terms and in a timely manner and that general business and economic conditions will not change in a material adverse manner. Although the assumptions made by the Company in providing forward looking information or making forward- looking statements are considered reasonable by management at the time, there can be no assurance that such assumptions will prove to be accurate. Forward-looking information and statements also involve known and unknown risks and uncertainties and other factors, which may cause actual results, performances and achievements of NxGold to differ materially from any projections of results, performances and achievements of NxGold expressed or implied by such forward-looking information or statements, including, among others: limited operating history, negative operating cash flow and dependence on third party financing, uncertainty of additional financing, delays or failure to obtain required permits and regulatory approvals, no known mineral resources/reserves, reliance on a single project, aboriginal title and consultation issues, reliance on key management and other personnel; potential downturns in economic conditions; availability of third party contractors; availability of equipment and supplies; failure of equipment to operate as anticipated; accidents, effects of weather and
Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those contained in the forward-looking information or implied by forward-looking information, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking information and statements will prove to be accurate, as actual results and future events could differ materially from those anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward-looking statements or information. The Company undertakes no obligation to update or reissue forward-looking information as a result of new information or events except as required by applicable securities laws. The footnotes, endnotes and appendices to this presentation contain important information. The endnotes and appendices are found at the end of the presentation.
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Technical Information The scientific and technical information in this presentation has been prepared or approved by Darren Lindsay, Vice President of Exploration and Development of the Company, a “qualified person” within the meaning of National Instrument 43-101 – Standards of Disclosure for Mineral Projects. For details of the Kuluu Project including the sampling procedures, quality assurance program and quality control measures, analytical or testing procedures applied during the execution of the work reported on in this presentation please refer to the “Technical Report on the Kuluu Project” bearing an effective date of January 10, 2017 and available on the Company’s profile at www.sedar.com. This presentation contains information regarding Agnico Eagle’s Meliadine Gold Project. Mr. Lindsay has been unable to verify the information contained herein regarding Agnico Eagle’s Meliadine Gold Project and such information is not necessarily indicative of the mineralization on the Kuulu project in which the Company has an exclusive right to earn up to a 70% interest in. Technical Information Related to the Ben Lomond Project The following is taken from the Mega Uranium Annual Information Form for the year ended September 30, 2019 as dated December 18, 2019. The AIF incorporates by reference the technical report dated July 16, 2005 and entitled “Technical Report on the Mining Leases Covering the Ben Lomond Uranium-Molybdenum Deposit, Queensland, Australia”, prepared by Andrew Vicar and David G. Jones of Mining Associates Pty Ltd (the “Ben Lomond Report”). The mineral resource estimates at Ben Lomond, based on documents supplied for the Ben Lomond Report, have been calculated on 4 separate occasions over the years 1979 to 1982. The range of resource estimates varies from a low of 4,000 tonnes contained uranium to a high of 5,400 tonnes. An independent resource calculation was conducted by the Australian Atomic Energy Commission (“AAEC”) in 1982. A summary of the AAEC estimate, using a cut-off grade of 500 parts per million uranium and converted to % uranium oxide (“U3O8”), is tabulated on slide 12. The AAEC resource categories were chosen based on the Australian Joint Ore Reserves Committee (“JORC”) code guidelines of the time. In the opinion of Andrew Vigar, who is a qualified person under the current JORC Code and NI 43-101, the AAEC estimate is relevant, is within the range of reliability expected for this style of deposit, uses the resource category definitions in their current context and has not been superseded by any more recent estimates. It is Messrs. Vigar and Jones’ opinion that the resource estimate is compliant with the definitions under section 1.3 and 1.4 of the current NI 43-101. Technical Information Related to the Mountain Lake Project The property contains a historical inferred mineral resource estimate of 8.2 million pounds U3O8 with an average grade of 0.23% U3O8 contained in 1.6 million tonnes of mineralization. The estimate was reported in the technical report entitled “Mountain Lake Property, Nunavut” prepared for Triex and dated February 15, 2005. This resource is a historical estimate and a qualified person has not done sufficient work to classify the historical estimate as current mineral
National Instrument 43-101 – Standards of Disclosure for Mineral Projects) with significant experience on the project, using methods that were standard in the industry. In order to upgrade or verify the historical estimate as current mineral resources, the Company anticipates that it will need to incorporate the drilling data collected by Triex and Pitchstone in 2006-2008. The historical resource uses the “inferred mineral resource” category set out in section 1.2 of National Instrument 43-101. There are no more recent estimates available to the Company. The historical estimate was prepared with the polygonal method using only intervals greater than 0.1% U3O8 with a vertical thickness of at least 1.0 metre. Polygon sides were determined by drawing lines perpendicular to, and one half the distance to each adjacent drill hole. Estimated uranium was then obtained by multiplying the polygon areas by their thickness, a specific gravity of 2.5, and the grade of the drill hole interval. The mineral resource was classified as inferred.
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Georgetown projects in Queensland Australia from Mega Uranium as well as the Mountain Lake project in Nunavut from IsoEnergy
Australia, immediately adjacent to Novo Resources' Karratha Gold Project
adjacent and northwest along trend from Agnico Eagle’s multi-million-ounce Meliadine Gold project, Nunavut
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Philip Williams Pres, CEO & Director
director of investment banking focused on the metals and mining sector
Janine Richardson CFO
Peter Mullens VP Corp Dev
countries
Leigh Curyer Chairman
Uranium One)
uranium assets for First Reserve International
Trevor J. Thiele Director
Australian Agribusinesses (Elders and Viterra)
Karl Laufmann Director
management and corporate advisory mandates
Anthony Milewski Director
director, adviser, founder and investor.
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The uranium spot price and volumes are up dramatically over the past several months… driven primarily by COVID related supply side disruptions.
Mine(s) Operator Current Impact
Cigar Lake Cameco 1.5m reduction per month based on 18m lbs per annum Kazakhstan ISR Kazatomprom 59.2m lbs target reduced to 49.4 – 50.7m lbs Husab CGN 21 day reduced operations (2019 production of 8.8m lbs ramping to 15m lbs) Rossing CNUC 21 day reduced operations (2019 production of 5.4m lbs)
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Demand for nuclear power on the rise:
Supply constraints abound:
exiting mines let alone new mine development
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1 Calculated from January 1, 2015 to November 5, 2018
Between Jan 2005 and Dec 2006 Mega announced nine acquisitions and raised over $50m in capital. During that period its share price increased by 25 times and its market cap went from ~$15m to $940m.
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was
completed by Minatome in 1982
relevant Federal and State authorities in 1984
by the imposition of the “the Three Uranium Mines Policy” by the then Australian Federal Labour Government
1.05 km strike length where, in this area, limited widely spaced surface drilling has intersected encouraging intervals of uranium mineralization and rock alteration.
Category Tonnes (m) Grade (%) Lbs (m) Indicated 1.33 0.27 7.9 Inferred 0.6 0.21 2.8
NI 43-101 Compliant Resource
* See disclaimer on slide #3
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Lomond
which was detected in 1971 in an airborne magnetic- radiometric survey.
in order to validate and extend the historical Maureen resource, to seek resource extensions and to discover additional resources in the immediate vicinity.
compliant resource (see table)
property, within both the Proterozoic basement and
/metasediments, in the form of radiometric anomalies, uranium occurrences and favourable geological settings for uranium
Category Tonnes (m) Grade (%) Lbs (m) Indicated 3.12 0.09 5.95 Inferred 0.15 0.11 0.38
NI 43-101 Compliant Resource
* As published in the technical report dated June 25, 2008 and entitled “A Review and Resource Estimate for the Maureen Uranium-Molybdenum Deposit, North Queensland, Australia Held by Mega Uranium Ltd.”, prepared by Mining Associates Pty Ltd (the “Georgetown Report”).
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Interest Terms
Option
To Acquire 100%
Contingent payments
Misc.
standing between the option date and the exercise date
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Work Programs:
potential of Ben Lomond and Georgetown
exploration potential and for updated resource calculations and QA/QC purposes
development potential of Ben Lomond including reviewing and evaluating potential
trading houses, particularly in the Asia Pacific Region Budget:
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Category Tonnes (m) Grade (%) Lbs (m) Inferred 1.6 0.23 8.2
Historic Mineral Resource
* See disclaimer on slide #3
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Interest Terms
Option
To Acquire 100%
Contingent payments
Misc.
good standing between the option date and the exercise date
exercise the option and satisfy the remaining portion of the purchase price by issuing such number of Nxgold shares to IsoEnergy that results in IsoEnergy, together with the Nxgold shares already owned by IsoEnergy, owning an aggregate number of Nxgold shares equal to 9.9% of the total number of issued and outstanding Nxgold Shares after giving effect to such issuance.
spot price reaching USD$50, IsoEnergy will have the one-time option to elect to receive $205,000 in lieu of, and not in addition to, each of the USD$75 and USD$100 contingent payments for a total aggregate amount of $410,000. Payable at Nxgold's
the election by IsoEnergy.
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Share Structure & Balance Sheet
Basic 14,963,229* Warrants 9,545,649 Options 1,355,000 Fully Diluted 25,863,878 Cash & Securities ~C$2.85 million Debt $Nil
Stock Options & Warrants
Stock Options Expiry
$4.50 Apr- 22 25,000 $2.00 Jun-23 330,000 $0.30 Jun-25 850,000 $0.50 Jul-25 150,000 Total Options 1,355,000
Warrants Expiry
$0.50 Jul-20 300,000 $0.50 Oct-20 569,000 $0.70 Oct-20 200,000 $1.80 Jun-21 118,635 $2.70 Jun-21 2,372,514 $0.20 Jun-22 85,500 $0.30 Jun-22 5,900,000 Total Warrants 9,545,649
*Includes 900,000 shares to be issued to IsoEnergy
Major Shareholders
Mega Uranium 6% IsoEnergy 6% Management and Directors 4.5%
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Wes Short Email: wshort@nxgold.ca
nxgold.ca
Phil Williams Chief Executive Officer Email: pwilliams@nxgold.ca
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Western Australia
Resource’s Karratha Gold Project
characteristics to the recent gold discoveries by Novo Resources, Artemis Resources and De Grey Mining, in the same region
and Comet Well range from 2.16 to 6.1 g/t gold (see news release dated October 26, 2018
coarse gold quartz vein stockwork system, is within 600m of the Mt. Roe Property.
Photo: pan-sized nuggets
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late 2016 by prospectors
Fortescue Group which has the potential for Pilbara- wide mineralization
similar to those of Nome, Alaska; South Island, New Zealand; and Witwatersrand, South Africa
possible in the contemplated transgression-regression geological model
Source: Novo Resources Corporate Presentation August 8, 2018
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“Melon Seed” nugget from Novo Resources. (Image source Novo Resources Corp.) “Melon Seed” nugget from NxGold Mt Roe Project
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Lake Project) is 20 km NW and immediately along trend of Agnico Eagle's Meliadine gold development project
proven and probable 16.1 Mt at 7.12 g/t Au as of December 31, 2017) (www.agnicoeagle.com). Agnico Eagle is set to start up process plant in Q2 2019
within the Meliadine gold belt in Nunavut, Canada
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tonnes grading 7.12g/t)*
2019 up to average mining rate of 400,000 oz per year*
production)
*Source: Agnico Eagle Mines Limited, News Release dated February 15, 2017 Image Source: Agnico Eagle Mines Limited
Agnico Eagle’s Meliadine Gold Project Agnico Eagle’s Meadowbank/Amaruq Gold Mine
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Interest Terms
Initial 50% interest
anniversary, $4 million 2nd anniversary and $5 million 3rd anniversary
Additional 20% interest (up to 70%)
Extension
each extended year
Misc.
Note
2018 NxGold delivered a notice of force majeure to Nunavut Tunngavik Incorporated (NTI) due to the continued delay in the renewal of the existing Land Use Licenses, KVL311B01 and KVRW12E01 pertaining to the Kuulu project. This action enables NxGold to maintain its rights under the Earn-In Agreement and under the Mineral Exploration Agreement without having to incur the spending obligations.
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2 4 6 8 10 12 $0.00 $1.00 $2.00 $3.00 $4.00 $5.00 Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18 Jul-18 Oct-18
Volume (millions) Share Price (C$) Announced positive PFS results for the Arrow Project: AT NPV8% of C$3.7B AT IRR of 56.8% AT average annual net cash flow of C$909M Announced intersection of widespread mineralization at Arrow Announced updated mineral resource estimate for the Arrow deposit Announced best assay results to date at Arrow Zone
+750% return1
1 Calculated from January 1, 2015 to November 5, 2018
January 1, 2015: C$75 million market value
November 5, 2018: C$1.1 billion market value
Announced maiden PEA results for the Arrow Project: AT NPV8% of C$3.5B AT IRR of 56.7% AT average annual net cash flow of C$553M