1 Private & Confidential
Investor Presentation
July 2018
Investor Presentation 1 Private & Confidential July 2018 - - PowerPoint PPT Presentation
Investor Presentation 1 Private & Confidential July 2018 Legal Disclaimer This presentation contains, or incorporates by reference, forward -looking information within the meaning of applicable Canadian securities legislation.
1 Private & Confidential
July 2018
2 Private & Confidential
This presentation contains, or incorporates by reference, “forward-looking information” within the meaning of applicable Canadian securities legislation. Forward-looking information may include, but is not limited to, statements with respect to the future performance of Fura Gems Inc. (“Fura” or the “Company”), Fura’s mineral properties, Fura’s ability to complete acquisitions, the future price of emeralds, rubies and other gemstones, the estimation of mineral resources and mineral reserves, results of exploration activities and studies, the realization of mineral resource estimates, exploration activities, costs and timing of the development of new deposits, the acquisition of additional mineral resources, the results of future exploration and drilling, costs and timing of future exploration of the mineral projects, requirements for additional capital, management’s skill and knowledge with respect to the exploration and development of mining properties, government regulation of mining
forward-looking statements can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates” or “believes”, or variations (including negative variations) of such words and phrases, or state that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved. Forward- looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Fura to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such factors include, among others, risks associated with the Company’s dependence on the mineral projects; general business, economic, competitive, political and social uncertainties; the actual results of current exploration activities; risks associated with dependence on key members of management; conclusions of economic evaluations and studies; currency fluctuations; future prices of emeralds, rubies and other gemstones; uncertainty in the estimation of mineral resources, exploration and development risks; infrastructure risks; inflation risks; defects and adverse claims in the title to the projects; accidents, political instability, insurrection or war; labour and employment risks; changes in government regulations and policies, including laws governing development, production, taxes, royalty payments, labour standards and occupational health, safety, toxic substances, resource exploitation and other matters; delays in obtaining governmental approvals or financing or in the completion of development or construction activities; insufficient insurance coverage; the risk that dividends may never be declared; and liquidity and financing risks related to the global economic crisis. Such forward-looking statements are based on a number of material factors and assumptions, including: that contracted parties provide goods and/or services on the agreed timeframes; that on-going contractual negotiations will be successful and progress and/or be completed in a timely manner; that no unusual geological or technical problems occur; that plant and equipment work as anticipated and that there is no material adverse change in the price of emeralds and
be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward looking statements contained herein are made as of the date of this presentation. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forward-looking statements due to the inherent uncertainty therein. This presentation does not constitute or form part of and should not be relied upon in connection with any offer or invitation to sell or issue, or a solicitation of an offer or invitation to purchase or subscribe for, any securities or other interests in the Company or any related entity and no legal relations shall be created by it. The Company cautions that it is not basing its production decision on its mineral properties on a feasibility study of mineral reserves demonstrating economic and technical viability, and as a result there is increased uncertainty and there are multiple technical and economic risks of failure which are associated with this production decision. These risks, among others, include areas that are analyzed in more detail in a feasibility study, such as applying economic analysis to resources and reserves and a number of specialized studies in areas such as mining and recovery methods, market analysis, and environmental and community impacts. Ricardo A. Valls, M.Sc., P.Geo., of Valls Geoconsultant, Toronto, Ontario, a Qualified Person as defined by National Instrument 43-101, has reviewed the scientific and technical information disclosed in this presentation.
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Mozambique Rubies
Mustang / Regius merger Strategy
Target Market Share of colour gemstone 10% in 5 years and 15% in 10 years Production start date* March 2018 (Colombia) / Aug 2018 (Mozambique) Revenue Inflow to start* Q2 2019 (Colombia) / Q3 2019 (Mozambique)
FURA to have two operating assets within first 18 months of creation
*: Targets subject to operational performance and financing requirements
FURA Focus
▪ Considered to be the only listed company in the world with sole operations in high-margin colour gemstone sector ▪ Listed on TSX Venture Stock Exchange (FURA.V) ▪ Managed by industry veterans with more than 75 years of collective experience in colour gemstone sector who have:
▪ Developed world’s largest Emerald mine in Zambia (valuation: US$550mn) ▪ Developed world’s largest Ruby mine in Mozambique (valuation: US$1bn) ▪ Produced over 100mn carats emeralds and rubies ▪ Sold over US$650mn rough emeralds and rubies
About FURA
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Considered only listed company in the world to operate in colour gemstone space EMERALDS
World’s largest emerald supplier by value
Colombia RUBIES
World’s largest ruby supplier by volume
Mozambique
76%
Coscuez S.A.
80%
Fura Mozambique
65% - 80%
Mustang/ Regius
An iconic mine that produced the 1,759 carat “Guinness emerald”
Bulk Sampling
Largest Ruby landholding in the main Ruby belt Mozambique 4 Exploration Licenses 2 Mining License 1 Mining License applied 7 Exploration Licenses
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FURA’s Timeline since Jan 2017 and Key Projected Highlights for Next 12 Months
*: Targets subject to operational performance and financing requirements
Jan’17 May’17 Jun’17 Jul’17 Sep’17 Oct’17 Oct’17 Nov’17 Nov’17
Dev Shetty’s appointment as President & CEO C$3mn raised @C$0.21per share Set up of HQ in Dubai C$4mn raised @C$0.40 per share Acquisition of Mozambique Ruby licenses announced Drilling Program commenced in Mozambique Acquisition of iconic Coscuez mine announced Completed acquisition of Mozambique Ruby licenses
Senior Management Appointments Jan’18 Jan’18 Feb’18 Mar’18 Apr’18 May’18 Jun’18 Jun’18 Jul’18
Completed acquisition of Coscuez Emerald mine Operational Update for Mozambique C$12mn raised @C$0.60 per share Bulk Sampling started in Coscuez Coscuez begins bulk sampling WGM appointed for NI 43-101 mineral resource estimate Diamond Drilling Program commenced in Coscuez Key management appointment in Technical services, Security & Geology
Enters into agreement to acquire Mustang/Regius Ruby Assets *Jul’18 *Aug’18 *Nov’18 *Nov’18 *Dec’18 *Dec’18 *Q2’19 *Q3’19 *Q3’18
Announcement of Mustang acquistion Completion of Mustang ruby assets acquisition NI 43-101 mineral resource estimate completion Global Marketing roll-out Seek London Listing & raise Bulk Sampling - Mozambique rubies First Emerald auction First Ruby auction Large scale mining
Colombia Mozambique
In Next 12 Months
Last 18 months of operations
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Target 15% of colour gemstone market
0.5 2.0 4.5 13.0 0.0 15.0
Global Rough Gemstone Sales ($23bn) 2015*
Other Coloured Gemstones 10 20 30 40
De Beers ALROSA Sodiam Dominion Rio Tinto Petra Informal Others
Rough Diamonds
Sale: % Value by Producer (source : De Beers ‘The Diamond Insight Report 2017) 23 45 68 90 113 Gemfie ield lds
and Infor
l Se Sector
Colour Gemstones
Sector % By Company (source : Gemfields annual accounts for 2016 revenue
Fura Targets ▪ 10% of the current market share by year 5 ▪ 15% of the Enlarged Market by year 10 (Expected market size in year 10: $5bn)
*Source: https://resourcegovernance.org/sites/default/files/documents/governing-the-gemstone_sector-lessons-from-global-experience.pdf
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Located in Proven Geological Environment
Location ▪ Montepuez District, Mozambique ▪ In Mozambique’s ruby producing zone ▪ Covering a significant prospective land parcel Brief History
production
Fura team working in this region for last 5 years
high-margin mining operations Fura Acquisition Date of Acquisition 27 November 2017 Ownership 80% Fura 20% Local partners (free carry, non-dilutive) Consideration US$800K plus 10million shares Estimated development cost US$20mn
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FURA Will Hold the Largest Ruby Land Package in Mozambique
Transaction Summary: ▪ Controlling interest in 9 mineral exploration licenses held by Mustang and Regius ▪ Total consideration: A$15mn; consisting of A$3mn cash and c.12.7million deferred (20 months) Fura shares ▪ Cash consideration: A$3mn ▪ Common shares with a value equal to A$4mn (on closing), A$4mn (12 months from closing) , A$4mn (24 months from closing) ▪ Closing of acquisition anticipated in August 2018 and subject to customary conditions precedent, including, inter alia, Ministry and joint venture authorizations and legal opinions
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Combining Best-in-class Assets with the Best-in-business People
Asset
▪ 2 mining licenses with 25 years validity ▪ 1 mining license applied for ▪ Producing Ruby Mine with exploration and geological data ▪ Infrastructure in place ▪ 2 - 60 TPH wash-plant ▪ Security infrastructure ▪ Camps ▪ Access Roads ▪ Ruby bearing Ore in the wash-plant to further expand the understanding of the Geological environment
People
Team that built world’s largest emerald and ruby mines ▪ Dev Shetty (ex- COO/Director of Gemfields) ▪ Ashim Roy (ex- GM of Gemfields Ruby Operation ) ▪ Rupak Sen (ex- Global Marketing Director of Gemfields) ▪ Dibya Baral (ex- GM of Gemfields Emerald Operation) ▪ Rahul Gopal (ex- Head – Security of Gemfields Ruby Operation) ▪ Najah Sanoon(ex- Gemmologist of Gemfields) ▪ Amit Sharma (ex- Sr Geologist of Gemfields Ruby Operation)
Proposed Strategy
▪ New Drilling program to expand the current drilling results with Fura’s team of Geologists ▪ Reconfiguration of current wash-plant to increase efficiency ▪ Focus only on selling Rough Rubies via organized auction platform ▪ Extension and consolidation of some of the ruby licenses to increase efficiency ▪ Grading of the product as per market norms and using Fura’s team of Gemmologists ▪ Marketing of product via Fura’s Marketing platform and to build ethical route to the market
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Nov 2017 – Jun 2018 July – Dec 2018 Acquisition of 4 exploration licenses Total Investment to date : US$2.8m Employees hired: 54 Further Investment expected to make : US$9.2m Planned hire: 50 Phase I drilling: 2,500 mts complete Phase II drilling: 3,500 mts targeted (focus: License 3868) 30 TPH exploration plant, camp commissioned Bulk Sampling to commence : Aug 2018 Drilling for Mustang/Regius to commence: Aug 2018 Completion of drilling for 3868 license Completion of acquisition of Mustang/Regius ruby assets Acquisition of Mustang/Regius ruby assets
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Near the Surface Occurrences
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Coscuez
La Pita Cunas Totumos Espanola
Furatena Formation Capotes Formation
Muzo Quipama La Victoria Polveros
Location ▪ Boyaca region, Colombia ▪ 245km from capital city of Bogota ▪ Western corridor (on Muzo formation) Brief History ▪ In existence since 1646 ▪ Produced some of world famous emeralds ― Guinness Emerald with 1,759 carats ▪ Mined and developed traditionally ▪ Lacking investment in geology, infrastructure and had no long term plans Fura Acquisition Date of Acquisition 22 January 2018 Ownership 76% Fura 24% Local partners (free carry, non-dilutive Consideration US$10mn
years
issued
Located in Known Emerald Corridor
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Key Milestone Achieved Since Completion and to be Achieved for Further 6 Months Jan – Jun 2018 July – Dec 2018 Transaction completed : Jan 2018 Total Investment to date : US$ 5.5m Employees hired: 240 (provided HSE training) Further Investment to make : US$ 4m Bulk Sampling to continue Bulk Sampling Target : 30,000 tonnes Commenced : Apr 2018 Completed: 850 tonnes Commencement of NI 43-101 mineral resource estimate: May 2018 (WGM Appointed) Drilling Target : 2,500 mts Commenced : Jun 2018 Completed: 400 metres Plant commission: Sep 2018 NI 43-101 Mineral Resource Estimate: Nov 2018 Long term mine plan finalised CSR and Sustainability Strategy Scoping Study for Coscuez – Sept 2018
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Muzo for
tion Itoc
unnel Cap apotes for
ion Muzo for
tion Itoc
unnel Cap apotes for
ion
An Iconic Emerald Deposit – First Listed Company Operating In Worlds Largest Emerald Producing Country
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Intense calcite veins bearing emerald Breccia zone with intense calcite veins & pyrites Crumbled breccia zone with banded shale Extensive carbonate veins & alteration in shale
Mineralised Area identified for Bulk Sampling
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Target Of 30,000 Tonnes By Year Ended 2018
Month Total studied rock weight (Metric Tons) Total Emerald (Carats) Grade (ct/t) January 72.8 1262.6 17.3 February 104.0 215.5 8.4 March 62.3 25.5 6.3 April 61.0 110.2 5.4 May 257.5 754.1 4.2 June 320.5 320.5 3.1 Total 878.1 2688.4 3.1
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Phase 1 : 2,500 Metre Of Diamond Core Drilling expected to be completed by December 2018
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ÄRE Emerald
A rare and exceptional 25.97 carat rough emerald
Significant Progress On Emerald Recovery Within One Week Of Acquisition
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Note: Targets subject to operational performance and financing requirements
23 Private & Confidential CONTACT INFORMATION Dev Shetty President and Chief Executive Officer dev.shetty@furagems.com +971- 50 187 2487/+44 77475 62 475 Dubai Fura Services DMCC, 26J Almas Tower, Jumeirah Lake Towers, Dubai, UAE Canada Fura Gems Inc, 65 Queen Street West, Unit 800, Toronto, Ontario - M5H 2M5, Canada www.furagems.com