World Class, Highest Quality Shovel Ready, Frac Sand Product - - PowerPoint PPT Presentation

• WorldClass,

ShovelReady, NickelSulphide Project HighestQuality FracSandProduct Availableinthe CanadianMarket

• VictoryNickel

CompanyProfile

• SupplyingCanadawithHighest

QualityFrac Sand

• MultiPhasedBusinessPlan
• Phase1complete
• Salesongoing
• Phase2approvedbyboard
• OwnershipofWisconsinandManitoba

fracsandresources

• PermittingofWisconsinproperty

underway

• Phase3Winnipegsiteselectionongoing
• Developmentofdomesticandadditional

Wisconsinsandprogramsareinprogress

• OneCompany

TwoCompellingInvestmentOpportunities

• WellPositionedforResurgencein

NickelMarket

• FourNickelProjectsinCanada:
• Over1billionlbs nickelinM&Iresource
• FlagshipMinagoProjectinManitoba:
• Feasibilitystudycomplete,permittedfor

development

• FracsandcoproductatMinago

• CompanyHistory

FromNickeltoFracSand

2007: VictoryNickelcreated 2009: FeasibilitystudyforMinago:significant frac sandbyproductvalueidentified 2011: Minago permittedforproduction 201112: Meaningfuldeclineinnickelprices 2012: VictorySilicacreatedtohelpunlock valueoffrac sandatMinago 2013: Fracsandbusinesscreated,independentof Q12014:Proofofconcept:firstfrac sandsales Q32014:7PersonsPlantcommissioningcomplete Q42014:OptionsignedtoacquireWIfracsandresource 2016: 7PersonsPlant oncare&maintenancedueto downturn Q12017:Fracsandsalesresume

FracSand Nickel

• ExperiencedManagement

VictorySilicaLimited

• RenéR.Galipeau/Chairman

35+yearsminingexperiencewithHudsonBay,BreakwaterResources,LacMinerals,RioAlgom.CurrentViceChair&CEOofVictoryNickel.

KenMurdock/CEO&Director

Engineerwithover25yearsexperienceintheaggregate/construction&oilfieldmaterials/frac sandindustries.Inadditiontooperatingas anindependentconsultantinCanadaandWisconsin,frac sandindustryexperienceincludesCanfrac Sands(operations),UnitedIndustrial Services (design,permitting,construction,operationandmarketingofasilicasandprojectinPeaceRiver)andLafargeCement.

TroyBergen/PlantManager,SevenPersonsFracSandFacility

• OperatedtheSevenPersonsfracsandfacilitybetween2008and2010withpreviousowner3RSandLtd. Prior tothat,hewasOperations

ManagerwithCleanEarthEnvironmentalLtd.

PaulL.JonesGeologicalConsultant

GeologistandQPwith25+yearsexperiencewithmorethan20juniors

SeanStokes/CorporateSecretary

(SeeVictoryNickelAppendix)

• ShaleGas/TightOilRevolution

FracSandBoom

• Unconventional‘shalegas’and‘tightoil’previouslyuneconomictorecoveratalarge

scale

• Efficiencygainsinhorizontaldrillingandtheintroductionof‘fracking’helpedunlock

vastnaturalgasandoilresources

• TherapidimplementationoftechnologychangedtheNorthAmericanenergy

landscape,witha“sand boom”beingaresultingfactor

FracsandisaneffectivewaytoparticipateinNorthAmerica’s rampant‘unconventional’oilandgasproductiongrowth

• Whatis‘Fracking’?FracSand?

Notallsandmakesfrac sand!

• Hydraulic fracturing or‘fracking’isatechniqueusedinthedevelopmentof
• il&gasformationsto increase flow and extend w ell life.

Proppant (suchasfrac sand)holdsor‘props’theformationopen,increasesporosity,

andincreasesoil/gasflowtothewellhead

• Frac sand mustmeetuniqueAPIspecificationssuchasmineralogy,

roundness andstrength foruseintheoil&gasindustryasaproppant

Victory Silica’s FracSand

30/50 20/40

• Proppant/FracSandMarket

HydraulicallyFracturedWellsontheRise

USOilProduction(20002015)

• Proppant/FracSandMarket

RigCountontheRise

NorthAmericanRigCounts(JanNov2016)

• Proppant/FracSandMarket

FracSandIntensityontheRise

• IndustryAverageProppantperFracJob
• Averagesanduseperwellhasincreasedby128%Q12016overQ22012
• Refrackingofwells
• Uncompletedwellsinventory

• Proppant/FracSandMarket

ProppantDemandontheRise

• QuarterlyNorthAmericanProppantDemand

• FracSandPriceIndex

FracSandPricingontheRise

• Manitoba,Saskatchewan,Alberta,B.C.,NorthDakota

NorthAmericanShaleBasins

InitialSupplyOpportunities

• VictorySilicaBusinessPlan

Phased Approach– ClearPathforGrowth

Phase1:MarketEntry

SevenPersons(dry)Plant:

processinginfrastructurein Alberta(500ktpa)

Shipcontracted(wet)sand

fromWisconsin

Washplantcapability Strategicstoragecapacity

Phase3:Growth

Winnipeg(dry)plant:

processinginfrastructurein Manitoba(1,040ktpa)

Siteidentifiedwithfavourable

logistics(CN,CP,BNSF)

Initiallysuppliedfrom

Wisconsin

MinagoSand

Longertermupside Currentlylookingatsmaller

pitconfigurationtotargetfrac sandonly

Phase2:VerticalIntegration

WisconsinmineJVincludingwashplant

• wnership/frac sandpropertyoption

Securityofsandsupply/qualitycontrol Marginenhancement

• Processingpurchasedimportwetsand

(concentrate)fromWisconsin

• SevenPersonsPlant
• Fullyfunctioningsandplanton22.4acres
• 22,000tonsproductstoragecapacity
• $6.0Mcapextotakedryplantcapacityto

500,000tpa(complete)

• 120,000tpa washplantcapability

Phase1:MarketEntry

SevenPersonsPlant– MedicineHat,Alberta

• DrySandProgram

Shipdry,finishedWisconsinnorthernwhitefracsandbyrailtoFort Saskatchewantransload EnhancedpricingandmarginduetocloserproximitytocustomersinGrande Prairieandotherplayswherefracsandiscurrentlyindemand 7PersonsPlantavailableasbackupintheeventofrail/othersupplydisruptions

• DomesticSandProgram

SupplyingdomesticandimportedsandwasalwaysapartofinitialPhase1plan; highdemandforWisconsinsandin2014putdomesticsandsalesonhold Today’smarketrealitiesmakesdomesticsandmoreattractiveforcostsavings 7PersonsPlanthas120,000tpa wetsandprocessingfacilityalreadyonsite; ~$150,000capextogetwetplantupandrunning,whennecessary

VictorySilica

OngoingSupplementalPrograms

• Phase2:VerticalIntegration

WisconsinProperty/WashPlant

• Securesandsupply,enhancemargins
• Enteredintooptionagreementtoacquire

Wisconsinfrac sandproperty

• ApprovalfromBoardorDirectorstoproceed

withPhase2,includingconstructionofa 1,000,000tpy fracsandwashplantinWI

• Oilpricecrashputthisonhold
• Providessignificantflexibilitytoadaptto

marketconditions

• Phase3:Growth

WinnipegProcessingSite

• BuildprocessingfacilityinWinnipeg

Leaseexistingrailsupportedindustrial

site

Constructnewdryplant– 18mos.

fromstart

SupplyfromWisconsinandarea

(Minago longertermsupplyoption)

TargetWesternCanada(CN)andUS

Bakken (CP,BNSF)markets

• Minago Project

Nickel/FracSandCoProduction

OneofCanada’slargest undevelopedsulphidenickelresources Positivefeasibility study completed;permitted forproduction

Frac sand asignificantvaluedriver:US$2.90/lbNiincoproductvalue

basedonfeasibilitystudy

Superb location:Manitoba;road,rail,poweraccess

11.2milliontonnefrac sandresource,2 billion tonne potential

Potentialforsmaller,lesscapitalintensivepitconfigurationtotargetfrac sandonly

Valuable“CALL OPTION ” onnickelat$10.00/lb+

• MinagoProject

CoProduct:FracSand

FeasibilityStudyHighlights

• 11.2milliontonnesmarketablefrac

sandinpitfootprintalone

• Minedoverfirstthreeyears
• Salesover10years
• Coproductvalueperpoundofnickel

=$4.04(US$3.68);optimized:$3.18 (US$2.90)

• Fulldetailsinfeasibilitystudy

availableonSEDAR

• FracSand

Nickel

• MinagoProject

FracSandPotential

Existingresourcewithincurrentpitshell: 15Mt Existing&proposedquarryleases: 75Mtpotential* Proposedquarryexplorationpermits: 475Mtpotential* Entirelandpackage(mineralleases+ miningclaims): 2Bt potential*

The“Call Option”

• CompanyProfile

NickelProjects

FourAdvancedSulphide NickelProjects

Over1billionpoundsofnickelinMeasuredandIndicatedresources and300millionpoundsofInferredresources,NI43101compliant

LynnLakeoptionedtoCorazonMining

• MinagoProject

TheProperty

• Welllocated
• Sulphidenickeldeposit
• Exceptionalmetallurgy
• Openpitandundergroundmining

potential

• Bankablefeasibilitystudyonopen

pitonly

• Exceptionalexplorationupside

• MinagoProject

ReservesandProductionUpside

• NoseDepositopenpit:

8.6yearminelife Feasibilitystudydoesnotinclude:

• NoseDepositU/G(inferred

resource)

• NorthLimb:Explorationtarget
• Mineralizationopentowest,

northandatdepth

• Combinedresourcesprojected

minelifeof>20years

• MinagoProject

NickelConcentrateAssay

• MinagoProject

FeasibilityStudyOptimization

• MinagoSulphideNickelProject:EconomicSummaryComparison

BaseCase Dec.14,20091

($millionexcept%&yrs)

BaseCase July19,20111,2

($millionexcept%&yrs)

AtToday’sMetalPrices

Undiscountedcashflow 917.7 1,418.4 951.3 NPV@8% 293.8 513.0 278.0 NPV@6% 402.6 669.3 392.6 IRR 17.7% 22.4% 16.5% PreProductionCapital 593.0 585.1 558.0

• 1. ThreeyeartrailingaverageUS$metalpricesandexchangerateasofmarketcloseDecember10,2009:Ni:

$11.19/lb;Cu:$2.91/lb;Pd:$322.4/oz;Pt:$1,353.98/oz;Au:$836.25/oz;Co:$27.73/lb;Ag:$14.25/oz;$Can/$US exchangerate:1.097

• 2. Updatedresource

• MinagoProject

CostSummary

• C1 CashCostPerlb Ni

Feasibility Study After Optimization NetofCredits* US$1.94(C$2.12) US$2.20 (C$2.41) MetalByProduct Credits US$0.72(C$0.79) US$0.77(C$0.85) FracSandByProduct Value US$3.68(C$4.04) US$2.90 (C$3.18) CashCostperlbNickel BeforeCredits US$6.34(C$6.95) US$5.87(C$6.44)

*NetC1costsincreasewhenmetalproductionincreaseswithoutcorrespondingfrac sandincrease(samesizepit)

• MelProject

Overview

100%owned 25kmnorthofThompson Nearsurface,ramp/pitaccessible

resource

Directshippotential MillingagreementwithValeatcash

cost+5%*

Ongoingeconomicevaluation Metallurgicaltesting

Classification Tonnes (millions) Grade (%Ni) InSituNickel (millionslb)

Mel** Indicated 4.3 0.875 83 Inferred 1.0 0.839 19

• LacRocher Project

Overview

Nearsurfacedeposit,highgrade component,directshippotential PEAindicatesbreakeven~C$10 Ni/lbandC$3.84/lbCu

EISsubmitted,accessroad

complete

Onsiteupgrading:DMS,optical

sortingbeingevaluated

Classification Tonnes (millions) Grade (%Ni) InSituNickel (millionslb) LacRocher** Measured 0.29 1.23 8 Indicated 0.51 1.05 12 TotalM&I 0.80 1.12 20 Inferred 0.44 0.65 6

**At0.5%nickelcutoff

• VictoryNickel

BoardandManagement

CynthiaThomas/Chair

MBA,20+yearsinternationalminingandprojectfinance,formerDirectorMiningInvestmentBanking– ScotiaMcLeod

RenéR.Galipeau/CEO&Director

30+yearsminingexperiencewithHudsonBay,BreakwaterResources,LacMinerals,RioAlgom

PeterR.Jones

Engineer,formerCEOofHudbayMinerals,40+yearsminingexperiencewithHudbay,Cominco,CapeBretonDevelopment,Granduc OperatingCo.andAdanacMolybdenum

MichaelAnderson

Lawyer,nineyearsasGeneralCounselandSecretarywithDenisonMines,previouslyapartnerwithGowlingLafleurHendersonLLP,in housecounselwithJohnLabatt,GeneralCounselforSwiftCanadian

RolandHorst

35yearsminingexperienceasaCEO,banker,investmentbankerandgeologist

• PaulL.Jones/GeologicalConsultant

GeologistandQPwith25+yearsexperiencewithmorethan20juniors

SeanStokes/VPCorporateAffairs&CorporateSecretary–VictoryNickelInc.

20+yearsfinance,businessdevelopment,communicationsexperience,incl.TiberonMinerals,LibertyMinerals,ScandinavianMinerals, NuinscoResources

• Disclaimer