Agne Ahlenius. Platschef Björkdalsgruvan. Frukostmöte, Skellefteå - April 8, 2016

Transcription

1 Agne Ahlenius Platschef Björkdalsgruvan Frukostmöte, Skellefteå - April 8,

2 Mandalay Resources - Björkdalsgruvan Är allt guld som glimmar? 2

3 Mandalay Resources - Björkdalsgruvan Varför Skellefteå?? 3

4 APR 2016 TSX // MND 4

5 Forward-looking Statements This presentation contains "forward-looking statements" within the meaning of applicable securities laws, including statements relating to life of mine production plans, exploration plans and the growth and strategy of Mandalay. Actual results and developments may differ materially from those contemplated by these statements depending on, among other things: exploration results or production results not meeting management s expectations; capital, production and operating cost results not meeting current plans; and changes in commodity prices and general market and economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A description of additional risks that could result in actual results and developments differing from those contemplated by forward looking statements in this news release can be found under the heading Risk Factors in Mandalay s annual information form dated March 30, 2016 and in its final prospectus dated September 2, 2014, copies of which are available under Mandalay's profile at Although Mandalay has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward- looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. 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-lookingstatements. Quality Control and Assurance Quality control and assurance programs are implemented in line with the standards of National Instrument The exploration programs at Costerfield and Bjorkdal are supervised by Chris Gregory (Member, Australian Institute of Geoscientists, VP of Operational Geology for Mandalay and a Qualified Person as defined under National Instrument Mr. Gregory regularly visits Costerfield and Bjorkdal, and supervises the collection and interpretation of scientific and technical information contained in this presentation. The exploration programs at the Cerro Bayo and Challacollo projects are supervised by Scott Manske, Chief Cordilleran Geologist of Mandalay Resources, and an Oregon registered Professional Geologist. A Qualified Person as defined by NI , he has reviewed and approved the technical and scientific information on these projects contained in the presentation. Dr. Mark Sander (Member: AusIMM), President and CEO of Mandalay, has visited the Costerfield, Cerro Bayo, Challacollo, and Björkdal and has supervised the preparation of this presentation. All currency references in US$ unless otherwiseindicated 5

6 Mandalay: A Values-Based & Value-Focused Company Our Vision We create exceptional shareholder value through the acquisition of undervalued assets that can rapidly become cash generative, self-fund exploration, establish and maintain high operating margins and return cash to shareholders within a planned period of time. Mandalay is committed to operating safely and in an environmentally responsible manner, while developing a high level of community and employee engagement WEARE SUCCESSFUL WHEN: Our employees live and work safely and experience the personal satisfaction that comes with high performance and recognition The communities in which we operate value our presence Our environmental impact is minimized and causes no permanent harm We have a large, diversified set of customers who are delighted with and compete for our products Our shareholders realize a superior total return on their investment and support our corporate values. Our values are visibly demonstrated by strong local management, at the point of impact with our stakeholders, and co-ordinated across the Company for maximum effect 6

7 Mandalay Resources: Delivering Consistent Value A Canadian-based natural resource company with producing assets in Australia, Chile, and Sweden, and a development project in Chile. The Company is focused on executing a roll-up strategy, creating critical mass by aggregating advanced or in-production gold, copper, silver and antimony projects in Australia, the Americas, and Europe to generate near-term cash flow and shareholder value. TIMELINE 2009 Costerfield,Australia Gold &Antimony 2010 Cerro Bayo, Chile Silver & Gold 2013 Challacollo,Chile Silver & Gold 2014 Björkdal, Sweden Gold Revenue, EBITDA (1) & Cash from Operations 2015 Quarterly Financial Measures Revenue EBITDA Cash from Operations 1. The Company defines EBITDA as earnings before interest, taxes and non cash charges/ (income). EBITDA should not be considered by an investor as an alternative to net income or cash flow as determined in accordance with IFRS. 7

8 Investment Value Volume (millions) Acquisition Strategy Track Record: Shareholders Receive Superior Total Return on their Investment 300% 250% 200% 150% 100% 50% Q Q Cumulative Total Return (% Value Change)* Q Q Q Q Q Q Q Q Q Mandalay Cumulative Returns 9.5% Annual Compounded Rate of Return Gold Silver Q Q $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $0 Dividends Paid (USD)** % of revenues (dividend contribution) $100,000 $80,000 $60,000 $40,000 $20,000 $0 Total Return vs. Peers and Seniors Mandalay (1) Peer Index (2) Gold Senior (3) A $10,000 investment on September 24, 2009 would be worth: Mandalay: $56,255 Peer Index: $9,165 Gold Seniors: $3,881 *Q to Q4 2015, includes all dividends paid. Source: MetalPrices.com for metal spot prices Index: September 30, 2009 = 100. Mandalay share price: $0.64. Graph updated quarterly, prices as at the last trading day of each respective quarter. 8 **Annual cash dividend paid quarterly, based on 6% of the Company s trailing quarter s gross revenue and the future cash requirements of the Company 1. Adjusted for reinvested dividends. Assumes investment in Mandalay made as part of private placement announced on 24-Sep-09 to fund acquisition of Costerfield and accounts for warrant exchange offer of 0.47 shares per warrant. End date as at Feb. 18, Peer Index: Argonaut, Dundee PM, Kirkland, Lake Shore, OceanaGold, Perseus, Primero, Timmins. 3. Gold Seniors: Agnico Eagle, AngloGold, Barrick, Goldcorp, Gold Fields, Kinross, Newcrest, Newmont, Polyus, Yamana.

9 Investment Rationale for Mandalay in Skellefteå Highly Educated Workforce Stable Mining Jurisdiction Stable Economy and Infrastructure Supervisory positions largely staffed with academic credentials of Masters-level and above Strong mining tradition and work ethic Low interest rates Good access to equipment, insurance, and consumables Low energy costs with stable access to energy Currently 3 rd highestranked jurisdiction for positive mining policy perception (1) Ranked 13 th globally for Investment Attractiveness (1) Fraser Institute Annual Survey of Mining Companies 2015 can be accessed at: 9

10 Investment Rationale for Mandalay in Björkdal Highly efficient & productive workforce Opportunities for improvement in operations Grade control Operational plant improvements Ore sorting Increase reserve through exploration Grade improvement Opportunity to drive average grade from 1.3g average head grade to 2g reserve grade (g/t) Low environmental impact operation Building assay lab on site timing June 2016 Fraser Institute Annual Survey of Mining Companies 2015 can be accessed at: 10

11 Björkdal Gold Mine: Overview Land package and Ownership 12,747 hectares 100% Number of Employees (1) 165 direct, 65 contractors: 230 total 2015 Production 44,039 oz Au 2016E Production P&P Reserves (2) Current throughput 50,000 55,000 oz Au Represents approximately 30% of global production g/t Au 3,500 tpd Plant recoveries (2015) Au: 88% 2016 Planned Exploration Budget $3 million 1. As at year-end 2014, filed in Company s Annual Information Form 2. Please see notes to Reserves on Company website 51 1

12 Björkdal Geology and Mining Transformation Improved knowledge: Fundamental geology of district and mine Understanding gold distribution in the vein system Plus new operating practices: Commitment to exploration - (US$3.0 million in 2016) Detailed drill core logging and sampling Detailed face mapping and chip sampling every blast; discard low-grade on-vein advances and detailed stope design, leaving behind low-grade segments Commitment to in-mine drilling (both POD and extensional) Local assay lab under construction LeachWell process (large samples so more accurate; high capacity and fast turnaround) Commitment to test programs to confirm/measure improvements Geology informing mining decisions (small cross-discipline teams) Leading to: More selective and geologically-controlled extraction supported by improved resource modelling Increased reserves Improved grades from underground and open pit An improved, deliverable economic mine plan with real-time grade control Production of more ounces of gold from existing capacity at lower cost/oz 13

13 Björkdal Processing Improvements Completed: Sampling survey on milling and gravity gold circuits to identify improvement opportunities Laboratory flotation recovery study on effect of fineness of grind, % solids, and residence time key for decision-making on possible future flotation circuit expansion 2016 Planned Improvements: Milling/Flotation material flow stability survey to identify areas where automation can be implemented to improve recovery Introduction of high chrome grinding media for increased wear resistance, grinding media cost saving and improved pulp chemistry for improved flotation recovery Flotation circuit and ancillary equipment expansion study to determine OPEX and CAPEX for a planned flotation circuit expansion to improve flotation recovery and concentrate grade Pilot tests to investigate the improvement of coarse, fine, and ultra-fine particle gold recovery in the flotation circuit 14

14 Björkdal Gold District Exploration in 2016 Storheden Intercepts under tailings Björkdal Mine: MI&I Resources P&P Reserves Open Pit Underground Nylunds Potential open pit infill drilling 2016 Rönnberget Historic and current drilling with highgrade intercepts Pit 2 Mine 2 KM Target 1 5

15 Permitting 2016 The existing environmental permit for the mine will expire when the planned capacity of the tailings management facility ( TMF ) is reached in The renewal of this permit is understood to be a two year process. A new permit related to the mine tailings area is required before 2019 and the application process began in The permitting process entails amoung other things the following: Archeological studies Analysis of impact for the Sami community that are active in the area Fish and water life in the area and close vicinity of the mine Study of fauna and wildlife in the area Existing water qualities and water balances in the area Studies of noise, dust, etc during the operation of the mine. In conjunction with the permitting process Björkdal will begin the development of its Community Action Plan, consistent with guidelines for all mine sites. 2

16 Björkdal Team Active in the Local Community Revitalization of Sandfors Village School The Björkdal team refurbished the old school in Sandfors village Rather than be totally shut down, the school was converted into a multipurpose, multi-use facility for the community, including: A contractor/employee hotel for the mine; A kindergarten facility; and The school kitchen was repurposed as a restaurant that serves the kindergarten, employees, and local community Conservation and Water Quality The Björkdal team works closely with the local fishing conservation association to share information from environmental testwork conducted around the property Björkdal team discusses the health and water quality of nearby streams and lakes and assists local conservation authority in formulating strategies to best preserve water quality and the health of nearby fish and aquatic invertebrates Nearby streams are crucial spawning areas for salmon and brown trout, so water quality is of key importance INSERT PHOTO OF SCHOOL 18

17 2016 and Beyond Operations Build on an already efficient low cost per tonne operation Grow high grade oz Au and lower cost/oz Au by: Reducing mine dilution in underground to improve head grades with minimal increase in cost per tonne Ore sorting Processing improvements to increase recoveries Exploration Grow reserves and mine life by: Improved fundamental geologic concepts Self-funded exploration drilling Community Develop community action plan ongoing connections with community Introduce community resolution process Implement community perception survey Community open house Mining team Personal leadership training for all supervisory staff More discussion and opportunities for values-based leadership opportunities 19

18 APR 2016 TSX // MND For more information, please contact: Greg DiTomaso Director, Investor Relations Tel: Company Website:

19 Mandalay Resources - Björkdalsgruvan Nästan allt är guld som glimmar! 23

20 Mandalay Resources - Björkdalsgruvan Framtiden är guld värd! Och det är vi som håller i rodret! 24