MAG Silver Corp. Juanicipio Joint Venture. Corporate Presentation November 10, 2011 Vancouver

Transcription

1 MAG Silver Corp Juanicipio Joint Venture Corporate Presentation November 10, 2011 Vancouver

2 Forward Looking - Safe Harbor Statement MAG Silver Corp is a Canadian issuer. This presentation is prepared by MAG Silver Corp ( MAG TSX / MVG NYSE Alternex ) management and MAG is solely responsible for content and format. Daniel MacInnis P.Geo is a non-independent Qualified Person and has compiled this presentation from industry information and reports and news releases with specific underlying Qualified Persons as set out in the Releases and reports. Industry Information has been compiled from publicly available sources and may not be complete, up to date or reliable. This presentation contains forward-looking statements within the meaning of Canadian and U.S. securities laws. Such forward looking statements are subject to risks and uncertainties which could cause actual results to differ materially from estimated results. Such risks and uncertainties include, but are not limited to, the Company s ability to raise capital to fund development and exploration, changes in general economic conditions or financial markets, changes in metal prices, general cost increases, litigation, legislative, environmental and other judicial, regulatory, political and competitive developments in Mexico or Canada, technological and operational difficulties or inability to obtain permits encountered in connection with The Company s exploration activities, community and labor relations matters and changes in foreign exchange rates, all of which are described in more detail in the Company s filings with the Securities and Exchange Commission. There is no certainty that any forward looking statement will come to pass and investors should not place undue reliance upon forward-looking statements This presentation uses the term "Indicated Resources". MAG advises investors that although this term is recognized and required by Canadian regulations (under National Instrument Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize this term. Investors are cautioned not to assume that any part or all of mineral deposits in this category will ever be converted into reserves. Cautionary Note to Investors Concerning Estimates of Inferred Resources: This presentation uses the term "Inferred Resources". MAG advises investors that although this term is recognized and required by Canadian regulations (under National Instrument Standards of Disclosure for Mineral Projects), the U.S. Securities and Exchange Commission does not recognize this term. Investors are cautioned not to assume that any part or all of the mineral deposits in this category will ever be converted into reserves. In addition, "Inferred Resources" have a great amount of uncertainty as to their existence, and economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules, estimates of Inferred Mineral Resources may not form the basis of feasibility or pre-feasibility studies, or economic studies except for Preliminary Assessment as defined under Canadian National Instrument Investors are cautioned not to assume that part or all of an Inferred Resource exists, or is economically or legally mineable. The Company may access safe harbor rules. Please see complete information on SEDAR and at the SEC on EDGAR. This presentation is for information purposes only and is not a solicitation. Please contact the Company for complete information and consult a registered investment representative / advisor prior to making any investment decision. Note to U.S. Investors: Investors are urged to consider closely the disclosure in our Form 40F, File no , available at our office: Suite West Pender, Vancouver BC, Canada, V6C 2V6 or from the SEC: 1(800) SEC The Company may access safe harbor rules. Investors are urged to consider closely the disclosures in MAG Silver's annual and quarterly reports and other public filings, accessible through the Internet at and Neither the TSX Venture Exchange nor the New York Stock Exchange Alternex has reviewed or accepted responsibility for the accuracy or adequacy of this presentation, which has been prepared by management. 2

3 MAG Silver Growing Assets Exploration / Pre-development - focused on Ag (Pb / Zn) in Mexic0 Main Asset 44% Interest in the Juanicipio Joint Venture Indicated Resource of 5.7M tonnes grading 702 g/t Ag (128M oz.) / 1.9 g/t Au /2.2% Pb / 4.2% Zn Inferred Resource of 4.3M tonnes grading 513 g/t Ag (71M oz) / 1.4 g/t Au / 1.6% Pb / 3.0% Zn Updated PEA underway and tentatively scheduled for early Q completion New Discovery Confirmed on Las Venadas High Grade Mo / Au Deposit Pozo Seco (100% Interest) Indicated resource M tonnes grading 0.147% Molybdenum and 0.25 g/t Gold (94M pounds Mo / 230K ounces Au) Inferred resource 23.38M tonnes grading 0.103% Molybdenum and 0.17 g/t Gold (53M pounds Mo / 129K ounces Au) Cinco de Mayo Jose Manto Ag / Pb / Zn (100% Interest) New high grade Ag / Pb/ Zn sulphide intercepts in the Jose Manto Cinco Ridge mineralized corridor (Bridge Zone) Resource estimation on Jose Manto by Q Strong Financial Position - $CDN 27.0M (October. 2011) 3

4 Property Locations Work Activity One Drill Operating New Mineralization Discovered One Drill Operating Drilling Planned 2012 (Q1) 8 Drills Operating One Drill Operating 4

5 MAG Silver Core Asset Location and Focus The Fresnillo Silver Trend Over 4.2 billion ounces of silver production Host to the world s largest primary silver mine 37M oz. per year (2010) MAG holds a significant land package on the trend 10% of world historical production MAG Land Holdings 5

6 Zacatecas / Fresnillo Major Silver Districts Core Area MAG is active in the Zacatecas District - Lagartos SE: Puerto Rico, Mala Noche and Veta Grande Veins Vibora Vein Drilling in progress at Lagartos SE / S 6

7 Minera Juanicipio S. A. de C.V. - Upside for Discovery Main Asset - Valdecañas Vein Emerging multiple vein district Owned 44% MAG / 56% Fresnillo plc New Resource Estimate 200M oz. Ag Standalone Updated PEA Study underway (Q1 2012) Saucito Mill Emerging high grade ore shoot on Juanicipio Vein 3 rd Vein Identified / Las Venadas 100% Fresnillo plc 7

8 Juanicipio Updated Resource November 2011 Prepared by Strathcona Mineral Services on behalf of the Juanicipio Joint Venture Highlights Indicated Resource increased to 64% of total estimate Lower tonnage but with higher overall grade: 10M tonnes (increased economics) Indicated Grade increased to 702 g/t Silver (22.5 ounces per tonne) Inferred Grade increased to 513 g/t Silver (16.5 ounces per tonne) Contained Metal: 200M oz Ag / 538K oz. Au / 410M lbs. Pb / 801M lbs. Zn Strathcona quote:...there can be little doubt that the Valdecañas Vein will become an important silver producer within the district 8

9 Juanicipio Join Venture Resource Estimate to June / Strathcona Mineral Services 100 g/t Silver Cut off Classification Tonnes (millions) Silver (g/t) Silver (million Ounces) Gold (g/t) Valdecañas Vein Lead (%) Zinc (%) Gold (K oz) Lead (M lbs.) Zinc (M lbs.) Indicated Inferred Footnotes: 1. CIM Definition Standards have been followed for classification of mineral resources. 2. Mineral resources are reported at a 100 g/t silver cut-off. 3. The mineral resource estimate uses drill hole data available as of June 01, Mineral resources are not mineral reserves and do not have demonstrated economic viability. 5. Totals may not add correctly due to rounding. Footwall (Desprendido) Vein Inferred Juanicipio Vein Inferred Totals Indicated Inferred

10 Scoping Study* - Synopsis August Valdecañas Vein Stand Alone Scenario 100% MAG 44% NPV (5%) (@ US$12.32 oz./ag; $698oz/Au; $0.79lb/Pb; $1.10lb/Zn) US$967M US$425.5M IRR (pretax) 48.4% Payback 2.2 years Pre Production / PP Capital 3.5 years / US$65M US$28.6M Mine Life / Mine Rate/Mill Rate Operating Costs 12.6 yrs/2,000tpd/ 2,350tpd US$42.28 t / milled CAPEX (Includes pre production) US$217M US$95.5M Annual Production (Recovered Silver) 14.0 M ounces (ave.) 6.2 M oz Unit cost per ounce of accountable silver (net of by product credit and TTM* costs) Pre Tax Returns In Millions $ BASE Base CASE Case US$1.77 Silver Price US$ per Ounce $10.59 $10.00 $11.00 $12.00 $13.00 $14.00 $15.00 NPV (0%) 1, , , , , , , NPV (5%) , , NPV (8%) IRR Unlevered 38.5% 36.6% 40.1% 43.6% 47.0% 50.3% 53.5% Payback (Years) With four year trailing average metal prices. Authored by Wardrop, a Tetra Tech Company on behalf of the Juanicipio joint Venture. * Source Wardrop Valdecañas Project Scoping Study, NI Technical Report, August 19,

11 Valdecañas Vein Resource Classification Plan View Valdecañas Vein Composite and Block Model Silver Grades Diagram by Strathcona Mineral Services Indicated Ag Ounces 702 g/t Ag (56.3M MAG 44%) Inferred Ag Ounces 513 g/t Ag (31.2M MAG 44%) Juanicipio Vein Composite and Block Model Silver Grades Diagram by Strathcona Mineral Services 11

12 Valdecañas Vein Level Plan and Cross Section ID Fault 12

13 Las Venadas New Mineralized Structure Hole VP2 4.0 g/t Ag / 8.04 g/t Au NSV VP2 25P 1.0/ 7.70 / P NSV 13

14 Las Venadas Section 37P ( G ) N20ºE The Las Venadas intersections are located above or at the top of the bonanza zone The low base metal content is indicative of higher elevation intercepts on the structure

15 Joint Venture Status - November,

16 Cinco de Mayo CRD District Play CRD Exploration Focus on Jose Manto Cinco Ridge (Bridge Zone) Large, High Grade Moly / Gold Deposit at Pozo Seco Jose Manto Discovery Ag/Pb/Zn 16

17 Cinco de Mayo Buried CRD System Jose Manto Bridge Zone Ag / Pb/ Zn // Pozo Seco Molybdenum / Gold Classic CRD Ag / Pb / Zn Bridge Zone (Ag / Pb / Zn) La Gloria Skarn (Ag / Pb / Zn) Jose Manto (Ag / Pb / Zn) Cinco Ridge (Ag / Pb / Zn) Pozo Seco (Mo / Au) Latest drill results: Replacement style mineralization intersected over a 4.0+Km strike length Jose Manto Bridge Zone High Grade Ag / Pb / Zn m below surface Open all directions Very large CRD system indicated High Grade Oxide Moly / Gold Deposit Shallow / open pit configuration Open in several directions Nearby water, power, road 17

18 Bridge Zone Mineralization extended for 2,000m Recent Drill Results Indicate Mineralization in the Jose Manto / Cinco Ridge Corridor (Bridge Zone) can be traced for over 4,000+ metres. Best result is Hole CM11-380: 386 g/t (11.3 oz/t) silver with 14.0% zinc and 8.2% lead over 3.98 metres including 1,170 g/t (34.0 oz/t) silver with 13.7% zinc and 19.1% lead over 0.86 metres Mineralization is located shallower to the South East at the Bridge Zone (220m - 325m) Mineralization is open in all directions. These new results confirm that a very large Carbonate Replacement ( CRD ) system is present. 18

19 Cinco de Mayo Bridge Zone (New Mineralization) Hole ID Width Ag (g/t) Ag (opt) Lead (%) Zinc (%) CM and and including and CM including and CM and including including CM CM CM Assays Pending CM Assays Pending 19

20 Pozo Seco High Grade Mo / Au Deposit Classification Tonnage (Tonnes x 1000) Molybdenum (%) Molybdenum (pounds) Gold (grams per tonne) Gold (ounces) Total Indicated 29, ,012, ,000 Total Inferred 23, ,205, ,000 Pozo Seco Long Section Potential Open Pit Outline Metallurgical Studies Nearing Completion Next Step: Initiate a PEA (Scoping Study) Notes : 1.CIM Definition Standards have been followed for classification of Mineral Resources. 2.The cut-off grade of 0.022% Mo was estimated using a Mo price of US$17/lb. and assumed operating costs and recoveries. 3.Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability. 4.Totals may not add correctly due to rounding. 20

21 Cinco de Mayo Round up Jose Manto Cinco Ridge (Bridge Zone) Latest seven drill holes connects Jose Manto and Cinco Ridge mineralization (Ag / Pb / Zn). Mineralized corridor is now over 4,000+ meters long indicating a very large CRD presence. Drilling to continue. Pozo Seco Metallurgy process in final stages. Once completed and with acceptable Mo recoveries will lead to a Preliminary Economic Assessment (PEA) before end of 2012Q1. Jose Manto Deposit remains open in several directions with large upside potential based on geophysics and drilling. Reassessment and a first resource estimate is underway and is expected by mid 2012 Q1. 21

22 Mojina CRD Main Street 22

23 Mojina Salient Points MAG earning 100% of the Mojina Silver-Lead-Gold (Zinc) Property. Drilling in Progress Nov Pozo Seco Cinco de Mayo Mo MAG Base Camp Past Production of: 125,000 tonnes grading g/t ( opt) silver, 2-4 g/t gold and 8-10% Lead from oxidized manto ores. Same structural grain Same Regional Structure? Same Lithological Section Superb Infrastructure Easily explored from Cinco base camp Mojina 23

24 Mojina Magnetics and Intrusion Focus Felsic Dike-Sill Historic Mine Area Carbonate section Felsic Breccia X Drill Target Probable Intrusion And Felsite source Sill Upper Mine Lower Mine Access Adit Mn-oxide mill tailings from elsewhere

25 La Esperanza MAG (60%) / Canasil Option 25

26 La Esperanza Property Highlights MAG earning a 60% interest in 19k ha Fresnillo / La Colorado Silver Trend Multiple epithermal vein system 7 holes with weighted average of: 330 g/t Ag (9.6 opt) and 2.5% Pb + Zn /4.21m AEM / Mag survey completed Dec

27 La Esperanza Cross Section looking NW ES06-09 ES06-06 ES06-04 Weighted Average This Section (3 Holes) Width Meters Silver g/t Silver opt Lead % Zinc % Mine Workings 7 holes with weighted average of: 330 g/t Ag (9.6 opt) and 2.5% Pb + Zn / 4.21m 27

28 La Esperanza Multiple Vein Targets MAG / Canasil Option 28

29 Lagartos SE, LAG 5 Work in Progress Core Area LAG 5 Vibora ( Snake ) Vein Target 29

30 Lagartos SE Proposed Drilling LAG 5 El Compass Vein Snake Vein El Orito Vein MAG Silver Claim Boundary Vibora ( Snake ) Vein MAG Silver (100%) LAG 5 Claim Block 30 MAG Silver 1 Km Area of Exploration Focus Snake Vein

31 MAG News to Watch For in 2011 Juanicipio Joint Venture - MAG 44% Completion of Valdecañas Stand Alone Update PEA Study (Q1, 2012) Exploration / Delineation results for Juanicipio Vein Follow up on Las Venadas Exploration results on Other Targets Cinco de Mayo (Pozo Seco) - MAG 100% Skarn / CRD / Manto exploration results (Bridge Zone) Metallurgical Test Results for Pozo Seco / PEA in 2012 Jose Manto re-evaluation, resource La Esperanza (60%) / Lagartos SE (100%) / Mojina (100%) Drilling on 3other projects in late 2011 (Q4) Drill and Exploration results Mergers and Acquisitions Searching For Opportunity 31

32 Analyst Coverage Pozo Seco Raymond James Bart Jaworski BMO John Hayes Canaccord Nicholas Campbell 32

33 Major Shareholders - > 1.0M Shares 33

34 Management Team 34

35 POZO SECO Symbol TSX NYSE.A 52 week hi/lo ($CDN) $14.15 $7.25 Recent ($CDN) $8.50 Issued/Outstanding 55,639,761 Options (to $14.70) 4,027,559 Fully Diluted 59,667,320 Working Capital ($CDN) $27,000,000 Nov Market Cap ~ CDN $475M (I/O) 35

36 MAG Silver Corp See for copy of presentation Contact: MAG Silver Corp Suite 770, 800 West Pender Street Vancouver BC, Canada V6C 2V6 Tel.: Toll Free: Corporate Presentation