TSX:AR. Corporate Presentation. June 1, 2017

Transcription

1 TSX:AR Corporate Presentation June 1, 2017

2 FORWARD LOOKING INFORMATION This presentation contains certain forward-looking statements and forward-looking information under applicable Canadian securities laws concerning the proposed transaction and the business, operations and financial performance and condition of Argonaut Gold Inc. ( Argonaut or Argonaut Gold ). Forward-looking statements and forward-looking information include, but are not limited to, statements with respect to estimated production and mine life of the various mineral projects of Argonaut; expectations with respect to future cash flows from operations, net debt and financial results; the successful completion of proposed acquisitions; metal or mineral recoveries; synergies and financial impact of completed acquisitions; the benefits of the development potential of the properties of Argonaut; the future price of gold, copper, and silver; the estimation of mineral reserves and resources; the realization of mineral reserve estimates; the timing and amount of estimated future production; costs of production; success of exploration activities; and currency exchange rate fluctuations. Except for statements of historical fact relating to Argonaut, certain information contained herein constitutes forward-looking statements. Forward-looking statements are frequently characterized by words such as plan, expect, project, intend, believe, anticipate, estimate and other similar words, or statements that certain events or conditions may or will occur. Forward-looking statements are based on the opinions and estimates of management at the date the statements are made, and are based on a number of assumptions and subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking statements. Many of these assumptions are based on factors and events that are not within the control of Argonaut and there is no assurance they will prove to be correct. Factors that could cause actual results to vary materially from results anticipated by such forward-looking statements include risks of the mining industry, failure of plant, equipment or processes to operate as anticipated, changes in market conditions, variations in ore grade or recovery rates, risks relating to international operations, fluctuating metal prices and currency exchange rates, changes in project parameters, the possibility of project cost overruns or unanticipated costs and expenses and labour disputes. These factors are discussed in greater detail in Argonaut's (i) preliminary short form prospectus dated February 27, 2017, (ii) most recent Annual Information Form, and (iii) most recent Management Discussion and Analysis, which are each filed on SEDAR and provide additional general assumptions in connection with these statements. Argonaut cautions that the foregoing list of important factors is not exhaustive. Investors and others who base themselves on forward-looking statements should carefully consider the above factors as well as the uncertainties they represent and the risk they entail. Argonaut believes that the expectations reflected in those forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements included in this presentation should not be unduly relied upon. These statements speak only as of the date of this presentation. Although Argonaut 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 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. Argonaut undertakes no obligation to update forward-looking statements if circumstances or management s estimates or opinions should change except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking statements. Statements concerning mineral reserve and resource estimates may also be deemed to constitute forward-looking statements to the extent they involve estimates of the mineralization that will be encountered if the property is developed. Comparative market information is as of a date prior to the date of this document. References to dollars or $ are to U.S. dollars unless specified otherwise. TSX:AR June 2017 ARGONAUT GOLD 2

3 Argonaut s Long Term Goal: Intermediate Gold Producer (300k 500k oz per year) RATIONALE CASH SUSTAINABLE It provides cash needed to grow and build. At $1,200 gold price, 300,000 oz at AISC 1 $950 yields $75M per year FCF (after tax) which can fund the following based on circumstances: - Exploration - Build new mines - Dividends NEW INVESTORS It opens doors for different investors at $1B plus market cap 1 Non-IFRS measures discussed on page 21 of this presenta:on TSX:AR June 2017 ARGONAUT GOLD 3

4 Argonaut Competitive Advantages Competitive advantages vs other junior gold mining companies: PROVEN CASH GENERATION AT LOW GRADE OPERATIONS ABILITY TO SHOW VALUE ADD Growth at El Castillo Resource growth and construction of San Agustin Restart of La Colorada CLEAN BALANCE SHEET Consistantly demonstrated that the balance sheet will not be put at risk Our Goal USE OPERATIONAL EXPERTISE AND EXPERIENCE TO CREATE THE NEXT INTERMEDIATE GOLD PRODUCER IN THE AMERICAS TSX:AR June 2017 ARGONAUT GOLD 4

5 Checking The Right Boxes Strong board and management ~45% production growth through 2019 Leverage to gold through development assets Focus on high-return, short payback projects in the Americas Focus on simple projects Strong balance sheet Our Long- Term Goal Annual production 300,000 to 500,000 GEOs at an AISC 1 at or below $950 per gold ounce. 1 Non-IFRS measures discussed on page 21 of this presentation. TSX:AR June 2017 ARGONAUT GOLD 5

6 2017 Production and Cost Guidance El Castillo / San Agustin 4 Complex La Colorada Consolidated GEO 1 Production In 000s Cash costs 2, 3 $/Au oz sold AISC 2, 3 $/Au oz sold GEO is gold equivalent ounces based on a conversion of silver to gold at a a 70:1 ratio. 2 Non-IFRS measures discussed on page 21 of this presentation. 3 Assumes a MXN:USD exchange rate of 19:1. 4 San Agustin guidance reflects full year expected production and cost guidance. Production and costs prior to the declaration of commercial production will be capitalized on the balance sheet. TSX:AR June 2017 ARGONAUT GOLD 6

7 Three-Year Production Outlook Prior to San Juan Concession Purchase GEO 2 Production El Castillo/San Agustin Complex La Colorada Year El Castillo / San Agustin 1 Complex GEO Production (000s) La Colorada GEO Production (000s) Consolidated GEO Production (000s) Year Steady Production Growth Argonaut Goal: Annual AISC 4 at or below $950 per gold ounce sold 1 San Agustin 2017 guidance reflects full year expected production production and costs prior to declaration of commercial production will be capitalized on the balance sheet. 2 GEO is based on a conversion ratio of 70:1 for silver to gold ounces. 3 Assumes mid-point of production guidance. 4 Non-IFRS measures discussed on page 21 of this presentation. TSX:AR June 2017 ARGONAUT GOLD 7

8 San Agustin Construction Schedule and Project Details 1 PROJECT DETAILS 10 kilometres from the El Castillo mine Low initial capital - $43M Low cash costs - $648/GEO After-tax IRR 50% After-tax NPV at $1,200 Au and 5% discount - $90M Average LOM annual production 80k GEOs Low risk project Open pit / Heap leach GEO production profile first 5 years Year 1 Year 2 Year 3 Year 4 Year Aug Sept Oct Nov Dec Jan Feb Mar Apr May Jun Jul Construction Commences Detail Design El Castillo West Crusher Relocation/Installation Leach Pad & Pond Construction Produce & Place Pad Overliner Recovery Plant Installation Commence Mining Commence Loading Leach Pads 1 Based on the assumptions and parameters as set forth in the PEA NI Technical Report dated June 10, TSX:AR June 2017 ARGONAUT GOLD 8

9 San Agustin Construction Leach pad Primary crusher with stacker Mining Secondary screening and crushing TSX:AR June 2017 ARGONAUT GOLD 9

10 MINE DETAILS 120 kilometres from the capital of Durango in state of Durango, Mexico Open pit / Heap leach mine 2016 Production and Preliminary Costs El Castillo Mine Production of 62,766 GEOs 2 Cash costs - $904/oz sold 2017 Guidance El Cas:llo Production of 70,000 80,000 GEOs at El Castillo/ San Agustin Complex Cash costs - $ /oz sold GOLD RESERVES & RESOURCES (at December 31, 2016) 1 Category Tonnes (millions) Au Grade (g/t) Au Ounces (millions) Proven & Probable Measured & Indicated Inferred Mineral Resources are inclusive of Mineral Reserves. Please see resource disclosure on page 22 for full details 2 GEO is gold equivalent ounces calculated at a conversion rate of 65:1 for silver to gold for 2016 and 70:1 for 2017 TSX:AR June 2017 ARGONAUT GOLD 10

11 El Castillo Then and Now 2010 Today Fresnillo concession Fresnillo concession 300k oz Au mineral reserve Drilled ~35k metres Expanded mineral reserve to 1.2M oz Au 300k oz Au mineral reserve Ini:ated a 21k metres drill program Technical report expected Q El Cas:llo pit Drill targets TSX:AR June 2017 ARGONAUT GOLD 11

12 El Castillo 2017 Infill Drill Program: 157 RC Holes for 20,310 metres TSX:AR June 2017 ARGONAUT GOLD 12

13 El Castillo North Target Drill Results Mineraliza6on In Oxida6on Zone contour map 750m Thickness of 0.15 g/t Au in Drill Holes 5 20 m m m m >150 m 300m Shallow mineraliza6on star6ng at surface to 50 metres Current Pit Deeper mineraliza6on star6ng below 50 metres TSX:AR June 2017 ARGONAUT GOLD 13

14 El Castillo South Target Drill Results Mineraliza6on In Oxida6on Zone contour map 400m Current Pit Thickness of 0.15 g/t Au in Drill Holes 5 25 m m m m >100 m 400m Shallow mineraliza6on star6ng at surface to 30 metres Deeper mineraliza6on star6ng below 30 metres TSX:AR June 2017 ARGONAUT GOLD 14

15 MINE DETAILS 45 kilometres from the capital of Hermosillo Open pit / Heap leach mine La Colorada Mine 2016 Production and Preliminary Costs Production of 59,331 GEOs 2 Cash costs - $704/oz sold 2017 Guidance Production of 45,000 50,000 GEOs 2 Cash costs - $ /oz sold Category GOLD RESOURCES (at December 31, 2016) 1 Tonnes (millions) Au Grade (g/t) Contained Au Ounces (millions) Ag Grade (g/t) Contained Ag Ounces (millions) Measured & Indicated Inferred Please see resource disclosure on page 22 for full details 2 GEO is gold equivalent ounces calculated at a conversion rate of 65:1 for silver to gold in 2016 and 70:1 in 2017 TSX:AR June 2017 ARGONAUT GOLD 15

16 El Creston Drilling Comparison Pits $1200 Block Model October 2016 Constraint Pit Indicated Unconstraint Pit Indicated Unconstraint Pit Indicated & Inferred Pits $1200 Block Model April 2017 (includes 2017 drill holes) Constraint Pit Indicated Unconstraint Pit Indicated Unconstraint Pit Indicated & Inferred TSX:AR June 2017 ARGONAUT GOLD 16

17 PROJECT DETAILS 1 Magino Project Gold production profile Life of mine Location Ontario, Canada Mine life 10 years Cash cost - $582/oz Au After-tax NPV at $1,200 gold and a 5% discount rate - $415M After-tax IRR 23% Initial capital - $540M US$M *Mine Fleet 70 Pre-production Mining 40 *Process Plant 180 Infrastructure & Tailings 95 Total Direct Cost Year Long Sec:on PFS Ore Blocks Above 0.34 g/t Mineral Reserve Cutoff EPCM, Indirects, Owners Costs 100 Contingency 55 Total Initial Capital 540 note: *Of the above, $176mm is quoted RESERVES & RESOURCES (at December 31, 2016) 2 Proven & Probable Reserves of 3.0M oz Au 105M tonnes at 0.89 g/t Indicated of 4.1M oz Au (inclusive of reserves) 144M tonnes at 0.88 g/t CATALYSTS Feasibility Study H Permitting and First Nations agreements Au Block Grades - 1-2g/t 2-3g/t +3g/t 1 Based on the assumptions and parameters as set forth in the Pre-Feasibility NI Technical Report dated February 22, Please see Resource disclosure on page 22 for full details TSX:AR June 2017 ARGONAUT GOLD 17

18 Key Deliverables La Colorada exploration results El Castillo North Target exploration results El Castillo South Target exploration results þ þ þ First gold production from San Agustin Q Magino Feasibility Study H New El Castillo Complex NI Technical Report Q Magino permits 2018 TSX:AR June 2017 ARGONAUT GOLD 18

19 Summary of Investment Case Strong balance sheet with flexibility Defensive gold stock Highly leveraged to upside in gold Proven operator $55M cash $30M revolver $18M VAT $61M inventory value at $1,200 gold At March 31, 2017 Long track record of adding cash to the balance sheet through operations Goal of AISC 1 at or below $950 per gold ounce sold De-risking of development assets provide tremendous leverage Track record of low cost production ~45% annual production growth 2017 to 2019 prior to Fresnillo transaction 1 Non-IFRS Measure. See note on page 21 of this presentation. TSX:AR June 2017 ARGONAUT GOLD 19

20 ADDITIONAL INFORMATION Dan Symons Vice President, Investor Relations Argonaut Gold Inc. First Canadian Place 100 King St. West, Suite 5700 Toronto, ON M5X 1C7 T: CORORATE PRESENTATION JANUARY 2017 ARGONAUT GOLD TSX:AR

21 Notes and Disclosures Argonaut Gold is a Canadian gold company engaged in exploration, mine development and production activities. Its primary assets are the production stage El Castillo mine and the construction stage San Agustin project in Durango, Mexico and the production stage La Colorada mine in Sonora, Mexico. Advanced exploration stage projects include the San Antonio project in Baja California Sur, Mexico, and the Magino project in Ontario, Canada. The Company also has several exploration stage projects, all of which are located in North America. QUALIFIED PERSON Technical information included in this presentation was supervised and approved by Thomas Burkhart, Argonaut Gold's Vice President of Exploration, and a Qualified Person under National Instrument Standards of Disclosure for Mineral Projects. ( NI ). NATIONAL INSTRUMENT Thomas Burkhart, Argonaut Gold s Vice-President of Exploration and a Qualified Person under NI , has read and approved the scientific and technical information in this presentation as it relates to Argonaut. This presentation contains information regarding mineral resources that are not mineral reserves and do not have demonstrated economic viability. The preliminary economic assessments referenced herein are preliminary, and may include inferred mineral resources that are too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the preliminary economic assessments will be realized. CAUTIONARY NOTE TO U.S. INVESTORS CONCERNING ESTIMATES OF MEASURED, INDICATED AND INFERRED RESOURCES This presentation uses the terms Measured, Indicated and Inferred Resources as defined in accordance with NI United States readers are advised that while such terms are recognized and required by Canadian securities laws, the United States Securities and Exchange Commission does not recognize them. Under United States standards, mineralization may not be classified as a reserve unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve calculation is made. United States readers are cautioned not to assume that all or any part of the mineral deposits in these categories will ever be converted into reserves. In addition, Inferred Resources have a great amount of uncertainty as to their existence, and as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Resource will ever be upgraded to a higher category. United States readers are also cautioned not to assume that all or any part of an Inferred Resource exists, or is economically or legally mineable. NON-IFRS MEASURES The Company has included certain non-ifrs measures including Cash cost per gold ounce sold, All-in sustaining cost per gold ounce sold, Adjusted net earnings and Adjusted earnings per share in this presentation to supplement its financial statements which are presented in accordance with International Financial Reporting Standards ( IFRS ). Cash cost per gold ounce sold is equal to production costs less silver sales divided by gold ounces sold. All-in sustaining cost per gold ounce sold is equal to production costs less silver sales plus general and administrative expenses, exploration expenses, accretion of reclamation provision and sustaining capital expenditures divided by gold ounces sold. Adjusted earnings is equal to net income (loss) less foreign exchange impacts on deferred income taxes, foreign exchange (gains) losses, non-cash impairment write down (reversal) related to the net realizable value and changes in expected recovery of gold ounces from mineralized material in the work-in-process inventory, non-cash impairment loss on certain non-current assets, unrecognized Mexican operating loss carryforwards, unrecognized (recognition of previously unrecognized) Mexican deferred tax assets during the period and other adjustments. Adjusted earnings (loss) per share is equal to adjusted net earnings (loss) divided by basic weighted average number of common shares outstanding. The Company believes that these measures provide investors with an improved ability to evaluate the performance of the Company. Non-IFRS measures do not have any standardized meaning prescribed under IFRS. Therefore they may not be comparable to similar measures employed by other companies. The data is intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. TSX:AR June 2017 ARGONAUT GOLD 21

22 Mineral Resource Notes and Disclosures All Mineral Resources have been estimated in accordance with Canadian Institute of Mining ( CIM ) Standards. Mineral Resources are not known with the same degree of certainty as Mineral Reserves and do not have demonstrated economic viability. In addition, the quantity and grade of reported inferred mineral resources shown above are uncertain in nature and there is insufficient exploration to define these inferred mineral resources as an indicated or measured mineral resource and it is uncertain if further exploration will result in upgrading them to an indicated or measured mineral resource category. Numbers may not add up due to rounding. The Mineral Reserves for El Castillo were updated internally, are valid as of December 31, 2016 and reviewed by Mike Lechner and Richard Rhoades, each of whom is a "qualified person" for purposes of NI The reserve update used a gold price of $1,200. Cut-off grades, depending on rock and ore type, varied from 0.15 g/t for oxide to 0.44 g/t for silicified sulphide. The Mineral Reserves for Magino were taken from the Magino Technical Report dated February 22, 2016 (effective January 18, 2016). The Mineral Reserve was estimated at a gold price of $1,200. The Probable Reserve study used a gold cutoff of 0.35 g/t. These amounts have been reviewed and confirmed by Thomas Burkhart, who is a qualified person for purposes of NI The M&I Resource and Inferred Resource for El Castillo were updated internally, are valid as of December 31, 2016 and reviewed Mike Lechner and Richard Rhoades, each of whom is a "qualified person" for purposes of NI The Mineral Resource update used a gold price of $1,400. Cut-off grades, depending on rock and ore type, varied from g/t for oxide to g/t for silicified sulphide. The Mineral Resources for the San Agustin Gold-Silver Project were taken from the San Agustin Technical Report dated June 10, 2016 (effective date of April 29, 2016). The Mineral Resource was estimated at a gold price of $1,300 and silver price of $20. A gold equivalent cutoff of 0.18 g/t was utilized for the resource. These amounts have been reviewed and confirmed by Thomas Burkhart, who is a "qualified person" for purposes of NI The M&I Resource and Inferred Resource used for La Colorada were updated internally, are valid as of December 31, 2016 and reviewed by Mike Lechner and Richard Rhoades, each of whom is a "qualified person" for purposes of NI The Mineral Resource update used a gold price of $1,400 and a silver price of $20. The gold equivalent cutoff grade varied depending on deposit and ranged from to 0.13 g/t. The Mineral Resources for the Magino Project were taken from the Magino Technical Report dated February 22, 2016 (effective date of January 18, 2016). The Mineral Resource was estimated at a gold price of $1,300. The Indicate Resource study used a cutoff of 0.25 g/t gold. These amounts have been reviewed and confirmed by Thomas Burkhart, who is a "qualified person" for purposes of NI The Mineral Resources for the San Antonio Project were taken from the San Antonio Technical Report dated October 10, 2012 (effective date of September 1, 2012). The gold resource was estimated at a gold price of $1,500 using a cutoff grade of 0.11 g/t Au for oxide and transition and 0.15 g/t Au for sulphide. These amounts have been reviewed and confirmed by Thomas Burkhart, who is a "qualified person" for purposes of NI TSX:AR June 2017 ARGONAUT GOLD 22

23 Appendix TSX:AR June 2017 ARGONAUT GOLD 23

24 Q and Recent Highlights Solid Financial Performance Net income of $12.0 million and adjusted net income 1 of $4.9 million Earnings per share basic of $0.07 and adjusted earnings per share basic 1 of $ ,707 GEO 2 Production Produced 37,707 GEOs at a cash cost per gold ounce sold 1 of $751 and AISC per gold ounce sold 1 of $870 Growth Initiatives Construction at San Agustin Acquired Fresnillo concession to extend mine life at El Castillo Infill drill program at El Castillo Infill drill program and stripping at El Creston deposit at La Colorada De-risking Magino Project Submitted Environmental Impact Statement January 2017 Feasibility Study during H Advanced permitting Advanced First Nations impact benefit agreements Received Environmental Socially Responsible Company award at all Mexican opera:ons 1 Please refer to section on slide 21 entitled Non-IFRS Measures for a discussion of these Non-IFRS Measures. 2 Gold equivalent ounces ( GEO or GEOs ) are based on a conversion ratio of 70:1 for silver to gold for TSX:AR June 2017 ARGONAUT GOLD 24

25 Strong Q1 Production One time benefits Potentially sustainable benefits El Castillo Delay of disassembly and relocation of west crusher to San Agustin from early February to early March led to placement of ore on the pad that exceeded budget Completed leaching of previously placed ROM material La Colorada Area of higher than expected grade in Grand Central/La Colorada pit was loaded onto the leach pad El Castillo Changes to crusher maintenance program, which led to less downtime Modifications to blasting practices to increase rock fragmentation, which aided crusher throughput La Colorada Modifications to blasting practices to increase rock fragmentation, which aided crusher throughput TSX:AR June 2017 ARGONAUT GOLD 25

26 El Castillo North Target 75 RC Holes for 11,540 metres TSX:AR June 2017 ARGONAUT GOLD 26

27 El Castillo North Target TSX:AR June 2017 ARGONAUT GOLD 27

28 El Castillo North Target TSX:AR June 2017 ARGONAUT GOLD 28

29 El Castillo North Target TSX:AR June 2017 ARGONAUT GOLD 29

30 El Castillo North Target TSX:AR June 2017 ARGONAUT GOLD 30

31 El Castillo North Target TSX:AR June 2017 ARGONAUT GOLD 31

32 El Castillo North Target TSX:AR June 2017 ARGONAUT GOLD 32

33 El Castillo South Target (71 RC Holes for 6,990 metres) El Cas:llo San Juan Claim 547,788 E 547,826 E 547,864 E 547,902 E 547,940 E 547,978 E 548,016 E TSX:AR June 2017 ARGONAUT GOLD 33

34 El Castillo - South Target Sec:on 547,788 E San Juan Claim El Cas:llo Current Topo g/t Au g/t Au _ 1,700 Ox Level Au > 0.15 g/t _ 1,600 Au > 0.15 g/t Model Prior to 2017 drill program I I TSX:AR June 2017 ARGONAUT GOLD , , ,200 I

35 El Castillo South Target Sec:on 547,826 E Current Topo San Juan Claim El Cas:llo _ 1,700 Ox Level _ 1,600 Au > 0.15 g/t Model Prior to 2017 drill program Au > 0.15 g/t I I TSX:AR June 2017 ARGONAUT GOLD , , ,200 I

36 El Castillo South Target Sec:on 547,864 E San Juan Claim El Cas:llo Current Topo _ 1,700 Ox Level Au > 0.15 g/t _ 1,600 Au > 0.15 g/t Model Prior to 2017 drill program I I TSX:AR June 2017 ARGONAUT GOLD , , ,200 I

37 El Castillo South Target Sec:on 547,902 E San Juan Claim El Cas:llo Current Topo g/t Au _ 1,700 Ox Level Au > 0.15 g/t Model Prior to 2017 drill program I I Au > 0.15 g/t TSX:AR June 2017 ARGONAUT GOLD , , ,200 I _ 1,600

38 El Castillo South Target Sec:on 547,940 E San Juan Claim El Cas:llo Current Topo _ 1,700 Ox Level Au > 0.15 g/t Au > 0.15 g/t Model Prior to 2017 drill program _ 1,600 I I TSX:AR June 2017 ARGONAUT GOLD , , ,200 I

39 El Castillo South Target Sec:on 547,978 E San Juan Claim El Cas:llo Current Topo _ 1,700 Ox Level Au > 0.15 g/t Au > 0.15 g/t Model Prior to 2017 drill program _ 1,600 I I TSX:AR June 2017 ARGONAUT GOLD , , ,200 I

40 El Castillo South Target Sec:on 548,016 E San Juan Claim El Cas:llo Current Topo _ 1,700 Ox Level Au > 0.15 g/t Model Prior to 2017 drill program Au > 0.15 g/t _ 1,600 I I TSX:AR June 2017 ARGONAUT GOLD , , ,200 I

41 Cost per Tonne Mined / Processed El Castillo - Cost Per Tonne Cost per tonne Q Mining $1.26 $1.14 $1.23 $1.45 $1.29 $1.30 Cost per tonne of ore processed Q Mining $2.21 $2.28 $2.08 $2.62 $2.56 $2.58 Crushing & Processing $3.04 $2.59 $3.13 $2.75 $2.53 $2.42 Mine G&A $0.45 $0.49 $0.67 $0.45 $0.45 $0.30 Total $5.70 $5.36 $5.88 $5.82 $5.54 $5.30 La Colorada - Cost Per Tonne Cost per tonne Q Mining $1.39 $1.64 $1.37 $1.60 $1.37 $1.04 Cost per tonne of mineralized material processed Q Mining $3.44 $5.22 $3.02 $4.85 $1.40 $0.95 Crushing & Processing $2.66 $2.56 $3.11 $4.11 $4.09 $2.07 Mine G&A $0.52 $0.43 $0.59 $1.07 $1.48 $0.71 Total $6.62 $8.21 $6.72 $10.03 $6.97 $3.73 TSX:AR June 2017 ARGONAUT GOLD 41

42 Reserves and Resources at December 31, Project Category Tonnes (millions) Au Grade (g/t) Contained Au Ounces (millions) Ag Grade (g/t) Contained Ag Ounces (millions) El Castillo P&P Magino P&P Consolidated Mineral Reserves P&P El Castillo M&I San Agustin Indicated La Colorada Indicated Magino Indicated San Antonio M&I Consolidated Mineral Reserves M&I El Castillo Inferred San Agustin Inferred La Colorada Inferred Magino Inferred San Antonio Inferred Consolidated Mineral Reserves Inferred Please see Mineral Reserve and Resource disclosure on page 22 of this presentation. TSX:AR June 2017 ARGONAUT GOLD 42

43 2017 Capital Estimate and Fresnillo Transaction Capital 2017 Capital Estimate ($M) 1 Sustaining 6.6 Expansion 46.3 Stripping 21.6 Exploration 1.3 Total 75.8 Recent equity financing Base deal closed March 15, 2017 with net proceeds of approximately $28M 2017 Fresnillo transaction capital $26M purchased price and $2M for infill drill program $69M of $76M capital program are investments for growth initiatives Zero-cost collar currency hedge to safeguard currency volatility during San Agustin construction 1 Assumes exchange rates of MXN:USD of 19.1 and CAD:USD of 1.3:1. Does not include Fresnillo transaction capital (see February 23, 2017 press release). TSX:AR June 2017 ARGONAUT GOLD 43

44 2017 Capital Estimate ($M) 1 El Castillo San Agustin La Colorada Magino, San Antonio & Other Consolidated Sustaining Expansion Stripping Exploration Total Zero-cost collar currency hedge to safeguard currency volatility during San Agustin construction: Hedged $30M Over a 10-month term (February to November 2017) Ensures a MXN:USD Exchange rate of 20:1 with participation up to 24.6: Budget Assumed a 19:1 exchange rate 1 Assumes exchange rates of MXN:USD of 19.1 and CAD:USD of 1.3:1. Does not include Fresnillo concession transaction (see press release dated February 23, 2017). TSX:AR June 2017 ARGONAUT GOLD 44

45 San Antonio Project PROJECT DETAILS 1 45 km from the port capital city of La Paz. Low initial capital - $84M Low cash costs - $553/oz Au After-tax NPV at $1,200 gold and a 8% discount - $206M After-tax IRR of 66% 1.9 year payback Low risk project once permitted Open pit / Heap leach M&I RESOURCES (at December 31, 2016) 2 Measured & Indicated of 1.7M oz Au 65M tonnes at 0.83 g/t Inferred of 67k oz Au 6M tonnes at 0.34 g/t CATALYSTS Communicating with all stakeholders to advance permits 1 Based on the assumptions and parameters as set forth in the PEA NI Technical Report dated October 10, Please see Resource disclosure on page 22 for full details TSX:AR June 2017 ARGONAUT GOLD 45