JUNE 2018 Balkan Gold Project

Transcription

1 JUNE 2018 Balkan Gold Project

2 Forward Looking & Cautionary Statements Forward Looking and Cautionary Statements This presentation contains forward-looking statements and forward-looking information (collectively, forward-looking statements ) within the meaning of applicable Canadian and U.S. securities legislation, including the United States Private Securities Litigation Reform Act of 1995 concerning the business, operations and financial performance and condition of Velocity Minerals Ltd. (the "Company"). All statements, other than statements of historical fact, included herein including, without limitation, statements regarding future capital expenditures and financings (including the amount and nature thereof), anticipated content, commencement, and cost of exploration programs in respect of the Company's projects and mineral properties, anticipated exploration program results from exploration activities, the discovery and delineation of mineral deposits, resources and/or reserves onthe Company's projects and mineral properties, and the anticipated business plans and timing of future activities of the Company, are forward-looking statements. Although the Company believes that such statements are reasonable, it can give no assurance that such expectations will prove to be correct. Often, but not always, forward looking information can be identified by words such as pro forma, plans, expects, may, should, budget, scheduled, estimates, forecasts, intends, anticipates, believes, potential or variations of such words including negative variations thereof, and phrases that refer to certain actions, events or results that may, could, would, might or will occur or be taken or achieved. Forward looking information involves known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to differ materially from any future results, performance or achievements expressed or implied by the forward looking information. Such risks and other factors include, among others, the ability of the Company to obtain sufficient financing to fund its business activities and plans, operating and technical difficulties in connection with mineral exploration and development and mine development activities for Company's projects generally, including the geological mapping, prospecting and sampling programs for the Company's projects, actual results of exploration activities, including the estimation or realization of mineral reserves and mineral resources, the timing and amount of estimated future production, costs of production, capital expenditures, the costs and timing of the development of new deposits, the availability of a sufficient supply of water and other materials, requirements for additional capital, future prices of precious metals, tantalum and lithium, changes in general economic conditions, changes in the financial markets and in the demand and market price for commodities, possible variations in ore grade or recovery rates, possible failures of plants, equipment or processes to operate as anticipated, accidents, labour disputes and other risks of the mining industry, delays in obtaining governmental and regulatory approvals (including of the TSX Venture Exchange), permits or financing or in the completion of development or construction activities, changes in laws, regulations and policies affecting mining operations, hedging practices, currency fluctuations, title disputes or claims limitations on insurance coverage and the timing and possible outcome of pending litigation, environmental issues and liabilities, risks related to joint venture operations, and risks related to the integration of acquisitions, as well as those factors discussed under the heading Risk Factors in the Company s most recent annual management s discussion and analysis and other filings of the Company with the Canadian Securities Authorities, copies of which can be found under the Company's profile on the SEDAR website at Readers are cautioned not to place undue reliance on forward-looking statements. The Company undertakes no obligation to update any of the forward looking information in this presentation orincorporated by reference herein, except asotherwise required by law. National Instrument Stuart Mills, the Vice President Exploration for the Company, and a Qualified Person as defined by National Instrument , has approved the scientific and technical information concerning the Company discussed in this presentation. Mr. Mills is not independent of the Company as he is an officer, a shareholder and holds incentive stock options. Cautionary Note to United States Investors As a Canadian issuer, the Company is permitted to prepare its public disclosures and this presentation in accordance with Canadian securities laws, which differ in certain respects from U.S. securities laws. In particular, this presentation uses the terms mineral resource, measured mineral resource, indicated mineral resource and inferred mineral resource. While these terms are recognized and required by Canadian securities laws, they are not recognized by the United States Securities and Exchange Commission ( SEC ) and are not normally permitted to be disclosed in SEC filings by U.S. companies. U.S. investors are cautioned not to assume that any part of a mineral resource, measured mineral resource, indicated mineral resource or an inferred mineral resource will ever be converted into a reserve. In addition, reserves reported by the Company under Canadian standards may not qualify as reserves under SEC standards. Under SEC standards, mineralization may not be classified as a reserve unless the mineralization can be economically and legally extracted or produced at the time the reserve determination is made. Accordingly, information contained or referenced in this presentation containing descriptions of the Company s mineral deposits may not be compatible to similar information made public by U.S. companies subject to the reporting and disclosure requirements of U.S. federal securities laws, rules and regulations. Inferred mineral resources have a great amount of uncertainty as to their existence and great uncertainty as to their 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. Historical results orfeasibility models presented herein are not guarantees orexpectations of future performance. Currency All amounts in this presentation are expressed in Canadian dollars, unless otherwise stated. THIS PRESENTATION IS NOT INTENDED AS, AND DOES NOT CONSTITUTE, AN OFFER TO SELL SECURITIES OF THE COMPANY. The TSX Venture Exchange has not reviewed and do not accept responsibility for the accuracy or adequacy of this presentation, which has been prepared by the Company. 2

3 BALKAN GOLD PROJECT Focus on Near-Term Production Focus Gold in Bulgaria Envision gold production through open pit mining of satellite deposits; underground mining; and processing in central carbon-in-leach (CIL) plant Exploration and Mining Alliance with established operating Bulgarian partner Access to existing operating CIL plant Multiple near surface gold deposits potential open pits (option agreements) Rozino project Sedefche project Makedontsi project Four additional exploration properties Operating underground Chala gold mine (option agreement) Strategy to move towards production milestones achieved upcoming catalysts 3

4 TRACK RECORD Management & Board Experience MANAGEMENT Keith Henderson M.Sc. Director, President, CEO; Vancouver Stuart Mills M.Sc. Vice President Exploration; Bulgaria Valentin Buhov M.Sc. Exploration Manager; Bulgaria Plamen Nedyalkov Mining Engineer; Bulgaria BOARD OF DIRECTORS Keith Henderson M.Sc. Director, President, CEO Dr. Mark Cruise Director; Vancouver Daniel Marinov M.Sc. Director; Bulgarian National Gord Doerksen B.Sc. Director; Vancouver Blaine Bailey CGA Chief Financial Officer; Vancouver 4

5 BULGARIA Favourable Operating Environment INVESTMENT IN BULGARIA EU member (since 2007) 10% corporate tax rate Mining Law established 1999, updated 2011 Mining royalties (0.8 to 4.0%) compare favourably to established mining jurisdictions like Canada, Chile and Peru Experienced mining professionals Low cost operating environment 5

6 GORUBSO MINING A PRIVATE BULGARIAN MINING COMPANY Established Operating Partner Existing CIL Plant CIL processing plant operating since 2011 First (and only) company in Bulgaria to secure a cyanide operating permit Existing Underground Gold Mine Chala gold mine operating since 2006 Technical Expertise Abundant experience with all aspects of permitting and operation in Bulgaria Mine Staff Relationships Strong working relationships with municipalities, national governments and regulatory departments CIL Plant Secure Gold Room 6

7 BALKAN GOLD PROJECT CORNERSTONE OF EXPLORATION AND MINING ALLIANCE 2018 Catalysts & Focus Chala Mine Operating Haskovo Rozino Project Earn 70% interest on delivery of PEA Drilling started Q Maiden Resource Estimate announced Q ,050m drilling completed Preliminary Economic Assessment Q Makedontsi Project Kardzhali Central CIL Processing Plant Sedefche Project Krumovgrad Dundee Precious Metals (TSX: DPM) Krumovgrad Project Ivaylovgrad Rozino Project Sedefche Project Earn 70% interest on delivery of Feasibility Study Complete due diligence on historical resources 3,000m drilling complete Q Makedontsi Project Earn 70% interest on delivery of PEA Complete due diligence on historical resources 3,000m drilling complete Q Operating Chala Mine Earn 50% interest on Exploration Expenditures of $1M Underground drilling Q Q decision point 7

8 ESTABLISHED OPERATING BULGARIAN PARTNER CIL Processing Plant Gorubso owns and operates a modern gold processing plant including CIL processing Potential pre-concentration of open pit material at site, trucking to plant Aiming for future annual production capacity of more than 100,000 ounces gold Existing plant reduces project risk as well as potential capital and time savings CIL AGREEMENT Exclusive access to central gold processing plant to process current and future mineralized material from the Balkan gold project Gold production cost plus 2% Gorubso CIL Processing Plant 8

9 BALKAN GOLD PROJECT Rozino Project July 2017 Acquisition of Rozino Project March 2018 Publish Initial Resource Estimate April 2018 NI Report June 2018 Initiate NI PEA September 2018 Planned NI PEA Completion August 2017 Start of Phase I Drilling December 2017 Complete Phase I Drilling (7,300m) February 2018 Start of Phase II Drilling May 2018 Complete Phase II Drilling (1,750m) October 2018 Planned Option Exercise & JVA Aggressive exploration program on target to take project from acquisition to PEA in approximately 14 months. 9

10 ROZINO PROJECT Maiden Mineral Resource Estimate INFERRED MINERAL RESOURCE ESTIMATE (MAR 2018) (1) Main Zone (1) N.I inferred mineral resources at Rozino (March 2018) were estimated by Jonathon Abbott, a member of the Australian Institute of Geoscientists and employee of MPR Geological Consultants Pty Ltd of Perth, Australia. Mr. Abbott is a Qualified Person, as defined by National Instrument East Zone 90% of estimates from less than 110m from surface Less than 1% of estimates below 150m from surface Mineralized system remains open for expansion Plan view of Inferred Resource extents relative to angled drill hole dataset. 10

11 ROZINO PROJECT Metallurgy and Drill Intercepts INITIAL METALLURGY (MAR 2018) Main Zone Initial Metallurgical Test Work - Fine Agitated Leach East Zone ROZINO OPTION PEA including updated resource estimate earns 70% interest 9,050m drilling completed Prospecting licence located 80km from CIL plant 11

12 ROZINO PROJECT Near Surface Drill Intercepts MAIN ZONE EAST ZONE Section 4: Selected drilling completed in Section 8: Selected drilling completed in Drill intersections on this cross section are calculated using a 0.2 g/t gold trigger, a minimum 0.5 g/t gold composite, and a maximum of 3 meters consecutive waste. The current exploration model has not had sufficient drill testing to be able to determine the true thickness of mineralization. 12

13 ESTABLISHED OPERATING BULGARIAN PARTNER Chala Underground Mine Historical resources 9.83g/t gold (450,000oz) Digitally capture and integrate all mine data into a Micromine model 20,000m surface trench samples 55 historical surface drill holes Samples from 30,000m of underground development Face sample data from 650 stopes Definition of priority drill targets CHALA OPTION $1M expenditures earns 50% interest Located 40km from CIL plant 3D View of the Chala Gold Mine Exploration Model, viewing northeast. Development in blue, with stope sampling shown in red. Vein wireframes are represented in transparent colours. Cautionary Statement Historical resources at the Chala Mine were published by Kestebekov C, 1998, in Chala gold-polymetallic deposit, Spahievo ore field. Results of geological exploration with estimated resources of gold and gold-polymetallic ores as of 01/01/1998. Total historical production at the Chala Mine is estimated to be approximately 120,000 oz. The historical resource estimate was produced using the Bulgarian classification scheme, based on manual polygonal methods of resource classification. A qualified person has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves. In order to verify the potential existence of additional unmined mineralization at the Chala Mine, significant drilling will be required. The Company is not treating the historical resources as current mineral resources or mineral reserves. Historical resources are not consistent with the standards of disclosure defined by National Instrument Standards of Disclosure for Mineral Projects ( NI ) and may not necessarily be consistent with CIM (Canadian Institute of Mining, Metallurgy and Petroleum) best practice with respect toreporting mineral resources and reserves. Historical resources are included because they are considered relevant by the Company as they provide additional support for the potential exploration drilling at the Chala Mine by Velocity. 13

14 BALKAN GOLD PROJECT Sedefche Project Near surface deposit Historical gold resource estimate of 101,000 oz SEDEFCHE OPTION Due Diligence: 3D view, viewing NNW of $1200 Au ultimate pit within current topographic surface Feasibility study earns 70% interest Project is a permitted mining concession with full environmental assessment completed Located 39km from CIL plant 25m Cautionary Statement Regarding Historical Resources Historical resources at Sedefche (2006) were calculated by Gorubso using the Bulgarian classification scheme, based on manual polygonal methods of resource estimation. Resources were submitted to and accepted by the Bulgarian government, Dragiev, H, 2006, Momchil Prospecting License, Report at the Zvezdel - Pcheloyad Ore Field, Geological Report with Resource And Reserve Recalculation of Au-Ag Ores at the Sedefche Deposit. In order to verify the potential existence of additional unmined mineralization at Sedefche and Makedontsi, significant drilling will be required. The Company is not treating the historical resources referenced above as current mineral resources or mineral reserves. Historical resources are not consistent with the standards of disclosure defined by NI and may not necessarily be consistent with CIM best practice with respect to reporting mineral resources and reserves. Historical resources are included in this presentation because they are considered relevant by the Company as they form additional support for the potential optioning of the Gorubso Properties by Velocity. Due Diligence: Oblique view of nested pit shells for $1200 Au base case 14

15 BALKAN GOLD PROJECT Additional Projects & Due Diligence Project Tenure Distance to Processing Plant (km) Gold Resource Estimates Option Deliverable for 70% Interest Makedontsi Prospecting Licence 6 290,000 oz Resource (1) Preliminary Economic Assessment Enyovche Mining Concession 29 N/A Resource Estimate Kitnitsa Prospecting Licence 13 N/A Preliminary Economic Assessment Obichnik Prospecting Licence 22 N/A Resource Estimate Kaleto Prospecting 25mLicence 23 N/A Resource Estimate Cautionary Statement Regarding Historical Resources (1) Historical resources at Makedontsi (2013) were calculated by Gorubso using the Bulgarian classification scheme, based on manual polygonal methods of resource classification. Resources were submitted to and accepted by the Bulgarian government, Dragiev H, 2013 "Mlechino Prospecting License, Geological Report at the Nadezhda Prospect, with Resource and Reserve Recalculations of Au Ores at the Makedontsi, Dangovo and Kalina deposits. Inorder to verify the potential existence ofadditional unmined mineralization atmakedontsi, significant drilling will be required. The Company is not treating the historical resources referenced above as current mineral resources or mineral reserves. Historical resources are not consistent with the standards of disclosure defined by NI and may not necessarily be consistent with CIM best practice with respect to reporting mineral resources and reserves. Historical resources are included in this presentation because they are considered relevant by the Company as they form additional support for the potential optioning of the Gorubso Properties by Velocity. 15

16 BALKAN GOLD PROJECT Multiple High-Quality Gold Assets Kaleto Chala Gold Mine Operating Mine Option for 50% Equity $1 million expenditure Decision Q km EXPOSURE TO HIGH QUALITY GOLD ASSETS Operating CIL Plant exclusive access Operating Mine - 50% option Enyovche Kitnitsa Makedontsi Exploration Concession Option for 70% Sedefche Mining Concession Option for 70% Processing Plant Operating CIL Plant Cost Plus Obichnik Rozino Ongoing Drilling Option for 70% PEA Q Exploration Projects - 70% option 16

17 VELOCITY MINERALS Capital Structure Issued & Outstanding Warrants $0.50, expire Sep 25/18 $0.34, expire Sep 25/18 $0.30, expire Apr 30/19 $0.20, expire Apr 30/19 Options Fully Diluted 67,810,237 5,530,600 5,750,000 79,090,837 Share Price (Jun 4/18) Market Capitalization $0.15 $10 M Management & Board 44% 17

18 TSX.V: VLC Velocity Minerals Ltd. Alliance With Local Bulgarian Miner Focus Gold in Bulgaria Assets Multiple Advanced Gold Experienced Management and Board Discovery Track Record Delivering on Project Milestones Results Excellent to Date Drilling Ongoing & Planned 18

19 Velocity Minerals Ltd West Hastings Street Vancouver BC, V6E 2K3 Phone: