Building a South American Exploration Business Through the Cycle

Transcription

1 Building a South American Exploration Business Through the Cycle

2 Forward Looking Statements Except for statements of historical fact relating to the Company, certain information contained herein constitutes forwardlooking statements. Forward-looking statements are frequently characterized by words such as plan, expect, project, intend, believe, anticipate 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 on the date the statements are made, and are 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. There can be no assurance that such 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 such statements. The Company does not undertake to update any forward-looking statements that are incorporated by reference herein, except in accordance with applicable securities laws. For a description of material factors that could cause the Company s actual results to differ materially from the forward-looking statements, please review the Company s Annual Information Form and Financial Statements filed on The Qualified Person (QP) for projects is Michael Bennell, Vice President Exploration of the Company. 2

3 General Overview TSXV listed mineral exploration company active in Brazil, Peru, Colombia and Chile. South America-based management team that has a track record of exploration success. Multi-commodity mineral property portfolio: precious metals, base metals, industrial minerals, agricultural commodities and coal. Prospect Generator business model with exploration funding mainly derived from joint ventures and partnerships. Recent success at Liberdade (Brazil) in partnership with Codelco, with significant near-surface copper-gold mineralization intercepted in drilling. Exchange ticker symbol: LRA.V 3

4 Management and Directors Management Miles Thompson (President & CEO) Lara founder with +25 years in exploration globally. Previously Manager of Business Development for Gold Fields. Founder and Chairman of Reservoir Minerals. Michael Bennell (VP Exploration) +30 year track record with multiple discoveries in Australia, Brazil and Africa. Previously with BHP Billiton and AngloGold. Christopher MacIntyre (VP Corporate) +6 years in public markets and the resource sector. Commerce and Business graduate Queen s University. Helio Ikeda (Project Manager Brazil) Lara founder, with +30 years experience of exploration in Brazil. Worked previously for Vale, Billiton and Barrick. Carlos Caceres (Exploration Director Colombia) +30 years experience in coal, metals and oil and gas exploration in Colombia. Carlos Theune (Exploration Manager Chile) +30 years experience in industrial minerals exploration in Chile and internationally. Directors Michael Winn (Director) Geologist +30 years in oil and gas and mining. Director of several listed exploration companies. Byron King (Director) Geologist and lawyer following the resource industry +30 years. Served in the U.S. Navy, graduate of Harvard, U.S. Naval War College and Pittsburgh. Christopher Jones (Director) Member of the Institute of Canadian Chartered Accountants and Institute of Chartered Financial Analysts of Ontario. Vice President of Duff & Phelps. Adrian Calvert (Director) +15 years in resource industry. Founder of WindRose Capital Ltd. Holds law degree from the University of Queensland and an MBA from Insead. Geoff Chater (Director) +20 years in the industry, President & CEO of Luna Gold, previously First Quantum. Geology graduate Texas Christian University. Andre Gauthier (Director) +30 years in exploration and mining globally, previously for Falconbridge and Cambior. 4

5 Share Capital and Sustainability Metric Market Capitalization Value CAD$15 M Category Number Percent Outstanding 30,519,687 82% Cash & Marketable Securities ~CAD$1.5 M Payments due from Partners (est ) ~CAD$2.0 M Options 3,390,000 7% Warrants 4,083,135 11% Fully Diluted 37,019, % 2015 Budget CAD$1.5 M Insider Ownership ~10% shares 5

6 Relative Value Timelines for Exploration and Development Sold to a Miner Full Value Speculators Leave Orphan Period Institutional Investment Concept Pre-discovery Discovery Feasibility Development Startup Deplete Time Source: Brent Cook Exploration Insights 6

7 TSX Venture Exchange 2001-Present Market Peak 2011 Commodity Price Peak /25/01 5/9/03 9/20/04 2/2/06 6/17/07 10/29/08 3/13/10 7/26/11 12/7/12 4/21/14 0 The last bear market ran from 1997 to about

8 Project Generator Business Model 8

9 Joint Ventures, Alliances and Royalties Country Partner Project Commodity Lara % Cash $m Expl $m Shares m Royalties Brazil Codelco Liberdade Copper 25% % NSR Brazil Tessarema Curionopolis Copper-Au Royalty % NSR Brazil Aguia Sergipe Potash Shares Brazil Paradigm Canindé Graphite 20% % NSR Brazil Vertical Curionopolis Iron Royalty Peru Aruntani Grace Gold Royalty $ $1.5/t % NSR Peru Redzone Lara-Tingo Copper 45% % NSR Peru Hochschild Corina Gold Royalty % NSR Chile Kiwanda Bahia Inglesa Phosphate Shares % NSR Colombia Kiwanda Carbhid Coal Shares 2% NSR Colombia Kiwanda Pelaya Coal Shares 2% NSR Totals

10 Liberdade Copper - Brazil The Carajás is one of the most prolific mining districts in the world. Vale SA operates its richest iron mines here, in addition to producing copper, gold, nickel and manganese. Liberdade has unpaved road access from Tucumã and landing strip for light aircraft on-site. Mineral rights are within farm land cleared for cattle grazing, with only secondary growth forest cover 10

11 Liberdade Copper - Fortuna Target Open Pit Potential Potentially large open pittable Carajás-type IOCG system with a 1200 x 350m surface footprint. Codelco funding drilling to earn 51% and must deliver a minimum compliant resource of 500,000t of contained copper to raise that to 75%. Currently awaiting license renewal for next phase of drilling Liberdade Table 1 - Best Intercepts - Primary Chalcopyrite Zone Drill Hole Target From (m) To (m) Intercept (m) Copper (%) Gold (ppb) Cu Eq (%) LBCD - 02 Fortuna LBCD - 06 Fortuna

12 Curionopolis Copper - Brazil Also located in the Carajás district close to operating iron and copper mines. Artisanal workings exposed highgrade copper-gold veins. Codelco drill holes include: 53.8m at 9.59% Cu & 29.05m at 4.56% Cu. Codelco work found small high grade deposit that is being developed with a new partner Tessarema. Lara receives cash and royalties. 12

13 Vertical Iron - Brazil Iron formations extend for over 10km within the property Pilot mining license and permitting in place for smallscale production Final Exploration Report with Resources and Reserves filed with the Brazilian Dept of Mines Vertical currently working to secure environmental permits and Mining License Lara gets cash and royalties. Minimum royalty payments start in 2015 TSX-V: LRA 1 3

14 Corina Gold - Peru Low sulphidation epithermal veins targets close to Hochschild owned mines Lara trenched and sampled mineralization for >2km of strike on the Promesa vein Project optioned to Hochschild for $4.15m in cash and a royalty 14

15 Lara Copper - Peru Mineralized footprint 2km by 0.5km. Oxide resource over a mid-sized porphyry Attractive because low altitude, close to infrastructure and the coast. Purchase by Minsur of a 70% interest in the nearby Marcona - Mina Justa deposit for $505 million establishes valuation target benchmark 15

16 Bahia Inglesa Phosphate - Chile Historic Phosphate Resource Large historical phosphate resource in northern Chile, close to port and already producing on a small scale. Lara and partner Kiwanda have an option to acquire the 6,100 hectare producing Bifox mine. Lara and partner Kiwanda also hold 16,500 hectares of 100%-owned licenses where drill permits have been secured. 16

17 Carbhid and Pelaya Coal - Colombia Lara and partner Kiwanda own 19.9% of Carbhid SAS, operator of the Escalones underground coal mine in Colombia. Plus the option to acquire the Pelaya claim which has the potential for a large-scale resource that could be mined from open-pit ASX listing of the coal and phosphate into Phillips River. Lara gets 50% of the vend, cash and royalties on production. 17

18 Lara Price Chart 2006-Present 2.5 Nickel Discovery in Brazil Copper Discoveries in Brazil Sale of Non-Core Assets to Raise Finance $5m from sale of Phosphate Project in Peru $5m Financing Maxy Peru acquisition Pan Brazilian acquisition and $2.5m Financing 0 5/28/05 10/10/06 2/22/08 7/6/09 11/18/10 4/1/12 8/14/ Looking for Acquisitions Again!!

19 Investment Case for Lara Business model substantially increases the probability of success, while reducing the cost of failures Treasury sufficient for budget, subject to additions from payments from JV partners and sale of marketable securities Management team with deep roots in South America, multiple discoveries and significant ownership in the Company Focus on larger discoveries of interest to miners where even minority interest generates order of magnitude returns for shareholders; potential near term catalyst the Liberdade discovery with Codelco in Brazil Also building a portfolio of self-created royalty interests Despite substantial growth and maturity of the portfolio, Lara s price today is similar to 2006 start and the 2008 crash 19