FORWARD LOOKING STATEMENTS

Transcription

1 A DIVERSIFIED MINERALS ROYALTY COMPANY

2 FORWARD LOOKING STATEMENTS This document includes certain statements that constitute forward looking statements and forward looking information within the meaning of applicable securitiess laws (collectively, forward looking statements ). Forward looking statements include statements regarding Altius Minerals Corporation s ( Altius ) intent, or the beliefs or current expectations of Altius officers and directors. Such forward looking statements are typically identified by words such as believe, anticipate, estimate, project, intend, expect, may, will, plan, should, would, contemplate, possible, attempts, seeks and similar expressions. Forward looking statements may relate to future outlook and anticipated events or results. By their very nature, forward looking statements involve numerous assumptions, inherent risks and uncertainties, both general and specific, and the risk that predictions and other forward looking statements will not prove to be accurate. Do not unduly rely on forward looking statements, as a number of important factors, many of which are beyond Altius control, could cause actual results to differ materially from the estimates and intentions expressed in such forward looking statements. These factors include, but are not limited to the inability to obtain approval of the proposed plan of arrangement by the court and the other regulatory approvals and the occurrence of any other event, change or other circumstance that could give rise to the termination of the Arrangement Agreement, or the delay of consummation of the transaction or failure to complete the arrangement for any other reason. Forward looking statements speak only as of the date those statements are made. Except as required by applicable law, Altius does not assume any obligation to update, or to publicly announce the results of any change to, any forward looking statement contained herein to reflect actual results, future events or developments, changes in assumptions or changes in other factors affecting the forward looking statements.

3 OUR WORK A UNIQUE CYCLE OF ROYALT TY GROWTH Mineral Exploration Project Generator Generate and define a project opportunity Form a partner funded joint venture to retain a minority direct project interest, or Convert the project interest into equity in a public vehicle Royalty creation and investment Royalties retained in project generation deals Equity sale profits used to acquire third party royalties

4 ALTIUS 17 YEAR ROYALTY HISTORY Altius founded in 1997 with a Project Generation ( PG ) / Royalty Creation business model. More than 60 project level agreements since founding Spins out 2 companies, Aurora (uranium) & Rambler (copper), pioneering i a lucrative variation on the PG and royalty creation business model Acquires 9% of International Royalty Corporation and proposes p merger which is unsuccessful but leads to others engaging in an acquisition auction; Altius nets ~$30m in profit Spins out 3 rd company; Alderon Iron Ore (ADV:TSX) creates 3% Gross Sales Royalty. Owns 32M shares Acquires Sherritt s PMRL & CDP royalties for up to $503M in partnership with Liberty Mutual and other private partners Acquired Voisey s Bay royalty for ~$13m Monetizesstake stake in both spin outs for pre tax profits of more than $200M while retaining a 2% royalty on Aurora properties. Begins search for additional Royalty acquisitions. Expands PG business into Quebec and Chile with emphasis on royalty creation Acquires 9% of Virginia and 6% of Callinan based upon attractive corporate equity vs. underlying royalty valuations

5 PRO FORMA CAPITAL STRUCTURE Altius trades on the TSX as symbol ALSand is a constituent of both the S&P/TSX Mining and S&P/TSX Small Cap indices Shares Outstanding: Market Cap.: Pro Forma Debt (post acquisition estimate): Public Investments (market value): 32,530,321 ~$420 million $119 million ~$80 million

6 PRODUCTIONON ROYALTIES

7 LOCATION 12 Canadian mine royalties producing electrical coal, potash, nickel, copper, cobalt and metallurgical coal Genesee Highvale Alberta Saskatchewan Voisey s Bay Newfoundland and Labrador Cheviot Calgary Cory Edmonton Saskatoon Paintearth Patience Lake Vanscoy Allan Sheerness Labrador City St. John s Regina Rocanville Esterhazy PMRL Electrical Coal Royalty PMRL Metallurgical Coal Royalty PMRL Potash Royalty Altius Royalties Canadaa

8 OUR PRODUCTION ROYALTIES DIVERSIFIEDD & LONG TERM REVENUE * 2013 Calendar Year attributable EBITDA to Altius PROJECT OPERATOR ROYALTY Voisey s Bay VALE 0.3% NSR 2013 ($m) COMMODITY EST. EBITDA LIFE 3.1 Ni Cu Co 21 Genesee Wesmoreland/ Tonnes x indexed 6.9 Coal/Electricity 43 Capital Power multiplier Paintearth Wesmoreland/ ATCO Tonnes x indexed 5.3 Coal/Electricity 11 multiplier Sheerness Wwesmoreland/ Tonnes x indexed 5.4 Coal/Electricity 24 ATCO multiplier Highvale TransAlta Tonnes x indexed Nil Coal/Electricity 19 multiplier Cardinal River Teck 5% net revenue 2.6 Steelmaking Coal 16 Rocanville Potash Corp Revenue Cory Potash corp Revenue Allan Potash Corp Revenue Patience Lake Potash Corp Revenue 2.2 Potash Potash Potash Potash 49 Esterhazy Mosaic Revenue Vanscoy Agrium Revenue CDP various Revenue others various Revenue TOTAL 2.1 Potash Potash Potash Potash 73 *$31.6m

9 DIVERSITY Altius royalty asset base is well diversified by commodity, geography and asset Revenue from 6 commodities with more than 50% from low risk, inflation adjusted electrical coal royalties No single asset contributes more than 22% of revenue Development pipeline comprised of iron ore, uranium and other assets will further increase Altius revenue diversification Revenue by Commodity (1) Revenue by Asset (1) Nickel, Copper and Cobalt 10% Met Coal 7% Other 4% Electrical Coal 58% Voisey's Bay 10% Other 9% Paintearth 19% Rocanville 8% Genesee 22% Potash 21% Esterhazy 8% Cardinal River 7% Sheerness 17% (1) Attributable to Altius; LTM as of December 31, 2013

10 LONGEVITY Altius royalty asset base has long to very long life royalties and excellent royalty growth potential Potash Average life of the potash assets on which we have a royalty is over 70 years based on reserves Electrical Coal Power generation plants have a minimum average estimated regulatory life of more than 20 years Mine Life Mine Life in Years Potash Royalty Asst Mine Lives Allan Rocanville Cory Vanscoy Esterhazy Keephills 3 Genesee 3 Genesee 2 Sheerness 2 Genesee 1 Sheerness 1 Battle River 5 Keephills 2 Keephills 1 Sundance 6 Sundance 5 Sundance 4 Sundance 3 Battle River 4 Battle River Coal Power Generation Forecast

11 5 COAL/ELECTRICAL ROYALTIES Coal supplied to mine mouth power generating stations on a fully dedicated basis No exposure to thermal coal market prices Coal mining and royalty costs to the generating plant are estimated at less than $20/tonne Coal generation represents Alberta s base load and lowest cost power Royalties paid by utilities based upon units of coal consumption multiplied by a royalty rate and escalated according to Canadian Real GDP inflation rates Possibilities for extended power plant lives 2012 Alberta Power Generation Government of Canada Real GDP Change Forecast Wind 4% Hydro 3% Other* 3% Coal 53% Gas 37% Source: Government of Canada, Budget 2013 Source: Alberta Department of Energy (* Other includes Biomass, Waste Heat and Fuel Oil)

12 6 POTASH ROYALTIES +36% Expanding Operations POT (TSX) Royalties cover ~60% of Canada s potash production Mean remaining mine life of 70 years Recent market over supply concerns may be easing (see POT:TSX chart)

13 VOISEY S BAY NICKEL COPPER COBALT ROYA ALTY Acquired in 2003 payback achieved in 2008 Nickel prices improving Exposure to exploration and expansion potential at zero cost (new underground mine approved last year) Royalty yrevenue ($ millions) Labo or Disruption

14 ROYALTY GROWTH POTENTIAL

15 KAMI IRON ORE ROYALTY Kami Royalty Altius discovered, and holds a 3% Gross Sales Royalty, over Alderon s Kami Iron Ore deposit At Fe 62.5% prices of $110/ tonne this royalty will generate pre tax revenue of more than $25 million/year per 8MTpa of concentrate production Permits granted for up to 16MTpa Alderon Equity Altius is a founder and the largest shareholder of Alderon Iron Ore: 32.9 million shares (~25%) Other major shareholders include Hebei Iron and Steel Group (~20%) and Liberty Mutual (15%) Royalty and Equity generation cost to Altius of ~$2.5 million

16 JULIENNE LAKE IRON ORE Top tier Labrador Trough iron ore project (hematite ore, low stripping ratio) Awarded exclusive right (following a competitive bidding process) to negotiate an agreement to acquire the central part of the Julienne Lake deposit (the EML) from the Province of Newfoundland and Labrador Altius has existing mineral rights that cover the interpreted along strike extensions of the deposit Altius has partnered with two Chinese integrated steel producers (forming the JL Alliance) to study and potentially develop the consolidated mineral rights (EMLand Altius Julienne Lk) Lake) Subject to successful conclusion to negotiations, Altius will retain a gross mine gate royalty y and a 10 20% project interest relating to the entire consolidated deposit.

17 CARBON DEVELOPMENT PARTNERSHIP LONG TERM GROWTH CDP properties cover ~12 billion tonnes of undeveloped coal reserves and resources in western Canada and ~2 billion tonnes of inferred potash resources in Saskatchewan (defined by more than 30, drill holes) Much of the resource land is located proximal to existing mining operations and could be incorporated into future mine plans for new royalties Other discrete mineral land areas offer the opportunity to create new royalties, joint ventures, and/or spin out companies (several unsolicited proposals from developers of export coal projects since acquisition) Source: Company filings (1) Reserves and Resources reported on a 100% basis (millions of tonnes) Coal Bituminous Thermal Sub bituminous 6, ,552.8 Lignite Total Coal 7, ,694.7 Potash Rocanville 49.0 Other Resources 2,037.0 Total Potash ,037.0 (thousands of hectares) Resources and Reserves (1) Proven and Probable Reserves Measured and Indicated Resources Total Mineral Holdings Province Fee Simple Crown Leases and Licenses Leases from Third Parties Inferred Resources Total Coal Saskatchewan Coal Alberta Coal B.C Potash Other Freehold Minerals Other Saskatchewan Saskatchewan Freehold B.C. 6 6 Minerals Total

18 ROYALTY PIPELINE HIGHLIGHTS PROJECT OPERATOR ROYALTY Kami Alderon/HBIS 3% Gross Julienne Lake Chinese steel 2 2.5% Mine company Gate Royalt ty partners CDP Various various CMB Paladin 2% Gross STATUS COMMODITY POTENTIAL LIFE / COMMENT Development Iron Pre feasibility Iron Exploration to Production Potash and Coal Large, advanced stage resource base, some current revenue Pre feasibility Uranium Large, growing resource Lab West Rio Tinto 3% Gross Projects (4) Snelgrove Mamba 3% Gross Schefferville Century/Wisco 1 4% Sliding Discovery Iron Potential ldso zone drilling discovery Grenville/ Menihek Century/Wisco 1 4% Sliding Exploration Iron Early stage surface discoveries Astray Northern Star/ 1 4% Sliding Exploration Iron Early stage surface discoveries Xinxingi Chile Projects Prospex 1% BM/2% PM Exploration Copper and Gold Projects being assembled Natashquan Anglo American 2% NSR Exploration Ni PGM Targets to be drill tested this year Lab/Quebec Alliances Virginia various Resource Definition Iron Geothite Bay is a significant new discovery Discovery Iron Potential DSO zone drilling discovery Exploration Ni PGM, Au Prospecting, land assembly Alaska Projects (6) Millrock et JV partners 1% BM/2% PM Exploration Copper and Gold Various stages, strong generative team

19 CURRENT EQUITY HOLDINGS a near term source of debt repayment COMPANY SHARES Market value ($ millions) (Sept. 2014) DESCRIPTION Alderon (T.ADV) 32,869, Payment shares Virginia Mines (T.VGQ) 2,658,449 Callinan (T.CAA) 2,901, Champion Iron (T.CIA) 17,000, Cash purchase 5 Cash purchase 2 Payment shares Century Iron (T.FER) 5,000, Payment shares TOTAL ~$80 million