A Gold Miner in the Making

Transcription

1 Goose Gold Project, Back River, Nunavut, Canada A Gold Miner in the Making May 2017

2 Forward Looking Information 2 Statements relating to our belief as to the timing of completion of the environmental assessment, the results of the final public hearings, the timing of receipt of a project certificate and permits and the timing of the start of construction and the first gold pour, and the results of further optimization studies to the feasibility study, the potential tonnage and grades and contents of deposits and the potential production from and viability of Sabina s properties are forward looking information within the meaning of securities legislation of certain Provinces in Canada. Forward looking information are statements that are not historical facts and are generally, but not always identified by the words expects, plans, anticipates, believes, intends, estimates, projects, potential, opportunities, and similar expressions, or that events or conditions will, would. may, could, or should occur. The forward looking information is made of the date of this presentation. This forward looking information is subject to a variety of risks and uncertainties which could cause actual events or results to differ materially from those reflected in the forward looking information, including, without limitation: the effects of general economic conditions; changing foreign exchange rates; risks associated with exploration and project development; the calculation of mineral resources and reserves; risks related to fluctuations in metal prices; uncertainties related to raising sufficient financing to fund the planned work in a timely manner and on acceptable terms; changes in planned work arising from weather, logistical, technical or other factors; the possibility that results of work will not fulfill expectations and realize the perceived potential of the Company s properties; risk of accidents, equipment breakdowns and labour disputes; access to project funding or other unanticipated difficulties or interruptions; the possibility of cost overruns or unanticipated expenses in the work program; title matters; government regulation; obtaining and receiving necessary licenses and permits; the risk of environmental contamination or damage resulting from Sabina s operations and other risks and uncertainties including those described in Sabina s annual information form for the year ended December 31, 2016 available at Forward looking information is based on the beliefs, estimates and opinions of Sabina s management on the date the statements are made. Sabina undertakes no obligation to update the forward looking information should management s beliefs, estimates or opinions, or other factors, change, except as required by applicable law

3 3 Key Investment Highlights A scarcity of gold and de-risked gold projects make Sabina one of the few highly leveraged undervalued opportunities 80km long multi-generational mining district with embedded growth in a good jurisdiction Will produce ~200k ounces Au/year Robust at US$1150 gold and C$0.80 with a 24% after tax IRR Capex is attainable - targeting gold production Q1/2021 Advancing through permitting Strong government and community support Exceptional team ~C$43 million in cash and equivalents

4 Back River Gold District DISTRICT OPPORTUNITY 100% OWNED BY SABINA Bath Back River Property LEGEND 4 Current Mine Life LOM Gold Production M&I Inferred ~ 12 years 2.3M oz 5,333M oz Au 1,851M oz Au Camp Area of Interest Claim Lease Inuit Owned Land Surface Subsurface and Surface Significant extended production opportunities exist through: Deposits not included in FS plan (at both Goose and George) Low risk resource conversion opportunities Direct extensional potential for all deposits George Project Boulder 80 Km Boot Goose Project Numerous blue sky brownfield targets Del Continued greenfield and generative exploration future Kilometres

5 5 Back River Deposits are Well Drilled and Well Understood Mineral Resource Estimate Oct/14 Tonnes (kt) Au (g/t) Metal (koz Au) Measured 10, ,740 Gold Resource Millions oz Indicated Inferred Indicated 17, , Under Sabina Ownership Measured and Indicated 28, ,333 6 Inferred 7, , Mineral Reserve Estimate Aug/15 Classification Tonnes (kt) Au (g/t) Au (koz) Total Open Pit Proven 6, ,340 Probable 1, Total Underground Proven Probable 3, Total Back River Property Proven 7, ,346 Probable 5, , s & 90s June % of open pit reserve is in Proven Category George & Goose deposit discoveries Project owned by Arauco, Kinross, Miramar & DPM Project acquired by Sabina +325% resource growth under Sabina *See mineral reserves and resources estimate slide 29 for details

6 Back River World Class Grade Highest grade undeveloped open pits The only high-grade project with a major open pit component (72% OP, 28% UG) 6 +5 Moz Development Gold Assets in the Americas Total Resource gold grade g/t 15 UG UG 8.67 OP/UG 6.21 UG/OP UG/OP OP OP OP OP OP OP Notes: Total 2P, Measured, Indicated & Inferred gold resources larger than ~5 million ounces; excludes by-products. Source: Company Technical Reports

7 Permitting Process To Date 7 Event Date Start of Permitting 2012 Final EIS Submitted 2015 Final Public Hearings (Regulators, GN, GNWT, KIA, Community Representatives all agree project should proceed) April 2016 NIRB Recommendation to INAC Project should not proceed at this time June 2016 INAC Disagrees with NIRB. Project sent back for further review Jan 2017 Sabina Files FEIS Addendum Feb 16, 2017 NIRB Formally Accepts FEIS Addendum Provides timeline Feb 23, 2017

8 8 Permitting Process Going Forward NIRB Timeline What happens next? Event NIRB initiates the Technical Review of the project proposal and requests final written submissions from interested parties NIRB issues notice of Final Hearing (60 day public notice requirement) Date Feb 23, 2017 Mar 2017 Parties submit final written submissions to the NIRB Apr 24, 2017 Sabina submits its response to final written submissions to NIRB May 15, 2017 NIRB facilitates a Technical Meeting via teleconference (optional step to be utilized if deemed necessary/appropriate) May 24, 2017 Parties file presentations for Final Hearing (tentative date only) May 27, 2017 [it is] our intention to ensure that the assessment would be expeditious and would result in a new report which focuses on the areas of deficiencies identified by the Ministers (rather than all aspects of the previous assessment being revisited). Ryan Barry Executive Director, NIRB NIRB Final Hearing (tentative dates only) NIRB issues the updated Final Hearing Report for the Back River Project proposal. May 31 Jun 3, 2017 Jul 2017

9 Permitting Addendum to FEIS Filed with NIRB Feb 16/17 9 Area Concern Updated Submission To NIRB Caribou and Terrestrial Wildlife Although Project does not come into contact with Bathurst Herd and has little overlap with Beverly Herd, if Caribou change migration the project could have a negative impact on declining caribou herd populations. Enhanced Wildlife Mitigation and Monitoring Plan including additional operational slow-down measures for large groups of caribou and in -case of a shift in migration and calving grounds. Comparisons to other arctic projects showing best in class approach. Completed detailed third party reviews with industry experts. Freshwater Aquatic Environment Marine Environment Water Quality (Ground and Surface) Climate and Meteorology How can we minimize impacts on fish populations in the project area? Regulatory oversight for bulk fuel shipping, and being able to respond quickly enough should there be accidents/spills. Quality and handling of project contact water. Impact of climate change on waste rock and tailings storage after the mine has closed (permafrost warming). Updated plans for draining lakes/ponds and removal of fish from waterbodies affected by the project, additional detail also provided on plans for to offset removal of fish by providing increased access for fish in other areas. (Program at Bernard Harbour). Enhanced detail on plans for bulk fuel transport and transfer at the Marine Laydown Area, as well as additional detail on emergency response planning. Further detail and clarity provided on responsibilities of various government ministries. Enhanced detail and clarification on site water quality objectives, including additional discussions with regulators and comparisons to other arctic projects. Comparison to other Arctic projects showing best in class approach and adaptive management plans (increased monitoring of rock to be able to mitigate before negative events happen). Completed detailed third party reviews with industry experts.

10 10 Corporate Update Focused on Maintaining Q Gold Production Advancing permitting: NIRB and water license processes progressing NIRB process on track, initial feedback has been positive Water license application nearly complete, expect to submit following NIRB decision, if positive Advancing development: basic engineering underway SCGT engaged, will complete basic engineering by June 30, 2017 Project development team focused on all aspects to maintain schedule despite NIRB delay Completing Project optimizations Flotation testwork is in final testing stage Other optimizations underway include: Improvements to overall project execution schedule Optimization of process plant

11 11 Corporate Update Focused on Maintaining Q Gold Production Completing exploration programs Drill testing of high impact targets at Goose that have potential to extend mine-life Fieldwork to advance targeting through out Back River to support further long-term growth Advancing Project financing Have issued an RFP for financial advisory, will engage advisor in early May Objective is to have an indicative term sheet by the end of 2017 Other initiatives planned Begin implementation of IT systems suitable for construction and mining operations Ramp up personnel if positive recommendation is received

12 Back River Initial Project Feasibility Study Highlights 12 Significant Gold Production 244 koz/au in years 1-8, 198 koz/au LOM. 3,000 tonnes per day 72% of ore from open pits Payback with open pit mining Simplified Mine Plan Lower Execution Risk 4 mining areas within 5 km Maximum of 1 open pit and 1 underground simultaneously Infrastructure Higher proportion of pre-fab modules targeting less on site labour. Primarily Open Pit 3 open pits (Llama, Umwelt, Goose Main) 1 underground (Umwelt) Credible Relevant Benchmarking Against Northern projects For QA QC see slide 29 for details

13 Initial Project Feasibility Study Results BACK RIVER - SEPT Summary Gold/ C$0.80 Exchange Pre-Tax NPV(5%) & IRR C$699M / 28.2% After-Tax NPV(5%) & IRR C$480M / 24.2% Avg. LOM Production On-Site Op. Costs 198,000 oz/year C$114.58/t milled Payback 2.9 years Total Cash Cost US$534/oz Mill Throughput 3,000 tpd All-In Sustaining Cost US$620/oz Avg. Grade Processed 6.30 diluted g/t Au LOM All-In Cash Cost* US$763/oz Gold Recovery 93.0% Pre-Production Capital C$415M Mine Life 11.8 years Sustaining Capital C$185M Avg. Production (Y1-8) 250,000 oz/year Closure Capital C$64M *LOM All-In Cash Cost includes initial, sustaining and closure capital QA/QP (see slide 35)

14 Capital Costs Gold Price (US$/oz) 14 Back River Feasibility Study SENSITIVITIES & OPTIMIZATIONS Sensitivity to Capex & Opex NPV 5%, (C$M), IRR %, Post-Tax Operating Costs -20% -10% Base Case +10% +20% Sensitivity to Gold Price and Exchange Rate NPV 5%, (C$M), IRR %, Post-Tax Exchange Rate: US$:C$ % $ 1, % $ 1, Base Case $ 1, % $ 1, % $ 1,500 1,191 1,117 1, January 5, 2017 spot Au and FX = ~CAD $1,562, IRR = 28%, NPV $605M (after-tax) *LOM All-In Cash Cost includes initial, sustaining and closure capital QA/QP (see slide 35)

15 15 Potential Project Optimizations Flotation vs. whole ore leach Potential for positive impact on CAPEX, OPEX and recovery Opportunities for satellite deposits (eg: George) Improvements to overall project execution schedule Optimization of site layouts (Goose & MLA), process and infrastructure layout and design Increased Gold Price US$1,200 gold price Echo, Llama UG & George add potential to increase mine life with existing resources Imbedded growth all existing deposits remain open, numerous exploration opportunities Personnel and expertise availability (both for construction and operations) Access to used equipment (mining, process and infrastructure) Exploration opportunities for many years to come Success at Vault and Llama could result in earlier underground access

16 Embedded Future Growth GEORGE PROPERTY Back River Property LEGEND 16 Existing Mineral resources: Indicated Inferred Included in 6KFS 1.1m 5.6 g/t 980k 6.32 g/t ~600 k oz Camp Port Site George to BIPR Road Option BIPR Road Winter Road George to Goose Option Winter Road Port to Goose Option Opportunities: George Project Winter Road Port to Goose Option Stand alone second mine Satellite with haulage via winter road to Goose complex High value potential to add resources Inuit Owned Land Surface Subsurface and Surface Significant existing resources at George on 20km of largely unexplored iron formation offering opportunity for another mining complex on the Back River district Km Goose Project Kilometres

17 17 Other Opportunities in the District Two other widely mineralized BIF systems with little to no work Large gold footprint at Del Locale 1 Locale 2 LCPN LCPS George Takrark Demonstrated opportunity for gold discoveries from field work, grab samples and limited drilling Oar Many years of exploration bluesky Boulder Boot Opener Piglet Ayers Grizzly Cumquat LEGEND Player Feass Falcon Mineral Occurences Banded Iron Formation Lease Outline Claim Outline 0 5,000 10,000 15,000 Meters Llama Umwelt Goose Camp Zone Goose Main Source data: GN, DOE

18 High Impact Targets Around Existing Deposits at Goose EXPLORATION Targeting resource extension and new discovery to demonstrate additional mine life Approximately 7,000 meters of drilling planned in two 5-week campaigns starting late spring Spring drilling commenced April 2017 Summer drilling planned for August 2017 First results late spring 2017 Goose 2017 Target Areas

19 19 Significant Potential at Both Llama and Umwelt Underground Significant undrilled potential at both Umwelt and LLama. Parallel structures along 3 +km of strike. Llama underground not in the current development plan. At Llama a significant down plunge step out will test resource expansion potential.

20 Significant Potential at Umwelt Underground Vault Zone 20 At Umwelt drilling in the area of the high grade Vault zone will test resource growth potential near limits of planned underground infrastructure.

21 New Discovery at Kogoyok Offers Close to Surface Targets 21 Significant gold trend between Kogoyok and Echo is under drilled over 2 + km strike length. Echo deposit is open below 300m current depth of drilling and to the east where step-out drilling indicates continuation of the mineralized zone. Other field work focusses on mapping and sampling at Goose, Boot and Boulder properties

22 Hackett Silver Royalty Glencore Activities 22 Silver royalty comprises 22.5% of first 190 M ounces Ag produced; 12.5% of all Ag produced thereafter 45km west of Back River, one of world s largest undeveloped VMS deposits Sabina mineral resource estimate: Indicated resources of 25 million tonnes at 4.2% Zn and 130 g/t Ag Inferred resources of 57 million tonnes at 3% Zn and 100 g/t Ag. Glencore continues to evaluate Hackett for potential growth opportunity, Zinc a strategic commodity Glencore has met all expenditure requirements to date Sabina views royalty as strategic option on silver going forward The updated mineral resource estimate was originally prepared by Glencore (previously Xstrata) under the JORC code and was reported by Glencore on May 3, 2013 in its annual report of mineral resources and reserves as at December, 31, Glencore s updated mineral resource estimate has been reviewed by Sabina and is stated in the Report dated July 31, 2013 and titled Sabina Gold & Silver Corp. Hackett River Property Royalty NI Technical Report, Nunavut, Canada in accordance with NI thus conforming to CIM Definition Standards. Mineral resources that are not mineral reserves do not have demonstrated economic viability. Mineral resource estimates do not account for mineability, selectivity, mining loss and dilution. These mineral resource estimates include inferred mineral resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that these inferred mineral resources will be converted to measured and indicated categories through further drilling, or into mineral reserves, once economic considerations are applied.

23 23 Back River is a Compelling Gold Project Gold Discoveries Total Resource gold grade g/t EXPLORATION FAIL Amount of gold found by miners has plunged 85% over the past decade There are few advanced projects that are large, high grade, district scale, in good jurisdictions Sabina does not need to look elsewhere for growth Source:

24 LOM Annual Production (Koz/yr) 24 Back River - Large, Robust, Good Jurisdiction Few projects with after tax IRR >30% with production ~200,000 oz per year at US$1200 gold price After-Tax IRR and LOM Annual LOM Production Matrix PVG MAX 250 SBB (3,000 tpd case) 200 BSX VIT 150 DNA NCA 100 GQC AMM ICG % 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% After-Tax IRR (%) at $1,200/oz Source: Company public information and Cormark Securities based on internal modelling of these projects at US$1200 gold and $0.75 US$:C$ Exchange. As at July 2016

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26 Management & Board 26 Executive Management Bruce McLeod President, CEO & Director Elaine Bennett VP Finance & CFO Nicole Hoeller VP Communications & Corp. Secretary Technical Management Angus Campbell VP Exploration Wes Carson VP Project Development Matthew Pickard VP Environment & Sustainability Board of Directors Bruce McLeod (Pres. & CEO) Roy Wilkes (Chairman) David Fennell Jonathan Goodman James Morton Anthony Walsh Walter Segsworth Anna Stylianides Combined exploration, mine development, permitting operations & capital markets experience in over 70 projects & companies

27 Management & Board Analyst Coverage 27 BMO Capital Markets Andrew Kaip Sabina Gold & Silver Corp. Symbol Listed exchange Market capitalization Shares outstanding (pro forma after financing) Shares outstanding (diluted) Cash Q1 Debt SBB TSX ~C$386 million ~224 million ~243 million ~C$43 million None 52 week trading range C$0.54 -$1.90 Recent Price ~C$1.85 Paradigm Capital Don MacLean Cormark Securities Tyron Breytenbach RBC Capital Markets Sam Crittenden Canaccord Eric Zaunscherb Haywood Geordie Mark Echelon Partners Matt O Keefe Industrial Alliance George Topping Major Shareholders Holdings (I&O) Dundee Precious Metals 10.7% Sun Valley Gold 10.5% Silver Wheaton 5.3% Management (options incl.) 3.0% Since February 2015, insiders have purchased 3,954,000 shares and sold 0

28 28 Back River Feasibility Study QA/QC The FS was prepared under the direction of JDS Energy & Mining Inc. by leading independent industry consultants, all Qualified Persons (QP) under National Instrument Qualified Person, Designation Company QP Responsibility/Role Gord Doerksen, P.Eng. JDS Energy & Mining Inc. Executive Summary, Introduction, Reliance on Other Experts, Reserves, Infrastructure, Market Studies, Capex, Opex, Economic Analysis, Adjacent Properties, Environmental, Other Relevant Data, Interpretations, Recommendations, References, Abbreviations, Project Execution Plan, Logistics, Infrastructure, G&A Dino Pilotto, P.Eng. JDS Energy & Mining Inc. Mining Methods Andrew Fowler, MAusIMM, CP (Geo) AMC Mining Consultants (Canada) Ltd. Mineral Resource Estimates for George Dinara Nussipakynova, P.Geo AMC Mining Consultants (Canada) Ltd. Mineral Resource Estimates for Goose John Morton Shannon, P.Geo AMC Mining Consultants (Canada) Ltd. Property Description, Accessibility, History, Geology, Deposits, Exploration, Drilling, sample Preparation, Data Verification Maritz Rykaart, P.Eng. SRK Consulting (Canada) Inc. Geochemistry, Tailings Management, Water Management Stacy Freudigmann, P.Eng Canenco Canada Inc. Metallurgy, Recoveries, Process Rob Mercer, Ph.D., P.Eng Knight Piésold Ltd. Geomechanical Angus Campbell, P.Geo, Vice-President, Exploration, is a qualified person under NI where the information relates to mineral resource estimates and Wes Carson, P.Eng Vice-President, Project Development is a qualified persons under NI for the feasibility study and both approve the scientific and technical information contained herein. A National Instrument compliant technical report will be filed on the project within 45 days from September 14, Further information can be found at Technical Report and Feasibility Study for the Back River Gold Property, Nunavut dated June 22, 2015 and filed on SEDAR at

29 APPENDIX 29

30 30 Nunavut AN ACTIVE MINING REGION Polaris Mine 33,000 people live in coastal and inland communities in Nunavut Mining has been ongoing for decades Nanisivik Mine Established routes and logistics for fuel delivery, construction equipment and resupply Ekaluktutiak Cambridge Bay Gjoa Haven Mary River Nunavut is pro responsible resource development Kugluktuk Ulu Jericho Lupin Mine Ekati Diavik Snap Lake Omingmaktok (Bay Chimo) Hope Bay Hackett George Goose Amaruq Meadowbank LEGEND Project Current or Past Producing Mines Communities Kitikmeot Region Yellowknife Meliadine Source data: GN, DOE Pine Point Cullaton Raglan

31 31 Logistics and Transportation MARINE ROUTES LEGEND Equipment and material originating in western North America or in China will be consolidated at Vancouver, BC Equipment and material originating in eastern North America or Europe will be consolidated at Becancour, QC Western Shipping Route Mackenzie River Barge Route Eastern Shipping Route Mackenzie River Barge Route ~1,550 5Kt = 13 Day Transit MLA Eastern Shipping Route 3, Kt = 13.5 Day Transit Hay River Western Shipping Route 4,171 7Kt = 25 Day Transit Vancouver Arctic Class Transport Ship Arctic Class Barge Montreal Source data: GN, DOE

32 Logistics and Transportation WINTER ROADS Winter roads will be annually constructed beginning in Q4 Year -2 Construction will begin in December and take 6 weeks working on 2 fronts (starting at Goose and the MLA) The road will then remain operational for 7-8 weeks During construction, up to 16 trucks will be used to move freight and fuel from the MLA to the Goose site During operations, trucks are required annually for freight and fuel from the MLA to Goose (~45 days) Winter Road LEGEND Marine Laydown Area TCWR Winter Food Connector Winter Road Winter Road, George Tie-in Option 1 Winter Road, George Tie-in Option 2 BIPR Winter Road Connector Haul and Access Road Potential Development Area Federal Watershed Delineation Bathurst Inlet Burnside River Upper Black River Queen Maud Gulf Elice River Inuit Owned Lands Subsurface and Surface Surface 32 TCWR Winter Road Connector Source data: GN, DOE Winter Road Transport Truck 0 1:450, Kilometers

33 Significant Community Consultation WE HAVE LISTENED Area Number of Meetings Number of Major Correspondences Cambridge Bay TOTAL 33 Kugluktuk Bathurst Inlet & Bay Chimo Gjoa Haven Taloyoak Kugaaruk Other (e.g. northern trade shows & conferences, SEMCs, newsletters) Yellowknife / Other Locations in the NWT TOTAL We have worked closely with all communities, Hamlet Councils, HTO s, Elders & Youth advisory Groups Incorporated traditional knowledge with scientific data in all approaches As at January 1, 2017

34 34 Caribou Calving and Post-Calving Core Areas LEGEND No winter ice road throughout calving and post calving period No overlap with the Project Bathurst Herd west of the Project Marine Laydown Area Winter Road Beverly Herd east of the Project Camp Bathurst Herd Beverly Herd Communities Goose Property Kilometres Source data: GN, DOE

35 35 Key Support from Government and KIA & Communities In the GN s opinion, it is possible to develop terms and conditions to address the concerns expressed by the NIRB of the efficacy and adaptability of mitigation measure[s] for terrestrial wildlife, including caribou. Accordingly, referring the Final Hearing Report back to the NIRB for further review and public hearings may be the most responsible and expeditious way forward, and the one that provides the best opportunity to advance responsible development to provide economic opportunities for Nunavut s communities while respecting Inuit societal values and protecting the integrity of our land, water and wildlife. As a result, KIA recommends that the Report be returned to the Board under paragraph (e) with your [Minister of INAC] instructions to focus any further investigations on matters related to the Project s impacts on caribou and the best approaches to mitigation of such impacts. Stanley Anablak President, Kitikmeot Inuit Association Government of Nunavut