Seizing Opportunity and Building Value

Transcription

1 Hanson Lake District Seizing Opportunity and Building Value December

2 Opportunity is meaningless unless one takes action. TSX-V FOM 2

3 The Parties Committed to value creation 100% of McIlvenna Bay Upside Prospective Target A Bigstone, Thunder Zone Over 40,000 ha, limited historical drilling Leveraged to Zn and Cu McIlvenna Bay Largest undeveloped deposit Historic mining region FOM added value PEA 2015 NPV C$263M after tax $1.06Zn & $3.08Cu $Fx 0.89 Current spot: $1.46Zn, $3.08Cu, $FX0.79 Largest zinc miner Trades 42% of Zn market 60 day technical review Commitment 9 months to complete FS Zn and Cu purchased at market rates Potential cost benefits Facilitate financing Procurement savings TSX-V FOM 3

4 The Opportunity McIlvenna Bay Location Largest undeveloped VMS in Flin Flon region PEA Completed in 2015 Commitment Advance project to production with a partner Investment Minimizing shareholder dilution TSX-V FOM 4

5 Enter TSX-V FOM 5

6 The Deal Technical Services Agreement - Glencore Expertise Development, mining and operations Commodities Expert in metal markets Support Engineering and technical Endorsement McIlvenna Bay could be a mine TSX-V FOM 6

7 The Deal Technical Services Agreement - Foran Offtake Agreement on McIlvenna Bay Project Team experience in advancing asset Retain 100% Optionality Bigstone, Thunder Zone Prospective Target A + others TSX-V FOM 7

8 Terms of the Technical Services Agreement Desktop study 60 day review of project Evaluate options Toll treatment Second hand plant processing New build plant Design in-fill drilling program FOM executes drill program Action plan to complete Feasibility Study Time frame 9 months to complete after drill program Technical assistance Through to development and construction TSX-V FOM 8

9 Terms of the Technical Services Agreement FOM obligations Fund and conduct drill program Use Foran team Environmental baseline Apply for permits Socio-economic studies Community engagement Additional commitment Fund up to $1.5M required engineering services TSX-V FOM 9

10 World Class Mining Belt N Deschambault Lake HANSON LAKE DISTRICT FLIN FLON DISTRICT LALOR Snow Lake MCILVENNA BAY TARGET A Denare Beach/ Amisk Lake 777 Flin Flon SNOW LAKE DISTRICT BIGSTONE THUNDER ZONE REED LAKE 200 km Foran is not treating historic (non NI compliant) resource estimates as current; Additional work is required bring historic resource to current TSX-V FOM 10

11 Hanson Lake VMS District N MCILVENNA BAY TARGET A THUNDER ZONE BIGSTONE UTM Zone 13 NAD83 NTS 63L/10 TSX-V FOM 11

12 Hanson Lake VMS District Cluster of VMS deposits Poly-metallic Zinc, Copper, Gold, Silver Prolific mining belt Neighbouring Hudbay/Flin Flon/Lalor Long history of mining 30,000+ drill holes Current management Acquired project in 2011 Underexplored (~800 drill holes) Advanced project Upgraded deposits, new discovery Relationship with First Nations Peter Ballantyne Cree Nation McIlvenna Bay Camp TSX-V FOM 12

13 Access Road & Power Line Hanson Lake Foran Camp Silica Sand Mine McIlvenna Bay Deposit (projection to surface-approximate) Access Road & Power Line m McIlvenna Bay deposit (projected), exploration camp and Silica Sand Mine (under reclamation); looking Northwest April 2012 TSX-V FOM 13

14 McIlvenna Bay Mineral Resources Indicated Mineral Resource Estimate (US$60t/ NSR cut-off) Zone Tonnes (kt) Cu (%) Zn (%) Au (g/t) Ag (g/t) CuEq (%) ZnEq (%) Main Lens Upper West Zone 2, Main Lens Zone 2 3, Lens Copper Stockwork Zone 7, TOTAL INDICATED 13, Inferred Mineral Resource Estimate (US$60t/ NSR cut-off) Zone Tonnes (kt) Cu (%) Zn (%) Au (g/t) Ag (g/t) CuEq (%) ZnEq (%) Main Lens Upper West Zone 2, Main Lens Zone 2 2, Lens Copper Stockwork Zone 5, TOTAL INFERRED 11, Effective date Jan. 1, 2013; Metal prices for 2013 Resource are US$3.25/lb. Cu, US$1.10/lb. Zn, US$1,400/oz. Au & US$25/oz. Ag; The base case uses a US$60/t NSR cut-off using provisions for metallurgical recoveries, smelter payables, refining costs, freight, and applicable royalties; see appendices for full footnotes; for additional information see the Foran news release dated March 27, 2013 at TSX-V FOM 14

15 McIlvenna Bay Deposit PEA tpd, ramp and shaft access, on-site concentrator and tailings facilities; batch processing multiple ore zones Summary Mine Life Plant Throughput Pre-Tax NPV 7% Pre-Tax IRR Post-Tax NPV 7% Post-Tax IRR Payback 13.7 years 4,761 tpd $381.7M 21.9% $262.6M 18.9% 4.1 years Metal Production Metal Per annum LOM lbs. tonnes lbs. tonnes Zinc 58.9M 26, M 365,101 Copper 37.6M 17, M 233,013 Lead 1.2M M 7,167 oz. oz. Gold 16, ,000 Silver 398,000 5,437,000 1 The PEA is considered preliminary in nature and includes mineral resources, including inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Mineral resources that are not mineral reserves have not yet demonstrated economic viability. Due to the uncertainty that may be attached to mineral resources, it cannot be assumed that all or any part of a mineral resource will be upgraded to mineral reserves. Therefore, there is no certainty that the results concluded in the PEA will be realized. 2 Includes 20% contingency. 3 Comprised of $33.54/t mining, $13.39/t processing & $4.10/t G&A. 4 Net of by-product, includes all TC/RC, operating costs & royalties. All figures are quoted in CDN$ unless otherwise noted; base case metal prices of US$3.08/lb. Cu, US$1.06/lb., Zn, US$0.93/lb. Pb, US$1,238/oz. Au and US$17/oz. Ag and exchange rate of 0.89 based on spot as at Oct. 15, See the Foran news releases dated November 12, 2014 and January 21, 2015 at TSX-V FOM 15

16 McIlvenna Bay Deposit PEA tpd, ramp and shaft access, on-site concentrator and tailings facilities; batch processing multiple ore zones Capital Costs Operating Costs Base Contingency (20%) Total Avg. OpEx Per tonne milled LOM Pre-Prod. CapEx Sustaining Capital $207.3M $41.5M $248.8M $125.2M $25.0M $150.3M Mining $33.54 $796.2M Processing $13.39 $317.7M LOM $332.5M $66.5M $399.1M G&A $4.10 $97.4M Total $51.03 $1,211.3M 1 The PEA is considered preliminary in nature and includes mineral resources, including inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Mineral resources that are not mineral reserves have not yet demonstrated economic viability. Due to the uncertainty that may be attached to mineral resources, it cannot be assumed that all or any part of a mineral resource will be upgraded to mineral reserves. Therefore, there is no certainty that the results concluded in the PEA will be realized. 2 Includes 20% contingency. 3 Comprised of $33.54/t mining, $13.39/t processing & $4.10/t G&A. 4 Net of by-product, includes all TC/RC, operating costs & royalties. All figures are quoted in CDN$ unless otherwise noted; base case metal prices of US$3.08/lb. Cu, US$1.06/lb., Zn, US$0.93/lb. Pb, US$1,238/oz. Au and US$17/oz. Ag and exchange rate of 0.89 based on spot as at Oct. 15, See the Foran news releases dated November 12, 2014 and January 21, 2015 at TSX-V FOM 16

17 McIlvenna Bay PEA Sensitivity Analyses 1 Metal Price -10% Base Case +10% Zinc (US$/lb.) Copper (US$/lb.) Lead (US$/lb.) Gold (US$/oz.) 1,114 1,238 1,362 Silver (US$/oz.) Pre-tax NPV 7% $200.6M $381.7M $562.9M IRR 15.4% 21.9% 27.6% Payback 5.4 years 4.1 years 3.4 years Post-tax NPV 7% $129.4M $262.6M $394.5M IRR 13.3% 18.9% 24.0% Payback 5.4 years 4.1 years 3.5 years Exchange Rate -10% Base Case +10% CDN$:US$ Pre-tax NPV 7% $251.3M $381.7M $541.1M IRR 17.2% 21.9% 26.9% Payback 4.9 years 4.1 years 3.5 years Post-tax NPV 7% $166.9M $262.6M $378.7M IRR 14.9% 18.9% 23.4% Payback 4.9 years 4.1 years 3.5 years 1 The PEA is considered preliminary in nature and includes mineral resources, including inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. Mineral resources that are not mineral reserves have not yet demonstrated economic viability. Due to the uncertainty that may be attached to mineral resources, it cannot be assumed that all or any part of a mineral resource will be upgraded to mineral reserves. Therefore, there is no certainty that the results concluded in the PEA will be realized. 2 Includes 20% contingency. 3 Comprised of $33.54/t mining, $13.39/t processing & $4.10/t G&A. 4 Net of by-product, includes all TC/RC, operating costs & royalties. All figures are quoted in CDN$ unless otherwise noted; base case metal prices of US$3.08/lb. Cu, US$1.06/lb., Zn, US$0.93/lb. Pb, US$1,238/oz. Au and US$17/oz. Ag and exchange rate of 0.89 based on spot as at Oct. 15, See the Foran news releases dated November 12, 2014 and January 21, 2015 at TSX-V FOM 17

18 Adding value TSX-V FOM 18

19 Bigstone Cu-Zn Deposit BIGSTONE Upgrade historic resource to NI Specific gravity underestimated 2015 infill drilling 2 All six holes hit high-grade Cu+/-Zn 18.4% Zn over 12m incl. 27.0% Zn over 7.6m, plus 1.4% Cu over 10.6m & 1.3% Cu over 8.5m (BS ) 2.0% Cu over 105m incl. 4.1% Cu over 20m & 3.4% Cu over 19.0m (BS ) Historic mineral resource 1 : Zone Tonnage (t) Cu (%) Au (g/t) Zn (%) Ag (g/t) Copper (1% cutoff) Zinc (5% cutoff) N UTM Zone 13 NAD83 NTS 63L/10 1 Foran is not treating historic (non NI compliant) resource estimates as current; additional work is required bring historic resource to current 2 See Foran news releases dated April 1, 17 and 30, 2015 for additional information; true thickness approx % of downhole distance. TSX-V FOM 19

20 Thunder Zone Cu-Zn Deposit Cu & Zn-rich VMS mineralization 2013 discovery hole First new discovery in 30 years Intersected high-grade massive sulphides 2015 follow-up drilling Confirmed & expanded discovery 1 Higher grades than McIlvenna Bay Open along strike Thickening down-plunge MCILVENNA BAY TARGET A THUNDER ZONE N UTM Zone 13 NAD83 NTS 63L/10 1 See Foran news release dated March 25, 2015 for additional information; true thickness approx. 85% of downhole distance. TSX-V FOM 20

21 Target A Exploration High priority target Identified using updated geophysics Potential game changer Planned drilling for 2017 Prior drilling stopped short of target Wedge off existing hole MCILVENNA BAY TARGET A THUNDER ZONE BIGSTONE N UTM Zone 13 NAD83 NTS 63L/10 TSX-V FOM 21

22 Regional Exploration 10 km Thunder Zone First new discovery in 30 years Target A High priority McIlvenna Bay Flagship deposit Discovery Hole 3.7 Cu and 0.43 g/t Au MR m MR m Conductor Target Resource Grade Shell 13.9 Mt@ 13.19%ZnEq (Ind) ZnEq (Inf) TSX-V FOM 22

23 Regional Exploration McIlvenna Bay Deposit Target A 1.2 to 1.6 km long high-priority DEEP-EM conductor; not previously drill tested McIlvenna Bay Grid m 0 5 km UTM Zone 13 NAD83 NTS 63L/10 N TSX-V FOM 23

24 Metals Market Metals prices are projected to rise by 16% in 2017 amid tightening markets for most metals. The largest gains are expected in zinc (32%) and lead (18%) due to mine supply constraints brought on by permanent closures due to resource exhaustion, as well as discretionary closures (Glencore). Copper is also expected to increase by 18% on mine disruptions World Bank Forecast, April 2017 TSX-V FOM 24

25 Global Zinc Market 14% 8% 3% Applications Galvinizing Zinc base alloys Brass and bronze 15% 60% Compounds Other alloys Sectors 7% 23% 45% Construction Transportation Consumer Goods 25% Industrial Machinery From International Zinc Association TSX-V FOM 25

26 Global Copper Market 18% 13% 6% 63% Regions Asia Europe Americas ROW 15% 12% 12% 31% Sectors Equipment Construction Industrial Infrastructure Transportation 30% From International Copper Study Group World Factbook 2016 TSX-V FOM 26

27 Building Value Production Zinc Copper Thunder Zone McIlvenna Bay Target A Community Relations Tenacity Optionality Innovation Asset Location Team Access to Capital Potential TSX-V FOM 27

28 Contact Us Foran Mining Corporation Granville Street Vancouver, BC, Canada V6C 1T2 P: E: TSX-V FOM TSX-V FOM 28