Investment Highlights

Transcription

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2 Investment Highlights District Scale Opportunity 70km x 8km area. Discoveries at Foxtrot, Deep Fox and Fox Meadow plus 21 unexplored showings. REE Deposit in SE Labrador Foxtrot Deposit April 2016 PEA, 14-year mine life at 1000 tpd. Right mix of REEs. Highly Accessible Strategically located on tidewater, on a road and near communities. Mining Friendly Region Ranked #16 globally by Fraser Institute. Stable govt., competitive tax regime, clear regulations. Metallurgy Solved Proprietary solution, simple and low cost with excellent recovery rates. Environmental Advantage Dry stackable residue as opposed to wet tailings. No harmful by-products. Low CAPEX ($CAN) $152M with a $33M contingency. Potential for further reductions. Good local infrastructure. Experienced Mgmt. & Board Mining and exploration startups, metallurgy, geology, investment & government relations. 2 Corporate Presentation searchminerals.ca April 2017

3 Corporate Summary Management and Board Listing Head Office As at April 15, 2017 ($CDN) TSX-V: SMY Shares Outstanding 146,222,190 Warrants 28,786,977 Options 9,065,000 Fully Diluted 184,074,167 Share Price Range $ $0.10 Market Capitalization $12,428,886 Bank Auditors Vancouver, British Columbia Royal Bank of Canada Mao Ying LLP Ownership (Approx. 550 Shareholders) Management Ownership (Canada) 24% Strategic Investor since 2011(Brazil) 17% Other Newfoundland/Labrador (NL) 34% Rest of Canada 18% Rest of World 7.0% Jim Clucas, Executive Chairman, Director Former Inco Canada CFO and founder of International Nickel. Greg Andrews, President and Chief Executive Officer Extensive experience in capital markets, strategic planning and operations management. Dr. David Dreisinger, Director & V.P. Metallurgy Industrial Research Chair in Hydrometallurgy at UBC. Internationally recognized metallurgy process consultant. Dr. Randy Miller, Vice President Exploration Ph.D. Geologist. Over 20 years in Rare Earth Element Exploration. Dr. Jim Patterson, Director Ph.D. geologist; 40 years in exploration; former FNX Mining V.P. Ray Saunders, Director NL Entrepreneur, transportation expert, major shareholder. Roberto Giannetti da Fonseca, Director Former Brazilian Secretary of Foreign Trade, Chairman Kaduna Consulting - advisor to 50+ Brazilian multinationals. Leo Power, Director Entrepreneur, Director of Canada Fluorspar, Executive Chairman of Barite Mud Services, strong government relations background. Dr. Andrew Furey, Advisory Board, Director Nominee Founder and CEO -Team Broken Earth, Director of Canada Fluorspar and Sequence Bio. 3 Corporate Presentation searchminerals.ca April 2017

4 Business Partnership Strategy Search Minerals Through strategic joint venture and offtake partnerships, Search is seeking to access additional expertise to maximize production, sales cycles and return to shareholders. Strategic JV Partner Off-take Partner Strategic Joint Venture Partner To fund the Bankable Feasibility Study prior to final decision to build a Mine and Processing Facility. Off-Take Partner - Discussions moving forward now that the metallurgy is done. Seeking contracts from product end users and manufacturers. Search Minerals - Ongoing role in developing the District. 4 Corporate Presentation searchminerals.ca April 2017

5 Business Strategy Timeline (All costs in $CDN) 5 Corporate Presentation searchminerals.ca April 2017

6 Current Private Placement Up to 34,000,000 units (the Units ) at $0.09 per unit. A Unit = One common share and one half-warrant. Each full-warrant entitles the purchaser one full share at $0.18 for a period of twelve months following closing. Uses of $3,060,000 in Proceeds: Up to $1.1M for the environmental application and working capital. Up to $ 2.0M for the Deep Fox drilling program and other exploration. 6 Corporate Presentation searchminerals.ca April 2017

7 About REEs: Industry Drivers Green Energy Hybrid and Electric Vehicles Wind Energy Energy Efficient Lighting The Toyota Prius is estimated to contain: 1 kg Neodymium Metal 15 kg Lanthanum Metal 0.1 kg Dysprosium Metal Sales exceed 1 million units per annum Military and Defense Each F35 fighter aircraft requires 417 kg of REEs Each US nuclear submarine requires 4,000 kg of REEs Communications Aeronautical engineering and Jet Engines Guidance, Lasers, Sonar, Optics, and Electronic Counter Measures Modern Technologies Cell Phones and Digital Cameras LCD and Plasma Televisions MRI machines, X-Ray, and PET Medical imaging 7 Corporate Presentation searchminerals.ca April 2017

8 About REEs Industry Drivers cont d Five Key Elements or neo-creos to Dominate Neodymium, Praseodymium, Dysprosium, Terbium & Lanthanum Primary market driver is demand for permanent magnets which is expected to provide over 77% of demand (2021) with a CAGR of 17.9%. Market will grow from USD $1.4B in 2016 to $6.2B by Source: Adamas Intelligence, December 2016 Source: Adamas Intelligence, December 2016 Search Foxtrot Deposit April 2016 PEA Oxide % Revenue Neodymium 39% Dysprosium 29% Praseodymium 14% Terbium 8% Other 10% 8 Corporate Presentation searchminerals.ca April 2017

9 Location St. Lewis Source: Google Earth Source: Google Earth SE Labrador, Canada near the communities of St. Lewis and Mary s Harbour Same approximate latitude as Waterford, IRL; Cambridge, GBR; and Amsterdam, NLD Road accessible, ice free, on tidewater and in close proximity to Gulf of St. Lawrence and transatlantic shipping routes. 9 Corporate Presentation searchminerals.ca April 2017

10 Location Infrastructure Year-round ice free sea port Upgraded diesel power station Trans-Labrador Highway Airport Deposits / Prospects Foxtrot 12 km from town Deep Fox 4 km from town Supplies and reagents come to port Concentrate can be trucked out year round by road. 10 Corporate Presentation searchminerals.ca April 2017

11 District Scale Opportunity Search controls a 70 km x 8 km District at tidewater. Key Points Three major discoveries Foxtrot Deposit Deep Fox (2015) Fox Meadow (2016) Twenty-one other prospects. Excellent geological and geophysical control. April 2016 PEA is based on the Foxtrot deposit only. 11 Corporate Presentation searchminerals.ca April 2017

12 Foxtrot Deposit The Foxtrot Deposit lies within the Fox Harbour Volcanic belt. Delineated by over 70 drill holes, geological mapping and geophysics, the context of the mineralized zones is well understood. The accessible location with high grade zones containing economically significant quantities of CREEs triggered the decision to move forward with the Preliminary Economic Assessment which was updated in April Corporate Presentation searchminerals.ca April 2017

13 Foxtrot Deposit - PEA Plant Capacity FOXTROT April 2016 PEA Financials ($CDN) Pre-Tax NPV 10% and IRR $93 million and 22% After-Tax NPV 10% and IRR $48 million and 16.7% Payback Period Gross Revenue Life of Mine (LOM) Average NSR Value Facility Operating Cost CAPEX 1,000 tpd production rate / 4.9 Mt over 14 years Pre-tax 3.5 years, After- tax 4.4 years $1.7B Note: Revenue is dominated by Nd (39%), Dy (29%), Pr (14%) and Tb (8%). These elements and others projected to remain in supply deficit. $358 per tonne $238 per tonne $152 million for startup with a $33M contingency $ 57 million for underground - funded from operations $ 23 million for mine closure - funded from operations Cautionary Note: The preliminary economic assessment is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them to enable them to be categorized as mineral reserves and there is no certainty that the preliminary economic assessment will be realized. Mineral resources that are not mineral reserves do not have a demonstrated economic viability. 13 Corporate Presentation searchminerals.ca April 2017

14 Deep Fox Discovery Similar surface strike lengths as Foxtrot Zone widths are as wide or wider (up to 30m) than at Foxtrot Mineralized channel sample assays are 15% higher than at Foxtrot Plans to drill Deep Fox in Fiscal 2017 Excellent Location 12 km from Foxtrot 4 km from St. Lewis deep water port and road network 14 Corporate Presentation searchminerals.ca April 2017

15 Foxtrot vs. Deep Fox Cautionary Note: The preliminary economic assessment is preliminary in nature and includes inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them to enable them to be categorized as mineral reserves and there is no certainty that the preliminary economic assessment will be realized. Mineral resources that are not mineral reserves do not have a demonstrated economic viability. 15 Corporate Presentation searchminerals.ca April 2017

16 Metallurgy Completed High Recoveries During Pilot Plant Testing Processed over 3.0 tonnes of material representative of the Foxtrot Deposit. Clearly demonstrated the ability to produce a high purity mixed rare earth oxide (REO) concentrate. Average extractions of 85% neodymium (Nd), 86% praseodymium (Pr), 68% dysprosium (Dy), 71% terbium (Tb) and 86% lanthanum (La) Successfully demonstrated the ability to reduce uranium, thorium, zinc, and iron levels below levels expected by refineries. 16 Corporate Presentation searchminerals.ca April 2017

17 Initiatives to Improve Project Economics Goal has been set to bring after Tax IRR above 30%. 1. Increased REE Recovery Rates - Recent pilot plant and bench scale tests show recoveries well above those used in the 2016 PEA. 2. Engineering Review - Goal is to reduce CAPEX requirements by 35%. 3. Reduce Separation Costs - By examining new separation technologies and considering excess capacity at existing refineries (*average utilization is 38% in China). Currently sending concentrate samples to refineries with the goal of reducing separation costs by 50% relative to the costs in the April 2016 PEA. 4. Deep Fox 2017 Drilling Program Rationale Accessing material with grades 15% higher relative to Foxtrot would have a huge impact on net revenues. Deep Fox could provide the opportunity to develop the District with low cost open pit operations and delay $57M in underground development costs at Foxtrot. Potential to have 2,000 tpd. production at Deep Fox. 17 Corporate Presentation searchminerals.ca April 2017

18 Recap of Key Success Factors RIGHT RESOURCE METALLURGY SOLVED RIGHT LOCATION RIGHT POPULATION DENSITY LOW OPEX LOW CAPEX MINING FRIENDLY REGION DISTRICT PLAY 14 Year Mine life at 1,000 tpd. Significant % of the high demand neo-creos. High recovery rates. It can take years and $ millions to solve the extraction metallurgy for some deposits. Many projects are in remote areas which greatly increases infrastructure development costs. In a region where there is limited competing or conflicting land use. No nature reserves, no parks. Near communities and on a road. No fly-in camp required. Lower cost environmentally friendly processing technology. $152 Million is low, due to existing infrastructure, scalable processing plant, technical simplicity and open pit mining. Stable government with a competitive tax regime and well defined regulatory requirements. Ranked #16 in world! 3 discoveries and 21 additional prospects. Surface grades at Deep Fox are 15% higher than Foxtrot and zones wider. 18 Corporate Presentation searchminerals.ca April 2017

19 Cautionary Statement This presentation may include certain forward-looking statements within the meaning of the United States Private Litigation Reform Act of 1995 and applicable Canadian Securities Laws. All statements other than statements of historical fact, included in the presentation, including without limitation, statements regarding potential mineralization and reserves, exploration results, and future plans and objectives of Search Minerals, are forward-looking statements. Words such as expect, anticipate, estimate, may, will, should, intend, believe and other similar expressions are forward-looking statements. Forward-looking statements are not guarantees of future results and conditions but rather reflect our current views with respect to future events and are subject to risks, uncertainties, assumption and other factors, and actual results and future events could differ materially from those anticipated in such statements. There can be no assurance that such forward-looking statements will prove to be accurate. We base our forwardlooking statements on information currently available to us and we do not assume any obligation to update them, except as required by law. An additional Cautionary Note to Investors: In the event that we use certain terms in this presentation such as resource, measured resource, indicated resource and inferred resource, US investors are cautioned that, while such terms are recognized and required by Canadian Securities Laws, the United States Securities and Exchange Commission does not recognize them. Under U.S. standards, mineralization may not be classified as a reserve unless the determination has been made that the mineralization could be economically and legally produced or extracted at the time the reserve determination has been made. U.S. investors should not assume that all or any part of measured or indicated resources will ever be converted into reserves. In addition, inferred resources have a greater amount of uncertainly as to their existence and as to whether they can be mined legally or economically. Accordingly, information concerning descriptions of mineralization in the presentation may not be comparable to information made public by companies that are subject to the SEC s Industry Guide 7. All of the scientific and technical information contained herein has been reviewed and/or prepared by either Dr. Randy Miller, P.Geo. or Dr. David Dreisinger, both being a Qualified Person within the meaning of National Instrument Standards of Disclosure for Minerals Projects. For further details of the Company s procedures and policies for data verification, the reader is referred to the Company s news releases and other material information available on the Company s website at or on SEDAR at 19 Corporate Presentation searchminerals.ca April 2017

20 Thank You! Thank you! 20 Corporate Presentation searchminerals.ca April 2017