minnova corp. maverick gold project presentation september 2014
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MCI:TSXV July 2014
Maverick Gold Project Advancing toward Gold Production in 2015/16
New Name + Larger Resource + New Mine Plan = New Beginning
MINN VACORP.
O
M CI :T S X V
Forward-Looking Statements
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Some statements contained in this presentation are forward-looking and, therefore, involve uncertainties or risks that could cause actual results to differ materially. Such forward-looking statements include comments regarding mining and milling operations, mineral resource and reserve statements and exploration program performance. Factors that could cause actual results to differ materially include metal price volatility, economic and political events affecting metal supply and demand, fluctuations in mineralization grade, geological, technical, mining or processing problems, exploration programs and future results of exploration programs, future profitability and production.
Historical resources in this presentation are historical estimates that predate NI 43-101 and are not compliant with current definitions, and have not been verified by the company; consequently, they should not be relied on by investors.
www.minnovacorp.ca
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Minnova Corp. Management and Directors Focused on Shareholder Returns
3 www.minnovacorp.ca
Gorden Glenn, Chairman, President & CEO
Over 25 years industry experience in finance as Investment Banker (TD Securities and Desjardins) and Research Analyst and including 9 years as a geologist.
James D.A. White, Director
Mr. White is the Managing Partner of Baynes & White, a Toronto-based pension and benefits actuarial consulting firm.
Brian Robertson, P.Eng., Director
Over 30 years experience in corporate management, exploration programs, project management, mine permitting, construction, development and operation as well as the evaluations or corporate acquisitions.
Chris Irwin, LL.M., Interim CFO, Director
Mr. Irwin is President of Irwin Professional Corporation, a corporation providing legal services mainly to the natural resource sector.
TBD, New Director
Operations and development experience
TBD, New Director
Operations and development experience
Board of Directors
Consultants and Advisors
Notice of Alteration for Open Pit Development (NOA) – April 2014 Water Permit Application – April 2014
Nokomis Initial NI 43-101 Compliant Resource – April 2014 Updated Preliminary Economic Assessment (PEA) – July 2014 PEA to incorporate updated Resources (PL and Nokomis), new open pit mine plan and Minrail SAMSTM technology in new u/g mine plan
PL Deposit Resource Update – April 2014
New Underground Mine Plan – April/May 2014 To be incorporated in Updated PEA – June 2014 Test Mining – Fall 2014
A Century of Exploration, Development, Operations and Finance Experience
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Minnova Corp. Overview
www.minnovacorp.ca 4
• Shareholder return focused management team
• Decision making process is guided by overriding philosophy that outcome must have a positive benefit to shareholders
• Re-organized and re-structured between July 2012 to June 2014
• Culminated in the name change to Minnova Corp. - a growth oriented company
• July 2014 Updated PEA on Maverick Gold Project re-confirmed significant value proposition project development represents
• After tax NPV5% = C$84 mln or $5.44/share
• Growth beyond Maverick Gold Project is possible
• Asset valuations are re-basing and management is targeting acquisition of projects for future growth
• Going forward Minnova will continue to logically advance the Maverick Gold Project to production AND seek to acquire good quality, affordable, advanced projects to de-risk them and define a clear path to production
Minnova Ready to Capitalize on Near-Term Gold Production and Acquisitions
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Maverick Gold Project Location Flin Flon Gold and VMS Base Metal District
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A Proven Gold Mining Camp with Excellent Infrastructure
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Minnova’s Path To Production
www.minnovacorp.ca 6
July 2012 to December 2013
H1/2014
Initial Nokomis NI43-101 Resource
Updated PL Deposit Resource
Name changed to Minnova Corp.
Update mine plan
Updated PEA/PFS – July 2014
Survived Severe Market Downturn and Committed to Unlock Value of MGP
November
2010
Initial PL
Deposit NI43-
101 Resource
PEA
January
2012
Property
Acquisition
$3.5 mln
August
2011
January
2012
MCI.V vs HUI
Corporate Restructuring
Re-focus on MGP
Reduce Burn rate
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Maverick Gold Project, Then and Now Re-start of Mining Operations Targeted for Late 2015
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Historic Mine Development/Operations
Operated from Jan -88 to Apr-89 by Pioneer Metals
Produced 28k oz from 1988-1989 from 370,000 tonnes
1987 Kilborn feasibility recommended 500 tpd mill:
Capex: ~32 mln in 1987/88
Pioneer actually built mill with capacity of 1,000 tpd
Mill still in excellent condition today
6.9 km u/g drifting to a vertical depth of 130 m
1993 Kilborn feasibility Rsc and Rsv:
Resource: 524,376 oz @ ~7.6 g/t Au
Reserve: 184,200 oz @ 6.7 g/t Au
Minnova’s Development Work at Maverick
Updated PL and New Nokomis Resource Estimates
– Total Measured and Indicated mineral resources increased by 88% to 327,900 ounces gold
– Total Inferred mineral resources 438,600 ounces – In Pit Measured and Indicated resources
increased by 279% to 121,100 ounces Au grading 4.01 g/t Au
Positive Updated PEA July 2014 (@US$1,250/oz Au)
Production - ~50,000 oz per year
Pre-tax After-tax
NPV 0% : C$146.2 mln C$125.7 mln
5% : C$97.7 mln C$83.9 mln
8%: C$77.5 mln C$66.4 mln
IRR 59% 55%
Low capital cost - $26.3 million
Time to cash flow <18 months
Exploration and re-start upside
PL Deposit still open at depth and along strike
Numerous geophysical targets identified
Minrail SAMSTM test stope planned fall 2014
www.minnovacorp.ca
To
nn
age
(tp
d) G
rade
(g/t)
00.511.522.533.544.5
0
200
400
600
800
1000
1200
Jan
-88
Feb
-88
Mar
-88
Ap
r-8
8
May
-88
Jun
-88
Jul-
88
Au
g-8
8
Sep
-88
Oct
-88
No
v-8
8
De
c-8
8
Jan
-89
Feb
-89
Mar
-89
Ap
r-8
9
Tonnage Grade
2014 Program Focused De-Risking Mine Plan – Feasibility Study fall 2014
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Minnova Corp. Capital Structure
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Minnova Corp. (MCI: TSXV)
Share data and cash position as of June 30, 2014
Shares Outstanding 15,428,243
Warrants and Options O/S 1,299,794
Fully Diluted 16,636,045
Market Capitalization ~$8.0 million
Cash Position (June 30/14) $0.2 million
Debt ~$1.3 million
Options and Warrants
Warrants / Options
Avg. Exercise
Price
Options 782,500 $0.90
Common share warrants 2 517,294 $4.67
2) Expiring between April 2014 – February 2017
Significant Holders Ownership
Management and Directors ~9.0%
Pioneer Metals (Barrick Gold) ~4.1%
MCI: TSXV Share Price
Source: tmx.com and Minnova Corp.
www.minnovacorp.ca
Low Shares Outstanding = High Leverage to Gold Price and Production
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Maverick Gold Project Existing Infrastructure - Permits being Updated – Expanded Resource
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Historic Au Production
• Produced 28,000 oz from 1988-1989
• Existing 1,000 tpd mill
• 7,000 m underground mine workings
• Limited exploration on property
Resource Expansion Potential > 1 M oz Gold
• NI-43-101, M+I Rsc 327,900 oz Au and Inf Rsc of 438,600 ounces
• Expand and upgrade gold resources at PL and Nokomis deposits by step out and infill drilling
• Bonanza grades at Nokomis - 7.63 m with 125.08 g/t Au at Nokomis
• Numerous drilling targets outlined from VTEM survey along 20 km gold bearing horizon
• M Zone target – 1.5 km anomaly
• Drill hole A3-48 in 2011 intersected 0.50m @ 23.68 g/t Au at depth of ~250m vertical
• Follow-up ddh planned for 2014
Existing Infrastructure and Permits = Strategic Advantage
PL Property
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Maverick Gold Project PL Deposit – Geology Surface Plan and Section
OPEN
PL Deposit
Updated NI 43-101 Resource April 14 2014
In Pit M&I Rsc increased by 151% to 80,400 oz Au @4.40g/t
Underground M&I Rsc increased by 46% to 206,800 oz Au @5.93g/t
www.minnovacorp.ca
A3-85 – 2.3 m @ 12.6 g/t Au and 0.5 m @ 24.3 g/t Au
A3-83 – 2.0 m @ 12.0 g/t Au
A3-84 – 6.2 m @ 7.6 g/t Au
A3-81 – 1.7 m @ 47.2 g/t Au, incl. 0.5 m @ 145.5 g/tAU
Resource Still Open Down Dip to North East
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Community and Social Responsibility Sherridon – Cold Lake, Manitoba
www.minnovacorp.ca
Strong Local Community Support
• May 7, 2014 Community Update meeting - President and CEO Gorden Glenn and Director Brian Robertson provide MGP update and respond to questions and concerns of the local community
• Sherridon - Cold Lake, Manitoba is located approximately 13 km north of the MGP • The MGP and the local community share regional infrastructure including an all weather road, the
Keewatin Railway Company (KRC) and access to low cost, clean hydro power • We also share the same vision of re-starting sustainable, mining operations with minimal impact
to the environment • The community of Sherridon - Cold Lake, Manitoba expressed their strong support of the MGP
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Maverick Gold Project – July 2014 PEA
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• Total LOM production 483,350 • (86/14% split of u/g and open pit)
• Flexible mine plan • Average LOM Cash Costs US$798/oz • LOM AISC $1,003/oz
• AISC = operating costs + capital/sustaining cost including contingency, environmental bonding
• $26 million initial Capex to production • Offset by forecast 6.6 million yr 1 net
income • $125.7 million cumulative after –tax cash
flow at $1,250/oz • Payback from start-up in 18 months
www.minnovacorp.ca
Attractive Low Cost Production Profile with Quick Payback
$ oz
$200 oz
$400 oz
$600 oz
$800 oz
$1,000 oz
$1,200 oz
$1,400 oz
$1,600 oz
$1,800 oz
oz
10,000 oz
20,000 oz
30,000 oz
40,000 oz
50,000 oz
60,000 oz
70,000 oz
1 2 3 4 5 6 7 8 9 10 11
Open Pits (LHS) Underground (LHS) Total Cash Costs (RHS) AISC (RHS)
Forecast Production and Costs
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Maverick Gold Project – Positive PEA
www.minnovacorp.ca 13
Updated PEA Planned for Q2 2014
LOM Total (000's)
Discounted at 5% (000's)
Discounted at 8% (000's)
IRR (%)
Gross Sales $629,632 $475,868 $408,206
Less royalties $18,291 $13,785 $11,807
Less selling expenses $2,900 $2,191 $1,880
Net Sales Revenue $608,441 $459,890 $394,519
Mining costs $306,573 $221,457 $185,021
Processing costs $67,399 $48,613 $40,602
G&A costs $32,461 $23,311 $19,424
Total cash operating costs $406,434 $293,381 $245,048
Net cash operating margin $202,006 $144,609 $120,247
Initial capital $26,299 $24,471 $23,481
Sustaining capital $29,504 $24,722 $22,430
Net cash flow before tax $146,203 $97,713 $77,535 59%
Taxation payable $20,463 $13,845 $11,103
Net cash flow after tax $125,739 $83,867 $66,432 55%
• Pre-tax NPV 5% = $97.7 mln, IRR = 59%
• After-tax NPV 5% = $83.3 mln, IRR = 55%
• Payback of 1.5 years after plant start-up
• Cash flow in under 18 months
• 11 year mine life
• Total gold production of 483,000 ounces
• 2.5 mln tonnes grading 6.53 g/t Au
• Open pits - 558,000 tonnes @ 4.41 g/t
• LOM strip ratio of 6:1;
• Underground - 1.98 mln tonnes @ 7.26 g/t
• Average LOM cash cost of US$798 per ounce
• AISC of US$1003 per ounce;
• Pre-production (years -1 and 1) capital of $26.3mln
• In Year 1, the projected $12.7 mln capital
expenditure is partially offset by income of
$6.6 mln;
• Total LOM Sustaining Capital = $29.5 mln
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Maverick Gold Project – PL Deposit Longitudinal Section Facing West
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Longitudinal section looking northwest showing existing underground workings, proposed open pits, and proposed stopes from all zones. July 2014 PEA and April 2014, NI43-101 Resource Estimate
Pit 1
Pit 4/5 Pit 1 Pit 2 Pit 3
www.minnovacorp.ca
AREA 1
AREA 3
AREA 2
AREA
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Updated PEA - Optimized Mine Plan Achieves Significant Increase in Mine Production
Mined Ounces
Open Pits:
Pit 1: 4,302 oz
Pit 2: 16,340 oz
Pit 3: 14,115 oz
Pit 4: 1,837 oz
Pit 5: 6,879 oz
Total Pits: 43,473 oz
Underground:
Zone 1: 79,074 oz
Zone 2: 117,929 oz
Zone 3: 53,241 oz
Zone 4: 126,117 oz
Zone 5: 85,775 oz
Total Undergound: 505,557 oz
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Maverick Gold Project Key Operating Permits and Infrastructure (1000 tpd Mill) In Place
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New Underground Mine Plan – SAMSTM Specialized Shallow Angle Mining System
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• Innovative modular concept and design
• Very high proportion of the mining tasks are mechanized
• Eliminate the use of manual drills for drift development • Jackleg vs Long Tom and Jumbo
• Introduction of long hole productivity techniques • Hydraulic vs pneumatic
• Enhanced work conditions and modular design result in higher productivity
• www.minrail.ca
www.minnovacorp.ca
Auriga is De-Risking MGP with New Underground Mine Plan and Innovative SAMSTM
SAMSTM developed by Minrail Inc., of Val-d'Or Quebec
Minrail has developed a unique and innovative mining system for shallow-angle mining operations (S.A.M.S.™) that promises to revolutionize mining operations as we know them today.
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Old Underground Mine Plan – Conventional
17 www.minnovacorp.ca
Accepted Narrow Vein Mining Methods are Manually Intensive and Less Productive
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New Underground Mine Plan – SAMSTM Specialized Shallow Angle Mining System
18 www.minnovacorp.ca
Innovative Mechanized Rail-Based System is Safer with Higher Productivity
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Maverick Gold Project – Exploration Upside
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Targeting in excess of 1,000,000 ounces gold
Well-defined major regional gold mineralized structure at the northern border of Flin Flon greenstone belt
Drill program planned to expand resources
Maverick Property covers over 20km of strike length
Target has well-defined geophysics trend with several showings found along strike
Updated MGP NI 43-101
In Pit M+I Rsc 121,100 oz @ 4.01 g/t Au
Underground M+I Rsc increased by
46% to 206,800 ounces Au
Total M+I Rsc 327,900 @ 5.93g/t Au
Total Inf Rsc 438,600 ounces Au
M Zone Drill hole A3-48
0.50m @ 23.68 g/t Au
PL Deposit and Onsite Mill
Nokomis Deposit Ind Rsc 40,700 oz Au Inf Rsc 19,100 oz Au
www.minnovacorp.ca
Property Unexplored away from Known Deposits
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Maverick Gold - Nokomis Deposit Satellite Deposit just 8km Northeast from the Maverick Mill
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• Potential open pit satellite deposit • Confirmation drilling program complete
• Indicated mineral resource of 40,700 ounces • Inferred resource of 19,100 ounces of gold
• Initial high-grade gold intercepts • 125.08 g/t over 7.6 m (incl. 1,830 g/t over 0.5 m); • 12.27 g/t over 5.2 m; • 5.1 g/t over 6.4 m; • 9.65 g/t over 5.6 m (incl. 62.23 g/t over 0.5 m)
High-grade near-surface mineralization
www.minnovacorp.ca
Incremental Mill Feed from Nokomis Enhances MGP Economics
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Maverick Gold - Nokomis Open Pit
www.minnovacorp.ca 21
Nokomis Pit Optimisation • Tonnes in mine plan - 228,000 • Grade - 4.3 g/t Au • Contained gold - 31,500 0z • Strip ratio 6.3:1 • Production starting in year 3 • High grade vector (>30 g/t Au)
to be tested (yellow line inbox)
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Minnova Corp. Attractive Value Proposition
22 www.minnovacorp.ca
One of the Most Attractive Near Term Producer Value Propositions AISC: Cash Costs + Corp. G&A + All Capex (Exploration, Development, Sustaining)
Low AISC
Source: Scotiabank
MCI
0.00x
0.10x
0.20x
0.30x
0.40x
0.50x
0.60x
0.70x
0.80x
0.90x
P / NAV
Attractive grade - Resource open
Low P/NAV relative to other emerging producers
Low Cash operating costs
Low AISC
Low Capital Intensity
Short time to production
PL and Nokomis Deposits
open to expansion
Minnova
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Minnova Investment Highlights
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Near-term gold production, with excellent exploration upside
Past producing property, with significant onsite infrastructure
1,000 tpd mill, ancillary facilities, ramp and underground workings
Road access to property, access to grid power and railway
Final permitting in progress to achieve production in late 2015
April 2014 NI 43-101 Resource Estimate:
Total M+I Rsc 327,900 @ 5.93g/t Au
Total Inf Rsc of 438,600 ounces Au
Open pit and shallow underground
Positive July 2014 Updated PEA for open pit and U/G mine re-start
Average annual production of ~50,000 ounces at C2 cash cost of $798/oz
Start-up capex of $26.3 Million Partially offset by $6.6 M in yr 1 income
un-discounted cash flow: $130 Million
www.minnovacorp.ca
MCI’s Value Proposition is One of the Best in the Jr Gold Development Sector Today
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For more information:
Minnova Corp. MCI :TSXV +1 647 985 2785 365 Bay Street, Suite 400 Toronto, Ontario M5H 2V1 www.minnovacorp.ca MCI_Minnova MCI.Minnova
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