august 14, 2018 hope bay site visit · 8/14/2018 · mike samuels s director, metallurgy dan...

August 14, 2018 – Hope Bay Site Visit

Doris Mine and Plant

Caution Regarding Forward-Looking

Information

31

Attendees are cautioned that we will be making forward-

looking comments. To fully understand the risks inherent in

our comments, forecasts and estimates you are

encouraged to read our Management Discussion and

Analysis for the second quarter ended June 30, 2018

together with our Financial Statements for the same

period.

Participants

32

Jason Neal

President & Chief Executive Officer

Gil Lawson

Chief Operating Officer

Mike Samuels

Senior Director, Metallurgy

Dave King

Vice President, Exploration

Ann Wilkinson

Vice President Investor Relations

Strategic Overview – Building Momentum

33

• Operating team in place

• Recovery improvement from 71% in Q1 to 82% in Q2 – June (85%)

better than May (83%)

• Successful ramp up of plant to 2,000 tpd capacity

• Mine positioning for mining in Hinge and Crown Pillar recovery in

Q3

• Improved operations will drive positive AISC margin

• NIRB recommendation that Madrid-Boston Project be permitted to

proceed sent to Crown-Indigenous Relations and Northern Affairs

Canada

• Strategic analysis and planning for higher risk-adjusted returns and

value on Madrid and Boston development

• A return to exploration driven growth

Senior Management

34

Jason Neal

President & CEO

Gil Lawson

COO

Mike Samuels

S Director, Metallurgy

Dan Redmond

Dir, Strategic Mine Planning

Dan Gagnon

General Manager

Jerome Girard

Asst. General Manager

Maarten Theunissen

CFO

Ron Gagel EVP,

Corporate Affairs

Julia Micks EVP, Human Resources

Oliver Curran VP,

Environmental Affairs

David King VP,

Exploration

Ann Wilkinson,

VP, Investor Relations

Senior Management

35

Dan Gagnon

General Manager

Jerome Girard

Asst. General Manager

Ron Bertrand Surface

Operations Manager

Kelly Schwenning Manager, Projects

Chad Parent Process Plant

Manager

Doug Brown Health and Safety

Manager

Jason Nickel Mining Manager

6

• Operations

• Complete sealift in Q3

• Processing

• Q3 recoveries targeting mid-80s%

• Q3 installation of additional gravity concentrators in mill to

achieve 90% recovery in Q4

• Mining - Ramp up production

• Development

• More efficient mining – blasting, dilution control

• Crown pillar recovery – Q4

• Complete exploration program and prepare for increased

exploration activity

Near-Term Priorities - Operational

Key Financial Metrics

37

Q1-18 Q2-18

Gold Sold (ounces) 19,540 25,760

Revenue (C$ millions) 33.0 43.3

Realized Gold Price (US$/oz) 1,332 1,300

Cash Costs (US$/oz) 1,049 928

AISC (US$/oz) 1,807 1,642

Cash flow from Operating Activities

(C$ millions)10.9 14.6

EBITDA (C$ millions) (3.5) 4.9

Capital Expenditures (C$ millions) 18.8 27.1

Unrestricted Cash Balance (C$ millions) 35.7 24.2

Restricted Cash Balance (C$ millions) 42.3 42.3

Q2 2018 Conference Call

8

Growing Toward Positive AISC Margin

-

3,000

6,000

9,000

12,000

15,000

18,000

21,000

24,000

27,000

30,000

33,000

36,000

-

5

10

15

20

25

30

35

40

45

50

55

60

Q4 2017 Q1 2018 Q2 2018

Go

ld S

old

(o

z)

C$ m

illio

ns

Cash cost (Opex) Corporate G&A UG development

Sustaining CAPEX Revenues Gold sold (Y2)

AISCUS$1,807/oz

AISCUS$1,624/oz

AISCUS$1,870/oz

US$1,049/oz US$928/ozUS$1,228/oz

9

• Principal Amount

• US$160 million

• No gold hedging required

• Interest Rate

• 6.5% per annum plus greater of US$ 3-mth LIBOR, and 1.0%,

compounded and payable quarterly

• Payments

• US$6.5 M Quarterly – October 31, 2018 – July 31, 2020

• US$30M Bullet – January 31, 2019

• US$5.5M Quarterly – October 31, 2020 – April 30, 2022

• Maturity Date – July 31, 2022 – Bullet payment of unpaid balance

Debt Facility Summary

KEY TERMS / FEATURES

• Macquarie owns the fuel

• No security required – not debt

• Price = Cost of contract + Premium

• Converts inventory working capital to cash

Diesel Purchase and Storage Arrangement

PROCEDURE

1. Macquarie steps into TMAC’s current fuel purchase and delivery contract

2. Macquarie rents tanks from TMAC

3. TMAC will purchase the fuel from

Macquarie as it draws fuel from Roberts

bay tanks

10

CIRNA

KIA

Letters of credit

Letters of credit

Insurance Company

Letter of credit agreement

Demand Bond

Environmental Bonding Product

11

36

Madrid-Boston Project Permitting Milestone

• Significant permitting milestone: June 26, 2018, Nunavut Impact Review Board

recommended to the Minister of Crown-Indigenous Relations and Northern Affairs Canada

that the Madrid-Boston Project proceed.

• Final Hearing Report is very supportive of TMAC’s proposal with recommend terms and

conditions that offer operational flexibility with respect to how we implement our

environmental programs and mitigations.

• Madrid-Boston Project includes 3 new mines, extensive infrastructure and belt wide

production of 6,000 tonnes per day.

• Next step in the permitting process is for the Minister to approve NIRB’s recommendation,

allowing NIRB to issue TMAC a new Project Certificate for the Madrid and Boston mines.

• Following the Minister’s approval, the Nunavut Water Board will give notice of the final

hearing date for TMAC’s Type A Water Licence applications.

– NWB Technical meetings and the Pre Hearing Conference have been completed with no

outstanding technical issues.

“For those of us in this region, we are also in support of the mining

company, TMAC. We would like to see them continue. We are in support

of TMAC. We were able to ask questions. We were given clear and

concise responses from the company. We would like to see the Hope Bay

project go ahead in the communities in our region. They have really

contributed to the Kitikmeot communities a great deal, and they are very

supportive of the students completing their education, and they've also

recognized the students trying to finish their education.”

-Taloyoak Statement from Final Hearing

“We are in support of the mine. We would like to see the company given

the greenlight. The way I see it, it's going to help our economy and Canada

as a whole. I am thankful to the Government of Nunavut and the

Government of Canada and the Kitikmeot Inuit Association as well. I see it

as a benefit to everyone, ensuring that they have protection plans in place

and to implement the protection plan of the environment.”

- Kugaaruk Statement from Final Hearing12

13

• Plant capacity consistently at 2,000 tpd

• Q3 recoveries back to mid-80s%

• Q3 installation of additional gravity concentrators in mill to achieve

90% recovery in Q4

• Ramp up mine production and development

• Complete current exploration program and prepare for increased

exploration activity

• Secure Madrid-Boston Project Certificate by Q4-2018 and Water

Licences by Q2-19

• Advance analysis of optimized Hope Bay Belt development

Near-Term Priorities

Operations

Doris Mine and Plant14

Safety & Health

15

• We remain lost time

injury free for 2018

• 264 days LTI free and

10 days Medical Aid

free

• 1 Medical Aid in 2018

• Focus is on safe

operating procedures

and personnel

training

Key Operating Metrics

16

Q1-18 Q2-18 Jul-18

Processing

Throughput (t)83,600

(928 tpd)

88,300(970 tpd)

31,500(1,016 tpd)

Processed Grade (g/t) 10.9 10.0 8.8

Recovery (%) 71 82 75

Gold produced (oz) 20,650 23,140 6,660

Gold poured (oz) 18,870 25,970 5,450

Mining

Ore (t) 82,600 68,900 27,300

Waste (t) 72,300 80,700 25,300

Total (t) 154,900 149,600 52,600

Average grade (g/t) 8.5 9.8 9.3

Key Financial Metrics

317

700

1,000

1,300

1,600

1,900

2,200

-

5,000

10,000

15,000

20,000

25,000

Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018

Go

ld p

rod

uc

ed

(o

un

ce

s)

Gold Produced AISC (US$/oz) Cash Cost (US$/oz)

US$/o

z

Plant Performance – June

18

• Gravity gold recovery from ~ 50% to refinery

• The Plant processed 26,000 tonnes with an overall recovery of 85%

• Initial feed to CL2 and commissioning dual concentrator lines

• Challenges seen in solutions and concentrate management on CTP

side resulting in seven days of down days (<400 tonnes processed)

• Confidence to proceed with expenditures related to additional

gravity concentrators

Plant Performance – July

19

• Experienced water balance issues and several mechanical failures in

oxygen generator, detox mixing tank and detox filter press that

affected recovery and throughput

• Ten down days in month (<400 tonnes processed) including three day

scheduled shutdown for power plant and distribution system

• 31,500 tonnes processed at 75% recovery

• Learning to balance concentrates and solutions management

running the twin lines

• CL2 continues to operate as well, or better than, CL1. Best day to

date was ~2,200 tonnes, without topping out the lines

• Expect tonnages to start ramping up consistently now

Demonstration of 2,000 tpd Plant Capacity

20

-

500

1,000

1,500

2,000

2,500

1-J

un

2-J

un

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un

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un

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un

11-J

un

12-J

un

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un

14-J

un

15-J

un

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un

17-J

un

18-J

un

19-J

un

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un

21-J

un

22-J

un

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un

24-J

un

25-J

un

26-J

un

27-J

un

28-J

un

29-J

un

30-J

un

1-J

ul

2-J

ul

3-J

ul

4-J

ul

5-J

ul

6-J

ul

7-J

ul

8-J

ul

9-J

ul

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ul

11-J

ul

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ul

13-J

ul

14-J

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15-J

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ul

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ul

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ul

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22-J

ul

23-J

ul

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25-J

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26-J

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27-J

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28-J

ul

29-J

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30-J

ul

31-J

ul

CL1 Feed CL2 Feed Average

2,000 tpd

Dilution Control

21

• We did not “bench” a blast in

June/July, so re-design is working

• Improved dilution in June

Expansion of Gravity Effort

Falcon C2000 (2)

Grind/Flotation Feed Surge bins (2)

Remove cleaner Jigs

Move Spinners to Crushing Circuit

Falcon SB1350 (2)

KnelsonXD20 (2)

Replace Regrind Cyclones (2)

22

Falcon SB400 Addition - May 2018

23

Ultimate Gravity Concentrators - Q4 2018

24

Additional Surge Capacity - Low-g gravity

concentrators to crushing

25

Additional high-g gravity concentrators in

primary grinding

26

Additional high-g gravity concentrators in

sulphide recovery

27

Expansion of pump box volumes

28

Addition of a high-g gravity concentrator to

the regrind circuit

29

• Crushing Surge Capacity

• Completed structural steel design for tower and surge bins

• East tower fabrication completion targeted for August to allow moving spinners

• Surge bins fabrication completion targeted for early September

• Foundation concrete design is finalized

• All east tower equipment operational by end of September

• Primary Grinding

• Falcon SB1350s and screens completed and being shipped to site

• Falcon C2000s and screens ordered – delivery by end of August

• Completed structural steel design - fabrication completion targeted for mid-September

• Foundation concrete design is finalized

• Ball mill discharge pump box volume expanded by 100%

• All west tower equipment operational by end of September

• Regrind area

• Knelson XD20s being shipped to site

• Move spinners after structural steel for east tower erected, then install XD20s

• XD20s operational by early September

• Expansion of regrind mill pumpboxes

Equipment and Materials Status

30

• Pumps

• 20 new pumps (3x2, 4X3, peristaltic hose) – 6 pumps and 3 pump boxes are being re-used, but in a

different area of the flowsheet

• Electrical and mechanical

• Process Flow Diagrams, mechanical equipment lists, instrumentation diagrams completed

• Electrical and instrumentation lists developed for final costing and purchasing

• No new electrical room required - new MCC and some variable speed drives repurposed and

augmented

• G Mining

• Scope includes supervision of concrete, structural steel erection, mechanical and electrical

installation

• Costs/Budget

• Scope increased to add a second surge bin with related tower

• Detailed engineering Gantt chart and budget completed - awaiting detailed costs for surge bins,

west tower, and regrind structural steel

• Budget at $8.0 million (including camp cost allocation)

Other Equipment/Logistics Status

31

Exploration

32

Hope Bay – Exploration Objectives

Near Term

• Production Support

• Doris Connector - definition drilling supporting detailed mine planning

• Doris BTD Extension - definition and expansion, facilitate conversion to reserve

• Madrid Naartok zone - definition of shallow, high grade core, supporting

advanced exploration program

Medium Term

• Development Support

• Doris - “in mine” extend Doris mine lift

• Madrid - Definition and expansion supporting LoM planning

• Boston - Expand known resources, define potential supporting development plan

• Continue developing and testing regional targets

Long Term

• To date, little work completed outside of the 3 known deposits

• Define the long term potential of the Belt. New discoveries and infrastructure nodes 33

2018 Planned

Development

Existing

Development

North Fault

Historical Drillhole

Referenced in text

2018 TMAC Drillhole

High-Grade Doris

“Hinge”

BTD Extension

N

BTD East

Limb

Diabase

Doris North

Open

10TDD741 (Historical)

523 g/t Au over 5.6 m

Incl. 5,777 g/t Au over 0.5 m

TM50148

261.4 g/t Au over 7.1 m

Incl. 2,710 g/t Au over 0.66 m

TM50152

71.8 g/t Au over 1.4 m

and 1,255 g/t Au over 1.5 m

TM00058 (Historical)

112.8 g/t Au over 1.5m

TM00132 (Historical)


Doris North BTD Drilling Highlights

TM50124


and 96.6 g/t Au over 2.9 m

100 m 34

Naartok East

N

100 m

Naartok

West

Rand

Suluk

High-

Grade

Plunge

Historical Drillhole

2018 TMAC

Drillhole

PMD099 (Historical)

33.1 g/t Au over 11.0 m

TM00375

11.5 g/t Au over 25.1 m

Incl. 18.1 g/t Au over 14.0 m

TM00376

12.9 g/t Au over 50.0 m

Incl. 60.1 g/t Au over 8.5 m

05PMD288 (Historical)

23.2 g/t Au over 15.9 m

Madrid North Drilling Highlights

TM00371


35

Huge Database (+30 years; 4 owners)

(+90 high priority targets)Geology Magnetics Gravity Targets Identified

Excellent Exploration Results and Historical Data Base to Build On 36

Hope Bay – Exploration Potential

Tremendous Exploration Potential

within the relatively under-

explored Hope Bay and Elu belts.

• Very little work completed

outside of the 3 known

deposits.

• Begin to define the long term

potential of the Belt. We have

people working on long term strategic planning that will

require data.

• Numerous high grade Au

surface samples throughout

the belt

• Au in till anomalies defined

near current infrastructure at

both Doris and Boston>10g/t Au

Madrid

Boston

Doris • Au in till sampling

• Detailed mapping

• RC/RAB drilling to further define

diamond drilling targets

• Ground geophysics

• Diamond drilling

37

Regional Exploration – Hope Bay

CGG HeliFALCONTM (2016) Ground Gravity (2009)

80 km

38

Hope Bay Belt - Surface Grab Samples +

Outcrop

Doris

Madrid

Boston

80km

>10g/t Au >50g/t AuOutcrop Map 39

Abundance of Targets Near-Mine and

Regionally

Hope Bay

Deformation

Zone

2.5km

Doris

Madrid

N

Hope Bay

Deformation

Zone

2nd Order

Structures

774,000 ozs Au Indicated

400,000 ozs Au Inferred

2,759,000 ozs Au Indicated


Boston

2.5km

N



>10g/t Au

Boston

Madrid

Doris

40

28.6 g/t Au/3.8m

Historical

Measured

And

Indicated

Inferred

Un-Classified

56.6g/t Au/8.8m

Historical

28.5 g/t Au/7.1m

17.3 g/t Au/4.8m

46.6 g/t Au/7.8m

Historical

2017 Drillhole15.3 g/t Au/22.3m 22.0 g/t Au/17.55m

15.9 g/t Au/18.4m

Category Tonnes

(kt)

Grade

(Au g/t)

Ounces

(koz)

Measured & Indicated 3,711 9.2 1,096

Inferred 1,393 7.4 330

250 m

N

41

Boston Deposit

43

Boston Regional Exploration



Intense Alteration Trend

Boston Regional Exploration Potential

• Intense alteration trend extends >5

Km south, along mafic

volcanic/metasediment contact similar to known Boston Deposit

• Numerous surface showings >10 g/t

Au, and shallow high-grade drill

intersections

• 2017 gold in till sampling program identified anomalies south of Boston

along alteration trend.

• Several untested gold in till

anomalies north of Boston appear

to be associated with favourable stratigraphy beneath the lake. 2.5km

42

Appendices

43

Share Capital Structure & Major Shareholders

Major Shareholders Number of Shares

Percentage of Shares

Outstanding

Resource Capital Fund VI L.P. 27,959,260 30.4

Newmont Mining Corporation 26,381,620 28.7

Blackrock, Inc 12,252,291 13.3

Directors and Officers 3,478,773 3.8

Kitikmeot Inuit Association 1,133,333 1.2

As at July 31, 2018

Common Shares (Issued and Outstanding) 91,959,512

Share Incentive Options 4,657,517

Lenders Warrants – 1,900,000 @ C$15.43 – Expire Jul 31/22 & 433,834 @ C$7.50 – Exp. Jul 23/20 2,333,834

Restricted Shares 506,173

Director Share Units 31,249

Fully Diluted Shares 99,488,285

44

Who What How Calculated

Kitikmeot Inuit

AssociationNSR • 1% on Hope Bay. Not Elu.

Maverix NSR • 1% on Hope Bay and Elu.

Nunavut

Tunngavik Inc.NPI

• On Inuit-Owned Land (Doris and Madrid)

• 12% of production (limit deductions to

75% of revenue (85% at Doris))

• Deductions never lost and are carried

forward.

Government of

CanadaNPI

• On Crown Land (Boston & Elu)

• Sum of graduated royalty rates from 0%

to 14% of value of the output of the mine 45

Royalties & Taxes

Who What

Kitikmeot Inuit

Association

Commercial Lease Payment

($1.0 million per year plus inflation)

Nunavut

Tunngavik Inc.

Production & Exploration Lease Payments

Start 2017

$8 million payment (accrued in June 2017)

(payable over 8 quarters, $1 million each quarter)

Crown-

Indigenous

Relations and

Northern Affairs

Claim & Lease Payments

Government of

Nunavut

Property Taxes

(Relates to amount of infrastructure at Hope Bay)

Obligations

46

august 14, 2018 hope bay site visit · 8/14/2018 · mike samuels s director, metallurgy dan...

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