corporate presentation fall 2018 - bunker hill...
TRANSCRIPT
Operating as Liberty Silver Corp.| LSL.C
1 Corporate Presentation – Fall 2018
Information set forth in this presentation may contain forward-looking statements. Forward-looking
statements are statements that relate to future, not past events. In this context, forward-looking
statements often address a company's expected future business and financial performance, and often
contain words such as "anticipate", "believe", "plan", "estimate", "expect", and "intend", statements that an
action or event "may", "might", "could", "should", or "will" be taken or occur, or other similar expressions.
By their nature, forward-looking statements involve known and unknown risks, uncertainties and other
factors which may cause our actual results, performance or achievements, or other future events, to be
materially different from any future results, performance or achievements expressed or implied by such
forward-looking statements. Such factors include, among others, the following risks: the risks associated
with outstanding litigation, if any; risks associated with project development; the need for additional
financing; operational risks associated with mining and mineral processing; fluctuations in gold and other
commodity prices; title matters; environmental liability claims and insurance; reliance on key personnel;
the potential for conflicts of interest among certain officers, directors or promoters with certain other
projects; the absence of dividends; competition; dilution; the volatility of our common share price and
volume; and tax consequences to U.S. Shareholders. Forward-looking statements are made based on
management's beliefs, estimates and opinions on the date that statements are made and the Company
undertakes no obligation to update forward-looking statements if these beliefs, estimates and opinions or
other circumstances should change. Investors are cautioned against attributing undue certainty to
forward-looking statements.
2
Forward Looking Statements
3 *SEC Compliant Resource not to be considered NI 43-101 compliant
Re-starting a Significant Past Producer in a
Historic Mining Camp
• Fully Permitted: Patented ground and signed EPA Agreement.
• Historic SEC Proven & Probable Reserves and Resources*: 9.1M tons @
5.08% Zn, 2.35% Pb, 1.29 opt Ag.
• Past Producer – Proven Metallurgy: The Bunker Hill Mine produced over
35M tons of ore grading 8.76% lead, 3.67% zinc, and 155 g/t silver. Zinc and
lead concentrates are very clean with no deleterious elements.
• Developed: Near term access to +8 years of mineable material at 1,500 tpd.
• High grade zones: > 20% combined Pb/Zn.
• Excellent Infrastructure/Geopolitical Risk: paved road access, low cost
power, water, skilled labour, mining services, Idaho is mining friendly and a
“Right to Work” state.
• Exploration Potential: 3,400 DD holes show numerous high grade intercepts
that were never followed up on.
• Experienced Management: operated the nearby Galena Mine.
Capital Structure
CSE symbol BNKR
Shares O/S 34.6 million
Options 2.9 million
Warrants 7.4 million
Fully Diluted Shares O/S 44.9 million
Cash (as of 03/31/2018)
Convertible Debt
C$ 2.0 million
US$ 2.0 million
4
Corporate Overview
42%
23%
35%
Share Ownership
Mgmt/Insiders
Institutional
Retail
CSE: BNKR share price (1 year)
Institutional Shareholders
Valuestone Global Resources Fund 1
RBGAM
EDE Value Fund
55
Project Location
66
Patented Claims
• Patented claims comprising 5,773 acres.
• Fully Permitted:
– Virtually all underground mining and mill processing permitted. Air quality permit required for
crushing has 180 day lead time. No permit required for dry or paste TSF on private land,
whereas a technical review required for public land.
– Mine water discharge is fully permitted as per EPA’s operation of water treatment plant which
processes Bunker Hill mine effluent. NDPES water permit will be required in 5 years time at
which Bunker Hill can lease the plant, purchase it, or build a new one.
• March 2018 EPA Agreement:
– Definitively resolves long standing environmental legacy issues.
– Provides environmental indemnity from potential EPA legal actions related to previous
environmental contamination.
– Company to reimburse the EPA for a portion of prior clean up costs (US$20M over 7 years) and
to pay US$960,000 per year to cover costs of ongoing water treatment plant operation.
8
Fully Permitted
Source Zone
P&P
Reserves/Resources
(tons)
Zinc
(%)
Lead
(%)
Silver
(oz/ton)
Cominco Engineering Services
Mine Plan (1989)**Quill/Newgard 4,669,600*** 5.01 2.87 1.61
Bunker Hill Mining Company Inc.
(1991)
Quill/Newgard
+ others9,141,109**** 5.08 2.35 1.29
5
*SEC Compliant Resource but not to be considered 43-101 compliant
** Above the 9 Level
*** approximately 8 years of production at a throughput rate of 1,500 tpd
**** approximately 17 years of production at a throughput rate of 1,500 tpd
Historic Resources*
11
Quill Drill Indicated Resource
South Newgard
Mined Out
UTZ
Quill Ore Zones from 1991 Bunker Hill Reserves
15 Level
Kellogg Tunnel & 9 Level
NW Newgard
Location of Newgard, Quill and UTZ Ore Bodies
Project Setting/Geology
109
• Coeur D’Alene Mining District – World Class Production and Potential
– World class past production: Historically the 2nd largest silver producer in the world (> 1 billion
ounces Ag)
– Significant historical production of Zinc and Lead: equivalent to approximately 100Mt of ore
grading 10% Zn/Pb combined.
• Prolific host rock, Extensive Structural Preparation
– Mineralization (sphalerite, galena, tetrahedrite) hosted in the Revett Formation, part of the Belt
Supergroup, which consists of alternating intervals of quartzite and siltite, together more than
1,200 metres thick.
– Mineralization at Bunker Hill is controlled by 2 major parallel faults (Osburn and Placer Creek),
with numerous splays and tensional gashes.
• Significant Exploration Potential
– All zones are open at depth.
– Potential parallel zones (such as the South Newgard) represent further upside.
8
Project Setting/Geology
• 90 years of production history:
– 35M tons of ore grading 8.76% Pb, 3.67% Zn, and 155 g/t Ag.
8
Past Producer – Proven Metallurgy
Moisture content of the concentrates is 8-10 percent.
13
Lead Concentrate Zinc Concentrate
Silver troy oz/ton 31 – 34 2 – 3
Gold troy oz/ton Nil Nil
Lead % 65 – 69 1 – 2
Zinc % 5 – 7 55 – 58
Cadmium % 0.01 – 0.03 0.10 – 0.22
Copper % 0.5 – 1.0 0.10 – 0.15
Antimony % 0.25 – 0.35 0.01 – 0.03
Arsenic % 0.01 – 0.10 0.10 – 0.16
Mercury ppm 10 – 40 100 – 200
Sulfur % 15 – 17 27 – 30
Tin % Trace 0.001 – 0.002
Nickel % Trace Trace
Bismuth % 0.001 – 0.005 0.001 – 0.003
Iron % 4.0 – 5.5 4.5 – 6.5
Insoluble % 1.0 – 1.5 2.5 – 3.0
• Historical Lead & Zinc concentrate specifications (Quill and Newgard zones circa 1979)
Past Producer – Proven Metallurgy
Moisture content of concentrate: 8-10%
14
Developed: Near term access to 8+ years of
mineable material
The Number 2 Hoist The Number 1 Hoist
Developed: Existing Site Infrastructure
15
16
Higher Grades
• Higher Grade Zones
– Zonation: numerous areas where higher zones surrounded by lower grade halo
– Significant historical production of Zinc and Lead: equivalent to approximately 100Mt of ore
grading 10% Zn/Pb combined.
– Stope design to minimize economically marginal ore.
• Implementation of Modern Grade Control Methods
– Historically geologists were not utilized for grade control.
– Miners were paid by cubic feet mined – volumes were maximized at expense of grade.
– Future operation will benefit from the utilization of on-shift grade control geologists.
Eg. Level 14 Quill Zone historical diamond drill results:
62 ft of 1.9% Pb, 0.7 opt Ag, 16.6% Zn
within 182 ft of 0.9% Pb, 0.3 opt Ag, 7.3% Zn
• Access: First World
– commercial air travel to Seattle and Spokane, then 1.5 hours highway drive on Interstate 90:
mine is 500 metres south of highway and town of Kellogg (population: 2,000).
– 45 minute drive from Coeur D’Alene (population: 50,000) and 1.5 hour drive from Spokane
(population: 215,000).
• Power: Low cost
– Industrial hydroelectric rates are 4.5-5.5 cents/kWh.
• Water: Abundant
– Water sources are abundant and include mine outflow & south fork of Coeur D’Alene river.
• Labour and Mine Services: Developed and Available– Over 100 mines have operated in the Silver Valley for over 100 years, resulting in abundant available skilled
labour and mining services suitable to local underground mining conditions.
• Idaho:
– has mining friendly laws and is a “Right to Work” state. 8
Excellent Infrastructure/Geopolitical Risk
• Accessible & Previously Developed/Mined: Quill/Newgard zones
– Comprise approximately 4M tons of the historical resources.
– September 2018 NI-43-101 Technical Report on the Bunker Hill Mine Property outlines a 10-12
million ton Exploration Target, grading 6-8% combined Zn + Pb, on these zones.
• Extensions of Known Zones
– Up-dip and on strike extension of Quill, down-dip extension of Newgard.
– Potential offset extension of March zone.
• New Zones
– 3,400 DD holes show numerous high grade intercepts not followed up on, eg. potential parallel
zone to the March.
– No previous comprehensive view/understanding of control on mineralization.
– No geophysics utilized historically.
8
Exploration Potential
Proposed Drill Program for Quill/NewGard zones Exploration Target
– 5 DD rigs and directional drilling to define an Indicated Resource (100 ft. centres) on the entire 4,500 ft.
plunge length of the Leapfrog wireframe depicting the Exploration Target.
8
Exploration Potential
Proposed Drill Program for Quill/Newgard zones Exploration Target
8
Exploration Potential
Upper Zones
(above 9 Level)
Lower Zones
(below 9 level)
Total
Leapfrog tonnage 4.51 M tons 5.53 M tons 10.04M tonsMetres drilled 17,960 26,155 44,115Cost1 US$ 4.49M US$ 6.83M US$ 11.32MDuration2 80 days 116 days 116 days (4 mos.)
1 approximately 70% standard DD drilling at US$ 150-160 per metre, and 30% directional
drilling at US$ 220-230 per metre.
2 the Upper and Lower Zones will be drilled simultaneously, therefore the duration of both
programs together is determined by the longest program.
• Bruce Reid, President and Chief Executive Officer
– Geologist (University of Toronto)
– Former President and CEO of Carlisle Goldfields Limited : Sold to Alamos Gold for 209% premium to market.
– Founder and former CEO of US Silver: Put the Galena mine back into production in 2008.
– Former Executive Director of Patricia Mining, Founder of Western Goldfields,Founder of High Plains Uranium.
– Analyst and Investment Banker for over 15 years with firms such as Nesbitt Thomson, Loewen Ondaatje McCutcheon, and
Yorkton Securities.
• Mark Hartmann, Chief Operating Officer
– Mining Engineer (University of Minnesota)
– Former COO of US Silver.
– Former Mine Manager of the Sunshine Mine.
– Former Western Missouri Operations Manager at Lafarge, and Port Inland Mining Production Manager at Chemical Lime.
• Julio DiGirolamo, Chief Financial Officer
– CPA, CA
– Former CFO of Carlisle Goldfields Limited.
– Former Vice President and Corporate Secretary at Greenstone Resources.
Management: Technical and Capital Markets background and
a Proven Track Record in the Silver Valley
21
• Bruce Reid– Former President and CEO of Carlisle Goldfields Limited; Founding Shareholder of US Silver.
• John Ryan– 25 years experience as a Mining Engineer with extensive knowledge of the Coeur d'Alene mining district, Founder US Silver.
• Howard Crosby – +25 years experience as an executive in the mining industry, having served as an officer and director of public companies
listed in Canada, USA and UK.
• Roy Shipes– Former General Manager of Ok Tedi Mining Limited, Managing Executive Southern Peru Copper.
• Jennifer Boyle– Head of Global Corporate Finance for Velocity Trade Group of Companies, Founder and former CEO Satori Resources, and
Takara Mining.
• Dickson Hall– Partner in Valuestone Advisory Limited and Manager of Valuestone Global Resources Fund 1
Directors
22
3 *SEC Compliant Resource not to be considered NI 43-101 compliant
Re-starting a Significant Past Producer in a
Historic Mining Camp
• Fully Permitted: Patented ground and signed EPA Agreement.
• Historic SEC Proven & Probable Reserves and Resources*: 9.1M tons @
5.08% Zn, 2.35% Pb, 1.29 opt Ag.
• Past Producer – Proven Metallurgy: The Bunker Hill Mine produced over
35M tons of ore grading 8.76% lead, 3.67% zinc, and 155 g/t silver. Zinc and
lead concentrates are very clean with no deleterious elements.
• Developed: Near term access to +8 years of mineable material at 1,500 tpd.
• High grade zones: > 20% combined Pb/Zn.
• Excellent Infrastructure/Geopolitical Risk: paved road access, low cost
power, water, skilled labour, mining services, Idaho is mining friendly and a
“Right to Work” state.
• Exploration Potential: 3,400 DD holes show numerous high grade intercepts
that were never followed up on.
• Experienced Management: operated the nearby Galena Mine.
24
Contact Information
Bruce Reid
President & CEO
647.500.4495
Nicholas Konkin
Marketing & Communications
416.567.9087
25
5
NSR on production after the purchase option is exercised as follows:
• 2% NSR until US$ 15M is paid,
• after which there is a 1% NSR until US$ 15M is paid,
• after which there is a 0.5% NSR until US$ 30M is paid,
• for a total maximum amount payable of US$ 60M
Appendix A:
EPA, Property, & NSR Payments
Date Payment to Lessor Payment to U.S EPA
On Closing $4,000,000 $3,000,000
One year after closing $3,000,000 $3,000,000
Two years after closing $3,000,000 $3,000,000
Three years after closing $3,000,000 $3,000,000
Four years after closing $2,000,000 $3,000,000
Five years after closing $1,670,000 $1,670,000
Six years after closing $1,670,000 $1,670,000
Seven years after closing $1,670,000 $1,660,000
Eight years after closing $1,670,000
Nine years after closing $1,670,000
Ten years after closing $1,650,000
Total $25,000,000 $20,000,000