esperanza resources corp. presentation - a clear path to gold

Download Esperanza Resources Corp. Presentation - A Clear Path To Gold

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  • 1. A CLEAR PATH TO GOLD

2. 2LEGAL DISCLAIMERSome statements in this presentation constitute forward-looking statements within the meaning of applicable U.S. securitieslaws and forward-looking information within the meaning of applicable Canadian securities laws, which are collectively referredto as forward-looking statements. The United States Private Securities Litigation Reform Act of 1995 provides a safe harborfor certain forward-looking statements. Such statements include but are not limited to statements as to the completion of thetransactions between Esperanza Resources Corp. (the Company) and Pan American Silver Corp., the potential of the EsperanzaGold Project property, the Companys plans in respect of exploration and development, including: significant costs and timingthereof and other exploration properties. The forward-looking statements involve risks and uncertainties and other factors thatcould cause actual results to differ materially, including those relating to permitting, availability of equipment, exploration resultsand bringing properties into production. Please refer to a discussion of these and other risk factors in the Companys publicfilings with the Canadian regulators and the Form 20-F of the Company filed with the US Securities and Exchange Commission.The forward-looking statements contained in this presentation constitute managements current estimates as of the date of thispresentation with respect to the matters covered herein. We expect that these forward-looking statements will change as newinformation is received and that actual results will vary, possibly in material ways. While we may elect to update this forward-looking information at any time, we do not undertake to do so.This presentation is not, and under no circumstances is to be construed as, a solicitation or an offer of any kind. The matters setforth in this presentation do not constitute an agreement or offer that may be accepted. Accordingly, no person may bring aclaim or action against another for a failure to negotiate, agree or enter into any agreement with respect to matters contained inthe presentation.TSX.V: EPZOTCQX: ESPZF 3. STRONG MANAGEMENT TEAMProven mine builders, led by former Minefinders executive andoperating team.ESPERANZA GOLD PROJECTAccelerating to production and positive cash flow.$38 MILLION IN CASH AND SECURITIESWell funded to bring our first asset into production.LONG-TERM OBJECTIVEBuilding a multi-mine precious metals producer.HIGHLIGHTS3 4. THE NEW TEAMMANAGEMENTGREG D. SMITHPresident & CEOFormer CFO Minefinders, Chartered AccountantDANIEL OFLAHERTYExecutive VPFormer Director, Investment Banking at Scotia CapitalANDREW POOLERCOOFormer COO of Abacus Mining and Exploration CorpSenior Vice President, Mine Operations for Pan American SilverKYLIE DICKSONCFOFormer Controller of MinefindersJOHANNES J. MILLERVP OperationsFormer Operations Manager and Acting VP Operations forMinefindersNON EXECUTIVE DIRECTORSWILLIAM J. PINCUSChairmanFormer CEO of Esperanza with over 30 years experience as acertified professional geologistANDREW SWARTHOUTDirectorCEO of Bear Creek Mining Corp. and former officer of SouthernPeru CopperMARCEL DE GROOTDirectorFounder and President of Pathway Capital Ltd.BRIAN E. BAYLEYDirectorResource Lending Advisor for Sprott Resource Lending Corp.4 5. THE ESPERANZAGOLD PROJECT 100% ownership 15,025 hectares Gold oxide depositPlanned conventional open-pit heap-leachoperation with short construction lead-time& manageable capital requirementsUpdated PEA completed in September 20115 6. ESPERANZA GOLD PROJECT HIGHLIGHTS6WELL DEFINED GOLD RESOURCELOW CAPITAL REQUIREMENTSSTRONG ECONOMICSFAVOURABLE LOCATION IN MEXICOLOW RISK CONVENTIONAL OPERATION (OPEN-PIT HEAP-LEACH)SILVER BYPRODUCT CREDITEASY ACCESS TO INFRASTRUCTUREEXPLORATION UPSIDESTRONG COMMUNITY SUPPORTEXPERIENCED MINE BUILDERSQUICK TIMELINE TO PRODUCTION 7. LandfillCalabazas HilltopLeach Pad FieldsPower LinesCerro JumilESPERANZA GOLD PROJECT PIT & EXPLORATION UPSIDE7SouthwestExtension 8. PEA HIGHLIGHTS: SEPTEMBER 2011SEPTEMBER 2010 RESOURCE (USED AS THE BASIS FOR THE PEA)TONNAGE(000S)GOLDGRADE(G/T)SILVERGRADE(G/T)GOLD(KOZS)SILVER(KOZS)M&I 34,406 0.83 1.8 913 1,951INFERRED 8,596 0.83 6.9 230 1,904TWO-STAGES OF CRUSHINGAVERAGE ANNUAL GOLD PRODUCTION (KOZS) 103OPERATING COSTS (NET OF BY-PRODUCTS) ($/OZ AU) 499INITIAL CAPITAL COST ($MM) 114PRODUCTION RATE (KTPD) 20GOLD RECOVERY 65-75%SILVER RECOVERY 25%OVERALL STRIP RATIO (WASTE:ORE) 2.2:1NSR ROYALTY 3%Note: Totals may not sum to 100% due to roundingBased on Sept. 2010 Resource including 41,500 meters of drilling (does not include positive 2011 & 2012 drilling of 22,000 meters)8 9. VALUE CONSIDERATIONSAs per Esperanza Gold Project 2011 Preliminary Economic Assessment90%10%20%30%40%50%60%70%$0$50$100$150$200$250$300$350$1,000$1,050$1,100$1,150$1,200$1,250$1,300$1,350$1,400$1,450$1,500$1,550$1,600$1,650$1,700INTERNALRATEOFRETURN(%)AFTER-TAXNETPRESENTVALUE(US$M)PRICE OF GOLD (US$/OZ)(1)IRR5% NPV7% NPV$1,250/oz AuAfter-Tax NPV5% of $165MIRR of 35%$1,550/oz AuAfter-Tax NPV5% of $270MIRR of 53%(1) Silver price based upon a Ag:Au price ratio of 55:1Based on initial 6 year mine life does not include 0.5 Moz Au resource increase 10. 913@ 0.83 gpt1,474@ 0.91 gpt2301692.016.01.92.805101520253035404502004006008001,0001,2001,4001,6001,800SILVERRESOURCES(MOZ)GOLDRESOURCES(KOZ)10SEPTEMBER 2012 RESOURCE10September 2010 ResourceGold SilverSeptember 2012 ResourceGold SilverM&I Resources Inferred ResourcesSEPTEMBER 2012RESOURCE STATEMENT(63,500 METERS OF DRILLING)TONNAGE(000S)GOLDGRADE(G/T)SILVERGRADE(G/T)GOLD(KOZS)SILVER(KOZS)M&I 50,336 0.91 9.9 1,474 16,015INFERRED 7,970 0.66 10.9 169 2,793INCREASE TO M&IFROM 2010+46% +10% +466% +61% +729%6 yearmine life 11. CAPITAL COSTESTIMATENew management toreview and optimizecapital costs from PEAPEA Operating Costs: