Canada’s Most Active Diamond Explorer...This presentation contains projections and forward-looking...
Transcript of Canada’s Most Active Diamond Explorer...This presentation contains projections and forward-looking...
TSXV:NARTSXV: NAR
Canada’s Most Active Diamond Explorer
PDAC 2020
This presentation contains projections and forward-looking information that involvevarious risks and uncertainties, including, without limitation, statements regarding thepotential extent of mineralization, resources, reserves, exploration results and plans andobjectives of North Arrow Minerals Inc. These risks and uncertainties include, but arenot restricted to, the amount of geological data available, the uncertain reliability ofdrilling results and geophysical and geological data and the interpretation thereof andthe need for adequate financing for future exploration and development efforts. Therecan be no assurance that such statements will prove to be accurate. Actual results andfuture events could differ materially from those anticipated in such statements. Theseand all subsequent written and oral forward-looking statements are based on theestimates and opinions of management on the dates they are made and are expresslyqualified in their entirety by this notice. The Company assumes no obligation to updateforward looking statements should circumstances or management's estimates oropinions change.
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CAUTIONARY STATEMENT
Forward Looking
Information
Qualified Person under
NI 43-101
Disclosure of a scientific or technical nature related to North Arrow’s projects in thispresentation has been reviewed and approved by Ken Armstrong, P.Geo. President andCEO of North Arrow and a Qualified Person under NI 43-101.
CORPORATE OVERVIEW as of November 12, 2019
Capitalization
Listing: TSX Venture – NARIssued: 110.7 MOptions: 10.3 M*
Warrants: 44.4 M (25 M @ $0.225, 17.9 M @ $0.10)
Fully diluted: 165.4 MEstimated Working Capital: ~$1.0 M
Main Shareholders
Management/Directors/Advisors ~24.4%
Zebra Holdings and Investments ~10.3%
Electrum Strategic Opportunities Fund ~10.3%
Ross Beaty ~8.8%
Corporate Highlights
2*Includes stock options issued November 8, 2019
D. Grenville Thomas (Chairman) Founder of Aber (now Dominion Diamond), discoverer of the Diavik Diamond Mine; Canadian Mining Hall of Fame inductee.
Ken Armstrong P.Geo. (ON) (President, CEO, Director and Qualified Person under NI 43-101) Diamond exploration and evaluation experience with Diavik, Aber, De Beers, Navigator, and Stornoway.
Christopher Jennings (Director) Founder of SouthernEra, consultant to Aber; formerly with International Corona Corp., BP Minerals (Canada) and Falconbridge.
Blair Murdoch (Director) More than thirty years' experience in senior management of private and public companies.
Eira M. Thomas (Advisor) Extensive diamond exploration and development experience in Canada and Africa; Co-founder, CEO & director of Lucara; former officer and director of Aber; former CEO of Kaminak Gold Corporation (acquired by Goldcorp in 2016 for $520 million); currently director of Suncor.
Robin Hopkins (Advisor) 25+ years diamond exploration, evaluation and development experience with Stornoway, Navigator, and Aber.
Allison Rippin Armstrong (Advisor) 20+ years CSR experience; Ex-Kaminak Gold.
CORPORATE OVERVIEW - PEOPLE
Management Highlights
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CORPORATE OVERVIEW – PROJECTS
EXISTING DIAMOND MINE
Grassroots
7. Timiskaming (JV w SWY) 7
DIAVIKEKATI
VICTOR
RENARD
GAHCHOKUE
Discovery Stage
2. Mel (100%) Kimberlite Field discovery 20173. Loki (100%) Kimberlite 465 discovered 2018;
1st Lac de Gras discovery in > 5 years4. LDGJV (Dominion) Kimberlite discovery in 20195. Pikoo (100%) Kimberlite Field discovery 20136. Luxx (100%) Permitted & drill ready
Advanced Stage
1. Naujaat (100%) Significant diamond inventory; potential value upside: fancy orange-yellow diamonds
Assessing a known kimberlite or diamond deposit
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Brownfields Gold
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8. Hope Bay (100%)
Next stage of diamond exploration could lead to discovery
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5
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Target development
Within 3km of TMAC’s Doris Mine; similar geology and structures
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NAUJAAT PROJECT – TICKS ALL THE BOXES
Jurisdiction
Near tide water
Large tonnage
Low strip ratio
Significant diamond inventory*
Blue sky potential
* CAUTION – Inferred Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability
Unique diamond value proposition
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<3:1 vs >10:1 for NWT diamond mines
~48 Mt down to 205m below surface
~26M contained carats
15 additional kimberlites for evaluation
Freight costs 50% of NWT diamond mines
Clear permitting path in Nunavut
Q1-4 Kimberlite
NAR Laydown Area
Q1-4 DIAMOND DEPOSIT: STATUS
Q1-4 “run of mine” from 2014 sample; +9DTC and
above.
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2015 – Commenced two phase approach to show value upside of Q1-4 diamonds:1) Cutting/polishing of yellow diamonds2) Analysis of diamond size frequency distributions (SFD)
Primary WWW Conclusions from the 2015 Valuation:• Parcel too small• Yellow diamonds were considered of little interest.
2015 WWW Diamond Valuation based on 384 carats recovered from ~1,350 t$92 per carat modelled “possible high” | $43 per carat modelled “possible low”
Q1-4 DIAMOND PROJECT: STATUS
How the project advanced (2015 to present):
1. Cut & Polished Yellow Diamonds:• Certified by GIA as fancy vivid orangey yellow diamonds• Desirable to the luxury gem/jewelry trade
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Q1-4 DIAMOND PROJECT: STATUS
How the project advanced (2015 to present):
1. Cut & Polished Yellow Diamonds:• Certified by GIA as fancy vivid orangey yellow diamonds• Desirable to the luxury gem/jewelry trade
2. Nitrogen aggregation studies show the yellow and white diamonds distinct populations
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Q1-4 DIAMOND PROJECT: STATUS
How the project advanced (2015 to present):
1. Polished Yellow Diamonds:• Certified by GIA as fancy vivid orangey yellow diamonds• Desirable to the luxury gem/jewelry trade
2. Nitrogen aggregation studies show the yellow and whitediamonds distinct populations
3. Yellow diamonds show a much coarser size frequency distribution (SFD) implying potential for higher abundanceof yellow diamonds in coarser sizes
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Q1-4 Grade/Size CurveComparative Curves
Total Parcel
‘Dark Yellow’only
Q1-4 DIAMOND PROJECT: STATUS
How the project advanced (2015 to present):
1. Polished Yellow Diamonds:• Certified by GIA as fancy vivid orangey yellow diamonds• Desirable to the luxury gem/jewelry trade
2. Nitrogen aggregation studies show the yellow and whitediamonds distinct populations
3. Yellow diamonds show a much coarser size frequency distribution (SFD) implying potential for higher abundanceof yellow diamonds in coarser sizes
4. 2015 possible low to high model prices applied to the coarse yellow SFD scenario results in low to high price range of$60 to $220 per carat
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Q1-4 Grade/Size CurveComparative Curves
Total Parcel
‘Dark Yellow’only
Q1-4 DIAMOND PROJECT: STATUS
How the project advanced (2015 to present):
1. Polished Yellow Diamonds:• Certified by GIA as fancy vivid orangey yellow diamonds• Desirable to the luxury gem/jewelry trade
2. Nitrogen aggregation studies show the yellow and whitediamonds distinct populations
3. Yellow diamonds show a much coarser size frequency distribution (SFD) implying potential for higher abundanceof yellow diamonds in coarser sizes
4. 2015 possible low to high model prices applied to the coarse yellow SFD scenario results in low to high price range of$60 to $220 per carat
5. At this price the project is very attractive
11Potential value upside is based on coarse SFD alone; does not factor in that yellow diamonds are
fancy coloured, worth a premium price, and of interest to luxury jewelry trade
Q1-4 Grade/Size CurveComparative Curves
Total Parcel
‘Dark Yellow’only
Q1-4 - LARGE TONNAGE, EASY ACCESS
~700m
~200m
Q1-4 looking southwest: 12.5 ha kimberlite
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• Easy surface access to A28, A61 & A88 phases
• Current Q1-4 resource ~48Mt to 205m depth
• Modelling suggests extending the resource to 300m depth could result in strip ratio < 3:1
• 2017 drilling extended Q1-4 below 300m
Q1-4 DELINEATION DRILLING
• Several deep drill holes remained in kimberlite >100m beyond the current model and well below 300m from surface.
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B Looking North
Current TFFE
0 m
100 m
300 m
200 m
B
A
A’
B’
2017 drill holes on 2013 resource model
Looking West
A A’0 m
100 m
300 m
200 m
B’
Current TFFE
• Mini-excavators & free digging character• Helicopter supported• Test at least 2 phases (A28 & A88)
WAY FORWARD – OPTION 1: SFD QUESTION FIRST
1 Year Timeline: Sample collection & diamond recoveries in 2020
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~ 1,500-2,000t Sample from Q1-4Permitted & turn-key program
Sample Collection:
• Ship sample south for processing Sample Processing Options:
Sample Goal:• Confirm coarse SFD of orangey-yellow diamonds
Pros:• Staged approach – confirming coarse SFD is binary• Permit and excavators in place – short ramp up• Modelled on 2014/15 bulk sample – cost certaintyCons:
• Diamond value remains unanswered
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Same as 2014 & 2017 Small excavator Bags delivered by helicopter to
laydown area in Naujaat Transported by sealift to Montreal Trucked to laboratory for diamond
recovery
OPTION 1: 1,500-2,000 TONNE SAMPLE IN 2020
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• Take advantage of free digging character & community access trail completed in 2020 & 2021 - reduced cost & more local investment
• Test at least 3 phases (A28, A88, & A61)
OPTION 2 – SFD AND VALUE QUESTIONS
Two Year Timeline: Sample collection & diamond recoveries in 2021 16
~ 10,000t bulk sample from Q1-4
Sample Collection:
• Access could allow for on site processing: i) simultaneous collection/processingii) staged diamond recoveryiii) faster results
• Innovative flow sheet & TOMRA optical sorting
Sample Processing Options:
Bulk Sample funding:• Non-dilutive, project level funding options
Sample Goal:• Confirm coarse SFD & value
upside of orange-yellow diamonds
OPTION 2 – PROCESSING IN THE NORTH
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• Economic diversification -i) Access to aggregateii) Access to carving stoneiii) Tourism (outfitters; education)iv) Evaluation of Q1-4
• Safer access to the land for traditional land use activities and education
• Hamlet is project proponent• Entirely within municipal boundary• Permitting & funding are underway
OPTION 2 – REQUIRES ACCESS TRAIL
Timeline: Start construction in 2020
Community led initiative:
Economic & Cultural opportunities:
Funding:
• Applications submitted for Territorial and Federal government funding
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NAR Laydown
Q1-4 Kimberlite
Access Trail ATV Upgrade:Access Trail New Alignment:Spur Road: Kimberlite:Bridge:Culvert:Aggregate Deposit:
11 km4 km
1.5 km
Community Access ATV Trail Upgrade
Q1-4
A34A94
A76
ROAD ACCESS: BLUE SKY EXPLORATION
A94• ~10 hectares• Diamondiferous• 2 angled drill
holes (@450)• Both >300m &
ended in kimberlite
All other kimberlites are under-evaluated with limited drilling – similar age & mantle sample as Q1-4
• ~3 hectares• Diamondiferous• 2 angled drill
holes (@450)• 1 hole ends in
kimberlite
A34
• ~3 hectares• Diamondiferous• 3 angled drill
holes
A76:
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20
A34
A94
A97
A76
A42
A152A59
RENEWED EVALUATION OF OTHER KIMBERLITES
A34
A34 Cross Section - Looking West
100 m
2003-08-082003-08-07
220 m
RENEWED EVALUATION OF OTHER KIMBERLITES
2003-08-08
2003-08-07
220 m?
satellite image airborne magnetics airborne EM 6200 Hz
Kimberlite A34
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2003-08-25
2003-08-14
385 m
satellite image airborne magnetics airborne EM 6200 Hz
2003-08-142003-08-25
100 m
385 m
?
A94 Cross Section - Looking Northwest
Kimberlite A94
RENEWED EVALUATION OF OTHER KIMBERLITES
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WAY FORWARD – SUMMARY TIMELINE
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• Fabrication – ~October order to meet June delivery• Delivery/Commissioning – Earliest Summer 2021
• Currently permitted for 1,500t – Summer 2020• Processing & Results Fall 2020/Spring 2021• 10,000t sample – requires access road• Permitting required (drafting stage)• Earliest collection - 2021
Processing Plant: Design Engineering Study
Access Trail: Permitting & Funding – In Progress
• Construction start – Summer 2020 (funding needed)• Construction completion – Late 2020 / early 2021
Exploration Potential: Detail Review & Evaluation –In Progress
Bulk Sample: Staged Approach
There is no other diamond project in the world at this stage of assessment without the involvement of a diamond producer.
SFD & Diamond value are the last variables.
All the other boxes are ticked.
CORPORATE OVERVIEW – PROJECTS
EXISTING DIAMOND MINE 24
DIAVIKEKATI
VICTOR
RENARD
GAHCHOKUE
Discovery Stage
Mel Project (100%)
2
2
MEL KIMBERLITES – EXCELLENT MANTLE SAMPLE
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olivine
pyrope garnet
ilmenite
MEL PROJECT - MICRODIAMOND RESULTS
26*Stones per tonne per Unit Interval
BodySampleWeightDry Kg
Number of Diamonds per Sieve Size (mm Square Mesh Sieve)+0.106-0.150
+0.150-0.212
+0.212-0.300
+0.300-0.425
+0.425-0.600
+0.600-0.850
+0.850-1.18
TotalStones
ML8 (Lower) 24.15 0 3 0 2 1 1 1 8ML8 (Upper) 270.5 20 16 17 10 1 2 3 69
1 cm
NEW KIMBERLITE TARGETS - NORTH TRAIN
ML8 Upper and Lower Kimberlites
ML345 Kimberlites
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2018 sampling extended the
train further to the north;
sample 600m north of the
ML8 kimberlite had 34 KIMs
MEL PROJECT – WAY FORWARD
OCEAN
ML-345
ML-8 Upper
ML-8 Lower
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WAY FORWARDCamp is in PlaceGeophysicsTill SamplingProspectingDrilling
CORPORATE OVERVIEW – PROJECTS
EXISTING DIAMOND MINE
DIAVIKEKATI
VICTOR
RENARD
GAHCHOKUE
Discovery Stage
5. Pikoo (100%) Kimberlite Field discovered by North Arrow
Next stage of diamond exploration could lead to discovery
5
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Excellent diamond potential
PIKOO PROJECT, SK
North Arrow (100%).
Good local infrastructure; within 10 km of SK Hwy 911– more than 200 km from nearest kimberlite field (FALC).
10 discrete kimberlites discovered to date. Five tested and proven diamondiferous.
PK150 – most significant diamond discovery; 1,232 diamonds > 0.106 mm from 531 kg.
2016 drill program discovered PK346 and PK347 kimberlites.
Till sample results suggest more unique unsourced KIM trains.
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23 +0.85 mm stones recovered from initial 2013 209 kg PK 150 sample
PIKOO PROJECT, SK
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• Increased sample density throughout property has revealed independent source areas for at least 15 KIM trains; ~10 remain unsourced.
• North Pikoo - high interest chrome garnets in till not found in known kimberlites.
• More diamondiferous kimberlites are on the property.
Ice Direction
PK314 &“North PikooDykes”
PK312
PK311
PK346
PK347
PK150(plus PK151 and anotherdyke)
Deeper colour = more KIMs
Known kimberlites
?Priority Targets
?
?
? ?
?
?
?
?
??
?
PK393Target
Bear LakeTarget
PK 150 – MICRODIAMOND RESULTS
Compares well with two kimberlites currently slated for development
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PIKOO PYROPE GARNET CHEMISTRY
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EXISTING DIAMOND MINE 34
DIAVIKEKATI
VICTOR
RENARD
GAHCHOKUE
Discovery Stage
Loki Project (100%)
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LDG Project(JV w Dominion; ~21% NAR)
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LAC DE GRAS DIAMOND PROJECTS
GeoDan says “A relic of a previous kimberlite encased in a later pulse. This sample has a groundmass (gm) strongly altered to serpentine. Surrounding rock has a gm of carbonate & monticellite. From the Anchor kimberlite (LDG) discovered in 2019, NWT. FOV 7mm, PPL & XPL”
• Large project area (147,200 ha) south of Diavik & Ekati; 4 known kimberlites.
• Dominion Diamond Mines (Operator) is focused on discovery to extend Ekatimine life.
• $3.5 M 2020 exploration program is underway and will include spring and summer drilling.
LAC DE GRAS DIAMOND PROJECTS
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• 8,607 ha; 100% NAR • Kimberlite 465 discovered in 2018• Diamondiferous EG05 kimberlite• Additional targets associated with
unsourced KIMs• Way Forward: till sampling,
geophysics & drilling
Lac de Gras (LDG) Joint Venture
Loki Property
• One of Canada’s largest under-evaluated diamond inventories at Naujaat’s Q1-4 kimberlite (~26 million carats)
• Two new diamondiferous kimberlite fields – Mel & Pikoo
• 465 – first Lac de Gras kimberlite discovery in over 5 years
• Anchor – first kimberlite discovery by the LDG joint venture
• 6 drill-ready (and fully permitted) diamond properties; including 5 that host known diamondiferous kimberlite – Naujaat, Mel, Pikoo, Loki & LDG
DIAMOND DISCOVERIES: A CANADIAN LEADER
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NAR: Canadian diamond sector’s most active & successful explorer over the last 7 years
Future Rough Diamond Supply Spotlight
• 152 million carats produced in 2017.
• Zimnisky predicts world rough production to be 125 million carats by 2025 (includes 5 M carats from Luaxe); an 18% decline.
DIAMOND PIPELINE – SUPPLY
• Closure of Victor, Voorspoed & Argyle plus declining production from other mines (Jubilee, Diavik, Ekati).
• 2026 forecast total production still below 130 million carats (includes Luaxeat full 8 M ct/yr); no other >1 million ct/yr producers on horizon.
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Future Rough Diamond Demand Spotlight
DIAMOND PIPELINE – DEMAND
• U.S. retail market – almost 50% of global diamond jewelry sales; the foundation of global end-consumer diamond jewelry demand.
• Middle-class growth in Mainland China and India still the strongest driver of global diamond demand growth.
• De Beers’ Forevermark has stated that India may overtake China in 2020 as second largest market after the U.S.; market has grown by approximately 50% annually over the last three years.
Long-term scenarios for natural rough diamond demand,Bain & Company: Global Diamond Report, 2019
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TSXV: NARKen Armstrong
President & CEO
Nick ThomasCommunity and Investor
Relations Manager
Suite 960-789 West Pender StreetVancouver, BC
Canada V6C 1H2Tel: +1.604.668.8354Fax: +1.604.336.4813
www.northarrowminerals.com
@narminerals
northarrowminerals