Dalradian presentation april 10 2014 final
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Transcript of Dalradian presentation april 10 2014 final
Patrick F. N. AndersonChief Executive Officer
High-Grade Gold │ Post-PEA │ Low-Risk Jurisdiction │ Low Capex│ April 2014
2
FORWARD-LOOKING INFORMATION AND QUALIFIED PERSON
This presentation contains “forward looking information” which may include, but is not limited to, statements with respect to the future financial or operating performance ofthe Company and its subsidiaries (collectively, “Dalradian”) and its mineral projects, the future price of metals, the estimation of mineral resources, the realization of mineralresource estimates, the timing and amount of estimated future production, costs of production, capital, operating and exploration expenditures, costs and timing of thedevelopment of new deposits, costs and timing of future exploration, requirements for additional capital, government regulation of mining operations, environmental risks,reclamation expenses, title disputes or claims, limitations of insurance coverage and the timing and possible outcome of pending regulatory matters. Often, but not always,forward looking statements can be identified by the use of words and phrases such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”,“intends”, “anticipates”, or “believes” or variations (including negative variations) of such words and phrases, or state that certain actions, events or results “may”, “could”,“would”, “might” or “will” be taken, occur or be achieved.
Forward looking statements are based on the opinions and estimates of management as of the date such statements are made and are based on various assumptions such asthe continued political stability in Northern Ireland, that permits required for Dalradian’s operations will be obtained on a timely basis in order to permit Dalradian to proceed onschedule with its planned exploration and development programs, that skilled personnel and contractors will be available as Dalradian’s operations continue to grow, that theprice of gold will be at levels that render Dalradian’s mineral projects economic, that the Company will be able to continue raising the necessary capital to finance its operationsand realize on mineral resource estimates and current mine plans and that the assumptions contained in the Company’s PEA (as defined herein) are accurate and complete.
Forward looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Dalradian tobe materially different from any future results, performance or achievements expressed or implied by the forward looking statements. Such factors include, among others,general business, economic, competitive, political and social uncertainties; the actual results of current and future exploration activities; the actual results of reclamationactivities; conclusions of economic evaluations; changes in project parameters and/or economic assessments as plans continue to be refined; future prices of metals; possiblevariations of mineral grade or recovery rates; the risk that actual costs may exceed estimated costs; failure of plant, equipment or processes to operate as anticipated; accidents,labour disputes and other risks of the mining industry; political instability; delays in obtaining governmental approvals or financing or in the completion of development orconstruction activities, as well as those factors discussed in the section entitled “Risk Factors” in the Company’s Annual Information Form for the year ended December 31, 2013dated March 25, 2014 (the “AIF”) .
Although the Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward lookingstatements, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Forward looking statements containedherein are made as of the date of this presentation and the Company disclaims any obligation to update any forward looking statements, whether as a result of newinformation, future events or results, except as may be required by applicable securities laws. There can be no assurance that forward looking statements will prove to beaccurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on forwardlooking statements.
Certain technical data in this presentation was taken from the technical report entitled “A Preliminary Economic Assessment of the Curraghinalt Gold Deposit, Tyrone Project,Northern Ireland” dated September 6, 2012 (effective date for resource is November 30, 2011), prepared by B. Terrence Hennessey, P.Geo., Mr. Barnard Foo, P.ENG., Mr.Bogdan Damjanovic, P.ENG, Mr. Andre Villeneuve, P.ENG., and Mr. Christopher Jacobs, CEng MIMMM of Micon International Limited (the “PEA”), and is subject to all of theassumptions, qualifications and procedures described therein.
Mineral resources that are not mineral reserves do not have demonstrated economic viability. The PEA is preliminary in nature. It includes inferred mineral resources that areconsidered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is nocertainty that the results of the PEA will be realized.
Michele L. Cote, MSc., P. Geo., VP Exploration, Dalradian Resources Inc., is the Qualified Person who supervised the preparation of the exploration technical data in thispresentation. The exploration data was based on the procedures described in the Company’s AIF and is subject to all of the assumptions, qualifications and proceduresdescribed therein.
2
OVERVIEW AND CORPORATE
4
DNA SNAPSHOT
Curraghinalt ranked #7 worldwide in undeveloped gold deposits by grade1
Positive PEA shows a high margin and low capex producer Conventional metallurgy Excellent infrastructure
Board for growth; management for execution
Strong local and national support for Curraghinalt project in Northern Ireland
Underground bulk sample program to begin shortly
2014Shaping up to be
an eventful
1 NRH Research – 2013 Ranking Gold Mines & Deposits Report
5
CORPORATE SUMMARY
All dollars quoted in $ CAD
$0.0
$0.2
$0.4
$0.6
$0.8
$1.0
$1.2
$1.4
$1.6
$1.8
$2.0
$2.2
Mar
20
13
Ap
r 2
01
3
May
20
13
Jun
20
13
Jul 2
01
3
Au
g 2
01
3
Sep
20
13
Oct
20
13
No
v 2
01
3
Dec
20
13
Jan
20
14
Feb
20
14
Mar
20
14
Ap
r 2
01
4
ANALYST COVERAGE:(targets range from $1.00-$2.25)
$0.83April 4, 2014
SHARE CAPITALIZATION AND CASH POSITION
Shares outstanding of 109.4 million and fully diluted of 128.0 million as of March 25, 2014 (includes Feb 2014 financing shares and warrants)
Cash position of $6.9 million as of December 31, 2013; Closed $13.9 million financing on February 19, 2014
TSX: DNA STOCK PRICE
Stuart McDougall
Mike Kozak
Bart Jaworski
Michael Curran
Joe Mazumdar
Jamie Spratt
Steve Parsons
Laurie Curtis
AnalystTargets
$1.75
$1.00
$1.30
$1.50
$2.25
$1.20
$1.70
6
2009
• Project Acquisition -December
• Historic gold resource of 250,000 oz Indicated & 350,000 ozInferred1,2
2010• Increased resource
to 400,000 ozIndicated & 1.16M ozInferred1,3
• IPO - August
2011• 7 rigs onsite
• Increased resource to 10,000 ozMeasured, 460,000 oz Indicated & 2.23M ozInferred1,4
2012• Robust PEA
announced
• New discovery -Alwories
2013• UG planning
permission application
• VP Project Development hired
• Extensive drilling and re-sampling
• Geochem extends trend to 12 km
IN FOUR YEARS WE HAVE:
1 Refer to PEA. Please see cautionary statements in Forward Looking Information (slide 3)2 Historic resource completed by Micon International Ltd in 2007 using cut-off of 6 g/t Au and a minimum vein width of 1 metre: Indicated: 0.57 MT grading 13.95 g/t Au for 250,000 contained ounces; Inferred: 0.64 MT grading 17.15 g/t Au for 350,000 contained ounces3 Historic resource completed by Micon using a 5 g/t Au cut-off and 0.1m minimum width: Indicated: 0.95 MT grading 13.24 g/t Au for 400,000 contained ounces; Inferred: 2.46 MT grading 14.64 g/t Au for 1.16 million contained ounces4 Resource estimate completed by Micon using a 5 g/t Au cut-off: Measured: 0.02 MT grading 21.51 g/t Au for 10,000 contained ounces; Indicated: 1.11 MT grading 12.84 g/t Au for 460,000 contained ounces; Inferred: 5.45 MT grading 12.74 g/t Au for 2.23 million contained ounces
7
THE BOARD: A TRACK RECORD OF DISCOVERY, DEVELOPMENT & PRODUCTION
PATRICK F. N. ANDERSONCHIEF EXECUTIVE OFFICER
Founder & Former CEO of Aurelian Resources
‘08 – PDAC International Mineral Discovery
‘08 – Northern Miner Man of the Year
JONATHAN RUBENSTEINDirector of Eldorado Gold
Director of Detour Gold
Chairman & Director of MAG Silver
Former Director of Aurelian Resources, Sutton Resources, Canico Resource and Cumberland ResourcesRONALD GAGEL
CFO of TMAC Resources; Former CFO of FNX Mining and Aur Resources
Director of Adriana Resources and StonegateAgricom
Former board member of HudBay Minerals and Central Sun Mining
‘13 – PDAC Distinguished Service Award
THOMAS OBRADOVICHCHAIRMAN
Founder & Former CEO of Young-Davidson Mines
Former Director of Aurelian Resources
SEAN ROOSENFounder & CEO OF Osisko Mining Corporation
Also Director of Astur Gold
‘06 – Prospector of the Year - Quebec
‘08 – Prospector of the Year - Canada
‘09 – Northern Miner Man of the Year
Founder & CEO of Continental Gold
Raised over $500M in funding during 15 years in the natural resources & investment sectors
ARI SUSSMAN
GRENVILLE THOMASFounder & Chairman of StrongbowExploration
Founder & Former Chairman, President & Director of Aber Resources (Harry Winston Diamond) now Dominion Diamond
‘99 – PDAC Prospector of the Year
‘01 – Northern Miner Man of the Year
‘09 – Canadian Mining Hall of Fame
8
MANAGEMENT: THE A-TEAM
PATRICK F. N. ANDERSONCHIEF EXECUTIVE OFFICER
Founder & Former CEO of Aurelian Resources
‘08 – PDAC International Mineral Discovery
‘08 – Northern Miner Man of the Year
KEITH MCKAYCHIEF FINANCIAL OFFICER
Former CFO of Aurelian Resources
Former SVP Financial Operations at AMEC and Controller at Rio Algom
TIM WARMANPRESIDENT
Former VP, Corporate Development of Aurelian Resources
Also Director of Continental Gold Ltd.
RUTH IVESVP PROJECT DEVELOPMENT
Over 18 years of hands on mining experience
Senior engineering & mine planning roles in over seven underground gold operations, predominantly narrow vein
MICHELE COTEVP EXPLORATION
Over 18 years of experience as an exploration geologist
MARLA GALEVP COMMUNICATIONS
18 years of experience
Senior communications roles at Endeavour Mining and Aurelian Resources
NORTHERN IRELAND
10
METAL PROJECTS IN IRELAND & THE UK
Our flagship asset: Curraghinalt high-grade lode gold deposit
Excellent regional infrastructure
Over 84,000 hectares under license
Gortin
Omagh
Curraghinalt
BELFAST
N O R T H E R NI R E L A N D
GalantasGold
ConroyDiamonds& Gold
Lonmin
Irish SaltMining
UndergroundSalt Mine
Clontibret
Croagh PatrickParys Mountain
Gwynfynydd
Galmoy Avoca
Pallas GreenSilvermines
South Crofty
Curraghinalt GoldDeposit
GoldBase MetalsSalt Mine
Allihies Copper Mines
Galantas GoldPrevious open pit producer; permitting underground
ScotgoldPermitted
Vedanta ResourcesIn production
BolidenIn production
IMC ExplorationGold exploration
LundinPrevious producer
ConroyGold exploration
Lisheen
Cononish
Tara
Cavanacaw
XstrataFeasibility
Gold Mines of WalesExploration
Clogau
11
DG3
Gortin
COUNTY TYRONE IS RESOURCE FRIENDLY
Curraghinalt
kilometres
0 1 2
Curraghinalt
Cavanacaw Open Pit Approx 30 km SW
Clear Cut Logging at Gortin Glen Forest Park
Alwories Quarry
125 Metres
Greencastle Quarry
12
PERMITTING
Less than a year to permit
underground bulk sample
Transparent process: all stakeholder
communications published on
government website
January 2011: EIA baseline data
collection commenced
Strong social license: 6:1 ratio
of supporters to objectors for
UG bulk sample
Regular community and
government agency meetings;
site visits for local and
government groups
CURRAGHINALT
14
DEVELOPMENT OF A HIGH-GRADE DEPOSIT
Gold resource covers a fraction of
12 km gold trend
High-grade gold resource1
Measured: 0.02 MT grading 21.51 g/t Au
for 10,000 contained ounces
Indicated: 1.11 MT grading 12.84 g/t Au
for 460,000 contained ounces
Inferred: 5.45 MT grading 12.74 g/t Au
for 2.23 million contained ounces
Positive PEA shows a high margin
and low capex producer1
1 Refer to PEA. Please see cautionary statements in Forward Looking Information (slide 3)
15
A 12KM GOLD TREND
GLACIATED TERRAIN WITH MINIMAL OUTCROP
Curraghinalt
Deposit
Curraghinalt
Trend
Curraghinalt Trend
Veins in Current Resource
Intersected Veins
Historical Findings
Geochem Anomaly
Curraghinalt DepositResource effective as of Nov 2011
1–
Measured: 0.01 Moz Au (0.02MT @ 21.51 g/t)
Indicated: 0.46 Moz Au (1.11MT @ 12.84 g/t)
Inferred: 2.23 Moz Au (5.45 MT @ 12.74 g/t)
Golan Burn
Outcropping veins including
60cm @ 61.43 g/t Au (12-CT-167)4
Alwories Discovery Holes2
4.72m @ 14.82 g/t Au (12-CT-173)
2.22m @ 14.10 g/t Au (12-CT-162)2a
1.47m @ 23.6 2g/t Au (12-CT-162)2b
400 m Step-out
3.2m @ 5.34 g/t Au (11-CT-99)3
Attagh Burn
2.47m @ 18.99 g/t Au
1 43-101 Compliant Resource completed by Micon International Ltd using a 5 g/t Au cutoff and a 0.1m Minimum Width diluted to a 1 m horizontal width2 12-CT-162 drilled at 180/-55. 12-CT-173 drilled at 150/-60; 2a from 186.00 m- 188.22m, 2b from 229m - 230.55 m ; true width undetermined3 11-CT-99 drilled at 200/-60, from 471.14-474.34 m4 12-CT-167 drilled at 180/-45 True width between 95-92% of core length
16
OROGENIC VEIN SYSTEM
CROSS-SECTION
ADIT
17
ROBUST OUNCES PER VERTICAL METRE
0 1,000 2,000 3,000 4,000 5,000 6,000
0
-50
-100
-150
-200
-250
-300
-350
-400
-450
-500
-550
-600
-650
-700
-750
-800
-850
Ounces per Vertical Metre (2011 Mineral Resource estimate)
Ounces perVertical Metre
Met
res
be
low
Su
rfac
e
PRELIMINARY ECONOMIC ASSESSMENT
MICON, JULY 2012
19
PRELIMINARY ECONOMIC ASSESSMENT
KEY PEA DATA*3 YEAR TRAILING AVERAGE
GOLD PRICE:$1378/ounce
5 YEAR TRAILING AVERAGE GOLD PRICE:$1,166/ounce
NPV with 8% discount rate (After-tax) $467 million $331 million
IRR (After-tax) 41.9% 33.4%
Average Annual Production 145,000 ounces/year
Processing Rate 1,700 tonnes/day
Life of Mine 15 years
Initial Capex ($38M contingency) $192 million
Cash Costs $532/ounce or $125/tonne
Diluted Grade 8.1 g/t Au
Gold Recovery 92%
Payback 2 years
* Prepared by Micon International Limited. PEA results released on July 25, 2012. Mineral resources that are not mineral reserves do not have demonstrated economic viability. The PEA is preliminary in nature. It includes
inferred mineral resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as mineral reserves. There is no certainty that the results of the PEA will be realized. All dollars quoted in $ USD unless stated otherwise.
At $814 gold price (10-year trailing average), after-tax IRR of 20.2%
BULK SAMPLE
21
UNDERGROUND EXPLORATION & BULK SAMPLE PROGRAM
DALRADIAN HAS RECEIVED PLANNING PERMISSION TO COMPLETE UP TO 2,000 M OF UNDERGROUND EXPLORATION DEVELOPMENT in order to:
Extend the existing adit to intersect further veining
Drift along exposed veins
Install a ramp and work on multiple levels
Remove a large bulk sample
Proposed Access Ramp to Sub-Level
Proposed Tunnel Extensions at Sub-Level
Proposed Tunnel Extensions at 170
M Level
Existing Exploration
Tunnel
Proposed Stopes
T17 Vein
No. 1 Vein
106-16 Vein
22
Demonstrate continuity of thickness and grade of mineralized veins
Convert indicated mineral resources to measured
Test mining techniques and backfill methods
Investigate geotechnical and hydrogeological conditions
Produce a bulk sample for metallurgical test work
Advance the permitting process
22
RO
AD
SHEE
PD
IP
MU
LLA
N
T17
No
. 1
10
6_1
6
BEN
D
CR
OW
EXISTING DEVELOPMENT
PLANNED DEVELOPMENT
PLANNED DEVELOPMENT
PLANNED STOPING
PROGRAM GOALS
Cross-section through proposed development,looking west
23
PROGRAM TIMELINE
Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr
2014/2015
Surface Work
Exploration Tunneling
Test Stoping
Hydrogeology & Geotechnical Studies
Backfill testing
Metallurgical Testing
Receipt of planning permission with final terms and conditions
Resource update
Updated economic study
24
PERFECT TIMING
25
Patrick F. N. Anderson
Chief Executive Officer
416.583.5622
Trading Symbol:
DNA on TSX
Corporate Office:
Dalradian Resources Inc.
155 Wellington Street West
Suite 2920
Toronto, Ontario
Canada M5V 3H1
www.dalradian.com