TSX: GCM OTCQX: TPRFFs21.q4cdn.com/834539576/files/February-2020.pdf · Corporate Presentation....

TSX: GCM OTCQX: TPRFFFebruary 2020

TSX: GCM OTCQX: TPRFF

A Leading High-Grade Underground Gold Producer

February 2020

Corporate Presentation


Forward-Looking Statements DISCLAIMER

This presentation contains "forward-looking information", which may include, but is not limited to, statements with

respect to the future financial or operating performance of the Company and its projects, and, specifically, statements

concerning anticipated growth in annual gold production, future cash costs and AISC, future G&A and capex, excess

cash flow and future repayments of its gold-linked notes. Often, but not always, forward-looking statements can be

identified by the use of words 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 involve known and unknown risks, uncertainties and other factors which may cause the

actual results, performance or achievements of Gran Colombia to be materially different from any future results,

performance or achievements expressed or implied by the forward-looking statements. Factors that could cause actual

results to differ materially from those anticipated in these forward-looking statements are described under the caption

"Risk Factors" in the Company's Annual Information Form dated as of March 27, 2019 which is available for view on

SEDAR at www.sedar.com. Forward-looking statements contained herein are made as of the date of this presentation

and Gran Colombia disclaims, other than as required by law, any obligation to update any forward-looking statements

whether as a result of new information, results, future events, circumstances, or if management's estimates or opinions

should change, or otherwise. There can be no assurance that forward-looking statements will prove to be accurate, as

actual results and future events could differ materially from those anticipated in such statements. Accordingly, the

reader is cautioned not to place undue reliance on forward-looking statements.

All amounts are denominated in U.S. dollars, unless indicated otherwise.


2019

Gold Production

240,000 ozs+10% over 2018

EMERGING MID-TIER GOLD MINER Focus in Colombia

3

Marmato Project

❖ High-grade underground

mines

❖ 88% of production

❖ 2019: 214,000 ozs

❖ Head grades averaged 16.4

g/t in 2019

❖ One of the Top 5 Highest

Grade Underground Global

Gold Mines

❖ Underground mine expansion

will incorporate Deep

mineralization in second

mining operation

❖ Spun out to a new vehicle,

Caldas Gold Corp, in Feb

2020, retaining 72% equity

interest

❖ 12% of production

❖ 2019: 26,000 ozs

Segovia Operations

Mining Projects in Historic Mining Districts with

Significant Exploration Upside


THE RIGHT TEAM

4

Directors Miguel de la Campa, Vice Chairman – Company co-founder with 30+ years of experience in financing and developing mining and other resource projects

Jaime Perez Branger – Executive with 30+ years of experience in finance and capital markets

Robert Metcalfe – Lawyer and corporate director

Hernan Martinez – Former Colombian Minister of Mines and Energy

Monica De Greiff – Executive President of the Bogota Chamber of Commerce and former Colombian Minister of Justice

De Lyle Bloomquist – Corporate director

ManagementSerafino Iacono, Executive Chairman – Company co-founder with 30+ years of experience in capital markets and public companies

Lombardo Paredes, CEO - 20+ years of corporate leadership and operations management experience in the resource sector in Latin America

Mike Davies, CFO – CPA,CA with 20+ years of international and public company experience in resource and other sectors

Alessandro Cecchi, VP Exploration – Exploration geologist with 20+ years of experience focused gold exploration and development in South America.

Jose Ignacio Noguera, VP Corporate Affairs – Lawyer with 20+ years of experience in public and government affairs and sustainability in the resource sector in Colombia

Angel Meza, General Manager, Segovia Operations – Mine engineer with 17+ years of experience in mining operations in South America and Africa

Inivaldo Diaz, Technical Manager, Segovia Operations – Civil mine engineer with 24+ years of experience in the mining industry in South America

Gabriel Gaviria, General Manager, Marmato Operations –

Mine engineer with 39+ years of experience in mining operations in Colombia

Seasoned Experience in Colombia


GRAN COLOMBIA 2.0❖ Gran Colombia’s high-grade Segovia Operations are continuing to fuel the Company’s

production growth, reaching 240,000 ounces of gold production in 2019, up 10% over

2018.

❖ Market capitalization is benefitting from execution of the Company’s strategy focused on

free cash flow generation from its high-grade Segovia Operations and the improved gold

price environment since mid-2019.

❖ ~52% appreciation in share price over the last 12 months.

❖ Share price remains below analysts’ targets.

❖ CA$35M strategic investment by Eric Sprott since November 2019.

❖ Maintaining strength in the Company’s balance sheet in 2019.

❖ Gold Notes are down 23% from one year ago to $63.9M as of January 31, 2020.

Redeeming another 30% of principal at the end of March 2020.

❖ $84M of cash as of December 31, 2019, up from $36M at the end of 2018.

❖ Future growth continues emphasis on high-grade Segovia mines and the other 24 known

veins we are not currently mining. Accelerating step-out and brownfield drilling with

45,000 m planned for 2020.

❖ Upside potential with Caldas Gold Corp (Marmato expansion) and Zancudo (IAMGOLD

earn-in), Gold X Mining (Toroparu) and Western Atlas (Nunavut, Venezuela) in the

pipeline.

WHAT’S NEW? Gran Colombia Continuing to

Deliver

“Focused on what we can control……Cash, Costs and Execution.”

5


CAPITAL STRUCTURE Fully Diluted = ~88.7M shares

Warrants

GCM.WT.B: 12.0 million @ CA$2.21 (2024 expiry)

Unlisted: 3.3 million @ CA$5.40 (2023 expiry)

Unlisted: 7.1 million @ CA$6.50 (2023 expiry)

Stock Options

0.4 million @ CA$2.55 (2021-2022 expiry)

0.5 million @ CA$3.16 (2023 expiry)

0.4 million @ CA$3.67 (2024 expiry)

Convertible Debentures

CA$20 million @ CA$4.75 (2024 expiry)

6

Common Shares

60.8 millionMarket Capitalization

(as of February 26, 2020)

CA$408 million

Outperforming the TSX Global Gold Index


RESULTS Solid Turnaround

7

Annual Gold Production reaches 240,000 ozs Annual Adjusted EBITDA exceeds $100M

AISC reflects focus on controlling costs

$M

Free Cash Flow is servicing debt and building cash

kozs

-

40

80

120

160

200

240

2017 2018 2019 9M-18 9M-19

Segovia

Marmato

$M

$-

$250

$500

$750

$1,000

2017 2018 TTM 9M-18 9M-19

AISC Total Cash Cost

US$/oz

$-

$35

$70

$105

$140

2017 2018 TTM 9M-18 9M-19

$-

$20

$40

$60

$80

$100

2017 2018 TTM 9M-18 9M-19

Operating Cash Flow Free Cash Flow

TTM = Trailing 12-months ended September 2019 for financial measures.


Cash & DebtRESULTSA

ISC (-2

3%

)

$-

$20

$40

$60

$80

$100

$120

$140

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Cash Debt (1)

$M

2018 2019

Gran Colombia’s balance sheet is getting stronger each quarter:• Cash has increased to $84 million as of December 31, 2019…added CA$15M through strategic investment in early

November 2019 by Eric Sprott.• The Gold Notes amortization schedule is steadily reducing debt by $4.9 million each quarter….down to $68.8 million at

the end of 2019 and $63.9M at end of January 2020. 30% redemption announced for end of March 2020.• Fitch affirmed Gran Colombia’s “B” Stable Outlook rating at the end of October 2019.

(1) Aggregate principal amount outstanding.

8


GOLD NOTES Exposure to Upside on Gold

• Issued April 30, 2018 and mature on April 30, 2024

• Senior secured obligation of Gran Colombia

• US$63.9 million outstanding as of January 31, 2020

• Listed on the TSX under the symbol GCM.NT.U

• 8.25% annual coupon paid monthly in cash

• Quarterly principal repayments in cash with gold

kicker above US$1,250/oz

• Company sets aside physical gold each month into a

Gold Trust Account to meet quarterly principal

payment obligations

• Less than 10% of Segovia’s projected future

production is required to meet principal repayments

• 30% partial redemption at the end of March 2020 at

par plus a make-whole premium (~10%)

B (Outlook Stable) -

5,000

10,000

15,000

2020 2021 2022 2023 2024

Amortization Schedule(Ounces to be Deposited to Gold Trust Account,

Adjusted for Impact of 2020 Partial Redemption)

9


SEGOVIA OPERATIONS Production Stage

El Silencio

Sandra k

Providencia

Las Verticales

Faulting

❖ High-grade mesothermal quartz-sulfide veins in historic mining

district….over 6 million ounces of gold produced through

continuous mining over past 150+ years.

❖ Three active underground mines (27 known veins) and a

substantial land package of ~9,000 hectares, including a unique

RPP contract license over ~3,000 hectares which grants mining

rights in perpetuity.

10

Main Mineralization ZonesLicense Boundaries for Segovia & Carla (100% Owned)


4th Highest Grade Gold Mine Globally (Last 12 Months *)

0

5

10

15

20

25

30

35

• As of September 2019** As of December 31, 2018

11

SEGOVIA OPERATIONS High-Grade

Producer

2P reserves** 1.9 Mt 11.0 g/t 0.7 Mozs

M&I Resources** 3.5 Mt 11.8 g/t 1.3 MozsInferred Resources** 3.6 Mt 10.1 g/t 1.2 Mozs


Chicharron

(Sandspring Resources)

Blue Sky Potential

Currently operating mines on

only 3 of 27 known veins in the

RPP-140 license.

12

Increase M&I resources and reserves

Consolidate advance deposits

Follow-up brownfield exploration projects

Areas of

Immediate

Interest

SEGOVIA OPERATIONS


SEGOVIA OPERATIONS Maria Dama Processing Plant

❖ Plant now has capacity to handle up to 1,500 tpd.

❖ Plant includes crushing, grinding, gravity concentration, gold flotation, cyanidation of the flotation concentrate, Merrill-

Crowe precipitation and refining of both the Merrill-Crowe precipitate and gravity concentrate to produce a final doré.

❖ Onsite lab provides quick turnaround of development samples; exploration samples processed in SGS Medellin.

❖ New “El Chocho” tailings storage facility will receive material over the next seven years and filter press has been

commissioned in 2019; onsite water treatment facility is treating excess water to Colombian standards before being

discharged.

13


Third Party Miner Contracts

❖ Agreements with 30+ third party miner groups

❖ Mine designated areas with the Company’s mining title

❖ GCM pays for recovered gold at fixed price

❖ Contractors manage miners & fund own costs

❖ GCM processes ore and sells the gold & silver

❖ GCM provides health & safety training

Benefits of Contract Mining

Model❖ Environmental benefits – GCM controls processing,

reducing mercury use

❖ Employment – expanded workforce

❖ Improved health & safety

❖ Workers receive health & pension benefits

❖ Government receives tax & royalties

SEGOVIA OPERATIONS Positive Agent for Change

Improving Health & Safety in Our

MinesFunding Community

Programs

14


The Future of MarmatoLies Underground

TSXV: CGC

❖ RTO transaction with Bluenose Gold

created Caldas Gold Corp on February

25, 2020

❖ Listed on the TSXV under the symbol

“CGC” with trading commencing on

February 28, 2020

❖ Spun out the Marmato mining assets

in Zona Baja to Caldas Gold in the RTO

❖ Gran Colombia maintains a 72%

controlling position in Caldas Gold

❖ Completed a brokered private

placement in late 2019 led by Scotia

raising CA$6.6M and another CA$15M

from Gran Colombia

❖ CA$2.00 Units => one share +

one warrant at CA$3.00 for five

years

❖ 50.5M shares issued & outstanding;

61.9M fully-diluted

❖Mineral Resource estimate updated as

of July 31, 2019

❖ PEA completed and 43-101 Technical

Report filed on SEDAR

❖ PFS underway for completion mid-

2020

❖ Drilling up to 15,000m in 2020 in the

Deeps Zone

15


Mine Expansion into the DEEPSMARMATO PROJECT

Mining Upper ZoneExisting mine and 1,200 tpd plant

Mining Deeps ZoneFuture mine with new 4,000 tpd plant

ZonaAltaRetained by Gran Colombia

Zona BajaCaldas Gold

See page 17 for Zona Baja Mineral Resources by Area and Page 18 for PEA Results Summary

16

Zona BajaCaldas Gold


Mineral Resource EstimateAs of July 31, 2019

MARMATO PROJECT

Deposit Type

Measured Indicated Measured & Indicated Inferred

Tonnes

(kt)

Grade

(g/t)

Au Metal

(koz)

Tonnes

(kt)

Grade

(g/t)

Au Metal

(koz)

Tonnes

(kt)

Grade

(g/t)

Au Metal

(koz)

Tonnes

(kt)

Grade

(g/t)

Au Metal

(koz)

Zona Baja (4)

Veins 2.1 4.9 325 7.2 4.5 1,037 9.2 4.6 1,362 3.3 4.4 466

Porphyry 1.6 2.7 140 1.6 2.7 140 0.3 3.1 34

Subtotal 2.1 4.9 325 8.8 4.2 1,177 10.8 4.3 1,502 3.6 4.2 500

Deep Zone 6.4 2.6 537 6.4 2.6 537 41.2 2.1 2,812

Total 2.1 4.9 325 15.2 3.5 1,714 17.3 3.7 2,039 44.9 2.3 3,312

1) Mineral resources are not mineral reserves and do not have demonstrated economic viability.

2) All figures are rounded to reflect relative accuracy of the estimate. All composites have been capped where appropriate.

3) Zona Baja includes mineral resources from the Echandia license below 1,340 masl and above 1,025 masl and are accessible from the current mining

operation.

4) Vein and Porphyry mineral resources are reported at a cut-off grade of 1.9 g/t. Cut-off grades have been based on a price of US$1,500 per ounce of gold,

suitable benchmarked technical and economic parameters and gold recoveries of 95% for underground resources, without considering revenues from other

metal.

5) Deep Zone mineral resources are reported at a cut-off grade of 1.3 g/t. Cut-off grades have been based on a price of US$1,500 per ounce of gold, suitable

benchmarked technical and economic parameters and gold recoveries of 95% for underground resources, without considering revenues from other metal

within a limiting pit shell. The Deep Zone includes mineral resources an elevation of 1,025 masl.

17


Life-of-Mine Plan (“PEA”) ResultsMARMATO PROJECT

-

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

Ou

nce

s

Precious Metal Production Profile (ozs/year)

Gold Silver

18

❖ Marmato mine in Zona Baja will comprise two distinct operations: Upper Zone and Deep Zone.

❖ Upper Zone: Immediate optimization of existing mining operation…5.5M tonnes processed over 16-year life with average LoM headgrade of 3.8 g/t resulting in 0.6M ounces of gold (27% of total). Annual production to increase from current ~25,000/yr to a rangebetween 35,000 and 40,000 starting in 2020. LoM cash cost of US$803/oz (down ~25% from historical) and LoM AISC of US$872/oz.

❖ Deep Zone: US$269M initial capital in 2020 to 2022. Total of 20.8M tonnes processed over a 16-year life starting in 2023 at an averageLoM grade of 2.5 g/t resulting in 1.6M ounces of gold (73% of total). LoM cash cost of US$797/oz and LoM AISC of US$885/oz

❖ Combined:❖ 2.2M ounces of gold with LoM cash cost of US$799 per ounce and LoM AISC of US$882/oz.❖ At US$1,300 per ounce long-term gold price, total undiscounted LoM after-tax cash flow of US$448M (NPV 5% - US$207M).❖ Before financing, IRR = 20% and payback by 2026.


Exploration UpsideMARMATO PROJECT

“I haven’t seen too many holes like MT-IU-041 with 73.63 meters at 5.72 g/t.”Serafino Iacono, Executive Chairman of GCM and Interim CEO of Caldas Gold

Recent Phase 2 drilling in 2019 continues to demonstrate an improvement of grades in

the Deeps

20

19


For Further Information, Contact: Mauricio Ostos

Investor Relations(416) 360-4653

[email protected]

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