Arizona Sonoran Copper Co., Inc.
Arizona Sonoran Copper — Investor Presentation (January 2023)
46 slides from Arizona Sonoran Copper's investor presentation, Jan 10, 2023
Slide 1: January 2023 Corporate Presentation
ASCU:TSX ASCUF:OTCQX January 2023 Corporate Presentation COPPER Invest in Sustainability
Slide 2: Cautionary Information
Cautionary Information This presentation (“Presentation”) is being furnished on a confidential basis in order to provide readers certain information with respect to the business and operations of Arizona Sonoran Copper Company Inc. (the “Company” or “ASCU”). This presentation contains forward-lookin
Slide 3: Capital Structure & Ownership
Capital Structure & Ownership CAPITAL STRUCTURE OWNERSHIP Retail Rio Tinto Market Capitalization (M) C$175M 19% 7% Shares Outstanding (M) 88.7 Management 6% Tembo Warrants (M) 6.6 35% Options (M) 2.9 Other 6% RSU’s (M)(1) 0.3 DSU’s (M) 0.4 Insitutional 27% Fully Diluted Share Capital (M) 98.9 Includ
Slide 4: ASCU: A Low-Risk Growth Opportunity
ASCU: A Low-Risk Growth Opportunity A Goal to Supply the US with Locally Sourced Copper Brownfield Exploration and Private Landownership = Development Project in Tier 1 State and County Led Jurisdiction Permitting process Proposed Copper Heap Leach, Building Scalability and SXEW Operation(1)(2) Grow
Slide 5: Management Team with Track Record of Execution
Management Team with Track Record of Execution STRONG SPONSOR SUPPORT George Ogilvie, P.Eng. Ian McMullan, P.Eng., MBA Nick Nikolakakis, BASc, MBA Rita Adiani, LLB Hons President, CEO & Director COO VP Finance and CFO SVP Strategy & Corporate Development • Private equity fund investing in +30 years
Slide 6: Experienced Board of Directors
Experienced Board of Directors David Laing, B.Sc. Eng Thomas Boehlert, ICD.D George Ogilvie, P.Eng. Chair of the Board of Directors Director President, CEO & Director +40 years experience in the mining industry with roles across +30 years in the agribusiness, mining & energy. Experienced finance ope
Slide 7: 2022 Accomplishments
PROJECTS 2022 ACCOMPLISHMENTS ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM 7
Slide 8: Building a US-based Copper Developer within Arizona
Building a US-based Copper Developer within Arizona CORPORATE OPERATIONS • C$35m Financing • Declares 2.9B lb maiden resource at P/S • Doubles the total leachable inventory • Rio Tinto investment for 7.4% ownership • Becomes the third largest independent project in • Bolsters Board and Team the US •
Slide 9: Location Advantage
PROJECTS LOCATION ADVANTAGE ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM 9
Slide 10: Arizona: Globally Recognized Top Tier Jurisdiction to Operate
ARIZONA: Globally Recognized Top Tier Jurisdiction to Operate Accessible Infrastructure and Ready Labour-force Cactus Project Arizona is the USA's and Parks/ Salyer leading copper-producing Deposits state which accounted for At the intersection of 71% of domestic output of 3 major porphyry copper in
Slide 11: Local Support for the Cactus Mine
Local Support for the Cactus Mine Overwhelming support for the Cactus Mine in Casa Grande – economic survey shows $8.5 Billion of indirect and direct revenues to the local community. Probably Support GOP: 93.0% Support 82.6% Dem: 66.7% Support Don't Know, Refused Support PND: 84.4% Support Definitel
Slide 12: Major Permits in Place – De-risked Project Development on Private Land
Major Permits in Place – De-risked Project Development on Private Land Water Rights in Hand, Access to Water Onsite COMPLETED PERMITS OUTSTANDING PERMITS - STREAMLINED PROCESS Permit Permit Office Permit Permit Office Status Industrial Air Permit Pinal County Submission being review Air Quality Dust
Slide 13: Among the Most Developed Independent US Development Copper Assets
Among the Most Developed Independent US Development Copper Assets Permitting well advanced and on track to complete a PFS Low Discovery Cost per Pound Significant Independent Copper Development 7000 $0.03 Assets in the USA Discovery Cost Per Pound (US$) Global Copper Inventory (Mlbs) 6000 4902 Prima
Slide 14: ASCU Projects
PROJECTS ASCU PROJECTS ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM 14
Slide 15: Cactus Project: 18-year Base Case on Low-Risk Brownfield Project
Cactus Project: 18-year Base Case on Low-Risk Brownfield Project Re-scoping Base Case Economics ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM 15
Slide 16: In-place Infrastructure
In-place Infrastructure Brownfield Advantage with Ready Access to Infrastructure Powerline and onsite substation connected to Arizona Public Service Electric Offices, core shack and ancillary buildings Rail line (to ship concentrate to refinery) Power substation Stockpile (part of Integrated Cactus
Slide 17: Cactus Mine Project
Cactus Mine Project PEA Base Case Project Economics + Potential to Scale KEY PEA PROJECT METRICS (1)(2) RESCOPING PEA Ore from 3 Sources (3) Upcoming PFS Considering Material from 5 Sources (3) Over the Life of Mine Mine Life 1.27 B lbs of Cu over 18 years Average Production 28 ktpa (56Mlbs); Peaks
Slide 18: Parks/Salyer Project
Parks/Salyer Project Opportunity to Integrate into the Cactus PFS • Maiden mineral resource declared in 2022 (see table) PARKS/SALYER MAIDEN MINERAL RESOURCE ESTIMATE • Opportunity to significantly add inventory to the upcoming PFS Category Tons CuT Tsol Tsol_lb Contained • Current 105,000 ft (32,00
Slide 19: Primary Sulphide (Chalcopyrite) Optionality
Primary Sulphide (Chalcopyrite) Optionality Partnership with Rio Tinto’s NutonTM Technology, a 30 year innovation Potential to add primary sulphides to future mine plans via heap leach and SX/EW plant, using NutonTM’s technologies Rio Tinto’s NutonTM is currently column leach testing Parks/Salyer &
Slide 20: 4 km Mine Trend with Exploration Upside
4 km Mine Trend with Exploration Upside Building Scale and Potential Future Operational Pipeline A 20,000 ft (6,100 m) exploration program is being considered on the: • Gap Zone • NE Extension Gap Zone Historic drilling and ionic leach surveys have indicated several anomalies along the 4 km mine tre
Slide 21: Metallurgical Programs: Focus on Leachable Material
Metallurgical Programs: Focus on Leachable Material Current Programs on Cactus and Parks/Salyer CACTUS: AVERAGE METALLURGICAL PERFORMANCE CRITERIA Heap-leach and SXEW process considered Preliminary Column Tests (PEA) Updated Column Tests 01 for 1.3 billion pounds of leachable copper (LOM) from Cactu
Slide 22: The Cactus Project Timeline
The Cactus Project Timeline Integrating the Cactus and Parks/Salyer Projects Task 1Q23 2Q23 3Q23 4Q23 1Q24 2Q24 3Q24 4Q24 2025 2026 2027 Drilling/ Assays Metallurgy Detailed Mine Design and Engineering Pre-Feasibility Permitting Feasibility Study Construction Decision and Project Contingent on Posit
Slide 23: Peer Benchmarking
PROJECTS PEER BENCHMARKING ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM 23
Slide 24: Copper Development Peers (P/NAV)
Copper Development Peers (P/NAV) 1.00x 0.93x 0.91x 0.90x 0.88x 0.80x 0.70x 0.60x Peer Average: 0.59x 0.60x P/NAV 0.50x 0.50x 0.48x 0.46x 0.40x 0.30x 0.24x 0.20x 0.18x 0.10x 0.00x IE FOM FIL NGEX MARI AMC ASCU TMQ FDY Source: Company Filings, Capital IQ, January 6, 2023 ASCU:TSX | ASCUF:OTCQX ARIZONA
Slide 25: Value Proposition: Benchmarking to Copper Developers
Value Proposition: Benchmarking to Copper Developers Low-Risk Copper Developer in Top Tier Jurisdiction $0.30 $0.30 ✓ Large scale mineral resource base $0.25 $0.23 ✓ Streamlined permitting: ✓ Water permits in hand ✓ No Federal Nexus $0.20 EV/lb CuEq (US$/lb) ✓ Brownfields project in Tier 1 jurisdict
Slide 26: Benchmarking ASCU to Copper Developers
Benchmarking ASCU to Copper Developers Market Capitalization (C$) $175M $1.7B $3.3B $801M $299M $591M $513M $368M $109M $58M $88M Cactus / Santa Cruz / McIlvenna Cu Creek / Asset Name Filo del Sol Marimaca Los Helados Kay Casino Arctic Copperwood Parks Salyer Tintic Bay Contact Cu Economic Study Lev
Slide 27: Key Investment Highlights
Key Investment Highlights • Our Core Values Are Supported by an ESG Framework • Copper Market Fundamentals remain Strong in the Medium and Longer Term • Mature Tight Share Capital Structure with No Debt • Experienced Leadership Team and Board with a Proven Track Record • Brownfield, Scalable Develop
Slide 28: Investor Relations Contacts
Alison Dwoskin, CPIR Director, Investor Relations adwoskin@arizonasonoran.com +1 (647) 233-4348 (cell) George Ogilvie, P.Eng President, CEO & Director gogilvie@arizonasonoran.com +1 (416) 723-0458 (cell) www.arizonasonoran.com | www.cactusmine.com
Slide 29: Appendix
Appendix ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM 29
Slide 30: The Cactus Mine Project's Path to Restarting Operations
The Cactus Mine Project’s Path to Restarting Operations Sacaton Begins US$20M ASARCO Remediation ARIZONA SONORAN COPPER COMPANY Production Complete 2019/ Next 1964 1974 1984 2019 2021 2022 Steps 2020 Sacaton Production Suspends • Purchases • Declaration • Bolsters Board • PFS and FS Studies Discover
Slide 31: Our ESG Framework – Setting the Pace for Net Zero Carbon Emissions
Our ESG Framework – Setting the Pace for Net Zero Carbon Emissions ▪ ASCU is actively exploring use of renewable energy for its operations with the goal of becoming a “Net Zero Carbon Emissions” copper producer ▪ Ability to also reduce carbon footprint by Arizona Public Service’s transition to renew
Slide 32: Journey Towards Net Zero - Partnership with Minviro
Journey Towards Net Zero - Partnership with Minviro Production and Reporting • Establishing reporting KPIs PFS / FS Construction • Reporting to international • Design parameters used to scope impact standards (e.g. SASB, TCFD) • Investment in low carbon technologies and minimizing • GHG inventory as
Slide 33: Building a Multi-Billion Pound Copper Resource
Building a Multi-Billion Pound Copper Resource GLOBAL MINERAL RESOURCE P/S DOUBLED THE GLOBAL Indicated Resource– 1,610,700 k lbs LEACHABLE INVENTORY Inferred Resource– 4,894,200 k lbs PARKS/SALYER CACTUS MINE Category and Tons CuT Tsol Tsol_lb Contained Category and Tons CuT Tsol Tsol_lb Contained
Slide 34: Junior Copper Producer Benchmarking (Enterprise Value and Production)
Junior Copper Producer Benchmarking (Enterprise Value and Production) $4,000 200 $3,689 180 $3,500 160 $3,000 140 Annual Production (Mlbs CuEq) $2,500 120 EV (US$M) $2,000 Company Goal: 100 Peak PEA Production: 80 $1,500 60 $1,000 $786 40 $635 $487 $500 $292 20 $141 $100 $0 0 Capstone Copper Taseko
Slide 35: Cactus PEA Production Schedule
Cactus PEA Production Schedule – Opportunity beyond 40 kstpa (80 Mlbs) CACTUS PRODUCTION SCHEDULE (1)(2) Heap Leach & SX/EW Processing 55,000,000 55,000 Organic Growth Opportunities: 50,000,000 In-Pit and Near-Pit Optimization 50,000 Parks/Salyer 45,000,000 NE Extension 45,000 40,000,000 40,000 Reco
Slide 36: Robust Returns from Lowest Capital Intensity vs Peer Group
Robust Returns from Lowest Capital Intensity vs Peer Group Between the PEA and the upcoming Prefeasibility study, PEA CONSTRUCTION CAPEX BREAKDOW N (US$M) ASCU is reviewing the following: Direct & Indirect Leach Pads, SXEW Total Cost Components Ponds & Pipelines Facility Capital Cost Directs Subtota
Slide 37: Detailed Leachable-Only Mineral Resource Estimate
Detailed Leachable-Only Mineral Resource Estimate Grades Significantly Increase Underground LEACHABLE MINERAL RESOURCE • UG high-grade contributing to economics Indicated Resource: 1,065,900 Klbs Inferred Resource: 1,211,300 Klbs • Maiden Reserves expected with PFS - Open Pit & Stockpile Underground
Slide 38: Mineral Resource Estimate Table
Tons CuT TSol Contained Contained Material Type (kt) % % Cu (k lbs) Cu (k Tons) INDICATED Cactus Oxide 31,400 0.559 349,700 176 Enriched 42,500 0.844 715,500 359 Total Leachable 73,900 0.723 1,065,200 534 Primary 77,900 0.35 545,500 273 Total Indicated 151,800 0.531 1,610,700 806 INFERRED Cactus Oxi
Slide 39: Notes to the Mineral Resource Estimate
Notes to the Mineral Resource Estimate Notes to the Mineral Resource Estimates 1. CuT means total copper and Tsol means total soluble copper as the addition of sequential acid soluble and sequential cyanide soluble copper assays. Tons are reported as short tons. 2. Cactus and Stockpile Resource esti
Slide 40: Cactus East FS Level Infill Drilling Supporting Current Model
Cactus East FS Level Infill Drilling Supporting Current Model S-37 August 30 Press Release Assays Pending 250 ft (76 m) 500 ft (152.4 m) ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM Press Release dated August 30, 2022 40
Slide 41: Cactus East Cross Section, Looking Northwest
Press Release dated August 30, 2022 Cactus East Cross Section, Looking Northwest ECE-073 ECE-069 ECE-058 S-37 S-42 A’ A ECE-072 ECE-073 ECE-069 344.0 ft @ 1.07% CuT, 247.0 ft @ 1.73% CuT, 0.82% Cu TSol 1.63% Cu TSol Incl. 101.7 ft @ 1.95% CuT, Incl. 90.0 ft @ 2.99% CuT, 1.89% Cu TSol 2.80% Cu TSol C
Slide 42: Parks/Salyer Plan View with Interpreted Mineralized Extents
Press Release dated November 29, 2022 Parks/Salyer Plan View with Interpreted Mineralized Extents ECP-045 ECP-101 ECP-099 ECP-102 ECP-100 Previously Reported ECP-079 November 28 Press Release ECP-103 Assays Pending Interpreted Mineralization Extents ECP-106 ECP-104 500 ft (152 m) 1,000 ft (304.8 m)
Slide 43: Parks/Salyer Cross Section – Looking West
Press Release dated November 29, 2022 Parks/Salyer Cross Section – Looking West A A’ ECP-079 ECP-106 ECP-100 479 ft @ 1.32% CuT, 0.90% TSol, 0.017% Mo (enriched) ASCU Property Boundary 225 ft @ 0.96% CuT, 0.63% TSol, 0.039% Mo (primary) ECP-099 552.0 ft @ 1.10% CuT, 0.85% TSol, 0.030% Mo (enriched)
Slide 44: Press Release dated November 2, 2022
Press Release dated November 2, 2022 ECP-097 Oxide Mineralization 1.71% TCu 1.70% TCu Sol 0.027% Mo 10 ft Interval 1,324 – 1,334 ft (3.0 m, 403.5 – 406.6 m) Within: 0.68% TCu 0.65% Cu Tsol 0.018% Mo 294.4 ft interval 1,071.0 – 1,365.4 ft (89.7 m, 326.4 – 416.2 m) ASCU:TSX | ASCUF:OTCQX ARIZONASONORA
Slide 45: Rediscovering the World-Class Santa Cruz Copper Porphyry System
Rediscovering the World-Class Santa Cruz Copper Porphyry System Drilling the same porphyry copper system, Ivanhoe Electric ARIZONA SONORAN starting at Santa Cruz and extending northeast to Sacaton Northeast IE and ASCU land position connected at Parks/Salyer CACTUS PARKS/SALYER ASCU – active drillin
Slide 46: Simple Heap Leach & SXEW Flowsheet
Simple Heap Leach & SXEW Flowsheet • Leach material mined from the Stockpile Project and new mining operations will be placed in 20 ft (6 m) lifts on lined heap leach pads • The initial oxide materials pad is 8.5 million ft2 (790 thousand m2) to hold approximately 40 Mt of leach material (2-3 years
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