Orezone Gold Corporation · TSX:ORE
Orezone Gold — Sprott Natural Resource Conference 2019
48 slides from Orezone Gold's conference presentation, Aug 2, 2019
Slide 1: Corporate Update – Bomboré Gold Project
Corporate Update BOMBORÉ GOLD PROJECT Sprott Natural Resource Conference July 30 – August 2, 2019 ORE:TSX.V 1
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains certain “forward-looking information” within the meaning of applicable Canadian securities laws. Forward-looking information and forward-looking statements (together, “forward-looking statements”) are frequently characterized by words such as “pl
Slide 3: Why Invest?
Why Invest? Experienced Team Established Jurisdiction Robust Economics Turnaround Story Proven track record 12 gold mines in After-tax NPV5% of Simplified the of project production and 2 in $361M and IRR of project and focused construction and construction 43.8% with a on a scale Orezone financing,
Slide 4: Orezone 2019 Highlights
Orezone 2019 Highlights Released updated Bomboré Sulphide Expansion Feasibility study* • Increased after-tax NPV5% by $137.5M (+62%) • Increased reserves by 686Koz (+60%) • Low AISC of $672 in the first 10 years Project financing discussions advancing • Debt advisors Cutfield Freeman engaged Resettl
Slide 5: Gold Production 2010 vs 2019
Gold Production 2010 vs 2019 West Africa gold production increased by 69% between 2010 to 2019 2010 and 2018 Ounces by Region Asia Central & South America North America Independent States Oceania West Africa South Africa Europe 0 5 10 15 20 25 2010 Ounces 2018 Ounces Source: World Gold Council. West
Slide 6: Burkina Faso and An Emerging Gold District
Burkina Faso and An Emerging Gold District Supportive mining jurisdiction • 12 gold mines in production • 2 gold mines in construction ~10Moz gold within 15km of Bomboré • West African Resources: Sanbrado • B2 Gold: Toega • New high-grade gold discoveries in this emerging district Pool of skilled an
Slide 7: Bomboré Location & Local Infrastructure
Bomboré Location & Local Infrastructure Access Road Located 85 km from the capital city along a major paved highway in a secure location Located 5 km from town of Mogtédo with a population of 15,000; easy access to skilled local workforce, housing and logistics Excellent infrastructure with major
Slide 8: Area of Lower Risk
Area of Lower Risk Bomboré is located in an area of lower risk Within 90 minutes of the capital along a paved and patrolled major highway Located in proximity to a military training facility • Significant military presence Zone of enhanced vigilance New Cartography of Risk Areas in Burkina Not recom
Slide 9: Feasibility Study Highlights
Feasibility Study Highlights ALL REPORTED FIGURES ARE IN US DOLLARS AND ON A 100% PROJECT BASIS Pre-tax NPV(1)5% of $513.5M and IRR(1) of 61.9% of with a 1.5-year payback After-tax NPV5% of $361.0M and IRR of 43.8% with a 2.5-year payback Mine life of 13+ years with LOM gold production of 1.6M ounce
Slide 10: Sulphide Expansion Feasibility Study Focus
Sulphide Expansion Feasibility Study Focus Identified P17S high-grade sulphide zone Several additional high-grade sulphide zones contained within main ore body Staged Sulphide Expansion with production commencing in Year 3 of oxide operations • High-grade sulphides will replace oxides Sulphide expan
Slide 11: 3D Combined Processing Plant
3D Combined Processing Plant Stage 1: Oxide Plant Stage 2: Sulphide Circuit 11 11
Slide 12: Key Project Changes (Cont’d)
Key Project Changes (Cont’d) Description 2018 FS 2019 FS Base Case Gold Price (US$/oz) 1,275 1,300 Mine Life (years) 12.3 13.3 Total Waste Tonnes Mined (Mt) 93.8 164.4 Total Ore Tonnes Mined (Mt) 56.0 70.1 Strip Ratio 1.68 2.34 Production Processing Annual Throughput (Mt) 4.5 5.2 Total Gold Ounces R
Slide 13: Key Project Changes (Cont’d)
Key Project Changes (Cont’d) Capital Costs 2018 FS 2019 FS Initial Construction Costs ($M) 143.7 153.0 Sustaining Capital Costs ($M) 58.9 66.2 Closure Costs ($M) 14.5 17.9 Financials1, 2 Pre-tax NPV(5%)(millions) 315.2 513.5 Pre-tax IRR 59.3% 61.9% Post-tax NPV(5%)(millions) 223.5 361.0 Post-tax IRR
Slide 14: Annual Gold Production and AISC
Gold Production and AISC Annual Gold Production and AISC/Ounce 180,000 $1,331 $1,400 158,583 $1,233 160,000 149,704 144,154 $1,200 139,507 All-in Sustaining Costs (USD/ounce) 138,563 140,000 $1,031 125,823 126,326 121,827 121,627 $1,000 Gold Ounces, Recovered 120,000 112,066 $878 $755 $767 $761 100,
Slide 15: LOM Operating Cost Breakdown
LOM Operating Cost Breakdown Mining costs: based on a detailed annual Total Costs $/tonne Description $/ounce mining schedule incorporating haul ($M) processed distances and pit depths as per contractor Mining 386.3 5.51 242 quotes Processing 456.9 6.52 286 Site G&A 139.4 1.99 87 Processing costs ba
Slide 16: Production and Grade Profile
Production and Grade Profile Annual Gold Production, Head Grade and Recovery % 180 1.02 1.03 1.01 110% 0.97 0.96 160 0.91 0.89 85.8% 0.88 0.85 0.85 85.8% 78.7% 90% 140 92.3% 92.3% 91.2% 88.7% 88.7% 87.2% 86.0% 85.0% 85.4% 85.3% 83.9% Recovered Gold (k oz) 120 80.1% 70% 0.78 0.62 100 0.50 0.40 50% 80
Slide 17: Optimization Opportunities
Optimization Opportunities Geological Interpretation: Continue to refine the geological model to incorporate the knowledge gained from recent drilling at P17S and to evaluate the potential for higher grade oxides and sulphides at depth along plunge. Metallurgical Recoveries: Recent sulphide test wor
Slide 18: Site Layout
Site Layout Waste Dumps Camp Stockpile Mining Pit TSF OCR Process Plant 18 18
Slide 19: Capital Structure & Research Coverage
Capital Structure & Research Coverage Capital Structure Insiders continue to buy ORE shares in the (as at June 26, 2019) market Shares Issued 213,326,906 Analyst average 12-month target price Options 16,026,838 C$1.36 Shares Fully Diluted 229,353,744 Cash (as at March 31, 2019)(no debt) ~USD$27.5 M
Slide 20: Project Development Timeline
Project Development Timeline 2019 2020 2021 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Complete Updated Feasibility Study Finalize Project Finance Package Resettlement Action Plan Tailings Storage Facility Off Channel Reservoir Development EPCM Process Plant Construction Commissioning Process Plant Ramp-Up Fi
Slide 21: Summary
Summary Orezone continues to deliver on its turnaround commitment • Focused on a project scale Orezone can finance and build • Improved the economics and mine-life of Bomboré with the addition of a phased sulphide expansion that is funded by oxide cash-flows • Covered by 7 equity analysts Developmen
Slide 22: An Evolving Geological Model
An Evolving Geological Model 22 22
Slide 23: Evolving Geological Interpretation
Evolving Geological Interpretation Siga South Deposit – Section 10600N Discreet hanging wall zones Thick, consistent footwall zone 23 23
Slide 24: P16 Down-Plunge Potential
P16 Down-Plunge Potential P16 mineralized zone plunging North, open at depth, potential HG ore shoots 6m @ 5.0 gpt 12m @ 2.5 gpt 9m @7.6 gpt Multigram and multimeter 13.5m @ 2.9 gpt drill intercepts following a 6m @ 7.6 gpt fold nose – None of which are included within the current resources 12m @ 15
Slide 25: 2018 Drilling – High-Grade Oxide Shoots
2018 Drilling – High-Grade Oxide Shoots P11 Target Area Maga North Target Area 2017 and 2018 drilling 2m @ 6.4 gpt 7m @ 15.1 gpt targeted select high-grade 3m @ 4.2 gpt 14m @ 6.4 gpt 4m @ 22.9 gpt 2m @ 10.3 gpt shallowly plunging shoots 5m @ 6.6 gpt 3m @ 15.1 gpt within current oxide pits 6m @ 3.5 g
Slide 26: Maga Hill Down-Plunge Potential
Maga Hill Down-Plunge Potential Longitudinal Section 1180E (View N312, ±80 m, ie: full width of the folded sequence) Maga Hill - a better defined multigram and multimeter group of ore shoots following fold noses - with exceptional expansion potential-this fold ? is over 160m in width and still open!
Slide 27: P17S Mineralization Trend
P17S Mineralization Trend RPA January 5, 2017 N Resource Pit Shells Untested 600m Gap Plan View 200 m 2018 Core Drill Collar Longitudinal View (Looking N270) 27 27
Slide 28: Next Steps
Next Steps Recent in-fill drilling (2019) has continued to confirm the folded plunging hinge systems at Siga and Maga Modelling is currently underway in all of these areas and is expected to be completed later this year Once modelling is completed, a new resource will be completed followed by a new
Slide 29: 2018 Regional Oxide Highlight Exploration Results
2018 Regional Oxide Highlight Exploration Results Historical result: KT Oxide Target 2018 result: KT 4m @ 4.0 gpt 3m @ 7.1 gpt P13 Oxide Target 6m @ 2.0 gpt 5m @ 1.2 gpt 7m @ 1.6 gpt 14m @ 0.8 gpt 10m @ 12.9 gpt 7m @ 1.6 gpt 9m @ 1.3 gpt 7m @ 1.6 gpt 4m @ 3.7 gpt GHO P17N Oxide Target 1m @ 23.5 gpt
Slide 30: Enhancement Opportunities
Enhancement Opportunities Dilution - Oxides and Sulphides Optimize metallurgical recovery Incorporate new higher grades and model into mine plan Continue to add resources and reserves to extend mine life Process plant design allows simple expansion with room for Ball Mill and additional CIL tank 30
Slide 31: Enhancement Opportunities
Enhancement Opportunities Resource modeling update Drilling to replace Including 2018 higher grade infill results end of life low grade stockpiles 180 1.02 1.03 1.01 110% 0.97 0.96 160 0.91 0.89 0.88 85.8% 0.85 0.85 85.8% 78.7% 90% 140 92.3% 92.3% 91.2% 88.7% 88.7% 87.2% Recovered Gold (k oz) 85.0%
Slide 32: Permitting
PERMITTING 32 32
Slide 33: Oxides
Oxides The oxide portion of the project is fully permitted, outside of the “Restricted Zones” and ready for construction and operation All necessary Environmental Baseline Studies were completed prior to submission of the Mining Permit application in 2015 The Mining Permit was granted on December 30
Slide 34: Health, Safety & CSR
HEALTH, SAFETY & CSR 34 34
Slide 35: Orezone’s Philosophy
Orezone’s Philosophy Create long-term, sustainable impact How do we achieve this? • Work closely with local leaders and NGO’s that have established deep local roots with proven success. • Focus on health care, potable water, education, agriculture and skills and training • Involve women's groups and
Slide 36: Orezone’s Philosophy
Orezone’s Philosophy Orezone commenced its programs at the outset of exploration based on experience gained during the Essakane development We currently work with several NGO’s and local groups on various projects and initiatives We ensure that the participants have “Skin in the Game” - This ensures
Slide 37: Livelihood Restoration Programs
Livelihood Restoration Programs Training to date • 170+ persons trained in various trades: welding, masonry, carpentry etc. • 20 persons trained on heavy equipment-women and men • 150+ persons trained on light vehicle driving licenses • 21 persons trained on land recovery: Zaï and Half-moon techniqu
Slide 38: Livelihood Restoration Programs
Livelihood Restoration Programs Programs – including ongoing Land Reclamation • Market gardens developed - agro-economist hired - additional gardens being developed • Speciality cash crops being developed- spices, shea butter • Chicken farming commenced- self funding and very successful to date Recl
Slide 39: Orezone Community Initiatives
Orezone Community Initiatives 39 39
Slide 40: RAP
RAP 40 40
Slide 41: RAP – Sample Houses
RAP – Sample Houses Current Houses Site Construction RAP Sample Houses 41 41
Slide 42: RAP Update
RAP Update Summary • All housing and community infrastructure now agreed and designs completed • All approvals received • Sample houses constructed - Key to acceptance - People can see and walk into the buildings as opposed to looking at drawings • Official opening ceremony held at end of May- Extre
Slide 43: RAP – Construction Overview
RAP – Construction Overview RAP Phase 1 housing • 935 - 1 bedrooms • 129 - 1 bedroom plus living room • 48 - 2 bedroom plus living room • All community infrastructure: schools, clinics, church and mosque etc. Seven villages being constructed Six contractors - all locally based All access roads to vi
Slide 44: Appendix
APPENDIX 44 44
Slide 45: Management Team
Management Team PATRICK DOWNEY • Engineer with over 30 years international resource industry experience President & CEO, • Previously President, CEO & Director of Elgin Mining, Aura Minerals Inc. and Viceroy Exploration Ltd. prior to its acquisition Director of Yamana Gold Inc. for $600M • Previousl
Slide 46: Directors
Directors MICHAEL HALVORSON • Over 50 years experience in the securities industry Chairman • Since 1980, he has been the President of Halcorp Capital, a private investment corporation • Past director of Strathmore Minerals, Western Silver, Novagold Resources, Esperanza Silver, Pediment Exploration,
Slide 47: Directors Cont’d
Directors Cont’d MARCO LOCACSIO • CEO of Adia Resources Inc. Director • Former portfolio manager and analyst of 11 years at Mason Hills Advisors focusing on precious metals equities STEPHEN AXCELL • Minerals Processing Engineer with over 38 years experience in mining operations management, project m
Slide 48: For more information on Orezone, please contact
For more information on Orezone, please contact Vanessa Pickering: info@orezone.com Tel: 778-945-3974 48
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