Slide 1: Spanish Mountain Gold
Spanish Mountain GOLD August 2020 TSX-V : SPA | OTC : SPAZF
Slide 2: Cautionary Statements
Cautionary Statements Certain of the statements and information on this presentation constitute “forward-looking statements” or “forward-looking information”. Forward- looking statements or information are subject to a variety of known and unknown risks, uncertainties and other factors that could ca
Slide 3: Project Highlights
Project Highlights Mining friendly jurisdiction + excellent access & infrastructure Fast-track Phase I (2019 PEA) to be “shovel ready” 1 g/t Au project for 11 years producing 1.14 million ounces Au from near-surface open pit Project (Phase 1) US$ 273m Capex + OpCost = AISC $549/oz Advance
Slide 4: Fully Funded to Concurrently Achieve Dual Objectives
Fully Funded to Concurrently Achieve Dual Objectives Deliver Preliminary Feasibility Study in Q1 2021 Resume environmental assessment & permitting 1. Fast-track Complete full feasibility study within compressed Phase 1 timeline To be “shovel ready” 2. Aggressively Commence major drilling c
Slide 5: Current Project Strategy—Prioritize Phase I
Current Project Strategy—Prioritize Phase I Mining Higher-grade, Near-surface Measured & Indicated (M&I) Ounces as Standalone Operations (Phase 1) Reduced target mill throughput to lower initial capex requirements significantly Lower Capex Enhance financing options and shorten payback of initial
Slide 6: Compelling Rationale for Phase 1
Compelling Rationale for Phase 1 Strategic Mine Plan Only 30% of M&I ounces incorporated Higher grade/ near-surface Mill Feed Profile Dec, 2019 PEA Total feed: 39m tonnes PEA pit outline Avg. Au grade: 1.0 g/t Total gold: 1.258 Moz Project Scope (Phase 1) Throughput: 10ktpd Capex: C$36
Slide 7: Low Cost Operations—$549 AISC/oz
Low Cost Operations—$549 AISC/oz Access & Infrastructure ~100k highway access to William Lake (major mining supply centre & labour pool) Abundance of grid power and BC Hydro substation connectivity Supplies & labour available from many Dec, 2019 PEA surrounding communities Low Milling Cost & S
Slide 8: Initial Capex (US$m) vs. peers
World’s Top Ten: gold development projects* with lowest AISC $700 $1,000m AISC per oz (US$) Initial Capex (US$m) 970m Modest Capex + Low AISC $900m $600 616 609 611 802m 576 579 $800m Initial Capex (US$m) 549 AISC per oz (US$) $500 689m $700m 492 $600m $400 373 374 399 475m vs. $500m $300 $400m $300
Slide 9: Project Economics—Phase 1
Project Economics—Phase 1 Positive Economics Even at Low Gold Price Environment Gold Price Dec, 2019 PEA Pre-tax: Unit $1100 $1200 $1275* $1500 $1600 $1700 $1800 NPV@5% C$mm $232 $336 $414 $648 $752 $856 $960 IRR % 16 20 23 31 34 37 40 Payback of Initial Years 4.3 3.8 3.5 2.8 2.6 2.4 2.2 Capex * PEA
Slide 10: Large & Growing Gold Resource
Large & Growing Gold Resource M&I Gold Ounces* 4.5 4.0 Million Ounces 3.5 3.0 2.5 2.0 1.5 1.0 0.5 - 2008 2009 2011 2012 2014 2017 2019 Year of Resource Estimate * At economic cut-off grade TSX-V: SPA | OTC : SPAZF 10
Slide 11: Planned Project Activities
Planned Project Activities 2021 2020 Activity Q1 Q2 Q3 Q4 Engineering field work Resource drilling campaign Preliminary feasibility study Resume environmental assessment & permitting Commence full feasibility TSX-V: SPA | OTC : SPAZF 11
Slide 12: Project Timeline
Project Timeline Y-1 Y-2 Y-3 Y-4 Y-5 PFS/ feasibility study Timeline re-start permitting to Production project finance construction TSX-V: SPA | OTC : SPAZF 12
Slide 13: Summary—"ticking all the boxes"
Summary—“ticking all the boxes” Jurisdiction/ Location Mining friendly/ excellent access & infrastructure Large Resource > 4 Moz M&I & growing + Inferred • No need for resource drilling & upgrade Accelerated Timeline • Detailed work completed (environmental baseline; metallurgical; archaeologi
Slide 14: Opportunity—same strategy delivering more potential
Opportunity—same strategy delivering more potential Potential Benefits EXPANDED Further improve economics Phase 1 Enhance key project metrics (under investigation) Delivered within the same compressed timeline TSX-V: SPA | OTC : SPAZF 14
Slide 15: More about the Project…
More about the Project… Location De-risking Activities Resource TSX-V: SPA | OTC : SPAZF 15
Slide 16: British Columbia: Favourable Mining Jurisdiction
British Columbia : Favourable Mining Jurisdiction Cheap grid power – 6.5¢/kWh Among lowest corporate tax rates in Canada Low Cost Refundable Mineral Exploration Tax Credit (made permanent in 2019) Barkerville Gold Mines by Osisko G&R for C$ 338 M Attracting Major 70% of Red Chris Mine by N
Slide 17: Project Location
Project Location Pro-mining Jurisdiction Low political risks/ strong resource sector Attracted major in-bound investments in recent years Solid track record of new mine permitting Excellent Mining Infrastructure Close to producing mines – Gibraltar, QR Mine & Mount Polley Paved highway acc
Slide 18: Advance Stage Project
Advance Stage Project Over $80m in total project expenditures 900+ drill holes over 180,000 metres Multiple scoping studies completed to Extensive Project maximize project economics/ Highly scalable Work Completed in project Multiple Areas Environmental baseline study completed and permittin
Slide 19: High Confidence in Metallurgical Recovery
High Confidence in Metallurgical Recovery Detailed confirmatory testwork completed Simple metallurgy and flowsheet Efficient conventional milling – coarse grind, low power cost and reagent consumption Overall gold recovery at 91% Crush & Grind Flotation Regrind CIL Location De-risking Activi
Slide 20: Environmental & Permitting
Environmental & Permitting Protocol Agreements signed with all three First Nations bands providing a framework towards Impact Benefits Community Agreements Engagement Long-standing practice of sourcing employees from First Nations and local communities Archaeological clearance obtained for the
Slide 21: Resource Estimate—Phase 1 vs. Total
Resource Estimate*—Phase 1 vs. Total Phase 1 processes only a portion (~25%) of M&I resource: 39 million tonnes @ 1.00 g/t = 1,258,000 ounces Tonnes Gold grade Gold Resource Category (Million) (g/t) (Million oz) Measured 30 0.60 0.6 Indicated 244 0.46 3.6 M&I Total 273 0.47 4.1 Inferred 53 0.37 0.6
Slide 22: Large and Growing Mineral Resource
Mineral Resource Large and Growing Ensure long-life operations to ride out price cycles Completed various scoping studies supporting potential viability at different throughput: Development 40,000 tpd Flexibility 20,000 tpd 10,000 tpd Additional Only 30% of M&I ounces are captured by Pha
Slide 23: Exploration Potential—Phoenix Zone
Exploration Potential—Phoenix Zone Strike length over 3.5km in length & less than 2km from the Main Zone Preliminary metallurgical testing suggests material is amenable to same processing flowsheet as Main Zone Location De-risking Activities Resource TSX-V: SPA | OTC : SPAZF 23
Slide 24: Capital Structure
Capital Structure CASH & CAPITAL STRUCTURE 18%* Net Cash $15 million 52% 30% Shares Issued and 313 million Outstanding Warrants 85 million Retail Institutional (Eric Sprott 16%; Others 14%) Options 9 million Management Market Capitalization $180 million TSX-V: SPA | OTC : SPAZF 24
Slide 25: Experienced Management & High Calibre Board
Experienced Management & High Calibre Board Industry & Business Management Experience Larry Yau >30 yrs CEO Sharon Ng >20 yrs CFO Judy Stoeterau >30 yrs VP Geology Board of Directors Morris Beattie >45 yrs Chairman Full biography at: Sara Heston >15 yrs www.spanishmountaingold.com W. Terry Maclean
Slide 26: Contact Information
Contact Information Spanish Mountain Gold Ltd. 1120-1095 West Pender St. Vancouver, B.C., V6E 2M6 Canada www.spanishmountaingold.com Larry Yau, CEO Tel: +1 (604) 601-3651 Email: info@spanishmountaingold.com or Corporate Communications Tel:+1 (604) 398-4377 TSX-V: SPA | OTC : SPAZF 26
Slide 27: Phase 1 Operations: well below average AISC per oz
Appendix 1 Phase 1 Operations : well below average AISC per oz $1,200 $1,000 $1,058 $944 $897 AISC per oz (US$) $800 LOM Avg: $600 $549/oz Medium Producer Large Producer Small Producer (> 1,000 oz/ yr) (< 200 oz/ yr) (> 200 oz/ yr) $400 vs. Phase I First 5 yr Avg: $519/oz $200 $0 Source: CIBC World
Slide 28: Phase 1 Operations: NPV & IRR
Appendix 2 Phase 1 Operations : NPV & IRR Pre-tax NPV Pre-tax IRR $1,000 50% $900 45% $800 Internal Rate of Return 40% $700 NPV (C$ Million) $600 35% Viable at low $500 gold price 30% $400 25% $300 20% $200 $100 15% $- 10% 1,100 1,200 1,275 1,500 1,600 1,700 1,800 Gold Price (US$) Location De-riskin
Slide 29: Mine Plan—Phase 1
Appendix 3 Mine Plan—Phase 1 Only Measured & Indicated Resource is Processed Unit Amount Dec, 2019 PEA M&I Mill Feed Mt 39 Gold Grade g/t 1.00 Silver Grade g/t 0.74 M&I Gold Ounces Koz 1,258 M&I Silver Ounces Koz 927 TSX-V: SPA | OTC : SPAZF 29
Slide 30: OpCost Profile—Phase 1
Appendix 4 OpCost Profile—Phase 1 Input Costs Mining C$/t mined $2.48 Mining $10.73 Processing $6.14 Tailings C$/t milled $0.16 G&A $2.06 Dec, 2019 PEA Total $19.10 Operations Unit Year 1 – 5 Avg. LOM Avg. Gold Grade g/t 1.13 1.00 Recovery % 91 91 Annual Gold Production Koz 116 104 Cash Cost / oz US
Slide 31: Initial Capex—Phase 1
Appendix 5 Initial Capex—Phase 1 C$ m Direct Site & Infrastructure $47.8 Mining $70.2 Processing Plant (including ore handling) $77.4 Dec, 2019 PEA Tailing Management Facility & Water Management $46.7 Environmental $12.0 Sub-total $254.1 Indirect Project Indirect & Owner’s Cost $68.2 Contingencies $