Mcewen Inc. · NYSE:MUX
Mcewen — McEwen Mining — Spring Mining Conference April 2021
43 slides from Mcewen's conference presentation, Apr 21, 2021
Slide 1: Gaining Momentum
YSE & TSX r N Gold // Coppe Gaining Momentum Spring Mining Conference April 2021 All figures in US Dollar
Slide 2: Cautionary Statement
MUX MUX: Cautionary Statement Executive Summary: If you are risk-averse, don’t buy our shares. Past performance is unreliable in predicting the future. Unexpected events do happen and will change forecasts.
Slide 3: MUX performance vs gold, silver and copper
160% 140 120 100 80 Silver 106% MUX 105% Copper 90% 60 40 20Gold 19% Mar-20 -20 May-20Jul-20Sep-20Nov-20Jan-21Mar-21 MUX Source: Bloomberg. From Mar 20, 2020 to Apr 16, 2021.
Slide 4: MUX vs GDXJ Relative Performance: Closing The Gap
100% 80 60 40 20 0 MUX vs GDXJ Relative Performance Apr 2018 – Apr 2021 Closing The Gap Potential MUX $3.00 -20 -40 -60 -80 MUX GDXJ MUX Outperformance MUX Underperformance $1.19 Current MUX 2018201920202021 MUX Source: Bloomberg. Weekly performance, from Apr 13, 2018 to Apr 16, 2021.
Slide 5: Daylighting Value from Copper & Silver
N Gold // Coppe Daylighting Value from Copper & Silv YSE & TSX r
Slide 6: MUX: Diversified Portfolio
MUX: Diversified Portfolio Mines Gold Black Fox Gold Bar El Gallo Gold & Silver San Jose Mexico Ontario Nevada Development Pipeline Gold Froome Grey Fox Stock Gold & Silver Fenix Argentina Copper Los Azules MUX
Slide 7: MUX's Big Exposure to Copper: Los Azules
MUX’s Big Exposure to Copper Los Azules: Large Copper Deposit Highlights of Drill Assays 221 m @ 1.62% Cu 240 m @ 0.94% Cu 200 m @ 0.89% Cu m @ 0.77% Cu m @ 0.63% Cu 429 m @ 0.75% Cu Los Azules Argentina Ore tonnes Copper lbs Gold oz Silver oz Indicated962 Million10.2 Billion @ 0.48% 1.7 Million @ 0
Slide 8: Leverage to Copper @ $4.30/lb
Leverage to Copper @ $4.30/ lb MUX has it BIG! Sensitivity of Los Azules’ NPV @ 8% discount $6Cu Price $5 Au Price Billions Ag Price $3 Grade $2 CAPEX $1 OPEX OPEX - Mining -40%-20%100%+20%+40% $1.80$2.40$3.00$3.60$4.20 Change from Base Case (%) Copper Price ($/ lb) Postproduction decision OPEX - Pr
Slide 9: Los Azules IRR Sensitivity to Copper Price
Los Azules IRR Sensitivity to Copper Price 35% 30% 25% 20% IRR 20.1% 25.1% 29.8% 33.6% 15% 10% 7.2% 5% 0% 14.3% @$4.30 lb Cu $2.00$2.50$3.00$3.50$4.00$4.50 Copper Price ($/ lb) MUX IRR presented is After-Tax. Oct 16, 2017 - “NI 43-101 Technical Report-Preliminary Economic Assessment Update for the L
Slide 10: Los Azules Preliminary Economic Analysis
Los Azules – Preliminary Economic Analysis Robust Economics @ $3/lb Copper Highlights of the 2017 PEA (Hatch) Average annual production 1st 13 Years Mine life Initial capex Payback After-tax IRR After-tax NPV @ 8% 415 Million lbs Cu @ $1.14/ lb cash cost + Au & Ag credits 36 years $2.4 Billion 3.6 y
Slide 11: A Potential McEwen Silver Spin Out
63.7 A Potential McEwen Silver Spin Out 2020 Production (Moz AgEq) MUX Silver will be among top silver-focused producers during its Phase 2 production schedule at El Gallo/ Fenix 19.1 14.7 10.1107.5 5.6 PanFirst MajesticFortunaMcEwenSilver CorpMcEwenEndeavourMcEwenSilver BearExcellon AmericanSilverS
Slide 12: Recent progress and priorities
A Potential McEwen Silver Spin Out 2020 Production (Moz AgEq) New Senior Management @ Head Office & Mine Sites Improved Balance Sheet, Debt Extended, Equity Raised Increasing Gold Production Extending Life of Mines – Mexico, Nevada, Timmins Aggressive Exploration Programs in Canada & Nevada Moving t
Slide 13: Management team
Rob McEwen Chairman & Chief Owner Rob has $1/ year salary, has invested $165 million in McEwen Mining and owns 18% of the company’s outstanding shares. He is the founder of Goldcorp, was awarded the 2001 PDAC Developer of the Year, the Order of Canada, and was inducted into The Anna Ladd-Kruger CFO
Slide 14: 2020 results highlights
114,800 GEO actual production Consolidated net loss $152.3 M relates primarily to: $27.5 M advanced projects & exploration $27 M gross loss of operations $9 M in G&A $83.8 M in Gold Bar impairment Removed going concern note Debt facility extension from Aug 2021 to Aug 2023 Remain in full compliance
Slide 15: Q1 2021 Production & 2021 Guidance
Q1 2021 Production & 2021 Guidance 2021 Production Expected To Be 23 - 40% Higher Than 2020 Gold Bar Mine, Nevada GEO 7,400 37,000 -45,000 Black Fox Mine, Canada GEO 5,200 27,500 -32,500 El Gallo Mine, Mexico GEO 1,300 4,500 -5,900 MUX GEO – gold equivalent ounces. 2021 production guidance - Feb 2,
Slide 16: Q1 production and liquidity
Q1 production 30,600 GEOs vs Q1 2020 35,100 GEOs Current liquid assets1: $47 M MSC (San José mine) dividend payments $5 M in Q1 2021 Raised ~$44 M in gross proceeds subsequent to year-end 2021 programs fully funded - Froome development project, US exploration & business investments $20 M flow-throug
Slide 17: Share structure and top holders
Shares Stock Ownership Top 10 Holders 3 Outstanding : 459 M Fully Diluted : 495 M ADTV 2 : 8.1 M Price : US$1.19 Market Cap : US$546 M Retail 63% Rob McEwen 18% Institutional 19% Rob McEwen 82.2 M Van Eck Associates 19.5 M Weiss Asset Management 14.0 M BlackRock 7.3 M Mirae Asset Global Investments
Slide 18: Development and exploration plans by asset
Fox ComplexFroome expands Black Fox production by 2.5 yrs Commercial production scheduled Q4 2021 PEA expansion study Q2 2021 $ 9M exploration program 2021 Gold BarUpdated feasibility study 300 Koz Au Recoverable 6-year mine life $5 M exploration program 2021 MUX El GalloFenix gold & silver project
Slide 19: Cortez & Gold Bar: Underexplored With Upside Potential
Criteria Cortez & Gold Bar Large footprint, shallow oxide gold x Host rock, alteration, mineralization style x Major faults, structural traps x Intrusions x Cortez Fourmile Discovery Goldrush Nevada Gold Mines Cortez 50 Moz Au cluster1 Gold Bar Nevada, USA Underexplored, With Upside Potential Surfac
Slide 20: North Ridge Drill Results
North Ridge Drill Results •21.3 m @ 3.07 gpt Au (11.6 to 32.9 m) •22.0 m @ 4.51 gpt Au (42.0 to 64.0 m) including 4.6 m @ 15.47 gpt Au (44.5 to 49.1 m) R Pick Cabin Legend G Near mine targets Brownfield Greenfield 012 MUX Near Mine Resource Expansion Brownfields Known Mineralized/ Altered Areas Gree
Slide 21: Fox Complex Gold Resources
Fox Complex Gold Resources 2,960,000 oz Measured & Indicated & 1,150,000 oz Inferred Destor-Porcupine Fault Zone Trans-Canada Hwy Fox - Stock Mine & Mill 20 Miles (32 km)Froome Grey Fox red Black Fox Mine Timmins Fox - Lexam 28 Miles (45 km) 121,000 oz Au M&I & 8,000 oz Au Inf 1,370,000 oz Au M&I &
Slide 22: Fox Complex: Upside Potential
Fox Complex: Upside Potential Room to Grow Along Strike and at Depth Red Lake Timmins Kirkland Lake Stock / Black Fox Surface 1,000m 2,000m 3,300ft 6,600ft Ore BodiesHeadframe/ Shaft McEwen Mineralization Zone Outlines Stock West 6.7 g/t Au / 39m Stock Mine 27.2 g/t Au / 7m incl. 120 g/t Au / 1.6m S
Slide 23: Black Fox Mine, Froome & Grey Fox Deposits
Fox Complex: Black Fox Mine, Froome & Grey Fox Deposits Black Fox Mine Grey Fox 888,000 oz Indicated @ 7.1 g/t Au 173,000 oz Inferred @ 6.6 g/t Au Froome 181,000 oz Indicated @ 5.1 g/t Au 1.2 miles 2 kmN MUX Please see Appendix for more details.
Slide 24: Froome on Target for Q4 Commercial Production
Froome on Target for Q4 Commercial Production Froome Expected to Be Better than Black Fox: Shallower deposit, suited for low cost, productive ‘bulk mining’ at pit level Wide disseminated style mineralization, more consistent grades and continuity Wider mining widths ranging from 15-40 m for most of
Slide 25: Grey Fox Priority Target
A Grey Fox Priority Target Drill HoleGrade (g/t Au) Width (m) Grade (g/t Au) Width (m) GxW Surface 0 - Whiskey Jack Long Section Looking North Near Surface, Good Grades Model Grades > 5 g/t Au – 5 g/t Au 4 Open 19GF-13202.0511.0incl.5.301.6 22.6 19GF-13132.0611.0incl.6.951.0 22.7 19GF-12935.824.4 25
Slide 26: Stock West
Historical grades processed @ Stock +5 g/t Au Stream-free land package Proximal to the mill – near surface Large mineralized intersections @ Stock West lend to potential for efficient bulk mining methods Dewatering of shaft to begin H2 2021 Stock West Stock Mine 137 Koz Au historic production Stock
Slide 27: Stock West longitudinal section
Stock West Stock Mine 137 Koz Au historic productionStock East Surface -500m Gold Grade x Widt (g/t x m) >100 50 to 100 25 to 50 10 to 25 5 to 10 h -1000m MUX Longitudinal Section Looking North
Slide 28: San José - One of the Highest Grade Mines in the Americas
San José - One of the Highest Grades Mines in the Americas (49% Owned) Large Property High Grade Mine Surrounds Newmont San José Mine Property outline San José Argentina Reserve Grade 1459 gpt Silver 7.3 gpt Gold Mine Life 25 Years 2021E Production 3,42.30 - 2.45 Moz Silver & 41.5 - 44.5 Koz Gold Ne
Slide 29: 2021 Exploration Budget - $9.3 Million
2021 Exploration Budget - $9.3 Million High grade areas close to mine: Isabel & Luisa veins Continuing areas: Telken, Saavedra & Aguas Vivas Aguas Vivas Saavedra San José Argentina Telken North Recent Near Mine Results 1.3 m @ 13.80 g/t Au & 3,149 g/t Ag 1.6 m @ 5.60 g/t Au & 648 g/t Ag 0.9 m @ 2.20
Slide 30: Upcoming catalysts
Fox Complex Expansion PEA Q2 Exploration Results Froome Commercial Production Q4 MUX
Slide 31: Motivated, United, Exceptional
Motivated United X ceptional
Slide 32: Appendix
Appendix
Slide 33: Project Fenix Feasibility Study
Project Fenix Feasibility Study* Phase 1, Years 1 - 6 Gold Production Phase 2, Years 7 - 9.5 Silver Production Fenix Sinaloa Mexico Avg Annual Production26 Koz Au4.5 Moz AgEq Capex$42 M Initial$24 M Year 6 Cash Costs$1,037/ oz Au$14.22/ oz AuEq AISC$1,045/ozAu$14.30/ oz AuEq Base Case $1,500/oz Au $
Slide 34: Stock West Drill Results
Stock West Drill Results - Strong, Consistent Mineralized Intercepts 21.40 g/t Visible Gold (VG) 5.63 g/t Au over 30.0 m MUX Drill core from hole S19-98.
Slide 35: Fox Complex Expansion Strategy
Fox Complex Expansion Strategy 1 Production Growth Steps to Target 100-150 Koz / Yr Leveraging Stock Mill Capacity Step 1. FroomeCommercial production Q4 2021 Bridging gold production for the next 2-3 years Step 2. Grey FoxGrow scale & increase Life of Mine; PEA Q2 2021 Gibson & Whiskey Jack drillin
Slide 36: Froome Deposit – Better Mining Conditions Than Black Fox
Froome Deposit – Better Mining Conditions Than Black Fox Shown below is a core interval of the wide zone - consistent grades and favorable ground conditions expected, providing for overall better mining conditions, compared to Black Fox’s nuggety style mineralization. From 127 m: 4.55 g/t Au over 53
Slide 37: Grey Fox 2019-2020 Exploration Highlights
Fox Complex: Grey Fox 2019-2020 Exploration Highlights From Multiple Zones of Near Surface Mineralization MUX Width (m) = down hole intersection, drill results using cut-off grade 1 gpt Au. All assays are uncapped.
Slide 38: Fox Complex Drill Results @ Stock West
Fox Complex Drill Results @ Stock West 494.0m 475.0m Length Au g/t Cog 1 Cog 3 1.0 1.15 7.72g/t Au / 25m 1.0 0.12 1.0 0.81 1.0 3.36 11.24g/t Au / 16.2m 1.0 1.27 1.0 0.65 1.0 11.60 1.0 6.04 1.0 10.70 1.0 10.35 1.0 16.90 1.0 12.60 1.0 13.65 1.0 26.80 1.0 21.40 1.0 9.48 1.0 13.85 1.0 13.05 1.0 8.70 1.0
Slide 39: San José Mine Vein Extensions
San José Mine Vein Extensions 1.0 m @ 7.02 g/t Au, 811 g/t Ag 1 km / 0.6 MilesN 1.0 m @ 2.38 g/t Au, 1,964 g/t Ag 0.7 m @ 0.30 g/t Au, 18 g/t Ag Micaela Kospi Odin Maia 1.0 m @ 20.26 g/t Au, 461 g/t Ag 1.3 m @ 6.67 g/t Au, 762 g/t Ag 1.2 m @ 5.80 g/t Au, 197 g/t Ag 0.9 m @ 8.00 g/t Au, 397 g/t Ag 1.
Slide 40: Attributable Gold and Silver Reserves
Attributable Gold Reserves ProvenProbableProven + Probable 43-101 Au ReservesTonnes Grams per Contained Metal Tonnes Grams per Contained Metal Tonnes Grams per Contained Metal (millions)tonne(Koz)(millions)tonne(Koz)(millions)tonne(Koz) Attributable Silver Reserves ProvenProbableProven + Probable 43
Slide 41: Attributable Gold Resources
Attributable Gold Resources MeasuredIndicatedMeasured + IndicatedInferred 43-101 Au ResourcesTonnes (millions) Grams per tonne Contained Metal (Koz) Tonnes (millions) Grams per tonne Contained Metal (Koz) Tonnes (millions) Grams per tonne Contained Metal (Koz) Tonnes (millions) Grams per tonne Conta
Slide 42: Attributable Silver and Copper Resources
Attributable Silver Resources MeasuredIndicatedMeasured + IndicatedInferred Attributable Copper Resources Measured Indicated Measured + Indicated Inferred 43-101 Cu ResourcesT (m onnes% Cu illions) Tonnes% CuPounds (millions)(millions TonnesPoundsTonnes )(millions)% Cu(millions)(millions)% Cu Los Az
Slide 43: Non-GAAP measures
In this presentation, we have provided information prepared or calculated according to U.S. GAAP, as well as provided some non-U.S. GAAP ("non-GAAP") performance measures. Because the non-GAAP performance measures do not have any standardized meaning prescribed by U.S. GAAP, they may not be comparab