Mcewen Inc. · NYSE:MUX
Mcewen — U S Gold — Merger or Acquisition (January 2012)
35 slides from Mcewen's merger presentation, Jan 11, 2012
Slide 1: The Next Mid-Tier Silver Producer
+ SHAREHOLDERS OF US GOLD AND MINERA ANDES ARE URGED TO READ THE DEFINITIVE PROXY STATEMENT AND MANAGEMENT INFORMATION CIRCULAR, RESPECTIVELY, AS WELL AS ANY OTHER RELEVANT MATERIALS FILED UNDER US GOLD AND MINERA ANDES’ PROFILES ON EDGAR AND SEDAR, CAREFULLY AND IN THEIR ENTIRETY BEFORE MAKING ANY
Slide 2: Forward Looking Statements
Forward Looking Statements Certain statements contained herein and subsequent oral statement made by or on behalf of US Gold or Minera Andes may contain “forward looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements and informa
Slide 3: Last Day to Vote / Meeting Date
LAST DAY TO VOTE Jan 19, 2012 MEETING DATE Jan 19, 2012
Slide 4: Transaction Rationale
Transaction Rationale Production Growth Positive Cash Flow Low Production Cost Country Diversification Major US Listing *See note 2
Slide 5: Goal: Qualify for S&P 2015
Goal: Qualify for S&P 2015 1. US Company 2. Public Float > 50% 3. Liquidity Threshold 4. Sector Representation 5. US Listing 6. Market Cap. > $5 B 7. 4 Qtrs Positive Earnings Requirements *See note 3
Slide 6: Focused in the Americas
Gold Bar Project Gold - Development Los Azules Copper / Gold / Silver El Gallo Complex Silver / Gold - Development San José Mine Silver / Gold - Production Focused in the Americas
Slide 7: McEwen Mining Resource Estimates
McEwen Mining Resource Estimates* NI 43-101 5.3 M oz 1.2 M oz 70 M oz 86.4 M oz Silver M&I Inferred Gold M&I Inferred Copper Indicated Inferred 2.2 B lbs 10.3 B lbs *See note 15
Slide 8: San José Mine - Argentina
San José Mine - Argentina Production
Slide 9: San José Mine – Argentina
San José Mine – Argentina 2012 Silver Production Estimate* (49%) 2.6 MM oz Silver Industry low cost (-$0.35 / Silver oz) Resource* (49%) M&I 22.8 MM oz Silver Inferred 17.5 MM oz Silver Close to Goldcorp’s Cerro Negro Project *See note 4
Slide 10: Well Positioned – Argentina
Well Positioned – Argentina McEwen Mining (49%) San José Mine * McEwen Mining (100%)* Goldcorp paid $3.6 Billion* *See note 5
Slide 11: El Gallo Complex: Construction
H Gallo Complex: Te Construction. 5 cla : %
Slide 12: El Gallo Complex – Mexico Phase 2 Development
El Gallo Complex – Mexico 2 Phase Development* Resource update Q2 2012 - 125,000 m of drilling completed since last update Q4 2010 Feasibility & permit submittal Q3 2012 Production est. Q2 2014 5 MM oz Silver + 40,000 oz Gold / year Cash cost: $1-2 / Silver oz Capex: $165 Million *See note 7
Slide 13: El Gallo Complex – Mexico Phase 1
El Gallo Complex – Mexico Phase 1* Construction underway - Capex estimate $15 Million Production Q2 2012 30,000 oz Gold / year Cash flow to help fund Phase 2 *See note 6
Slide 14: Mill (5,000 tpd) Heap Leach Dry Tailings Waste Material Silver Deposit (1:1 Strip Ratio)
Mill (5,000 tpd) Heap Leach Dry Tailings Waste Material Silver Deposit (1:1 Strip Ratio) 14
Slide 15: Resource growth since last update
1000 500 0 Silver – Million oz Gold – Thousand oz 60 50 40 30 20 10 0 Jan 2010 Jul 2010 Nov 2010 Silver Measured & Indicated Inferred Gold Measured & Indicated Inferred 125,000 m Drilled Since Last Update *See note 7
Slide 16: El Gallo Complex – Location of Veins
El Gallo Complex – Location of Veins* 500,000 acres *See note 8
Slide 17: Gallo — 2011 Exploration Results
[Gallo — 2011 Exploration Result: Palmarito N : 458 gpt Ag/8m 263 gpt Ag/7m])) ae 7 638 gpt Ag / 3 mpg go — 126 gpt Ag / 25 m) = ee a _ 384 gpt Ag/5m jes ale : Pa gpt Ag/9m iS 2 pe : i 238 gpt Ag/12mE, x. ee 3 7 ‘= se : a : Po 2
Slide 18: El Gallo Complex – New Discoveries
El Gallo Complex – 2 New Discoveries Near Surface Potential 1.6 gpt Au, 81 gpt Ag / 19 m 1.1 gpt Au, 40 gpt Ag / 24 m 1.9 gpt Au, 67 gpt Ag / 20 m 1.2 gpt Au, 32 gpt Ag / 27 m 2.0 gpt Au, 44 gpt Ag / 15 m Near Surface Potential 2.1 gpt Au / 29 m 1.8 gpt Au / 19 m 3.2 gpt Au / 14 m 1.2 gpt Au / 20 m
Slide 19: Gold Bar - Nevada
Gold Bar - Nevatla Pre-feasihitity Study,
Slide 20: Cortez Trend - Nevada
Cortez Trend - Nevada *See note 10
Slide 21: Gold Bar Project - Nevada Pre-feasibility Study
Gold Bar Project - Nevada Pre-feasibility Study (Nov 2011)* 50,000 oz Gold / year (Oxide) 8 Year mine life Capex $55 MM ($17 MM contingency) Cash cost projected $665 / oz Gold Permit submittal expected by March 2012 *See note 11
Slide 22: Los Azules - Argentina
los Aziles - Argentina One of the World's largest Undeveloned Copper Deposits aes
Slide 23: Los Azules – Argentina 2010 Resource Estimate
Resources (tonnes) Cu (%) Au (gpt) Ag (gpt) Copper (B lbs) Gold (‘000 oz) Silver ( MM oz) Category Indicated Inferred 137 MM 900 MM 0.73 0.52 0.07 0.07 1.7 1.7 Los Azules – Argentina 2010 Resource Estimate NI 43-101 * 2.2 10.3 310 2,000 7.5 49.2 *See note 12
Slide 24: PEA Study (June 2010) – Los Azules
PEA Study (June 2010)* 100,000 TPD ore production LOM average 375 million lbs Cu/year Capex $2.9 Billion Cash Operating Cost $0.96/lb Payback in 3 years @ $3/lb 25 year Mine Life Los Azules – Argentina *See note 12
Slide 25: Los Azules Exploration
Los Azules Exploration* Expected to Start Q1 2012 *See note 13
Slide 26: 2012 Exploration
2012 Exploration* Expected to Start Q1 2012 *See note 13
Slide 27: CEO Ownership – Increased Focus
McEwen Mining First Majestic Silvercorp Hecla Coeur D’Alene Pan American Silver Standard $250 M $54 M $35 M $5 M $1 M $1 M $0 M CEO Ownership* Increased Focus *See note 15
Slide 28: Transaction Details
Transaction Details Proposed Corporate Name: Exchange / Ticker: Share Exchange Ratio: Pro-forma Market Cap*: Pro-forma Shares Outstanding: Pro-forma Rob McEwen Ownership: Pro-forma Balance Sheet: Shareholder Vote: McEwen Mining Inc. NYSE & TSX / Ticker MUX 1:0.45 Minera to US Gold US $1 Billion 267.
Slide 29: Contact Information
Contact Information Jenya Meshcheryakova Investor Relations T: 1.866.441.0690 E: info@usgold.com / info@minandes.com 181 Bay Street Bay Wellington Tower Suite 4750 P.O. Box 792 Toronto, ON M5J 2T3
Slide 30: Cautionary Note to U.S. Investors
CAUTIONARY NOTE TO U.S. INVESTORS - INFORMATION CONCERNING PREPARATION OF RESOURCE AND RESERVE ESTIMATES US Gold and Minera Andes are required to prepare reports under the Canadian Securities Administrators’ National Instrument 43-101 “Standards of Disclosure for Mineral Projects” (“NI 43-101”) unde
Slide 31: Canadian regulations on disclosure of resources
Canadian regulations permit the disclosure of resources in terms of “contained ounces” provided that the tonnes and grade for each resource are also disclosed; however, the SEC only permits issuers to report “mineralized material” in tonnage and average grade without reference to contained ounces. U
Slide 32: Notes
Notes Note 1: US Gold Proxy Statement dated December 13, 2011, page 70-71. Note 2: US Gold’s news release titled “Rob McEwen Proposes Merger of US Gold and Minera Andes: Creating a High Growth, Low-Cost, Mid-Tier Silver Producer Focused in the Americas” dated June 14, 2011. Note 3: US Gold Euro Paci
Slide 33: Notes 9 onward
Note 9: San Dimas project information was derived from US Gold’s news release titled “New Gold-Silver Discovery at the El Gallo Complex” released October 27, 2011. Mina Grande project information was derived from US Gold’s news release titled “El Gallo Complex Regional Drill Results Gearing Up for t
Slide 34: Note 14: Combined resources
Note 14: Combined resources calculated using the following. San Jose Mine (49%) (MAI) (1) Tonnes (MM*) (100%) Ag Grade (g/t) Au Grade (g/t) Ag (MMoz*) (100%) Au (MMoz*)(100%) Proven 0.7 511 7.26 10.6 0.14 Probable 0.75 394 5.45 8.6 0.12 Measured (inclusive of P+P) 1 570 8.1 16.6 0.23 Indicated (incl
Slide 35: Note (cont’d)
Note 14 (cont’d) Limo (UXG) (5) Tonnes (MM*) (100%) Ag Grade (g/t) Au Grade (g/t) Ag(MMoz*) (100%) Au(MMoz*)(100%) Measured 5.9 0.89 0.17 Indicated 3.7 0.61 0.07 Inferred 2.2 0.7 0.05 MM= millions Los Azules (MAI) (6) Tonnes (MM) Cu Grade (%) Au Grade (g/t) Ag Grade (g/t) Cu (B lbs) Indicated 137 0.