Arizona Sonoran Copper Co., Inc.
Arizona Sonoran Copper — Investor Presentation (October 2022)
48 slides from Arizona Sonoran Copper's investor presentation, October 2022
Slide 1: Corporate Presentation – October 2022
ASCU:TSX ASCUF:OTCQX Corporate Presentation – October 2022 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 Rio Tinto Retail 7% 19% Market Capitalization (M) C$135M Management Shares Outstanding (M) 88.7 6% Tembo 35% Warrants (M) 6.6 Other Options (M) 2.9 6% RSU’s (M)(1) 0.3 Insitutional DSU’s (M) 0.4 27% Fully Diluted Share Capital (M) 98.9 Includ
Slide 4: ASCU – Doubled Global Copper Resource with new Parks/Salyer Estimate
ASCU – Doubled Global Copper Resource with new Parks/Salyer Estimate Brownfield Exploration and Development Private Landownership = Project in Tier 1 Jurisdiction Lower risk permitting process • 100% ownership, Arizona-based past producing mine (1974- • Streamlined State-and-County led permitting fr
Slide 5: Located at the Intersection of Arizona’s Three Copper Porphyry Belts
Located at the Intersection of Arizona’s Three Copper Porphyry Belts Accessible Infrastructure and Ready Labour-force Arizona is the USA's leading copper-producing state which accounted for 71% of domestic output of copper in 2021(1) Cactus Project and Parks/ Salyer Deposit Santa Cruz Arizona ranked
Slide 6: Growing into a Significant Independent Contributor to US Copper
Growing into a Significant Independent Contributor to US Copper Increasing the Mineral Resource Base Significant Independent US Copper Projects 7000 $0.025 Global Copper Inventory (Mtonnes) Global Copper Inventory (Mlbs) Discovery Cost Per Pound 6000 $0.020 5000 0.2 $0.015 2.3 4000 4902 3000 $0.010
Slide 7: Cactus Site – Infrastructure, permits and a significant resource
Cactus Site – Infrastructure, permits and a significant resource A Low-Risk Development Opportunity in a World Class District ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM 7
Slide 8: Key Permits in Place – Streamlined Process with Definitive Timelines
Key Permits in Place – Streamlined Process with Definitive Timelines Derisked Project Development Permit Permit Office Status Air Quality Permit Pinal County Complete (annual renewal) Arizona Pollution Discharge Elimination System (402) – Cactus ADEQ Complete Arizona Pollution Discharge Elimination
Slide 9: Multi-Billion Pound Mineral Resource – In a World Class Mining District
Multi-Billion Pound Mineral Resource – In a World Class Mining District GLOBAL MINERAL RESOURCE Indicated Resource– 1,610,700 k lbs 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 Type (kt) (%) (%)
Slide 10: Parks/Salyer Sensitivity to the Copper Price
Parks/Salyer Sensitivity to the Copper Price Highly leveraged to the Copper Price Total Leachable Total Material Contained Copper (Blbs) vs Copper Price Price Tonnage TSol Tonnage TSol TSol TCu (M short (Cu (M short (Cu 3.40 3.30 (%) (%) 3.25 ton) Blbs) ton) Blbs) 3.15 3.20 3.05 $3.35 1.13 100.5 2.3
Slide 11: Parks/Salyer Grade Thickness Plan View
Parks/Salyer Grade Thickness Plan View Grade Thickness (GT) Map GT = CuT (%) x vertical thickness of mineralization (ft) Intercepts not drilled to the full extent of the basement fault will under-represent the GT value 1,250 ft (381 m) 2,500 ft (762 m) ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM 11
Slide 12: Building Scale and Potential Pipeline for Future Operations
Building Scale and Potential Pipeline for Future Operations 1 Cactus Mine 2 Parks/Salyer Deposit 3 Primary TM Resources 4 Cactus B’ 18 year mine life Rescoping Cactus to optimize Nuton testwork provides NE Ext a larger scale operation optionality for substantial primary B resource PARKS/SALYER CACTU
Slide 13: Drilling Programs De-risk Future Technical Studies
Drilling Programs De-risk Future Technical Studies PARKS/SALYER CACTUS 250 ft centres (indicated category) 125 ft centres (measured category) • 105,000 ft (24,384 m) • 60,000 ft (18,288 m) - infill drilling • Drilling to be complete by year- • 12,000 ft (3,650 m) - planned expansion end • Drilling t
Slide 14: Leachable Material: Positive Ongoing Metallurgical Testing
LEACHABLE MATERIAL: Positive Ongoing Metallurgical Testing (Bottle Roll / Column Leach) AVERAGE METALLURGICAL PERFORMANCE CRITERIA Simple heap-leach/SXEW process 01 considered for 1.3 billion pounds of leachable copper (LOM) Preliminary Column Tests (PEA) Updated Column Tests 2 years of met test wor
Slide 15: Project Timeline
Project Timeline Brownfield site offers fast track development In process Cactus, P/S 12-18 mos Cactus & P/S & NutonTM* Complete Cactus & P/S NutonTM FS Complete Parks/Salyer TS Results *Commercial Terms Complete Cactus MRE to be negotiated if successful Cactus PEA MRE NEXT STEPS • Ongoing Metallurg
Slide 16: Value Proposition: Reasons How ASCU Outpaces its Peers
Value Proposition: 10 Reasons How ASCU Outpaces its Peers Low-Risk Copper Developer in Top Tier Jurisdiction $0.160 $0.15 $0.15 $0.140 1. Updated large scale mineral resource 2. Water access and permits in place 3. Streamlined permitting process (private land) $0.120 4. No Federal nexus 5. Social li
Slide 17: Benchmarking ASCU to Copper Developers
Benchmarking ASCU to Copper Developers Market Capitalization (US$M) $112M $1.0B $452M $1.5B $201M $393M $245M $187M $96M $42M $42M Cactus / Parks Santa Cruz / Cu Creek / Asset Name McIlvenna Bay Filo del Sol Marimaca Kay Los Helados Casino Arctic Copperwood Salyer Tintic Contact Cu Economic Study Le
Slide 18: Copper Development Peers (P/NAV)
Copper Development Peers (P/NAV) 0.80x 0.70x 0.67x 0.60x 0.51x 0.50x 0.50x 0.49x 0.45x Peer Average: 0.42x P/NAV 0.40x 0.40x 0.37x 0.30x 0.24x 0.20x 0.15x 0.10x 0.00x FOM IE FIL NGEX MARI AMC ASCU TMQ FDY Source: Company Filings, Haywood Securities, Capital IQ, September 26, 2022 ASCU:TSX | ASCUF:OT
Slide 19: Key Investment Highlights
Key Investment Highlights • Our Core Values Are Supported by an ESG Framework • Copper Market Fundamentals Are Strong • Mature Capital Structure • Experienced Leadership Team and Board with a Proven Track Record • Brownfield, Scalable Development Project in Tier 1 Jurisdiction • Large scale mineral
Slide 20: Investor Relations Contact
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 21: Appendix
Appendix ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM 21
Slide 22: 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 23: Management Team with Proven Track Record
Management Team with Proven Track Record 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 of man
Slide 24: 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 25: Robust PEA Base Case Project Economics
Robust PEA Base Case Project Economics KEY PROJECT METRICS (1)(2) Over LOM Mine Life ~1B lbs of Cu over 18 years Average Production 28 ktpa (56Mlbs); Peaks at 40 ktpa (80Mlbs) Operating Costs • Avg OPEX over LOM (US$/t milled) • US$9.06/ton • Avg C1 Cost over LOM (US$/lb) • US$1.55/lb • Avg AISC ove
Slide 26: 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 27: Cactus Site – Brownfield Advantage with Ready Access to Infrastructure
Cactus Site – Brownfield Advantage with Ready Access to Infrastructure Powerline and onsite substation connected to Arizona Public Service Electric Historic data, core shack, maps etc. Power substation Vent raise and u/g development to historic orebody Rail spur (to ship concentrate to refinery) Sha
Slide 28: 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 28
Slide 29: 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 30: Parks/Salyer: Potential UG Deposit for Cactus Expansion
Parks/Salyer: Potential UG Deposit for Cactus Expansion ▪ 24 hole exploration drill program completed 500 ft centres may be used to calculate an inferred copper resource ▪ New 105,000 ft (32,000 m) infill drilling program underway 250 ft centres may be used to update potential resources to the indic
Slide 31: Parks/Salyer Plan View – Large Porphyry Copper Footprint
Parks/Salyer Plan View – Large Porphyry Copper Footprint A’ S-158 ECP-077 ECP-081 ECP-071 ECP-087 Extended 500 ft ECP-096 ECP-075 ECP-074 ECP-057 ECP-045 ECP-083 ECP-089 B B’ Extended 1,000 ft ECP-080 ECP-093 ECP-018 ECP-019 ECP-084 ECP-088 ECP-094 Previously Reported B ECP-061 ECP-042 ECP-079 ECP-0
Slide 32: Parks/Salyer Cross Section (Looking West)
Press Release dated August 23, 2022 Parks/Salyer Cross Section (Looking West) A A’ ECP-080 ECP-081 S-201 ECP-065 ECP-074 ARIZONA SONORAN IVANHOE ELECTRIC Conglomerate 253.7 ft @ 1.34% CuT, Fault 1.30% Cu Tsol, 0.011% Mo Leached Incl. 111.2 ft @ 1.79% CuT, 1.75% Cu Tsol, 0.013% Mo 130.0 ft @ 0.74% Cu
Slide 33: Parks/Salyer East-West Cross Section, Looking North
Parks/Salyer East A West Cross Section, Looking North B 3,000 ft | 915 m width B’ ECP-061 ECP-042 ECP-086 ECP-079 ECP-061 ECP-092 ECP-065 ECP-094 131.6 ft @ 1.17% CuT - Ox 1.06% Cu Tsol, 0.004% Mo 474 ft @ 0.89% CuT - Enr Conglomerate ECP-079 0.83% Cu Tsol, 0.026% Mo (Assays Pending) 479 ft @ 1.32%
Slide 34: The Cactus Project: A Low-Risk Growth Opportunity
The Cactus Project: A Low-Risk Growth Opportunity RECENTLY COMPLETED UPCOMING DE-RISKING • Drilling • Project Financing • Strategic Investor (Rio Tinto) Cactus drilling (FS) Subject to PFS and FS • No debt Parks/Salyer drilling (Expl.) outcomes • Permitting • Technical Studies • Construction • Infil
Slide 35: 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 36: Local Support for the Cactus Mine
Local Support for the Cactus Mine Overwhelming support for the Cactus Mine in Casa Grande – economic survey shows $8.5 Billion of indirect and direct revenues to the local community. Probably Support GOP: 93.0% Support 82.6% Dem: 66.7% Support Don't Know, Refused Support PND: 84.4% Support Definitel
Slide 37: Journey Towards Net Zero - Partnership with Minviro
Journey Towards Net Zero - Partnership with Minviro Production and Reporting • Establishing reporting KPIs PFS / FS Construction • Reporting to international • Design parameters used to scope impact standards (e.g. SASB, TCFD) • Investment in low carbon technologies and minimizing • GHG inventory as
Slide 38: Robust Returns from Lowest Capital Intensity vs Peer Group
Robust Returns from Lowest Capital Intensity vs Peer Group PEA CONSTRUCTION CAPEX BREAKDOWN (US$M) Direct & Indirect Leach Pads, SXEW Total Between the PEA and the upcoming Prefeasibility study, Cost Components Ponds & Pipelines Facility Capital Cost Directs Subtotal $18.4 $45.9 $64.3 ASCU has been
Slide 39: Junior Copper Producer Benchmarking (Enterprise Value and Production)
Junior Copper Producer Benchmarking (Enterprise Value and Production) $3,000 200 180 $2,500 160 $2,230 140 $2,000 Annual Production (Mlbs CuEq) 120 EV (US$M) $1,500 Company Goal: 100 Peak PEA Production: 80 $1,000 60 $566 $532 40 $500 $343 $278 20 $177 $81 $0 0 Capstone Copper Taseko Mines Copper Mo
Slide 40: 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 41: 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 Recov
Slide 42: Primary Material: Strategic Investment with Rio Tinto and Nuton
PRIMARY MATERIAL: Strategic Investment with Rio Tinto and NutonTM PARTNERSHIP The aim of the partnership is to unlock the value of primary, chalcopyrite-dominated, sulphide material via deployment of Rio Tinto’s NutonTM technologies and further add to the long-term, large-scale future profile of the
Slide 43: General Site Arrangement
General Site Arrangement Sources/Notes: 3D rendering of Figure 16-10 of Integrated Cactus PEA ASCU:TSX | ASCUF:OTCQX ARIZONASONORAN.COM 43
Slide 44: 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
Slide 45: Strong Copper Market Fundamentals
Strong Copper Market Fundamentals Consistent Rising Demand from Key Sectors Supply Constraints To Meeting Primary Demand in Medium Term 50 Total Copper Consumption Forecast by Industry, 2000-2040 35 45 Base Case Production Capability 40 30 35 25 Primary Demand Copper (Mt) 30 Copper (Mt) 25 20 20 15
Slide 46: Growing Mineral Resource Base
Growing Mineral Resource Base GLOBAL MINERAL RESOURCE DOUBLED THE GLOBAL LEACHABLE INVENTORY Indicated Resource– 1,610,700 k lbs Inferred Resource– 4,894,200 k lbs Tons CuT Tsol Tsol_lb Contained Cu Category Mineralization (kt) (%) (%) (klbs) Tons (kt) Total 73,900 – 0.723 1,065,200 534 INDICATED Le
Slide 47: Mineral Resource Estimate by Material Type
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 48: 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
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