Goldgroup Mining Inc. · TSXV:GORO
Goldgroup Mining — Investor Presentation (May 2012)
30 slides from Goldgroup Mining's investor presentation, May 2012
Slide 1: Goldgroup Mining Inc.
Goldgroup Mining Inc. TSX:GGA ▪ OTC:GGAZF May 2012 www.goldgroupmining.com TSX:GGA • OTC:GGAZF
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT Forward-Looking Statements This presentation contains forward-looking information about Goldgroup within the meaning of the Securities Act (British Columbia). Forward-looking statements relate to future events or future performance and reflect Goldgroup’s expectations regarding
Slide 3: Introduction
INTRODUCTION • Focused on expanding current annual gold production to 100,000+ oz Au • Developing advanced-stage Caballo Blanco open pit heap leach gold project • Highly successful mining and finance management team specializing in operations in Mexico • Cash position: $19 million* • Indicated Resou
Slide 4: Asset Overview
ASSET OVERVIEW • Caballo Blanco – Veracruz, Mexico – Advanced stage open-pit heap leach gold project with estimated annual production of ~100,000+ oz Au • San José de Gracia – Sinaloa, Mexico – High-grade gold resource; advanced stage underground epithermal vein system – 50% interest in DynaResource
Slide 5: Prolific Mining Jurisdiction
PROLIFIC MINING JURISDICTION La Herradura (Penoles/Newmont) Fresnillo Penasquito 6.0M oz AuEq Cerro Colorado Mine (Fresnillo) (Goldcorp) Why Mexico? 15.8M oz AuEq 48.5M oz AuEq Dolores • Management has spent over 15 (Minefinders) Camino Rojo years in the country 3.7M oz AuEq (Goldcorp) Mulatos 5.2M
Slide 6: Management Team
MANAGEMENT TEAM Keith Piggott, ACSM – President, CEO & Director Gregg J. Sedun, LLB – Executive Chairman & Director John Sutherland, CGA – Chief Financial Officer, Vice-President Kevin Sullivan, B.Sc. MAusIMM – Vice-President, Exploration Patrick Glynn, B.Sc.Eng. – Vice-President, Technical & Projec
Slide 7: Board of Directors
BOARD OF DIRECTORS Keith Piggott, ACSM – President, CEO & Director Gregg J. Sedun, LLB – Executive Chairman & Director Dr. Hans von Michaelis, Ph.D – Lead Director, Business Development Lenard F. Boggio, FCA, CPA – Director Chester Millar – Director Corry Silbernagel, P.Eng., MBA – Director Francisc
Slide 8: Significant Milestones
SIGNIFICANT MILESTONES Q4 2009 – Acquired Caballo Blanco from NGEx Resources Q2 2010 – Completed RTO with Sierra Minerals Inc. to form Goldgroup Mining Inc. (TSX:GGA) Q3 2010 – Sold El Porvenir project for $25 million (Initial cost: $5 million) Q1 2011 – Completed $40 million equity financing Q1 201
Slide 9: Mineral Resources
MINERAL RESOURCES www.goldgroupmining.com TSX:GGA • OTC:GGAZF 9
Slide 10: Caballo Blanco
CABALLO BLANCO Caballo Blanco Property Geology Map • 100% owned by Goldgroup Mining Inc. • Updated NI 43-101 mineral resource estimate in 55,000 hectares Q1 2012 (La Paila Zone focus) 54,000+ hectares • Indicated Resource: 575,000 oz Au Inferred Resource: 419,000 oz Au Northern Northern Zone Zone •
Slide 11: Caballo Blanco: Northern Zone IP Resistivity Map
CABALLO BLANCO Northern Zone IP Resistivity Map • Vuggy silica breccias, high sulphidation fully oxidized, epithermal gold system La Paila Zone Indicated: 575,000 oz Au • 175 holes drilled to date (GGA: 142) Inferred: 419,000 oz Au • 2011: 30,000m drill program on La Paila Zone completed Road • 2012
Slide 12: Caballo Blanco: La Paila Zone Drilling Results
CABALLO BLANCO La Paila Zone Cross Section Significant Drilling Results Gold Grade Drill Hole # Interval (m) (g/t) 68 134.0 0.61 72 122.0 0.80 73 48.50 3.47 79 100.1 0.88 82 154.0 0.59 84 64.00 1.20 120 126.2 0.69 127 144.0 0.89 131 90.60 0.91 139 79.42 1.20 142 69.60 0.97 143 93.90 0.77 153 197.0 0
Slide 13: Caballo Blanco: PEA Overview
CABALLO BLANCO Project PEA Overview* Economic Summary @ $1,500 Gold Unit Value • Mine type: Open-pit heap leach Pre-Tax NPV (5%) US$mm 283.8 • Processing: 20,000 tpd @ 0.538 g/t Au Pre-Tax NPV (0%) US$mm 386.3 Pre-Tax IRR % 66.4 • Primary and secondary crushing Payback Period years 1.5 • Metallurgic
Slide 14: Caballo Blanco: Site Plan
CABALLO BLANCO: SITE PLAN • 3.3 km haul roads • Potential 1.2 km tunnel (5.5m x 5.5m) to connect open pit to leach pad • Expect to build 200-300 metres/month (tunneling from both ends) • Cost of ~$5 million (PEA) • Heap leach area, carbon absorption plant, crusher • Contract mining and trucking – ch
Slide 15: Caballo Blanco: Next Steps
CABALLO BLANCO: NEXT STEPS • Ongoing crushing studies being conducted • Define ore characteristics – vuggy, massive, brecciated, and high silver • Determine crushing requirements by ore type • Adjust operating plan and determine operating cost efficiencies • Results expected in Q3 2012 • Ongoing dis
Slide 16: Timeline of Key Events
TIMELINE OF KEY EVENTS Caballo Blanco 2011 2012 2013 2014 Drilling NI 43-101 Resource Update Preliminary Economic Assessment T = construction start Permitting* T+9 months Construction* T +12 months Ramp-up* *The timing of the Environmental Impact Statement (“EIS”) permit approval is estimated to be
Slide 17: Caballo Blanco: Permitting
CABALLO BLANCO: PERMITTING • The EIS and the related Change of Land Use permits are Federal processes (SEMARNAT) • Currently responding to first round of comments on the EIS from SEMARNAT • Engaged expert consultants to assist in permitting process – environment, government relations, public relatio
Slide 18: San José de Gracia
SAN JOSÉ DE GRACIA • Updated NI 43-101 resource estimate in Q4 2011 Significant Drilling Results • Indicated Resource: 147,000 oz Au Drill Hole # Interval (m) Grade (g/t Au) Inferred Resource: 963,000 oz Au 21 6.10 26.89 26 4.10 16.82 • Historical production of 1 million+ oz Au 27 6.05 13.59 averagi
Slide 19: San José de Gracia
SAN JOSÉ DE GRACIA Hole Int erval Grade (m ) (g/ t Au) 1 151 7.82 22.19 Looking NE 2 177A 5.27 19.80 3 177B 5.48 12.47 4 226 8.04 18.47 5 237 0.40 889.91 • Four main veins: Tres Amigos, San Pablo, La Union, La Purisima • Resources in hills above river level • Low-cost adit mining • Good mining width
Slide 20: Cerro Colorado Mine
CERRO COLORADO MINE • 100% owned & operated by Goldgroup Mining Inc. • ~20,000 oz gold production in 2011 and 2012E • Open pit heap leach operation • In production for 8 years • Installed new crushing system to increase recoveries • Ongoing exploration drilling to increase resources www.goldgroupmin
Slide 21: Peer Group Analysis
PEER GROUP ANALYSIS Market Capitalization ($MM) Cash % of Market Cap $1,400 35% 30% $1,200 25% 25% $1,000 20% $800 15% 13% $600 $314 10% $400 5% $200 $91 0% $- EV/Au oz ($MM) EV/2011 Production ($/oz Au) $400 $16,000 $350 $14,000 $300 $12,000 $250 $10,000 $200 $8,000 $150 $5,885 $118 $6,000 $100 $4,
Slide 22: Corporate Strategy
CORPORATE STRATEGY • Create shareholder value by: – Developing Caballo Blanco into a open-pit heap leach producer of ~100,000+ oz Au annually on-time and on-budget – Continuing regional exploration to expand total resources – Medium-term development of high-grade San José de Gracia – Sustaining prod
Slide 23: Investment Opportunity
INVESTMENT OPPORTUNITY • Significant growth potential in near-term production and exploration at Caballo Blanco • World class management team with proven operating and mine production experience in Mexico • Significant management (17%) and institutional (51%) ownership • Well funded and no debt • Gr
Slide 24: Corporate Information
CORPORATE INFORMATION Share Structure* Analyst Coverage Issued & Outstanding: 130,726,049 Analyst Company Incentive Stock Options: 11,500,348 Warrants: 2,000,000 Nicholas Campbell Canaccord Genuity Vancouver, BC Fully Diluted: 144,226,397 Christos Doulis, CFA Stonecap Securities Toronto, ON Market C
Slide 25: Appendix: Additional Materials
APPENDIX: ADDITIONAL MATERIALS www.goldgroupmining.com TSX:GGA • OTC:GGAZF 25
Slide 26: Senior Management Team
SENIOR MANAGEMENT TEAM Keith Piggott, ACSM – President, Chief Executive Officer & Director • Developed gold mines in Australia and two Mexican gold mines, that have been in continuous production for fourteen and eight years, respectively • Identified a two million oz gold deposit at Ok Tedi, Papua N
Slide 27: Management Team
MANAGEMENT TEAM Kevin Sullivan, B.Sc. MAusIMM – Vice-President, Exploration • Graduate geologist from Victoria University of Wellington, New Zealand • Member of the Australasian Institute of Mining and Metallurgy • 20+ years of gold exploration experience in Australia • Instrumental in the discovery
Slide 28: Board of Directors
BOARD OF DIRECTORS Dr. Hans von Michaelis, Ph.D – Lead Director, Business Development • Ph.D in Geochemistry from the University of Cape Town. Expert in gold and silver ore processing technology • Founding shareholder of Alamos Minerals Ltd. and introduced the Mulatos Gold Project to Alamos • Former
Slide 29: Caballo Blanco: La Paila Zone Geology Map and Block Model
C ABALLO BLANCO La Paila Zone Geology Map La Paila Zone Block Model www.goldgroupmining.com TSX:GGA • OTC:GGAZF 29
Slide 30: Caballo Blanco: La Paila Zone 3D Interpretation
C ABALLO BLANCO La Paila Zone 3D Interpretation www.goldgroupmining.com TSX:GGA • OTC:GGAZF 30