AntaKori Project, Peru TSXV:REG. Emerging Copper Gold Discovery in the Land of Giants

Transcription

1 AntaKori Project, Peru TSXV:REG Emerging Copper Gold Discovery in the Land of Giants Corporate Presentation July

2 Disclosure Forward Looking Information. Certain of the information contained in this document constitutes forward looking information or forward looking statements (collectively, "forward looking information") within the meaning of applicable Canadian securities legislation. Such forward looking information include statements regarding: the Regulus / Southern Legacy amalgamation and matters in respect thereof, exploration plans for the Rio Grande, AntaKori, Pulchidiza and Golden Brew projects, Regulus and Southern Legacy resource estimates, use of proceeds of the equity financing. Often, but not always, forward looking information can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates", "believes" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. With respect to forward looking information contained herein, we have made numerous assumptions including among other things, commodity prices, economic and political conditions and continuity of operations. Although Regulus believes that the assumptions made and the expectations represented by such statements or information are reasonable, there can be no assurance that forward looking information referenced herein will prove to be accurate. Forward looking information by their nature are based on assumptions and involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Regulus to be materially different from any future results, performance or achievements expressed or implied by such forward looking information. These risks, uncertainties or other factors include, but are not limited to, the actual commodity prices received, unanticipated grade, geological, metallurgical, processing, access, transportation of supply or other problems, political, economic and operational risks of foreign operations, availability of materials and equipment, the timing of receipt of governmental permits, force majeure events, accidents, labour relations and risks in start up date delays, environmental costs and risks, the outcome of acquisition negotiations, general domestic and international economic and political conditions, the factual results of current exploration, development and mining activities and those factors disclosed in documents filed by Regulus from time to time with the provincial securities regulators in Canada. Although we have attempted to identify factors that would cause actual actions, events or results to differ materially from those disclosed in the forward looking information, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. Accordingly, readers should not place undue reliance on forward looking information. Regulus undertakes no obligation to update forward looking information as a result of new information after the date of this document except as required by law. All forward looking information contained herein is qualified by this cautionary statement. Presentation of Resource Estimates This corporate presentation uses the terms "indicated" and "inferred" in connection with its resource presentations, as defined in accordance with National Instrument Standards of Disclosure for Mineral Projects ("NI ") under guidelines set out in the Canadian Institute of Mining, Metallurgy and Petroleum (the "CIM") Standards on Mineral Resources and Mineral Reserves adopted by the CIM Council. Readers are cautioned not to assume that all or any part of "indicated" resources willeverbe converted into mineral reserves. "Inferred" resources have a great amount of uncertainty as to their existence and as to their economic and legal feasibility. It cannot be assumed that all or any part of an "inferred" resource will ever be upgraded to a higher category. Readers are also cautioned not to assume that all or part of an "inferred" resource exists, or is economically or legally mineable. Estimates of "inferred" resources may not form the basis of feasibility or other economic studies. Mineral resources that are not mineral reserves do not have demonstrated economic viability. All of Regulus' exploration programs and the related disclosure of information of technical or scientific nature are prepared by, or prepared under the direct supervision of John Black, Regulus' CEO, and reviewed and approved by Dr. Stewart Redwood BSc (Hons), PhD, FIMMM, FGS, who is a "qualified person" as defined in NI

3 Investment Highlights Emerging Cu-Au Discovery Peru New Spinco Altar Acquisition Proven Track Record Antares and Haquira Discovery AntaKori - Southern Legacy Merger Aldebaran Spinco - Argentina Acquisition of Altar Cu-Au Project Experienced Management Strong Technical Team Excellent In-Country Experience Loyal Shareholders 20,000+ m drill program 16 drill holes reported to date 3 drill rigs turning Updated resource planned for early Q Access to Capital Emerging Cu-Au-Ag Discovery at AntaKori Project initial inferred resource of 295 mt with 0.48% Cu, 0.36 g/t Au and 10 g/t Ag very significant upside High sulphidation epithermal mineralization with underlying Cu-Au skarn Opportunity to deliver exciting new discovery into a rising Copper Market Added value via spin out of Argentina assets and acquisition of Altar Cu-Au Project 3

4 The Strategy Our focus is here 4

5 The Strategy Proven Track Record Antares Minerals The Haquira Discovery and Sale to First Quantum Minerals 5

6 The Strategy Proven Track Record Regulus Resources AntaKori Project and REG shareprice 6

7 Management Team Management Team John Black, B.Sc., M.Sc. CEO, Director 30+ years international exploration experience Kennecott, Rio Tinto, WMC, founding President/CEO of Antares Minerals. Fernando Pickmann, LLM COO, President, Director 20+ years mining law experience advising junior and senior mining companies in Peru, former CEO of Southern Legacy Minerals, former director of PeruPetro, Andean Gold and Estrella Gold Corp. Mark Wayne, LLB, CFA CFO, Director 30+ years capital market experience, founding CFO of Antares Minerals, former Chairman Alamos Gold. Kevin Heather, B.Sc. (Hons), M.Sc., Ph.D. Chief Geological Officer 30+ years international exploration experience OGS, GSC, Barrick, independent consultant, founding VP Geology of Antares Minerals. Independent Directors Anthony Hawkshaw,Director Chartered Accountant, Business degree from University or Ryerson, Toronto. Founder and former director and CFO of Rio Alto Mining. Former CFO of Pan American Silver. Over 25 years experience in the mining industry. Raymond Jannas, Director Ph.D. in Geology from Harvard University, B.Sc. From Universidad de Chile. Over 30 years experience in exploration and mining geology throughout the Americas. Former VP Exploration for Hochschild Mining and Regional Exploration and Project Generation Manager at Gold Fields Ltd. President of Gexsa Ltda. and CEO of Minera Fuego Limtada. Gordon P. Leask Director Geological engineer with +30 years experience in the exploration industry, CEO of Highway 50 Gold Corp. and founding director and CEO of Goldrock Mines Corp. John M. Leask Director Geological engineer with +35 years in the exploration and mining business. Director of Highway 50 Gold Corp. and founding director of Goldrock Mines Corp. 7

8 REG Share Structure and Cash Position Shares issued 77,703,722 Warrants outstanding $1.60 to January 2020 Options outstanding $0.45 to December 2019 $1.50 to September 2021 $1.84 to December 2022 $2.00 to July 2023 Fully diluted 86,618,207 Principal shareholders: Insiders and Associates Route One Investment Co. First Quantum Minerals, Sentry, Farallon Capital, Primevest Cash position July 26, % (16.9% fully diluted) 17.6% (19.1% fully diluted) Significant positions Approx CAD$1.0 million additional funds arriving from exercise of options and warrants in near term Share Price July 26, 2018 C$ 1.90 Market Capital July 26, 2018 C$ 148 million 8

9 Project Portfolio 10 projects 5 countries Cu Au focused AntaKori Cu Au emerging discovery Advanced, large scale projects Conceptual, early stage projects AntaKori 9

10 AntaKori Flagship in Northern Peru Adjacent to Two Operating Mines 10

11 AntaKori Cu Au Ag Good Infrastructure Located 60km northwest of city of Cajamarca with daily commercial flights from Lima Accessible year round by paved and gravel roads from Cajamarca airport in 1.5 hours Proposed port facility of Eten for concentrate exports located 230km to the west Abundant ground water sources Transmission line crossing property Adjacent to Buenaventura/Southern Copper s Tantahuatay gold mine and Goldfield s Cerro Corona goldcopper mine 11

12 Resource Summary Regulus Resources now has a strong portfolio of projects located in 5 countries. Two of these projects, including the flagship AntaKori Cu Au Ag project in Peru, have reportable resources as summarized in the following table. The AntaKori resource estimate is based upon drilling by previous operators and does not include results from the current Regulus drilling campaign. Resource Category Tonnes (milions) Au (g/t) Cu (%) Ag (g/t) Au (M oz) AntaKori Cu Au Ag Project Cu (B lbs) Ag (M ozs) Au EQ (M ozs) Cu EQ (B lbs) Inferred Rio Grande Cu Au Project Indicated Inferred Au EQ and Cu EQ were calculated using the following metal prices: Au = US$1,200/oz, Cu = US$3.00/lb, Ag = US$20/oz 12

13 AntaKori Cu Au Ag Coimolache JV Regulus can earn In to 30-70% interest REG Goldfields AntaKori Sulphide Cu-Au Deposit Open laterally and to depth Coimolache BVN/SPCC REG Tantahuatay Pit Oxide Au REG 2014 REG 2016 REG REG REG REG REG Goldfields Previous drilling has defined substantial Cu Au Ag mineralization that occurs on both Regulus and Coimolache (Tantahuatay Mine) mining rights and remains open for expansion in most directions; Has been difficult for either company to proceed 13

14 Coimolache Agreement Key Benefits Mutual Rights of Access Mutual Rights of Expansion Agreement Full extent of Cu Au mineralization can be defined for the first time Drilling can be start more quickly using existing mine permits Coimolache can expand current oxide pit with layback onto Regulus ground paying5%nsrtoregulus Regulus can model pit layback onto Coimolache ground and thereby report more complete resources Either party can develop project but more likely to strike new JV to codevelop when better defined 14

15 Coimolache Agreement Summary Agreement allows collaborative exploration to define size/feasibility of giant AntaKori Cu Au Ag deposit. Area of interest centered on Regulus mining rights and known AntaKori Cu Au Ag sulphide mineralization. Parties remain autonomous and each retains its mining rights. All exploration data and surface rights shared within area of interest. Costs pro rated to underlying mining rights holder. Coimolache can expand Tantahuatay pit by layback onto Regulus mining rights by paying Regulus a 5% NSR. Exploration close to Tantahuatay Pit will be managed by Coimolache and utilize existing permits and extensions which will allow drilling this year. Either party may elect to become a developing party to develop and mine in the area of interest. The developing party would assume all costs for development, mining and closure and will pay 5% NSR for ore mined from the other party s mining rights. If Regulus elects to become the developing party, Coimolache will have a first right to assume the role. Regulus mining rights further from the pit will be managed by Regulus. 15

16 Colquirrumi Agreement Summary Option to earn in with an option to claw back. Area of interest 2,571 ha of Colquirrumi mining rights to north and east of main Regulus ground. Regulus can earn up to a 70% interest by drilling 7,500 m within 3 yrs of obtaining necessary permits. Colquirrumi can claw back to 70% (30% Regulus) by paying US$9 million. Regulus and Coimolache have rights of expansion as per Coimolache agreement. 16

17 AntaKori Cu Au Ag AntaKori Sulphide Deposit REG REG Limit of current resource Open in most directions REG Tantahuatay Mine REG 17

18 AntaKori Cu Au Ag Section L800NW Coimolache Regulus Coimolache Regulus High Sulphidation Epithermal Cu Au Target AntaKori Cu Au Skarn Porphyry Target Lms siltstone siltstone Breccia and porphyry 18

19 AntaKori Drill Results 2017/2018 drill program 18,000 meters 16 drill holes reported to date 3 drill rigs currently turning Will increase to 4 rigs in next month or so Approximately 14,000 m completed to date Some of more significant results to date include: 184 m with 1.54% Cu, 1.05 g/t Au and 11.9 g/t Ag from 250 m depth 524 m with 0.65% Cu, 0.47 g/t Au and 7.9 g/t Ag from 205 m depth 328 m with 0.42% Cu, 0.22 g/t Au and 8.6 g/t Ag from 172 m depth 323 m with 0.52% Cu, 0.15 g/t Au and 8.3 g/t Ag from 267 m depth 595 m with 0.35% Cu, 0.24 g/t au and 5.5 g/t Ag from 241 m depth 388 m with 0.41% Cu, 0.18 g/t Au and 7.8 g/t Ag from 219 m depth 437 m with 0.45% Cu, 0.18 g/t Au and 4.9 g/t Ag from 84 m depth 258 m with 0.43% Cu, 0.29 g/t Au and 4.6 g/t Ag from 8 m depth and 145 m with 0.70% Cu, 0.42 g/t Au and 12.0 g/t Ag from 288 m depth 327 m with 0.91% Cu, 0.44 g/t Au and 9.8 g/t Ag from 293 m depth 537 m with 0.49% Cu, 0.23 g/t Au and 6.3 g/t Ag from 127 m depth 19

20 AntaKori Cu Au Ag Current Drilling 20

21 DRILL RESULTS Approximate Resource Outline On Regulus Claims 1050N W 21

22 DRILL RESULTS Approximate Resource Outline On Regulus Claims 950NW 22

23 DRILL RESULTS Approximate Resource Outline On Regulus Claims 800NW 23

24 DRILL RESULTS Approximate Resource Outline On Regulus Claims 600NW 24

25 DRILL RESULTS 200NW 25

26 AntaKori Cu Au Ag Current Drilling 26

27 MOST RECENT DRILL RESULTS 27

28 MOST RECENT DRILL RESULTS 28

29 MOST RECENT DRILL RESULTS 29

30 MOST RECENT DRILL RESULTS 30

31 MOST RECENT DRILL RESULTS 31

32 BLUE SKY UPSIDE POTENTIAL MAGNETIC INTENSITY ANALYTICAL SIGNAL Historical Drill Holes (CMC- REG) only test a portion of the potential system Porphyry-skarn Target 1 (?) Porphyry-skarn Target 2 (?) Porphyry-skarn Targets 3 & 4 (???) REG Inferred Resource Outline (Sulphides) ~ % Cu, 0.36 g/t Au, and 10 g/t Ag ( Resource Estimate; Wilson, 2012) 2015 CMC Inferred Resource Outline (Sulphides) % Cu, 0.30 g/t Au, and 8.6 g/t Ag (BVN Annual Report 2015) 32

33 Cerro Corona Mine Antakori Claims Sub area 2 Cerro Corona Tailings Tantahuatay Leach Pads Antakori Claims Sub area 1 Tantahuatay 2 Open Pit 33

34 Strategy for 2018 and beyond 20,000+ m drill program with planned completion Q Doubling previous drilling meterage Updated resource estimate by projected to by early Q Drilling will continue with 3 5 drills for 2 3 years of extensive drilling to demonstrate full potential of deposit Complete Spin out of Aldebaran Resources and the acquisition of the Altar Copper Gold Project in Argentina Value added to REG shareholders Proven Track Record Antares and Haquira Discovery AntaKori - Southern Legacy Merger Experienced Management Strong Technical Team Excellent In-Country Experience 18,000m drill program 12 drill holes reported to date 3 drill rigs turning Updated Resource Estimate scheduled for Q

35 Aldebaran Spin-out - Transaction Summary Proposed Transaction Consideration Regulus Resources Inc. ( Regulus ) to spin out the Rio Grande project and other earlystage exploration properties in Argentina into a new company ( Aldebaran Resources or SpinCo ) Regulus shareholders to receive 1 SpinCo share for every 3 Regulus shares held SpinCo to acquire an option to earn up to an 80% interest in Altar from Sibanye Gold Limited ( Sibanye Stillwater ) An upfront cash payment of US$15MM to Sibanye Stillwater 19.9% equity ownership in SpinCo for Sibanye Stillwater SpinCo to carry US$30MM of spend on Altar over 5 years to earn 60% SpinCo may earn additional 20% by incurring US$25MM in spending over 3 years Conditions Regulus shareholder vote (66⅔% of shareholder votes cast + majority of minority) Entered into support agreements from Route One Investment Company, L.P. ( Route One or ROIC ) and management/directors totaling 30% Customary regulatory and court approvals Financing SpinCo is conducting a financing of a minimum of US$30MM (up to a maximum of US$40MM) at US$0.96 per post consolidated SpinCo share to finance the upfront payment and exploration thereafter Route One has agreed to fund US$30MM and meet SpinCo s financing obligations as part of the transaction 35

36 Aldebaran Spin-out - Transaction Rationale Creation of a new exploration company to acquire a majority interest in a large scale resource (Altar) with significant upside potential identified, on terms that equate to a very low acquisition cost Altar becomes a core asset again for the first time since 2011 Altar was sold for ~US$490MM in 2011 and has had ~US$45MM spent on it since Rio Grande and other Argentine assets provide additional optionality as secondary assets Large existing resource with considerable upside potential in both size and grade Peregrine Metals Ltd. advanced Altar as a very large, low grade copper gold deposit up to its sale in 2011 Stillwater completed significant additional drilling still focused on very large, low grade deposit in Several zones of higher copper gold grades and better metallurgy indicated in older drilling additional work necessary to define full size of these zones 2016/17 drilling discovered new high grade zones Valuation Perspectives EV/Cu Eq. Resources (US /lb) (1) Highly regarded exploration team to unlock value Support of longstanding Antares/Regulus shareholders Focus of Regulus remains on AntaKori while unlocking considerable value for Rio Grande Removing any further funding obligations in Argentina for Regulus 0.4 (1) Based on respective company disclosure. Median of 23 Transactions Between Altar 2011 (Stillwater / Peregrine) Current Transaction 36

37 Aldebaran Spin-out - Capitalization Summary Each shareholder of Regulus on the Effective Date to receive one share of SpinCo for every three shares held in Regulus SpinCo to raise a minimum of US$30MM at US$0.32 per share or US$0.96 per post consolidated share Route One has agreed to subscribe for US$30MM (fulfills the financing portion of the transaction) Sibanye Stillwater to receive 19.9% of SpinCo (1) Pro forma shares outstanding of ~75MM (post consolidation of 1 for 3) Sibanye 20% Existing REG Shareholders 32% Estimated SpinCo Ownership (FD ITM) Route One (Financing) 42% Route One (Existing) 6% Existing Regulus Shareholders to receive ~38% of SpinCo (~C$37MM of value at offering price) for contribution of Rio Grande and other Argentine assets Source: Company disclosure. Note: Based on FD ITM shares outstanding of Regulus of 86.5MM and US$30MM raised. (1) 19.9% if US$30MM raised. Ownership diluted if more funds raised. Sibanye-Stillwater ownership carries customary rights and restrictions. 37

38 Altar Cu-Au Project Overview Property Description Situated in the Andes Mountains of Argentina ~10 km from the Argentina-Chile border and ~180 km west of the city of San Juan and consists of >12,200 ha of concessions Previous Stillwater exploration focused on a small area Encouraging results from modest core program away from the main resource to test porphyry and shallow copper oxide targets Several high quality drill-ready targets identified via prospecting and geophysics High potential for discovery of additional deposits Geological Profile Large Andean porphyry copper-gold deposit with potential for discrete peripheral gold system targets Currently exhibits open mineralization in most directions Two main ore zones within the main area of the deposit are called the Altar Central and the Altar East zones Three kilometers west of the Altar Central zone is the Quebrada de la Mina ( QDM ) deposit, offering additional regional upside Source: Sibanye-Stillwater and Stillwater disclosure. 38

39 Altar Cu-Au Project Overview Altar Central & East (~4125m asl) QD M Altar North Altar East Altar Central CAMP Alluvial Plain with Altar Camp (~3100m asl) Looking North >12,200 ha of mining and exploration concessions controlled 39

40 Altar Cu-Au Project Long-Section QDM represents a new discovery in 2016 QDM/Radio Porphyry QDM Altar North Altar Central Altar Central Altar East Altar East Source: Regulus diagram based on Sibanye-Stillwater data. 40

41 Altar Cu-Au Project Long-Section QDM represents a new discovery in 2016 QDM Altar Central Altar East 3 km gap with no drill holes Multiple holes stopped in high-grade mineralization at depth ~6 km CuEq= Cu pct + ((Au ppm * $/oz Au + Ag ppm * $/oz Ag) / ( * * $/Lb Cu)) Grade upside at depth and along strike a re exploration story CuEq prices used are: Cu $US 2.25, Au $US 1100, Ag $US 14 Source: Regulus diagram based on Sibanye-Stillwater data. 41

42 Altar: Deeper, Higher-grade Cu-Au Intercepts Drill Hole ALD-176: Sub-interval m CuEQ (%) Cu (%) Au (ppm) Ag (ppm) Mo (ppm) As (ppm) Interval (m) Later high-grade cpy-anh veins overprinting early mineralized quartz stockwork veins Drill Hole ALD-176: Overall Interval 42

43 Project Portfolio Additional Projects Golden Brew Carlin Au, Nevada (Regulus) Conceptual play for Carlin Au system beneath cover Drill program completed in September 2017 with encouraging results Additional drilling warranted Rio Grande Cu Au Porphyry, Argentina (Aldebaran) Significant resource defined with potential at depth Immediately adjacent to Fortuna Silver s Lindero Gold deposit where construction is planned this year Aguas Calientes epithermal Au Ag Project and other early stage projects in Argentina (Aldebaran) Aguas Calientes project is drill ready Four additional early stage projects with potential 43