Utilizing Historical Data In Top-tier Mining Jurisdisctions Corporate Presentation

Transcription

1 Utilizing Historical Data In Top-tier Mining Jurisdisctions Corporate Presentation February 2019

2 Disclaimers 2 FORWARD LOOKING STATEMENTS This presentation by Discovery Harbour Resources Corp. (the Company ) contains forward-looking statements, including, in particular, statements about the Company s plans, strategies and prospects. These statements have been based on the Company s current assumptions, expectations and projections about future events. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, the Company can give no assurance that these expectations will prove to be correct or that results anticipated in the forward-looking statements will be achieved. These forward-looking statements include risks and uncertainties. These risks and uncertainties include, among other things, market conditions, industry uncertainty and other factors. QUALIFIED PERSON Mark Fields, P.Geo., is the Qualified Person for Discovery Harbour as defined in NI and has reviewed and approved the technical contents of this presentation.

3 Discovery Harbour Resources at a Glance Corporate Structure Public Company Listed on the TSX Venture Exchange () More than 50% Insider-owned 23,797,840 Shares Outstanding; 8,830,305 shares owned by Richard Gilliam Our Property Portfolio is Located in Nevada, USA Flagship Property : The Caldera Project Location 66km WNW of Tonopah, Nevada; At the intersection of two major gold trends Walker Lane and Northumberland Development Stage Exploration with extensive historical work and small-scale mining activity Metals Gold, with Silver Credit Deposit Type Low-sulphidation Epithermal Gold Going Forward Ø Ø Ø Ø Ø Completed private placement in July 2018 Planning private placement, size approx. $1.5M Detailed soils and geophysics to refine selection of drill targets Exploration drilling targeting the boiling zone depth, potential for bonanza grades Expand portfolio, focusing on western US gold projects Looking NW from Old East Golden Mine 3

4 Mining in Nevada 4 Great Mining Jurisdiction Ranked 3 out of 91 mining jurisdictions (Fraser Institute Survey in 2017) US is the 4th largest gold producer Nevada produces 78% of US gold production Nevada was 5.6% of global gold production (2017) ü ü ü ü ü ü ü ü Clear permitting procedures Secure tenure and stable political framework Low population density Skilled workforce English language Long history of gold mining In 2017 produced 5.6M ounces of gold Substantial historical database Looking West from West Golden Zone

5 Leadership 5 Key stakeholders and cornerstone investors in DHR have successfully Developed, Built and Sold large-scale mining projects Mark Fields Interim President & CEO, Director Geologist with broad public company experience; Oversaw major transaction selling Geodex Mineral s key asset in 2012 to Northcliff Resources (Hunter Dickinson). Developed and built metallurgical coal mine with Pine Valley Coal; recipient of EA Scholz award in Richard Gilliam Director (and 41.3% DHR shareholder) Mining entrepreneur; Founded and sold Cumberland Resources to Massey Energy for US $960 Million Andrew Hancharyk Director Corporate and securities lawyer with extensive public company experience Director 25 years of experience working with resource companies in various capacities as founder, finance agent and institutional investor. Interim President, CEO and Director of Westminster Resources Ltd., a principal of Ore Capital Partners. Jason Cubitt Track Record of Success 2005 Pine Valley Coal constructs first new metallurgical coal mine in northeast BC in 25 years Geodex Minerals forms JV, then sells remaining 30% stake to HunterDickenson s Northcliff Resources Cumberland Resources sells company to Massey Energy for US$960M

6 Our Flagship: Caldera Low Sulphidation Epithermal Gold Right location. Poised for Discovery. 6 - Prolific mining region & gold belt including proximity to major epithermal deposits - Small-scale historical gold production on the property - Extensive previous exploration work - Significant historical soil, rock chip and drilling results - Exceptionally high grade rock chip and drilling results - Newly acquired extension to north Map of Large Gold Deposits and Locations of Caldera Formations

7 Our Flagship: Caldera Low Sulphidation Epithermal Gold New Epithermal Gold Model Interpretation Makes Sense 7 Low sulphidation gold deposits can host bonanza grades in the boiling zone - All previous drilling was near surface; average length of holes: 106m - This is too shallow to intersect the boiling zone - Boiling zone can host bonanza grades - Previous explorers searched for low-hanging fruit - Need to go deeper. Potential bonanza grade boiling zone: 150 to 450 meters Low Sulphidation Epithermal Gold Model

8 Discovery Harbour Key Initiatives Turn-around underway with a clear & focused new strategy to enhance shareholder value Corporate Address Capital Markets Issues Share consolidation Convert debt to equity Marketing materials & website Clear value proposition 1) Exit Non-Core Assets 2) Pivot & Re-focus On New Property 3) Re-negotiate Vendor Deal Terms - 2BAR and Jersey Valley - The Caldera Project (Nevada) - Caldera Project (Nevada) 4) 5) - 1) Compile & Review Caldera Data 2) Site Visit 3) Interpret Data Ore Capital participated in financing, actively involved in strategic planning, new director (Jason Cubitt) - Clear understanding of the visible WNW-oriented mineralized structures 4) Increase Land Package 5) Mapping - Increase land position 5-fold - Complete mapping focused on alteration and structures based on low sulphidation epithermal gold model 6) Detailed Soil Sampling and Geophysics 7) Drilling Fundraise - Raise CAD$1.5 to 3M for detailed soils, geophysics and drilling - From 11 different historical owners - Low sulphidation epithermal gold model Add to Team - 6) Property - Incorporating Fall 2017 mapping - Select drill targets with maximum effectiveness - Previous drilling was too shallow - Drill down to the boiling zone 8

9 Caldera District Claims Map 9 Consolidating multiple historical production and exploration projects into a sizeable regional land package Western Side Photo of Caldera Project DHR Land Package: - Over 250 Claims Extension adds another 56 claims Spanning over 6 km strike length over 30 square kilometers Intersection of the Walker Lane and Northumberland Gold Trends 7 known mineralized zones Easy access - Historic small scale production Discovery Harbour: Caldera Project Property Outline Map

10 Caldera Gold Project Historic Work Done 10 Significant data collected on the Caldera Gold Property: Extensive historical database 1,365 soil samples (mapped) 804 rock chip samples (mapped) 142 drill holes (mapped) Geological mapping 15,072 meters drilled; average length only 106m Understanding of orientation of structures (WNW) Average vertical depth less than 100m Deepest vertical drill hole 194m, only 3 holes >160m vertical depth Old Prospect Pit at East Golden Rock Chip Sample in Pit had Value of 48.9 g/t Au Veinlets in Rock Sample in South Hills Zone

11 Historic Soil Sampling Results Two large soil anomalies, hosting both pathfinder and gold anomalies, found around major WNW-trending structures Gold Samples: Two major gold-in-soil anomalies Along WNW-trending major structures High and consistent values Epithermal gold model means more gold likely to be found deeper in the boiling zone Regional plumbing system 11 Caldera Property Soil Sample Grid Locations Pathfinder Samples: v Mercury High of 6,636 ppm v Antimony High of 231 ppm v Arsenic High of 1,835 ppm Supports deposit model; Found along major WNW-trending structures; Surface samples are high in the epithermal gold system

12 Historical Rock Chip Sample Results Ultra-high grade gold results, coupled with strong soil anomalies along WNW-trending structures, reinforce management s confidence in the Caldera Gold Project 804 Rock-chip Samples: 1 over 190 g/t Au 3 over 50 g/t 21 over 10 g/t 50 over 5 g/t 109 over 2 g/t 184 over 1 g/t 306 over 0.5 g/t 346 over 0.4 g/t 397over 0.3 g/t 556 over 0.1 g/t 12 Caldera Project Rock Chip Samples g/t AU East Golden Tagged Rock-chip Sample: 48.9 g/t Au Location of Rock Chip Samples on the Caldera Project

13 Historical Rock Chip Samples (cont d) 13 Extremely high proportion of anomalous samples, including bonanza grades g/t Au 804 Rock-chip Samples: 1 over 190 g/t Au 3 over 50 g/t 21 over 10 g/t 50 over 5 g/t 193 g/t Au Sample Number Grade g/t Au Z * This sample also contained 6,370 g/t Ag g/t Au Sample Number Grade g/t Au Z W W g/t Au Sample Number Grade g/t Au Sample Number Grade g/t Au CD CD Z W W W C Z Z CD W Sample Number Grade g/t Au B CD Z G Z over 0.4 g/t CD W over 0.3 g/t BG BG Z Z W W Z over 2 g/t 184 over 1 g/t 306 over 0.5 g/t 556 over 0.1 g/t

14 Drill Results 14 o High grade results spread along 6.5 km strike length o 2006 drill program: 2,708 meters - 1,300 meters (or 48%) of the assayed results graded higher than 0.25 g/t Au - Average length of holes: 113 meters - Average vertical depth: less than 100 meters o Drilling historically focused on finding near surface bulk tonnage deposits o Deepest vertical drill hole 194m - only 3 holes greater than 160m vertical depth

15 Mapping Prioritized and ranked 30 mineralized structures Focused on structures and alteration Prioritized targets for follow-up and drilling Mapping ranked targets on six key criteria for low sulphidation epithermal gold deposits: Length of Structure Intensity of Structure Width of Alteration Strength of Silica Alteration Anomalous Gold in Rock Samples Historical Drill Results Conclusions: 30 structures ranked and described Caldera Property exhibits surface characteristics that indicate that the entire epithermal system is preserved

16 Game Plan and Technical Conclusions 16 Epithermal system has been preserved Excellent opportunity to discover bonanza gold grades at boiling zone depth Need to link geochemical & geophysical anomalies to drill targets with maximum opportunity for bonanza gold grades at depth Priority Areas for Follow-up and Drilling PHASE 1: Detailed soil sampling over highly ranked structures and alteration targets; Geophysics focused on resistive features characteristic of Caldera mineralized system PHASE 2: Use historical data, 2017 program results and detailed soil sampling to position drill collars to best test likely bonanza grades in various anomalous zones Drill

17 Low Sulphidation Epithermal Gold 17 Model Deposits & Analogues 654,000 Oz Au ALLEGIANT GOLD: East Side Deposit Average Length of Hole 274 meters Best Rock Chip Sample 27.4 g/t Au PARAMOUNT: Grassy Mountain Deposit Lower Grade Envelope 200ft 800ft Deep High Grade ft Deep WESTHAVEN VENTURES: Shovelnose Project New high-grade Au discovery, B.C. 820,000 Oz Au 4,970,000 Oz Au OTIS MINING: Kilgore Project Average Length of Hole 196m g/t Au g/t Au

18 Caldera Deal Terms with Vendors 18 Deal Structured to Fast-track Exploration Initiatives April 2017: Agreement re-negotiated and amended (all figures in USD) Terms: Vendor - Genesis Gold, will retain a 2% NSR Advance Royalty Payments ( ARP ) due, as part of NSR Quartz Vein at Caldera Property ARP: $5,000 on signing Paid $15,000 June Paid $30,000 Due November Paid $50,000 Due November Paid $75,000 Due November 2019 $100,000 Due November 2020 $125,000 Due November 2021 (Adjusted for CPI from Previous Payment Date) $150,000 Due November 2022 and annually thereafter (CPI Adjusted) Discovery Harbour receives title when Advance Royalty Payments total $400,000 Warrants: Vendor received 166, Cents for 3 years from date of grant (June 2017)

19 Summary: 2017 and Focused on exploration using the low sulphidation epithermal gold model CORPORATE TECHNCIAL Accomplishments Accomplishments Share consolidation, corporate overhead reduction, major shareholder provided zero interest loans to support and position company, new website, marketing materials and plans completed Exited non-core assets, improved Caldera deal terms, collected and interpreted extensive historical data, expanded Caldera property dramatically by staking further 163 claims to cover district scale gold potential, mapped key epithermal features. Corporate Expanded property by further 56 claims to cover potential mineralized extensions. o Bolster depth to more actively engage financial markets, conduct technical work on project portfolio Plans Acquisitions o Acquire additional projects complementing Caldera Project and develop robust project portfolio focused on gold in western USA Financing o Complete major financing of approximately $1.5 to 3M, sufficient to complete geochemistry, geophysics and drilling, expand shareholder base Plans Geochemistry & Geophysics o Use mapping program results to parse priority targets with detailed soil geochemistry and geophysics o Combine geochemistry with geophysics to select best drill targets Drill Campaign o Drill approximately 6 300m to 400m each to reach the boiling zone where higher-grade gold would be deposited

20 Comparatives 20 Market Caitalisation Canadian$ million Discovery Harbour Value Proposition US-focused investments Corporate mandate to actively explore as well as acquire new prospects Caldera Project and its Extension forms excellent foundation of value Other projects being analyzed it is a buyer s market Shareholder value is a function of asset quality plus investor visibility company plans on actively engaging financial community Well-structured and modestly-valued = Significant room to increase shareholder value

21 Capitalization 21 Shares Outstanding 23,797,840 Valuation $1.66 M ($0.07 per share) Options $0.30 Expiry March 23, 2020 $0.90 Expiry July 5, 2020 $1.23 Expiry November 23, 2020 Warrants $0.15 Expiry June 12, 2020 $0.22 Expiry June 12, 2020 $0.10 Expiry July 23, 2020 Debt (owed solely to Richard Gilliam) $345,556 Non-interest bearing $100,000 Convertible debenture, non-interest bearing Convertible Debenture matured April 7, 2018; Convertible at 15 cents per share, or the price of the most recently completed private placement DHR Ownership: Tightly Held by Mining Entrepreneurs DHR Director: Richard Gilliam 41.3 % Ore Capital 15.6% Retail Investors 37.7 % Other DHR Management & Directors 3.3 %

22 Caldera Property Landscape Photos 22 Old Prospect Pit at East Golden Rock chip sample in pit had value of 48.9 g/t Au Looking northwest from the Old East Golden Mine Drill pad for Hole CD07-22 on West Golden Zone

23 Historic Work Done 23 Historic mining at West Golden Deep old working, at least 70 feet South Hills Zone Visible fault where Hole GW-5 intersected 10 feet of g/t Au Old East Golden Mine

24 Historic Work Done on Golden King Mine 24 Mining activity followed WNW structures in the 1920 s Legacy equipment - Ore hopper Historic tailings at Golden King Mine

25 Altered Rock Across Caldera Property Highly silicified altered rock on surface of West Golden Zone Highly fractured rock at Golden King Mine Quartz vein at Golden King Mine Historic rock sample photo Visible quartz in highly altered rock at East Golden 25

26 26 Contacts Office Address Mark Fields, P.Geo., B.Comm (Hon) Suite Howe St. Vancouver, BC V6C 2T5 President & CEO Office: Investor Relations Purple Crown Communications Office: