Ecuador: rehabilitating a land with a chequered mining history


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Objective Capital's Global Resources Investment Conference 2011
Stationers' Hall, City of London
27-28 September 2011
Day 1- Session 6: Americas' focus
Speaker: Steve White, Ecuador Gold Inc

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Ecuador: rehabilitating a land with a chequered mining history

  1. 1. Ecuador: rehabilitating a land with a chequered mining history<br />Steve White – Ecuador Gold<br />
  2. 2. @Objectivelive<br />GLOBAL RESOURCESINVESTMENT CONFERENCE 2011<br />Lead sponsor:<br />Media partners:<br />Other sponsors & participating organisations:<br />
  3. 3. ADVANCED GOLD PROJECT IN ECUADOR<br />Corporate Presentation<br />September 2011<br />3<br />
  4. 4. Disclaimer<br />Forward Looking Information<br />This presentation includes statements that are forward-looking. All statements in the presentation (other than statements of historical fact) that address future operations or plans of Ecuador Gold Inc. (“ECC”) or their affiliates, proposed acquisitions, development and commissioning of mines, long term corporate goals, estimated development costs or operating costs, marketing plans or anticipated customers, mine reserves or resources, expansion of production, demand for product, and the future of the mining industry in general and the mining industry in Ecuador in particular are forward-looking statements. Such forward-looking information involves known and unknown risks, uncertainties and other factors which may cause actual results, performance or achievements to be materially different from the results, performance or achievements implied by the forward-looking statements. Factors that could cause actual results to differ materially include, but are not limited to, market prices for gold, general economic, market and business conditions, risks and uncertainties related to ECC’s abilities to complete their acquisition of gold properties in Ecuador, to successfully explore and develop the property, to obtain all necessary permits for exploration and development as and when required, to obtain listings for securities of ECC on a Canadian stock exchange upon completion of the acquisition of the property by ECC, estimation of resources and reserves, delays in exploration or development, accidents, equipment breakdowns, title matters, labour disputes or other unanticipated difficulties with or interruptions in exploration or development, gold price fluctuations, failure to obtain adequate financing when needed, exchange rate fluctuations, and risks and uncertainties associated with doing business in Ecuador.<br />Although ECC has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that statements containing forward looking information will prove to be accurate as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance on statements containing forward looking information. <br />There may be information in this presentation that is information about prospective results of operations, financial position or cash flows (a “financial outlook”). This financial outlook is provided only to assist in an evaluation of the prospective business outlined in this presentation, but are not to be relied upon as accurate representations of future results and may not be appropriate for any other purpose. Furthermore, because this financial outlook is based upon estimates and hypothetical assumptions about circumstances and events that have not yet taken place and are subject to variation, there are no representations or warranties associated therewith, and there can be no assurance that the outlook will be attained. Readers are cautioned that no forward looking statement or financial outlook is a guarantee of future performance. ECC assumes no obligation to update these forward-looking statements or financial outlook except as may be required by law.<br />Not an Offering of Securities<br />This presentation is for information purposes only and does not constitute an offer to sell or a solicitation to buy the securities of ECC or any other securities.<br />Cautionary Note to U.S. Investors Concerning Estimates of Measured and Indicated Resources<br />This presentation uses the terms “Measured” and “Indicated” Resources. U.S. investors are advised that while such terms are recognized and required by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize them. U.S. investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves.<br /><br />4<br />
  5. 5. Corporate Highlights<br />Condor Gold Project<br /><ul><li> Proven Resources
  6. 6. Proximity adjacent to a Major
  7. 7. Experienced Management
  8. 8. Reinterpretation of the Geological Model
  9. 9. Aggressive Drill Program
  10. 10. Timing - Ecuador now ‘Open for Business’
  11. 11. Fully Funded - Listing Imminent</li></ul><br />5<br />
  12. 12. Ecuador<br />Ecuador: Improving Mining Regime<br /><ul><li>Well understood favorable mining geology
  13. 13. Geological studies performed by the British, Swedish and Ecuadorian Geological Surveys
  14. 14. Mining code established and mining tenement registry (catastral) is posted on the internet
  15. 15. Mining contracts being negotiated with Kinross, China Railway and International Minerals
  16. 16. Kinross has committed to investing $1.1 billion to the development of its Fruta del Norte Project
  17. 17. All business in Ecuador is transacted in US$</li></ul><br />6<br />
  18. 18. Location<br /><br />7<br />
  19. 19. Corporate Highlights<br />Condor Gold Project<br />Condor Gold Project<br /><ul><li>90% interest in the Condor Gold Project
  20. 20. Current 43-101 - 2.8 million oz gold
  21. 21. Additional 43-101 – 14.92 million oz silver 
  22. 22. New geological interpretation of property/package
  23. 23. Aggressive 40,000+ meter exploration & drilling campaign starting in Q4 2011
  24. 24. Proximity</li></ul> - adjacent to 13.7 million oz Fruta del Norte Project (Kinross) and 4.5 million oz Mirador Project (China Railway)<br /><ul><li>Continued Ecuador country de-risking</li></ul>- Mining law in place<br />- Mining contracts in process with majors<br /><br />8<br />
  25. 25. Management<br /><br />9<br />
  26. 26. Acquisition<br />Acquisition Structure<br /><ul><li>Ecuador Capital acquired a 90% interest in the Condor Gold Project through assignment of Alca’s agreement with Ecometals by:</li></ul>- Making all payments to Ecometals ($7 million)<br />- Spending $8 million on exploration<br />- Issuing 15 million shares to Alca<br /><ul><li>Alca had the right to purchase a 90% interest in the Condor Gold Project from Ecometals for $7 million:</li></ul>- $2 million due December 31 2010 (Paid)<br />- $2.5 million due May 31, 2011 (Paid)<br />- $2.5 million due on Nov 30,2011<br /><ul><li>DINE will continue to hold a 10% interest in the project
  27. 27. FJTX Concession – acquired from EcoMetals – paid $500,000 (31st May)</li></ul>Ecuador Capital Corp<br />Agreement to acquire all of Alca Gold’s 90% Interest<br />Alca Gold Corp<br />Agreement to acquire Ecometals 90% Interest<br />Condormining Corp<br /><br />10<br />
  28. 28. Location<br />Project Location<br />Mirador Project:<br /><ul><li>China Railway & Tongling acquired Corriente Resources in 2010 for $679 million
  29. 29. Resources estimate of 4.5 MMoz Au and 11.5 MMt Cu</li></ul>Fruta del Norte Project:<br /><ul><li> Kinross acquired Aurelian Resources in 2008 for $1.3 billion
  30. 30. Resources estimate 13.7 MMoz Au
  31. 31. In 2011, Kinross announced $1.1 billion for the Fruta Del Norte gold project to produce 400,000 oz per year</li></ul><br />11<br />
  32. 32. Condor Gold Project Resources<br />43-101 Compliant Resource<br />Chinapintza Vein System:<br /><ul><li>95,000 oz Au @ 11.2 g/t and 596,000 oz Ag @ 70.2 g/t M+I resources
  33. 33. 459,617 oz Au @ 5.9 g/t and 3.5 MMoz Ag @ 44.4 g/t inferred resources </li></ul>Condor Gold:<br /><ul><li>Includes San Jose, Enma and Soledad
  34. 34. 1.4 MMoz Au @ 1.0 g/t and 10.9 MMoz Ag @ 8.8 g/t M+I resources</li></ul>Santa Barbara Au-Cu Porphyry:<br /><ul><li>819,844 oz Au @ 1.0 g/t inferred resources</li></ul>Total Resources:<br /><ul><li>1.5 MMoz Au M+I and 1.3 MMoz Au inferred
  35. 35. 11.5 MMoz Ag M+I and 3.5 MMoz Ag inferred</li></ul><br />12<br />
  36. 36. Geology<br /><ul><li>Located approximately 40 km (straight-line) east of the town of Zamora in the Pachiicutza Mining District
  37. 37. Four types of mineral systems exist
  38. 38. Low sulphidation epithermal gold in diatremes
  39. 39. Vocaniclastics & breccia pipes
  40. 40. Polymetallic (Au, Ag, Pb, Zn) mesothermal veins & structurally controlled high grade epithermal gold
  41. 41. Gold, copper/gold & copper/molybdenum porphyry systems
  42. 42. The Northern Sectorcomprises low sulfidation mineralization which is hosted by a series of breccia pipes, porphyry potential, as well as by the numerous narrow fault-veins of the Chinapintza Vein System
  43. 43. The Southern Sectoris host to both classic Cu-Au Porphyry mineralization and structurally controlled higher grade Au
  44. 44. El Hito is a large classic Cu-Mo Porphyry</li></ul>Chinapintza<br />Los Cuyes<br />San Jose<br />El Hito<br />Santa Barbara<br /><br />13<br />
  45. 45. Two Porphyry Models <br />TYPE A<br />Gold – Copper Base Metal Model<br />+/- Ag, Mo, Zn<br />TYPE B<br />Gold Rich Model<br />Au, Cu, Mo, Zn, Bi, Te, As<br /><br />14<br />
  46. 46. Northern Section Regional Geology<br /><br />15<br />
  47. 47. Northern Section Geology<br />Condor Gold: New District Geologic & Porphyry Models<br />Geophysics Anomalies, Geology & PDH<br /><br />16<br />
  48. 48. Northern Section - IP<br />IP Interpretation with Porphyry Types<br /><br />17<br />
  49. 49. Northern Section Geology<br />Geology & Porphyry Type X-Sections <br /><br />18<br />
  50. 50. Northern Section Geology & Geophysics Sections<br />IP Geophysics with Porphyry Types<br /><br />19<br />
  51. 51. Northern Section Geology & Geophysics Sections<br />Resistivity Geophysics with Porphyry Types<br /><br />20<br />
  52. 52. Northern Section Magnetics<br />Northern Section Proposed 2011 Drilling<br /><br />21<br />
  53. 53. Northern Section – Chinapintza Vein System<br />Dynasty<br />Jerusalem<br /> Project<br /><ul><li>Gold-silver-lead-zinc in vein system split between Chinapintza and Jerusalem Project (Dynasty Metals)
  54. 54. Combined 1.9 MMoz Au resource
  55. 55. Jerusalem M+I resource of 585,100 oz Au at an average grade of 12.4 g/t and an inferred resource of 710,130 oz Au at an average grade of 11.5 g/t
  56. 56. Proposed acquisition or JV with Dynasty to facilitate consolidated exploration, resource development and feasibility
  57. 57. Further Exploration could significantly increase resources & economics</li></ul>Chinapintza<br />District<br /><br />22<br />
  58. 58. Northern Section – Los Cuyes Deposit <br /><br />23<br />
  59. 59. Northern Section – Soledad Deposit<br />High Grade Zinc-Pyrite Veined Breccia<br />Underground Working in High Grade Vein <br />Los Cuyes Deposit <br /><br />24<br />
  60. 60. Northern Section – Enma Deposit<br />Drill hole DEN-04a 74 to 76m depth assayed 250g Au over 2m<br />Various Types of Mineralized Breccias<br />Local Mine Extracting High Grade Vein<br /><br />25<br />
  61. 61. Southern Section – El Hito & Santa Barbara<br />El Hito – Santa Barbara Sector<br /><ul><li>Porphyry Cu-Mo mineralization
  62. 62. Further exploration intends to focus on the porphyry potential</li></ul>Santa Barbara – Santa Barbara Sector<br /><ul><li>Structurally controlled Cu-Au mineralization
  63. 63. Further exploration will be conducted in upcoming exploration campaign</li></ul>Chinapintza<br />Los Cuyes<br />San Jose<br />El Hito<br />Santa Barbara<br /><br />26<br />
  64. 64. Southern Section – Santa Barbara <br />IP/Chargeability with Previous & Proposed Drilling <br /><br />27<br />
  65. 65. Southern Section – El Hito<br />DH02: 171.2 m, Moly – cpy in grandiorite porphyry <br />DH03: 19.2 m, malachite in coarse grained diorite porphyry<br />Quartz stockwork zone in a porphyry intrusion at the SW part of El Hito. The outcrop is about 75 m wide. The area is still untested by drilling.<br /><br />28<br />
  66. 66. Capital Structure<br />*Pro forma Structure on completion of TSX Venture listing<br /><br />29<br />
  67. 67. Corporate Highlights<br />Condor Gold Project<br /><ul><li> Proven Resources
  68. 68. Proximity adjacent to a Major
  69. 69. Experienced Management
  70. 70. Reinterpretation of the Geological Model
  71. 71. Aggressive Drill Program
  72. 72. Timing - Ecuador now ‘Open for Business’
  73. 73. Fully Funded - Listing Imminent</li></ul><br />30<br />
  74. 74. Contact<br />Contact:<br />Steve White<br />Suite 1910-1055 West Hastings StreetVancouver, BC V6E 2E9 <br />Tel: 604-657-5871<br />UK – 07757 457 364<br /><br /><br />31<br />
  75. 75. Appendices<br /><br />32<br />
  76. 76. NI 43-101 Resources<br />Notes:<br /><ul><li>Per Al Maynard and Associates Pty Ltd. (14th April, 2011) – 43-101 Technical Report
  77. 77. 0.25 g/t or 0.5 Au cut-off grade
  78. 78. Totals are rounded</li></ul><br />33<br />