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Operating the new High Grade
Copperstone Gold Mine in Arizona
September 2013

1
Cautionary Statement
Forward Looking Statements: Certain statements contained in this presentation constitute forward-look...
American Bonanza Gold Corp’s strategy is
to build a portfolio of producing gold mines
in North America by:
•Developing hig...
Copperstone Gold Mine, Arizona

•
•

•
•
•
•

4

100%-owned & fully permitted high-grade
underground mine
Previous open pi...
Feasibility Study: Gold Resources and Reserves
Mineral Resource
Classification

Tonnes

Measured Resources

934,000

10.4
...
Development Timeline
• Feb. 2010:

Positive Feasibility Study completed
(updated Jan. 2011)

• Jan. 2011:

Project financi...
The Past Six Months: Ramp-up Progress
Month

Activity

March

•
•
•

April

New mine planning yielding results

May

Gold ...
Ore & Development Mining Progress
•

The priority of the new mine planning is to ensure
sustainability through the:
• Deve...
Copperstone Mine: Mine Plan
Planned New High
Grade Gold Stopes

N

Planned New
Underground Workings

Previously Mined
Wast...
Copperstone Mine: Processing Facility
• Consistent performance for over twelve months
• Currently permitted for 450 tons/d...
Copperstone Mine: Feasibility Economics
•
•
•
•
•

Gold production
Cash production
Capex Payback
Total gold produced
NPV

...
American Bonanza: Corporate Info
• Trading Symbol

BZA (TSX), ABGFF, (OTCQX), AB2 (Frankfurt)

• Recent share price

CDN $...
American Bonanza: Current Status
• Break-even gold sales:

~ 1,300 ounces of gold per month

• Gold Loan:

US$8.6 MM

• Cu...
American Bonanza Gold Corp:
Expansion Potential
September 2013

14
Copperstone Mine: Expansion Potential
Expansion potential within mine plan & permit
area to expand current resource
Severa...
Copperstone Mine: Expansion Potential
• Drill campaign initial focus will be near currently active stopes
where gold miner...
Suparna Gold Corp. Exploration JV
• South West of mining operations, on 50 claims that are part of
the larger Copperstone ...
Management
Brian Kirwin

President & CEO

•
•
•

Todd Fayram

Chief Operating Officer

•

•
•

Douglas Wood

•

Vice Presi...
Directors
Brian Kirwin
President & CEO

•
•
•

30 yrs+ mining experience in exploration, development & production.
Extensi...
American Bonanza: Growth Strategy
• Acquisition targets similar to Copperstone:
– Sites with substantial infrastructure – ...
Summary

• New gold producer in 2013 in rampup towards design rates
• Mine management team optimising
mill & mine to achie...
Appendix: Photo Gallery
September 2013

22
Copperstone Minesite: Aerial View
BZA’s North Portal

Open Pit
waste
Tailings Impoundment

Ore Haulage road

BZA’s West Po...
Copperstone Mine: Processing Plant and Ancillary Facilities
1.
2.
3.
4.
5.
6.
7.

8.
9.
10.
11.
12.
13.
14.
15.
16.

17.

...
Ore & Development Mining Progress

North Decline Portal

North Decline connects to West
Decline

Ore Stockpile near Crushe...
Ore & Development Mining Progress

Underground Bolter

Underground Loader
26

Surface Haul Trucks

Mine Shop and Team
Processing Facility

Crushing Circuit; plant in background

Secondary Crusher
27

Jaw crusher & feed bin

Processing Plant
Processing Facility

Grinding Mills

Gold Jigs
28

Flotation Cells

Electrical control room
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American Bonanza

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American Bonanza

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American Bonanza

  1. 1. Operating the new High Grade Copperstone Gold Mine in Arizona September 2013 1
  2. 2. Cautionary Statement Forward Looking Statements: Certain statements contained in this presentation constitute forward-looking statements. Such forward looking statements involve a number of known and unknown risks, uncertainties and other factors which may cause the actual results, performance of achievements of the Corporation to be materially different from actual future results and achievements expressed or implied by such forward-looking statements. Investors are cautioned not to place undue reliance on these forward-looking statements. Resources: This presentation uses the terms “Measured”, “Indicated” and “Inferred” Resources. U.S. investors are advised that while such terms are recognized and required by Canadian regulations, the Securities and Exchange Commission does not recognize them. “Inferred Resources” have a great amount of uncertainty as to their existence and great uncertainty as to their economic feasibility. It cannot be assumed that all or any part of an inferred resource will ever be upgraded to a higher category. The Resources in this document were prepared and filed in accordance with National Instrument 43-101 The resource estimate was prepared by Jonathan Brown., M.B.A., C.P.G., a qualified person under NI 43-101. The reserve estimate was prepared by Tom Buchholz, B.S. Eng - MMSA QPM, a qualified person. The estimates are effective as of February 2, 2010. Details of the key assumptions, parameters, and methods used to estimate the mineral reserves and resources, and information regarding the extent to which the mineral resources and reserves may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing or other relevant issues is contained in a technical report entitled "NI 43-101 Technical Feasibility Report Copperstone Project, La Paz County, Arizona" effective February 2, 2010 and revised January 10, 2011”, prepared for American Bonanza Gold Corp. by Dr. Corby Anders, Allihies Inc., MMSA QP, C. Eng FlChemE, Tom Buchholz, BS Eng. MMSA, Chris Pratt, LPG and Jonathan Brown, M.B.A., C.P.G.. To review this report in its entirety please visit www.americanbonanza.com.. Mineral resources that are not mineral reserves do not have demonstrated economic viabililty. Key Assumptions are described in detail in the technical report entitled "NI 43-101 Technical Feasibility Report Copperstone Project, La Paz County, Arizona" effective February 2, 2010 and revised January 10, 2011”, described above, and available for review on www.sedar.com and on www.americanbonanza.com. For the purpose of resource and reserve calculations, a gold price of USD962 per ounce was used. For resources, a cutoff grade of 5.1 g/t was used. For reserves, a cutoff grade of 4.5 g/t was used. Information in this presentation has been prepared under the supervision of Douglas R. Wood, LPG, a professional geologist employed by American Bonanza and a qualified person under NI 43-101. Numbers in this presentation may not add up due to rounding. 2
  3. 3. American Bonanza Gold Corp’s strategy is to build a portfolio of producing gold mines in North America by: •Developing high grade, high quality projects with upside exploration potential that can be put into production rapidly. •High grade + high quality = low capital and operating costs and rapid development. •Utilising cash flow to support acquisition, development, and future production. Create a highly profitable mid-tier gold producing company 3
  4. 4. Copperstone Gold Mine, Arizona • • • • • • 4 100%-owned & fully permitted high-grade underground mine Previous open pit produced approx ½ million ounces of gold (closed 1993) 9 miles from town of Parker, Arizona Excellent logistics: water, power, roads Significant upside exploration potential Focus of 2013 is the ramp-up to design production rates
  5. 5. Feasibility Study: Gold Resources and Reserves Mineral Resource Classification Tonnes Measured Resources 934,000 10.4 311,000 Indicated Resources 8,000 7.9 2,000 Measured & Indicated 942,000 10.3 313,000 Inferred (South Zone only) 335,000 12.2 132,000 Mineral Reserve Classification Tonnes Proven Reserves (diluted) 904,000 8.8 255,000 6,000 6.3 1,000 910,000 8.8 256,000 Probable Reserves (diluted) Proven & Probable (diluted) Grade (g/t Gold) Grade (g/t Gold) Contained Ounces of Gold Contained Ounces of Gold All reserves and resources are prepared and filed in accordance with NI 43-101. Mineral Reserves are contained within the Measured and Indicated Mineral Resources. Inferred Mineral Resources are in addition to Measured & Indicated Mineral Resources. Gold price used is USD962/ounce. Cutoff grade for resources is 5.1 g/t, and for reserves is 4.5 g/t. Full details are available at www.sedar.com and www.americanbonanza.com. Please see disclosure on page 2. Aprox. 10,000 ounces have been mined during 2012 and partial 2013. 5
  6. 6. Development Timeline • Feb. 2010: Positive Feasibility Study completed (updated Jan. 2011) • Jan. 2011: Project financing closed • Apr. 2011: Plant construction begins • Nov. 2011: Fully permitted for production • Feb. 2012: Mill Commissioned, ship 1st gold in concentrate Gold bearing Concentrate in bag • Year 2012: 6,500 ounces of gold produced 53,500 tons of ore mined 109,400 tons of total rock mined 109,400 tons of total rock mined Flotation tanks • Year 2013: Ramp-up to design production continues Gold bearing Concentrate to be shipped 6
  7. 7. The Past Six Months: Ramp-up Progress Month Activity March • • • April New mine planning yielding results May Gold production breaks 1,000 ounces June Positive early indications July Highest gold produced in one month with 1,224 ounces August Good progress made in accessing new ore zones Andy Patton joins as General Manager Lawrence Buss joins as Chief Geologist New mine plan introduced Gold bearing Concentrate in bag Flotation tanks Gold bearing Concentrate to be shipped 7
  8. 8. Ore & Development Mining Progress • The priority of the new mine planning is to ensure sustainability through the: • Development mining focus for the future, and thus • provide availability of additional ore zones • The new approach includes the following: • Development headings are mined parallel to and near the ore one (previously accessed along strike) • Ore zones then accessed via short crosscuts into and across the middle of the ore zones in high grade • Long hole stoping in several areas will help to reduce costs & increase productivity further 8 Mineralized ore body
  9. 9. Copperstone Mine: Mine Plan Planned New High Grade Gold Stopes N Planned New Underground Workings Previously Mined Waste Dumps Adits Previously Mined Open Pit Existing Underground Workings New Tailings Impoundment New Reclaim Pond Processing Plant Site Previous Tailings Impoundment 1,000 feet 9
  10. 10. Copperstone Mine: Processing Facility • Consistent performance for over twelve months • Currently permitted for 450 tons/day; plant capacity to 700 tons/day • Crush, grind, gravity, flotation circuit • Oxide ores – no requirement for cyanide use for free gold in oxides Flotation tank 10 Processing plant
  11. 11. Copperstone Mine: Feasibility Economics • • • • • Gold production Cash production Capex Payback Total gold produced NPV • Pre-tax Cash Flow • IRR avg. 46,000 oz/yr for first 3 yrs, then avg. 32,000 oz/year for next 3.3 yrs cost of $415 per ounce 13 months using base case $962/oz gold price (currently faster payback) 213,000 ounces (feasibility does not include inferred resources) base case is $51m (after tax, discounted @5%) using $962/ounce Au. - using $1400/oz gold price, NPV is $102M base case is $74m (undiscounted) - using $1400/oz gold price, cash flows total $168m (undiscounted) base case 96.3%, using $1400/oz gold price, IRR is 170.4% (Source: 2011 Feasibility Study, prepared and filed in accordance with NI43-101) Figures in US dollars. See page 2 for important information. 11
  12. 12. American Bonanza: Corporate Info • Trading Symbol BZA (TSX), ABGFF, (OTCQX), AB2 (Frankfurt) • Recent share price CDN $0.05 (September 10, 2013) • Market Cap CDN $11.7 MM • 3 month av. daily volume 348,000 • Shares Outstanding 234,396,111 Fully Diluted: Options: Warrants: 12 275,377,963 6,380,852 34,601,000
  13. 13. American Bonanza: Current Status • Break-even gold sales: ~ 1,300 ounces of gold per month • Gold Loan: US$8.6 MM • Current Financing: Convertible debenture $1 MM • Proposed equity financing: Use of proceeds is for equipment and inventory of spare parts aimed at productivity to achieve design production rates. Most conservative forecasts indicate that design rates can be achieved in 2013. 13
  14. 14. American Bonanza Gold Corp: Expansion Potential September 2013 14
  15. 15. Copperstone Mine: Expansion Potential Expansion potential within mine plan & permit area to expand current resource Several structural and geophysical exploration targets warrant additional follow-up drilling for resource discovery South Target Inferred Resource SW Target drilling anticipated from JV SOUTH TARGET Inferred Resource: 132,000 ounces at 12g/t grade 15
  16. 16. Copperstone Mine: Expansion Potential • Drill campaign initial focus will be near currently active stopes where gold mineralization is open up dip and down dip – ongoing, and scheduled for increase in drilling starting at the end of mine ramp-up • Reserves expanding due to current gold price – feasibility used $962 per ounce • Entire structure containing Reserves is open down dip with substantial potential to increase reserves • South Target Inferred Resource not included in the mine plan High grade gold assay bead – inferred resources of 132,000 oz of gold* with average grade of +12 g/t gold contained within 335,000 tonnes (5.1 g/t cutoff) SW Target identified by geophysical and structural analysis and first 10 drill holes returned promising results Free gold in oxide mineralization *(Source: 2011 Feasibility Study, prepared and filed in accordance with NI43-101) Figures in US dollars. See page 2 for important information. 16
  17. 17. Suparna Gold Corp. Exploration JV • South West of mining operations, on 50 claims that are part of the larger Copperstone property • Exploration target identified by geophysics and ten drill holes with encouraging results from 2005-2008 • Drilling suggests size and grade potential • The target is not part of the existing Copperstone Mine Resource, and is +1 km from the existing mine workings • JV will help to speed the exploration of this target for American Bonanza without the need for Bonanza to fund the drill program • Suparna Gold Corp. team is supported by an experienced group with previous involvement in successful exploration projects Example drill rig *(Source: 2011 Feasibility Study, prepared and filed in accordance with NI43-101) Figures in US dollars. See page 2 for important information. 17
  18. 18. Management Brian Kirwin President & CEO • • • Todd Fayram Chief Operating Officer • • • Douglas Wood • Vice President, Exploration • Joe Chan • Vice President & CFO 18 • 30 yrs+ mining experience in exploration, development & production. Extensive international work evaluating deposits, operating mines & corporate transactions. Former VP, Exploration of Vengold (1997-2000), & formerly with Placer Dome Inc. in senior Corporate Development & Exploration positions. 23 years experience in mine, process, and metallurgical engineering worldwide Served as General Manager, Project Development Manager, or VP Operations at over half-dozen mines Consultant to Lakeshore Gold, Getty Copper, Minefinders, AngloAmerican, Freeport among others Over 30 years experience in precious metals exploration and project development Played a significant role in the modern expansion of discoveries, reserves and operations on the Carlin Trend while serving as Newmont’s Exploration Manager, Great Basin, covering the Carlin Trend from 1984 to 1991. 25+ years of accounting, administration and system experience in the mining industry Former experience with Teck Cominco (1992 to 2002); former controller for various public companies, including International Taurus Resources Inc., since 2003
  19. 19. Directors Brian Kirwin President & CEO • • • 30 yrs+ mining experience in exploration, development & production. Extensive international work evaluating deposits, operating mines & corporate transactions. Former VP, Exploration of Vengold (1997-2000), & formerly with Placer Dome Inc. in senior Corporate Development & Exploration positions. Director James Bagwell Director Jamie Newall Director Robert McKnight Director • 35 yrs experience in investing, financing & consulting to natural resource companies. • Runs his own merchant banking company based in Canada. • Wayne Tisdale Currently President & CEO of Declan Resources Inc, and sits on the board of a number of private and public companies including Suparna Gold Corp. • 38 yrs+ in a number of sectors including mining, farming & real estate as an entrepreneur, investor & a variety of senior management roles. He is a partner with ABBA Corp & holds a BSc in Economics & Business Admin. • • • • • • • 19 Currently COO at Declan Resources Inc; exploration company in Sierra Leone. Sits on boards of several companies including Suparna Gold Corp. From 2007-2009, he was founding director of GPN Capital; an FSA authorised fund. Geological engineer with 25 yrs+ experience in the resource business. Senior roles with Brascan Resources, Wright Engineers, Getty Resources, TOTAL S.A., Endeavour Financial, Pincock Allen & Holt Ltd., AMEC, Yukon Zinc. Currently Executive Vice President of Nevada Copper.
  20. 20. American Bonanza: Growth Strategy • Acquisition targets similar to Copperstone: – Sites with substantial infrastructure – likely pre-mined sites or in production – Potential for rapid permitting (Copperstone permit cycle just over one year) – Potential for rapid construction (Copperstone construction approx. one year) – High margin potential: primarily result of high gold grades & favorable metallurgy – High grade + high quality = low capital and operating costs + rapid development 20
  21. 21. Summary • New gold producer in 2013 in rampup towards design rates • Mine management team optimising mill & mine to achieve full production • Excellent potential to expand reserves in permitted mine area • Exploration & acquisition strategies ready for execution at start of full production create a highly profitable mid-tier gold producing company 21
  22. 22. Appendix: Photo Gallery September 2013 22
  23. 23. Copperstone Minesite: Aerial View BZA’s North Portal Open Pit waste Tailings Impoundment Ore Haulage road BZA’s West Portal Open Pit (closed 1993) Open Pit waste Mill Complex Access Road 23 1000m
  24. 24. Copperstone Mine: Processing Plant and Ancillary Facilities 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. Crusher hopper Crushers Conveyor Crushed Ore bin Processing plant & concentrate plant Water tank Haulage road from portal Open pit waste dump Electrical substation Assay lab Warehouse Core storage Maintenance & truck repair shop Car lot & security entrance Access road Administration offices Gold bearing concentrate to ship 7 1 2 17 8 3 5 12 6 4 9 10 13 11 14 16 135m 15 24
  25. 25. Ore & Development Mining Progress North Decline Portal North Decline connects to West Decline Ore Stockpile near Crusher 25 North Decline Portal Safety Chamber Mineralized Ore Body
  26. 26. Ore & Development Mining Progress Underground Bolter Underground Loader 26 Surface Haul Trucks Mine Shop and Team
  27. 27. Processing Facility Crushing Circuit; plant in background Secondary Crusher 27 Jaw crusher & feed bin Processing Plant
  28. 28. Processing Facility Grinding Mills Gold Jigs 28 Flotation Cells Electrical control room

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