49 North Resource Conference


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49 North Resource Conference

  1. 1. Lake Shore Gold Corp. pPoised for Valuation Break-Out49 North Resource Conference TSX & NYSE MKT : LSGDecember 13, 2012 www.lsgold.com
  2. 2. Forward Looking StatementsInformation included in this presentation relating to the Companys expected production levels, production growth, costs, cash flows, economicreturns, exploration activities, potential f i t l ti ti iti t ti l for increasing resources, project expenditures and b i i j t dit d business plans are "f l "forward-looking statements" or d l ki t t t ""forward-looking information" within the meaning of certain securities laws, including under the provisions of Canadian provincial securities laws and underthe United States Private Securities Litigation Reform Act of 1995 and are referred to herein as "forward-looking statements." The Company does notintend, and does not assume any obligation, to update these forward-looking statements. These forward-looking statements represent managements bestjudgment based on current facts and assumptions that management considers reasonable, including that operating and capital plans will not be disruptedby issues such as mechanical failure, unavailability of parts, labour disturbances, interruption in transportation or utilities, or adverse weather conditions,that there are no material unanticipated variations in budgeted costs that contractors will complete projects according to schedule and that actual costs, schedule,mineralization on properties will be consistent with models and will not be less than identified mineral reserves. The Company makes no representation thatreasonable business people in possession of the same information would reach the same conclusions. Forward-looking statements involve known andunknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially differentfrom any future results, performance or achievements expressed or implied by the forward-looking statements. In particular, delays in development ormining and fluctuations in the price of gold or in currency markets could prevent the Company from achieving its targets. Readers should not place unduereliance on forward-looking statements. More information about risks and uncertainties affecting the Company and its business is available in theCompanys most recent Annual Information Form and other regulatory filings with the Canadian Securities Administrators, which are posted on sedar atwww.sedar.com, or the Company’s most recent Annual Report on Form 40-F and other regulatory filings with the Securities and Exchange Commission.QUALITY CONTROLLake Shore Gold has a quality control program to ensure best practices in the sampling and analysis of drill core. A total of three Quality Control samplesconsisting of 1 blank, 1 certified standard and 1 reject duplicate are inserted into groups of 20 drill core samples. The blanks and the certified standards arechecked to be within acceptable limits prior to being accepted into the GEMS SQL database. Routine assays have been completed using a standard fire p p g p y p gassay with a 30-gram aliquot. For samples that return a value greater than three grams per tonne gold on exploration projects and greater than 10 gpt at theTimmins mine and Thunder Creek underground project, the remaining pulp is taken and fire assayed with a gravimetric finish. Select zones with visible goldare typically tested by pulp metallic analysis on some projects. NQ size drill core is saw cut and half the drill core is sampled in standard intervals. Theremaining half of the core is stored in a secure location. The drill core is transported in security-sealed bags for preparation at ALS Chemex Prep Lablocated in Timmins, Ontario, and the pulps shipped to ALS Chemex Assay Laboratory in Vancouver, B.C. ALS Chemex is an ISO 9001-2000 registeredlaboratory preparing for ISO 17025 certification.QUALIFIED PERSONThe Company’s Qualified Persons (“QPs”) (as defined in National Instrument 43-101, “Standards of Disclosure for Mineral Projects”) for surface diamonddrilling projects at the Timmins West Mine Complex, Bell Creek Mine Complex; Fenn-Gib property and Casa Berardi optioned property are JacquesSamson, P.Geo. and Keith Green, P.Geo. Dean Crick, P.Geo. is the QP for underground drilling at the Timmins West Mine and Bell Creek Mine properties.Reno Pressacco, P.Geo is the QP for the current resource estimate at the Marlhill Deposit. Ralph Koch, P.Geo is the QP for the current resource estimateat the Bell Creek property and portions of the Timmins West Mine. Bob Kusins, P.Geo. is the QP for resource estimation for portions of the Timmins WestMine d t llMi and at all remaining Company properties. A QP M i i C ti As QPs, Messrs. S Samson, G Green, C i k K h and K i h Crick, Koch d Kusins have prepared or supervised th preparation of d i d the ti fthe scientific or technical information for their respective properties as reviewed in this MD&A. Messrs., Samson, Green, Koch, Kusins and Crick areemployees of the Company. 2
  3. 3. LSG: Poised for Valuation Break-OutExcellent progress in 2012 – stage set for outperformance Significant development and expansion work completed On track to achieve production targets Positioned for rapid growth in 2013 & 2014(1) Exiting 2012 with 25% increase ( 2,500 tpd) in p g (to p ) production rate Further increase planned for Q2/13 to 3,000 tpd Underpins @ 50% production growth in 2013, further growth planned in 2014 Strong financial position Cash position of $55-$60M exiting 2012(1) p g Significant reduction in capital spending going forward Positive free cash flow from operations in 2013 Excellent exploration upside (1) Examples of forward-looking information 3
  4. 4. LSG: Poised for Valuation Break-Out Lake Shore Gold (TSX, NYSE MKT: LSG) Shares outstanding (basic) 415,700,000 Share price (Dec. 10, 2012) p ( ) $0.71 Market capitalization $295,000,000 52 week High/Low $1.73/$0.63 3M average volume (shares on TSX/NYSE MKT) 2,034,000 2 034 000 4
  5. 5. LSG – 3 Multi-Million Ounce Gold Complexes Pipestone Fault Bell Creek Complex Bell Creek Mill Destor-Porcupine Fault City of Timmins Fenn-Gib Timmins Timmins West Mine Timmins Gold Camp: >70M ozs produced Timmins West Complex Main drivers of near-term growth Large resource base – 3.4M ozs M&I, 3.7M ozs Inferred Timmins West Complex – Total resources of 1.2M ozs M&I, 1.8M ozs Inferred – Timmins West Mine in production, 144/GRT attractive exploration targets Bell Creek Complex – Resources: 0.8M ozs M&I, 1.1M ozs Inferred – North A Deep Zone key target, other properties provide upside – Bell Creek Mill – operating at 2,500 tpd capacity Fenn-Gib – Large open pit project with significant exploration upside open-pit – Resources: 1.3M ozs Indicated, 0.8M ozs Inferred (1) Examples of Forward Looking Statements. 5
  6. 6. LSG – Large Resource Base Probable Reserves Tonnes Au Grade (g/t) Contained Ounces Timmins West Mine 4,922,000 5.21 823,800 Measured & Indicated(1) Tonnes Au Grade (g/t) Contained Ounces Timmins West Mine 5,826,000 5.99 1,122,500 Gold River 690,000 5.29 117,400 Bell Creek Mine 4,249,000 4.73 646,400 Vogel 2,219,000 1.75(2) 125,000 Marlhill 395,000 4.52 57,400 Fenn Gib 40,800,000 0.99(2) 1,300,000 Total T t l 3,368,700 Inferred Tonnes Au Grade (g/t) Contained Ounces Timmins West Mine 4,272,000 5.76 791,500 Gold River 5,273,000 5 273 000 6.06 6 06 1,027,800 1 027 800 Bell Creek Mine 6,088,506 4.87 953,800 Vogel 1,459,000 3.60(3) 168,800 Fenn-Gib e Gb 24,500,000 ,500,000 0.95(2) 0 95 750,000 50,000 Total 3,691,900 (1) Resources are inclusive of reserves (2) Open-pit resources (3) Combination of underground and open-pit resources 6
  7. 7. LSG – Strong Operating Performance in 2012 O track to produce over 85,000 ounces gold(1) On t k t d 85 000 ld Development program well advanced 700 000 ounces of resources to be accessed at TWM at year end(1) 700,000 Development to 610 Level at Bell Creek to support deep U/G drilling Extensive U/G diamond drilling program, 106,000 m to date in 2012 Focus on resource conversion and delineation Significant success achieved Si ifi t hi d Increased mill capacity & mine throughput 25% to 2,500 tpd Effectively Eff ti l managed capital and operating costs d it l d ti t Capex budget reduced from $193M to $175M Operating cost per tonne YTD of $112, below budgeted levels ($105 in Q3/12) (1) Examples of forward-looking information 7
  8. 8. Timmins West Complex130 km2 land position western extension of Timmins Gold Camp position, Pipestone Fault Bell Creek Complex Hoyle Pond Hollinger Pamour Destor Porcupine Fault McIntyre Timmins Dome Fenn-Gib Timmins West Complex 8
  9. 9. Timmins West Mine – 18Kms West of TimminsKey Facts:• Reserves: 823,800 ozs (4.9M tonnes & 5.21 gpt)• Resources: 1.1M ozs Indicated(1), 0.8M ozs Inferred• Production: 45,155 ozs produced in 9M/12• Infrastructure: 710 m 5 5 m diameter shaft, hoist, surface m, 5.5 shaft hoist ramp, two 800m drifts to Thunder Creek• 285 employees (85 surface, 200 U/G) (1) Resources inclusive of reserves. 9
  10. 10. Timmins West MineDevelopment to Timmins Deposit Thunder Creekaccess 700 000 ozs 700,000 200 Levelof resource by endof 2012(1) 300 LevelB end of 2013(1)By Development of Thunder Creek (Lower mine) (L i ) 650 L Level l completed Timmins Deposit 2012 Work 2012 Work Development Program* Program* completed to 900M Level Legend Existing Development 2012 Plan Work 2013 Plan Work Future Plan Work (1) Examples of Forward Looking Statements. 10
  11. 11. Timmins West Mine – Expanding OrebodiesB TW Shaft Ramp A 200 Level Rusk Shear 300 Level Rusk Zones Bristol FaultThunder Creek Stock 730 Level 650 Level Porphyry Zones A Holme Sh ear r Zo ne Mafic volcanics Turbidites, Timmins Mine UM Complex New  results outside  felsic volcanic Pyroxenite (AIC) deposit 50m west extension to  current resource at 750Lv: Syenite, monzonite Rusk zone at 765 Lv 750‐005: 7.5gpt/21.0m B e D3 shear zone 15.8gpt/5.8m gp / on 750 006: 7.3gpt/17.1m 750‐006: 7.3gpt/17.1m rZ ea 0 400 10.5gpt/ 3.4m 650‐223: 10.3gpt/39.5m Sh meters sk Thunder Creek 6.8gpt/5.7m incl 58.0gpt /3.0m         Ru Rusk East-west “Greenstone Nose” Shear Zone **Selected drill results, Not true widths 11
  12. 12. Bell Creek Complex32 km2 land position, includes Bell Creek Mine and Mill and multiple positionother exploration targets Bell Creek Complex Pipestone Fault Hoyle Pond Hollinger Pamour Destor Porcupine Fault McIntyre Timmins Dome Fenn-Gib Timmins West Complex 12
  13. 13. Shaft Mined out Bell Creek Mill – 20Kms of East of Timmins areasKey Facts: Resources:0.6M ozs Indicated, 1.0M ozs Inferred 16,892 ozs produced 9M/12 Significant development & drilling to evaluate North A Deep Zone Infrastructure: mill, tailings, 300 m shaft (non-producing), surface decline to 595 m, vent raises, drill drifts m raises Employees: 95 (70 U/G, 25 surface) (1) Examples of Forward Looking Statements 13
  14. 14. Mill – 25% Increase in Capacity Completed SAG Mill Building Crusher New CIL TanksTruck Dump 6,000 tonne Ore bin New Thickener Exceptional operational & metallurgical performance Average throughput: 2,108 tpd (Q3/12), recoveries: 97.1% (Q3/12) First phase of expansion complete: New capacity 2,500 tpd f Next phase to 3,000 tpd – Targeted completion Q2/13(1) (1) Examples of Forward Looking Statements. 14
  15. 15. LSG: Set for Rapid Growth in 2013 & 2014 Targeting @ 50% production growth in 2013(1) Production to reach >150,000 ozs by 2014(1) Development work largely completed at Timmins West Mine by end of 2013(1) Thunder Creek lower mine fully developed Timmins Deposit developed to 900M Level Phase 2 of mill expansion to be completed in Q p p Q2/13 – 3,000 , tpd capacity 50% higher than pre-expansion level(1) Cash costs to improve in 2013 and reach <US$700/oz in 2014 (incl. royalties)(1) Bell Creek, Gold River Trend and Fenn-Gib provide potential future gro th beyond f t re growth be ond 2014 (1) Examples of forward-looking information 15
  16. 16. Targeting Rapid Production Growth Estimated Production Ranges(1)(2) 3.7Ounces Denotes range 160,000 160 000 140,000 120,000 100,000 >85,000 80,000 , 60,000 40,000 20,000 0 2012 2013 2014 2015 2016 (1) Examples of Forward Looking Statement (2) Bell Creek, Gold River Trend and Fenn-Gib provide further potential growth after 2014 16
  17. 17. Bringing Costs Down – Cash Costs Cash cost per tonne better than planned levels $105 in Q3/12 $112 in 9M/12 Cash costs per ounce US$970 in 9M/12(1) Costs reflect average grades (impact of significant development material processed, deferral of high-grade stopes for further drilling) Cash costs to reach <US$700/oz. by 2014(2) $ y Higher throughput levels – 3,000 tpd Completion of capital program (leverage to infrastructure) Higher grades due to greater flexibility and better understanding of orebodies (1) Before royalties (2) Examples of forward-looking information 17
  18. 18. LSG: Strong Financial Position Well financed – no additional outside sources of capital required Expected to end 2012 with $55-$60 million in cash(1) Capital spending in 2012 reduced from $193M to $175M Capital spending in 2013 to drop @ 50% from 2012, with further 50% reduction expected in 2014(1) Positive free cash flow from operations in 2013, with strong growth in 2014(1) (1) Examples of forward-looking information 18
  19. 19. Strong Financial Position – At Year End 2012 Sources of Cash S fC h $ millions illi Cash and bullion inventory (Sept. 30, 2012) 90.0 Q4/12 operating cash flow(1) 18.0 Total sources of cash (to end of 2012) 108.0 Additional liquidity (standby line) 35.0 Total liquidity at end of 2012 q y 143.0 Uses of Cash (Estimates for Q4/12)(1) $ millions Estimated project spending 42.0 Exploration E l ti 1.5 15 Corporate G&A 3.5 Financing costs 1.6 Total T t l uses of cash f h 48.6 48 6 Positive Free Cash Flow from Operations Beginning in 2013 (1) Examples of forward-looking information 19
  20. 20. Strong Exploration Upside – Timmins WestGold River Trend Tonnes Grade Timmins West Mine Tonnes Grade Resources (Millions) (gpt) Ounces Resources (Millions) (gpt) Ounces Indicated 0.69 5.29 117,400 Indicated 5.83 5.99 1,122,500 Inferred 5.27 6.06 1,027,800 Inferred 4.27 5.76 791,500 6 kms Thunder Creek – 144 Trend Timmins West Mine 144 Thunder Creek Timmins Deposit 2,000 Lv 2 000 L UM and FW structures extended to 2,400 m 20
  21. 21. Strong Exploration Upside – Bell Creek Tonnes Grade (M) (gpt) Ozs. Bell Creek Mine M&I 4.25 4.73 646,400 Inf. 6.09 4.87 953,800 , Bell Creek Mine Marlhill Vogel Bell Creek Mine Ind. 2.22 1.75 125,000 MH Inf. 1.46 3.60 168,800 Marhill Vogel Ind. 0.40 4.52 57,400 VG Wetmore Hoyle Pond Hoyle Pond WM MineMine Key Projects MH – Marlhill Project Marlhill Project VG – Vogel Project WM – Wetmore Project 21 21
  22. 22. Strong Exploration Upside – Fenn-GibLarge-scale,Large-scale open-pit project 60kms from Timmins Bell Creek Complex Pipestone Fault Hoyle Pond Hollinger Pamour Destor Porcupine Fault McIntyre Timmins Dome Fenn-Gib Timmins West Complex 22
  23. 23. Fenn-Gib – Strong Growth Potential Fenn-Gib Tonnes Grade Resources (Millions) (gpt) Ounces 1:5,000 Indicated 40.8 40 8 0.99 0 99 1,300,000 1 300 000 Inferred 24.5 0.95 750,000 23
  24. 24. LSG: Well Positioned for Value Creation Strong operating performance in 2012 On track to achieve production and development targets(1) Mill expanded by 25% to 2,500 tpd Effectively managed capital and operating costs Poised for rapid growth in 2013 & 2014(1) Targeting @ 50% production growth in 2013, >150,000 ozs by 2014 Mill to reach 3,000 tpd capacity in Q2/13 Timmins West Mine development largely completed Cash costs to reach <US$700/oz in 2014 (incl. royalties) Strong financial position(1) Well financed – no outside capital required Disciplined approach to capital deployment Free cash flow from operations starting in 2013 Excellent potential for future growth from projects and attractive exploration properties – strong exploration upside (1) Examples of forward-looking information 24