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AGM Presentation Jan 5, 2012


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AGM Presentation Jan 5, 2012

  1. 1. AGM-­‐V  ALDRIDGE MINERALS AGM-V January 5, 2012
  2. 2. DISCLAIMER AGM-­‐V  Certain statements contained in this presentation regarding the company and itsactivities constitute forward-looking statements . All statements that are not historicalfacts, including without limitation statements regarding future estimates, plans,objectives, assumptions or expectations of future performance are forward-lookingstatements . We caution you that such forward-looking statements involve knownand unknown risks and uncertainties that could cause actual results and future eventsto differ materially from those anticipated in such statements. Such risks anduncertainties include fluctuations in metal prices, unpredictable results of exploration,uncertainties inherent in the estimation of mineral resources and reserves, fluctuationsin the costs of goods and services, problems associated with exploration and miningoperations, changes in legal, social or political conditions in the jurisdictions where thecompany operates, lack of appropriate funding and other risk factors. There can be noassurance that such forward-looking statements will prove to be accurate. Potentialinvestors should conduct their own investigation as to the suitability of investing insecurities of the company. Martin S. Oczlon, PhD Geo, is the qualified person for thecompany as required by NI 43-101 (Canadian Securities Administrators). The companyundertakes no obligation to update any forward-looking statements . We seek SafeHarbour. 2
  3. 3. Directors & Management AGM-­‐V  Mario Caron, CEO & DirectorJoined Aldridge Nov 2011. Mario is a mining executive with over 30years of experience in the mining industry including board andmanagement expertise in operations, exploration, and capital markets aswell as government relations, from various international projectsJacob Willoughby President & DirectorJoined board Feb 2010 & became President April 28th 2010. FormerPartner and base metal analyst at Paradigm Capital in TorontoBarry Hildred Chairman & DirectorJoined board April 2010. Former President of TMX Equicom, a subsidiaryof the TMX Group,and past President and founder of the Equicom GroupDr. Martin Oczlon, VP Exploration & DirectorFounder & largest individual shareholder. Former BHP Senior ExplorationGeologist for SE Europe and SW Asia 3
  4. 4. Directors & Management AGM-­‐V  Jim O’Neill, CFOJoined Aldridge June 2011. Formerly CFO of Royal Coal Corp, and VPCorporate Controller & IR at Tiomin Resources.Daniella Dimitrov, Director & legal advisorJoined board Oct 2010. Formerly Vice Chair of Baffinland Iron Mines andCOO of Dundee SecuritiesJohn F. Cook, DirectorJoined the board May 2011. Mining Engineer and former Chairman ofPremier Gold and Wolfden ResourcesEd Guimaraes, DirectorJoined the board May 2011. Served as Executive VP & CFO at AurResources prior to it being acquired by Teck Resources 4
  5. 5. Market Highlights (as of Dec 30, 2011) AGM-­‐V  Symbol Canada TSX-V: AGM Analyst coverage Frankfurt: AIW Clarus Securities Inc.Shares outstanding 37.1 million Mackie Research Capital CorporationDirectors & Insiders about 15 %Shares fully diluted 51.7 million 4.8 m options @ avg. strike of $1.37, 9.8 m warrants @ avg. strike of $1.71) (Exercising all options and warrants brings in C$23.4m)52 week high / low C$ 2.24 / $0.65Recent price C$ 0.70Market cap C$ 26 millionCash C$ 8.45 million (Aug 31, 2011)Top institutional RBIM, Colonial First State, USshareholders Global, Libra, Excalibur, Sprott, JVAR and Creststreet 5
  6. 6. Yenipazar - Location Map AGM-­‐V   AGM – Yenipazar Au-Ag-Cu-Pb-Zn Project 6
  7. 7. Turkey: A Great Place for Mining AGM-­‐V  Fantastic Growth GDP second only to China at 9.0%. Worlds 17th largest economy set to enter the top 10 by 2022Excellent infrastructure roads, electricity, water, railwaysNew, modern and western oriented mining code (2004)Low tax rate, tax incentives in our area, VAT re-payments•  0.5-1 % effective royalty, 20 % corporate taxOne of the world s last under explored mineral-rich regions with security of title and a safe working environmentRecent large discoveries include:•  EGO-T: Kisladag (254 Mt @ 0.95 g/t Au – 7.8 M oz Au = $10.7 B )•  ANO-T: Cöpler (90 Mt @ 1.87 g/t Au – 5.4 M oz Au = $7.4 B)•  ENK-ASX: Caldag (33 Mt @ 1.3 % Ni – 946 M lbs Ni = $9.8 B excluding Cobalt value) 7
  8. 8. Yenipazar Open Pit Resources (Feb 2011) AGM-­‐V   Million Au Ag Cu Pb Zn Tonnes g/t g/t % % % Ind. 24.28 1.09 33.8 0.31 1.16 1.52 Inf. 0.22 0.49 22.7 0.30 0.71 1.16Contained metal:854,400 oz of Au, 26.6m oz of Ag, 819m lbs of Zn,624m lbs of Pb and 167m lbs of CuNI 43-101-compliant resource estimate based on 370 drill holes inan optimized open pit shell (Feb 2011)According to the USGS the average Felsic VMS deposit is 3.0mtonnes and grades 3.2% Zn, 0.4% Pb, 1.2% Cu, 0.4 g/t Au and 25 g/t Ag.(Felsic VMS deposits are the largest of the 3 subtypes of VMS deposits)Mosier, Berger & Singer 2009 8
  9. 9. Accomplishments in 2010 AGM-­‐V  Raised C$5m in a private placement attracting the first institutional investors inAldridge (Jan - $1.00 unit with full warrant for two years at $1.50)Restructured the board and management – 5 Directors out, 5 Directors in –all new directors based in Toronto and have significant knowledge and experiencein Canadian capital marketsRevised our earn-in agreement with Alacer on YenipazarGained analyst coverage from Mackie Research and Clarus Securities, bothwith target prices over 4x our current share priceCompleted infill drilling and collected metallurgical samplesCompleted 43-101 compliant PEA in December (commenced in mid July)Relocated our corporate offices to Toronto from VancouverHired IR groups Equicom and Profinnotiv for NA and Europe respectively 9
  10. 10. Project Details AGM-­‐V  Open pit project — volcanogenic massive sulphide (VMS) Zn-Pb-Cu-Au-Ag deposit. Robust economics as demonstrated by our PEASolid Resource Base — +24 Mt within an optimized open pit shell. Thisputs Yenipazar in the 90th percentile of all known VMS deposits as far as sizeGreat Infrastructure — paved road next to the deposit, as well asaccess to water. Power and rail within approximately 20 kmUnique characteristic — Large ore mineral grains due tometamorphism – potentially more cost-efficient separation from host rock thanusual VMS-depositsDeposit dimensions — roughly flat lying body should allow for flexiblemine sequencing to optimize early payback - 1700 m long, up to 300 m wide,30-190 m deep, on average about 25-30 m thick. Still open, especially to thenorth of the deposit 10
  11. 11. Yenipazar Key Parametres AGM-­‐V  Large land package — 100 km2 propertythat has seen very limited exploration, leveland low-relief, open terrain used Typical VMS Mining Campspredominantly for farming (Source: Geological Survey of Canada)Local support — Near-by village with pro-mining work force and strong communitysupport.Agreement with Alacer — to earn 100 %interest. Alacer Minerals retains 6 % netproceeds interest (revenue minus operationalcost) until a total revenue of US$165m, and10% beyond that amountCommitment — Aldridge must deliver afeasibility to Alacer. There is no deadline, aslong as Aldridge works diligently towardscompleting feasibility study 11
  12. 12. Scoping Study Highlights AGM-­‐V   (P&E Mining, February 2011)Base Case NPV US$209m & IRR of 23.2% at 7% discount rate•  At 10% discount rate, NPV US$151m or $4.07per basic share, $2.92 ashare fully diluted•  Base case uses 3-year trailing average metal prices and 4.5:1 strip includingpre-strip and capex of US$198m for a 12 year mine life assuming 5,700 tpd mill(2m tpa)•  Average payable production of 23,700 oz Au, 1.1m oz Ag, 10m lbs Cu, 37mlbs Pb, 37m lbs Zn from diluted average grades of 1.02 g/t Au, 31.6 g/t Ag,0.29% Cu, 1.1% Pb, 1.4% Zn•  Zn conc grades 55%, Pb conc grades 55% & 1025 g/t Ag, Cu conc grades23% with 20 g/t gold & 337 g/t Ag• Project payback in 3.9 years. LOM average NSR US$57.27/t, LOM averagetotal operating cost $29.65/t•  At current metal prices (11/07/11) NPV of US$532m at 7% discount rate (NPVof US$431m at 10% discount rate) and IRR of 44%• *pre-tax numbers 12
  13. 13. Scoping Study Lowlights AGM-­‐V  Base case used results of ONE locked cycle flotation test•  Recoveries: Zn 59%, Pb 78%, Cu 77% - well below average for Zn – need tobe improved – Proper floatation study to be completed soon• Recoveries: Au 37%, Ag 57% - we expect to significantly improve on both ofthese•  A doubling of gold recoveries would double the base case NPV (i.e. US$302m at 10% or $8.14 / basic share)•  A 10% increase in recoveries of each of the 5 metals would result in a52% increase in our base case NPV•  Assumed smelter payability of Au and Ag in the Cu conc were only 90% and80%; should get 95% for both•  Assumed payability of Ag in the Pb conc was only 85%; should get 90% - 95% 13
  14. 14. Targeted Metallurgical Recoveries AGM-­‐V   & Production Revenue by MetalPEA  Recoveries  and  Production Au  (oz) Ag  (oz) Cu  (lbs) Pb  (lbs) Zn  (lbs) Au  (oz) Zn  (lbs) Pricing  Assumptions  (3  Yr  Trailing  as  at  12/10/10) $1,007 $16.19 $2.95 $0.90 $0.86 18% 23% Estimated  Recoveries  (PEA) 36.8% 56.9% 76.6% 77.8% 58.8% Ag  (oz) Avg  Payable  Prod 23,700 1,100,000 10,000,000 37,000,000      37,000,000 13% 10%  D i s count  R t. 7%  D i s count  R t. IRR Pb  (lbs) NPV    (US$m) $151 $209 23.2% 24% Cu  (lbs)  Share  Price  (Basic) $4.07 $5.63 22%  Share  Price  (FD) $2.92 $4.04Targeted  Potential  Recoveries Au  (oz) Ag  (oz) Cu  (lbs) Pb  (lbs) Zn  (lbs) Pricing  Assumptions  (3  Yr  Trailing  as  at  12/10/10) $1,007 $16.19 $2.95 $0.90 $0.86 Zn  (lbs) 20% Au  (oz) Estimated  Recoveries  (Targeted) 70.0% 66.9% 76.6% 77.8% 65.5% 28% Avg  Payable  Prod 49,000 1,670,000 9,742,000 36,838,000      40,609,000 10%  D i s count  R t. 7%  D i s count  R t. IRR Pb  (lbs) NPV    (US$m) $381 $475 39.8% 19% Ag  (oz)  Share  Price  (Basic) $10.27 $12.80 16% Cu  (lbs)  Share  Price  (FD) $7.37 $9.19 17%Potential  Recoveries  at  Spot  Prices Au  (oz) Ag  (oz) Cu  (lbs) Pb  (lbs) Zn  (lbs) Pricing  Assumptions  (Spot  as  at  11/7/11) $1,792 $35.00 $3.55 $0.90 $0.89 Zn  (lbs) 15% Estimated  Recoveries  (Targeted) 70.0% 66.9% 76.6% 77.8% 65.5% Au  (oz) Avg  Payable  Prod 49,000 1,670,000 9,742,000 36,838,000      40,609,000 Pb  (lbs) 35% 13% 10%  D i s count  R t. 7%  D i s count  R t. IRR NPV    (US$m) $850 $1,017 70.1% Cu  (lbs)  Share  Price  (Basic) $22.91 $27.41 14% Ag  (oz)  Share  Price  (FD) $16.44 $19.67 14 23%
  15. 15. Recent Metallurgical Improvements AGM-­‐V  Based on work done by G&T Metallurgical (Released Dec 1, 2011)•  Improvement in TOTAL Au recovery to 76% (approx. 47% recovered to a Augravity Pan concentrate, 24% recovered to Cu conc., 5% recovered to Pb conc.)•  Cu conc. graded 19.6% at recovery of 72% and contained 30.3 g/t Au (recoveryof 24%) and 482 g/t Ag (recovery of 15%)•  Pb conc. graded 64.3% at a total recovery of 51% and contained 1111 g/t Ag(45% recovery) and 4.7 g/t Au (5% recovery)•  Zn conc. graded 57.7% at a recovery of 77%•  OPPORTUNITY OF IMPROVEMENT: in this latest round of testing, 28% of ourtotal Au and 20% of our total Ag ended up in the Cu cleaner tailings. We willexamine ways to get more of this lost Au and Ag to remain in the Cu conc., andalso test to determine if we can leach these tails to recover more gold and silver.We ll also look to improve the Pb recovery by examining operating mines withsimilar grades and mineralogy (such as Oz Minerals Rosebery Mine in Tasmania). 15
  16. 16. Yenipazar Property & Drill Hole Sites AGM-­‐V  Exploration Drilling 16
  17. 17. High-grade Intersections AGM-­‐V   Hole-No Interval (m) Thick-ness Au g/t Ag g/t Cu % Pb % Zn %YP-149 92 126 34 m 5.78 93.4 1.11 2.72 3.90YP-151 58 70 12 m 3.62 52.0 1.03 0.52 2.76YP-151 74 100 26 m 6.35 52.5 1.62 1.18 2.79YP-156 42 90 48 m 3.93 16.7 1.09 0.30 0.30YP-156* 110 150 22 m* 0.46 26.9 0.15 0.81 1.39YP-264 52 100 48 m 4.72 66.2 0.96 4.22 7.65YP-282 82 114 32 m 2.93 82.1 0.97 3.10 4.84 *Cumulative thickness of 4 levels in 110-150 m interval 17
  18. 18. Recent Yenipazar Drilling News AGM-­‐V   Pairs of RC and duplicated diamond holes, 5 m apart * YPD-1 includes 112-114 m (61 g/t Au), 122-124 m (20.15 g/t Au), 124-126 m (12.5 g /t Au). Capped at 10 g/t Au, the average grade for the diamond drilled interval of 62-130 meters is 2.05 g/t Au 18
  19. 19. Yenipazar Mineralization AGM-­‐V   Large mineral grainsat Yenipazar allow for gravitational pre-enrichment 19
  20. 20. Favourable Terrain AGM-­‐V   Shallow topography is ideal for open pit construction 20
  21. 21. Feasibility Study - Consultants AGM-­‐V  Jacobs Minerals Canada – part of Jacobs Engineering Group Inc (NYSE: JEC), one of theworld’s largest & most diverse providers of technical, professional & construction services -$10B market cap. Overseeing & co-ordinating feasibility study.P&E Mining – established geological & mine engineering consulting firm specializing in NI43-101 geological reports, resource estimate technical reports, preliminary economicanalysis and pre-feasibility studies. Commissioned to do resource update and mine design.Golder Associates – founded in 1960, a global company providing consulting, design, &construction services to clients in Mining, Oil & Gas, Manufacturing, Power, Transportation& more. Responsible for geotechnical studies.SGS UK – global leader & innovator in inspection, verification, testing & certificationservices. Responsible for Metallurgical test work.SRK Turkey – formed in 1974, with 1000+ professionals employed internationally,specializes in design & management of mineral exploration programs. Experienced inpreparing technical reports admissible for stock exchange purposes, mineral explorationproject audits and in the valuation of exploration projects. Recent projects in Africa, SouthAmerica, the Middle East, Asia and Europe. Preparing ESIA Study. 21
  22. 22. Future Milestones for Aldridge AGM-­‐V  Complete feasibility study at Yenipazar – Began in May 2011, targetingNovember 2012Complete drilling and conduct geophysics at the 3 new outcrops north ofYenipazar – program to finish in late DecemberRelease drill results from our PNG exploration discovery as well as our recentexploration drilling at Yenipazar – expected mid DecemberComplete an AIF – draft complete, working towards final documentComplete a financing to secure funding for all our planned 2012 expenditures ofapproximatley C$10m 22
  23. 23. Aldridge PNG – The Kili Teke Discovery AGM-­‐V  Acquired a 338 sq. km license awarded in Feb 2009. Received 3 requests frommajors to JV the property before any results publishedCollected 80 rock samples and 350 soil samplesDiscovered a very large Cu-Au porphyry & skarn system named Kili Teke•  Two rock samples grading between 23% - 35% Cu with an average of 60 g/t Au and 238 g/t Ag;•  Thirteen samples grading from 1.0% - 12.9% Cu with an average of 0.44 g/t Au and 3.8 g/t Ag;•  28 samples grading from 0.3% - 1.0% Cu with an average of 0.39 g/t Au and 3.8 g/t Ag. Also had one sample grade 9.1% zinc 23
  24. 24. Aldridge PNG License Area AGM-­‐V   ALDRIDGE MINERALS INC Exploration License_2009-2-18Base image source: PNG Mineral Resources Authority, Info-DVD distributed on PDAC 2009-3, Toronto 24
  25. 25. Au in Soil Samples at Kili Teke AGM-­‐V   25
  26. 26. Cu in Soil Samples at Kili Teke AGM-­‐V   26
  27. 27. Cu in Soil Samples at Kili Teke with Ok AGM-­‐V  Tedi Pit Overlain for Scale 27
  28. 28. Timeline – Advancing Ahead AGM-­‐V   28
  30. 30. Directors & Management AGM-­‐V  Mario Caron, CEO & DirectorJoined Aldridge Nov 2011. Mario is a mining executive with over 30 years of experience in the mining industry including board and management expertise in operations, exploration, and capital markets as well as government relations, from various international projects. He holds a Bachelor of Engineering degree in Mining from McGill University and is a member of the Quebec Order of Engineers and the Association of Professional Engineers of Ontario.Jacob Willoughby, President & DirectorJacob is a geologist with a Masters in Business Administration from the University of Windsor and became president of Aldridge in April 2010. He joined the board in February 2010. He was previously a partner and mining analyst at Paradigm Capital in Toronto, a highly ranked investment firm with a specialization in mining finance, where he worked for five years until choosing to leave in March 2009. He is also a director of Foxpoint Capital Corp. 30
  31. 31. Directors & Management AGM-­‐V  Barry Hildred, ChairmanBarry founded The Equicom Group in 1995 and remained its President until October of 2009. In 2007, Equicom was acquired by the TSX Group. Mr. Hildred also serves on the Board of the Childrens Aid Foundation and is a past member of the Ontario Securities Commissions Continuous Disclosure Advisory Committee.Dr. Martin Oczlon, VP Exploration & DirectorDr Oczlon spent seven years during the 1990 s with BHP as senior exploration geologist in SW Asia and SE Europe. He drilled the discovery holes for the Reqo Diq Cu-Au porphyries in Pakistan, now with 21 Mt Cu + 37 Moz Au. From 1999-2002, he developed a private exploration company with a large project in Romania and sold it at a 200% profit. Aldridge Director since 2003, responsible for project acquisition, exploration and development 31
  32. 32. Directors & Management AGM-­‐V  John F. Cook, DirectorMr. Cook is a mining engineer with 45+ years of experience including development of open-pit & underground mines, exploration, operations, management, & feasibility studies. He was most recently President & CEO of San Anton Resource Corp. & is currently a director of Strategic Resources Inc., MBMI Resources Inc., Southern Andes Energy Inc. & Cerro Resources Inc.. He was Chairman of Wolfden Resources Inc. until its purchase by Zinifex Ltd in June 2007, and was Chairman of Premier Gold Mines Limited until 2010. Mr. Cook is a graduate of Sheffield University in mining engineering.Daniella Dimitrov, DirectorMs. Dimitrov has over 16 years of broad commercial and operational experience in senior executive roles with major companies. She has held principal roles in mergers, acquisitions, financings, corporate finance and joint ventures. Ms. Dimitrov s former positions include Senior VP, Strategic Initiatives of Raymond James Ltd., COO of Dundee Securities and Dundee Private Investors, General Counsel for the Dundee group of companies and counsel at a national law firm. She is also a director and vice chair of Baffinland Iron Mines. 32
  33. 33. Directors & Management AGM-­‐V  Ed Guimaraes, DirectorEd is a CA who held progressive management positions with Aur Resources between 1995 and 2007, ultimately serving as Executive Vice-President, Finance and Chief Financial Officer of Aur until December 2007. Aur was acquired by Teck Resources Limited in a takeover valued at $4.1 billion in August 2007. Mr. Guimaraes has worked as a consultant in the resources industry since that time and is currently a director of Nuinsco Resources Limited. Mr. Guimaraes holds a Bachelor of Arts in Administrative and Commercial Studies from the University of Western Ontario.Jim O’Neill, CFOMr. ONeill, a Chartered Accountant with over 25 years of industry experience, brings a depth of knowledge from various international mining, project management and distribution companies. Formerly CFO of Royal Coal Corp., and VP Corporate Controller & Investor Relations at Tiomin Resources. Prior to Tiomin, I held CFO positions with a publicly-traded multi-national engineering firm and a private business products manufacturer and distributor. 33