precious metal mining & exploration an
TRANSCRIPT
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 1
April 2013
Value Realization Ajax Copper Gold Project, B.C.
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 2
Forward Looking Information
This presentation includes certain statements that may be deemed "forward looking statements". All
statements herein, other than statements of historical facts, that address events or developments
that Abacus Mining and Exploration Corporation (the "Company") expects to occur, are forward
looking statements. Forward looking statements are statements that are not historical facts and are
generally, but not always, identified by the words "expects", "plans", "anticipates", "believes",
"intends", "estimates", "projects", "potential" and similar expressions, or that events or conditions
"will", "would", "may", "could" or "should" occur. Forward looking statements are based on the
beliefs, estimates and opinions of the Company's management on the date the statements are made.
Although the Company believes the expectations expressed in such forward looking statements are
based on reasonable assumptions, such statements are not guarantees of future performance and
actual results may differ materially from those in the forward looking statements. Factors that could
cause the actual results to differ materially from those in forward looking statements include market
prices, exploitation and exploration successes, and continued availability of capital and financing, and
general economic, market or business conditions. Investors are cautioned that any such statements
are not guarantees of future performance and actual results or developments may differ materially
from those projected in the forward looking statements. Except as required by securities laws, the
Company undertakes no obligation to update these forward looking statements in the event that
management's beliefs, estimates or opinions, or other factors, should change.
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 3
Abacus Today
• 20% interest in post-feasibility Ajax Copper-Gold project
• AME’s share of capex fully financed
• Significant cash flow potential of 23+ years from Ajax mine alone
• New world class operational leadership combines Abacus and
KGHM International (formerly Quadra-FNX) with major global mine
experience
• 6,000 hectares of surface freehold and leases, extensive mineral
rights
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 4
Abacus – Capital Structure
AME.V Capital Structure (C$)
TSXV Symbol AME
Share Price (Apr 1, 2013) $0.16
Share Price (52 week range) $0.32 – 0.11
Issued and Outstanding 214.0 million
Warrants ($0.32) 7.2 million
Options 11.4 million
Fully Diluted 232.6 million
Market Capitalization (fd) $36.5 million
Working Capital* $1.8 million Ownership
Teck Corporation 18.6%
KGHM 7.0% * As at 12/31/12
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 5
AME Achievements
• Joint ventured the Ajax project with a global mining major – May‘10
• Established a 500Mt reserve – 3 bil lbs Cu + 2.7 mil oz Au – Oct ‘11
• Completed a Feasibility Study – Jan ‘12
• Completed exercise of 80/20 ownership option giving AME a fully
financed carry to production – Apr ‘12
• Managed complex First Nations, Community Relations and
Environment Assessment Issues
• Handed over Operatorship of Ajax to KGHM Int’l – Sep ‘12
From 2002 Abacus acquired, explored and developed a world class orebody at Ajax. Since 2010 it has:
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 6
KGHM & AME (JV Company - KGHM Ajax Mining Inc)
• JV Partner KGHM Polska SA is the world’s 7th largest producer of copper
• Current output >500ktpa, goal to increase to 700ktpa by 2017
• Ajax investment is part of their global strategy for growth
• KGHM exercised its option to increase its stake to 80/20 in exchange for
$30m and fully financing AME in April 2012
7
The Ajax Copper-Gold Project
Prince George
Williams Lake
British Columbia
Conventional Open-Pit Copper-Gold Mine – 60,000 tpd
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 8
Feasibility Study Results
Base Case Highlights (all economic figures in US$)
Proven & Probable Reserves 3 bil lbs Cu + 2.7 mil ozs Au
Average annual production 110 million lbs Copper + 100,000 oz Gold
Mine life (@ 60,000 tpd or 21.9Mtpa) 23 years
LOM stripping ratio 2.4:1
LOM production (in concentrate) 2.5 bil lbs Cu + 2.28 mil oz Au
Concentrate composition 25% Cu + 18 g/t Au
Cash cost per lb of Cu (net of Au) US $1.28
Initial capital costs (incl $87 mil contingency) US $795 Million
Sustaining capital US $604 Million
Cu/lb US$2.75; Au/oz US$1,085
Robust economics using very conservative price assumptions
As of Jan 6, 2012
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 9
Feasibility Study Results (Jan 6, 2012)
Economic Analysis (all economic figures in US$)
Base Case Scenario
Alternate Case Scenario1
Alternate Case Scenario2
Cu US$/lb $2.75 $3.00 $ 3.50
Au US$/oz $1,085 $1,300 $1,700
Exchange Rate (US$:C$) 0.92 0.94 0.98
Pre-tax IRR 14.5% 19.5% 30.3%
Cash Cost per lb Cu1 $1.28 $1.11 $0.79
Pre-Tax NPV (8%) $416 mil $818 mil $1,601 mil
Project NPV to AME (8%) 2 $113 mil $194 mil $350 mil
NPV per share2 $0.53 $0.91 $1.65
Payback Years 7.8 3.8 2.2
1) Net of gold credits
2) Pretax, incl. cash paid to AME for PP reserves
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 10
Abacus’ 20% Interest
– Base Case per BFS
Cu US$/lb $2.75
Au US$/oz $1,085
AME’s current market cap $ 36.5 Mil
Project Pre-Tax NPV (8%) US $416 Mil
Portion Attributable to AME (20%) $83
Cash paid to AME for PP Reserves $30
Pre-Tax Project Value to AME (8%) US$113 Mil
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 11
Abacus’ 20% Interest
– Median Case
Cu US$/lb $3.00
Au US$/oz $1,300
AME’s current market cap $ 36.5 Mil
Project Pre-Tax NPV (8%) US $818 Mil
Portion Attributable to AME (20%) $164
Cash paid to AME for PP Reserves $ 30
Pre-Tax Project Value to AME (8%) US$194 Mil
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 12
Abacus’ 20% Interest
– Scenario 2 – current market
Cu US$/lb $3.50
Au US$/oz $1,700
AME’s current market cap $ 36.5 Mil
Project Pre-Tax NPV (8%) US $1,601 Mil
Portion Attributable to AME (20%) $320
Cash paid to AME for PP Reserves $ 30
Pre-Tax Project Value to AME (8%) US$350 Mil
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 13
Ajax Production Schedule
Start-up expected in Q3 2016
EA Permitting
Detailed Engineering
MAP Permitting
Construction
Production
2013 2014 2015 2016
Sept ‘13
Submission
Sept ‘14
Approval
Mar ‘14
Mar ‘14 Sept
Sept ‘14 Sept ‘16
Note: These timelines have been provided by KGHM International and are subject to change
As of Mar/13
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 14
Abacus vs. Peer Group
EV / Total Cu & Cu Equiv. Resources P / NAV (Consensus)
*Median $EV per Cu lb and P / NAV across 16 comparable transactions over the last 3 years
NAVPS based on consensus street estimates. Abacus NAV based on 20% of Feasibility Study pre-tax NAV under Alternative Case 1 ($3.00 Cu / $1,300 Au)
0.21x0.28x
0.32x
0.92x
0.00x
0.20x
0.40x
0.60x
0.80x
1.00x
0.00x
0.20x
0.40x
0.60x
0.80x
1.00x
P /
Co
nse
nsu
s N
AV
PS
¢2.2¢3.1 ¢3.8
¢8.5
¢0
¢6
¢12
¢18
¢24
¢0
¢6
¢12
¢18
¢24
$EV
per
Cu
Eq
uiv
. lb
Res
ou
rce
(Cen
ts,
blu
e d
ott
ed)
$EV
per
Cu
lb R
eso
urc
e (C
ents
)
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 15
Strategic Review
• Stifel Nicolaus has completed a detailed assessment of
the Ajax project valuation
• A number of potential investors have been reviewing the
data site
• Offtake interest
• Royalty stream
• Merger/acquisition
• Inherent value demonstrably in excess of market value
Abacus’ management and Board are
committed to maximizing value for
Abacus shareholders
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 16
Appendix
Ajax Project Area
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 18
General Site Layout
Ajax West Pit
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 20
Feasibility Study Results
Mineral Reserve Estimates (October 31, 2011)
Confidence Cut-Off Average
Grades
Copper
Equivalent Contained Metal
Category Grade Tonnes Cu Au Cu.Eq. Copper Gold
(US$/t) (Mt) (%) (g/t) (%) (M lb) (k oz)
Proven Mineral
Reserve
4.53 279.5 0.27 0.17 0.38 1,680 1,520
Probable
Mineral
Reserve
4.53 223.5 0.26 0.17 0.37 1,280 1,230
Total P&P Mineral
Reserves
4.53 503.0 0.27 0.17 0.37 2,960 2,750
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 21
Feasibility Study Results
Estimated Capital
US$ ‘000
Site services, utilities, general 61,584
Mine pre-stripping 34,443
Mining equipment 84,880
Crushing & Conveying 37,464
Ore storage and HPGR 89,614
Concentrator 144,815
Tailings storage 79,493
Ancillary buildings 18,639
Water supply from Lake 14,805
TOTAL DIRECT INITIAL CAPITAL 565,737
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 22
Feasibility Study Results
Estimated Capital
US$ ‘000
Total Direct Initial Capital 565,737
Project indirect 107,176
Owners costs 34,500
Contingency 87,570
TOTAL INITIAL ESTIMATED CAPITAL 794,983
Sustaining Capital
Mining equipment 262,714
Crushing & Conveying 135,458
Stacking 57,987
Plant site 43,214
Tailings 104,642
TOTAL ESTIMATED SUSTAINING CAPITAL 604,015
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 23
Copper Fundamentals
Copper price and inventory – 5 years
Copper deficit YTD estimated at almost 300,000mt
Bloomberg, Deutsche Securities
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 24
Copper Fundamentals
Chinese metal net imports
Chinese net imports of refined copper steadily increasing since May ‘12
Desjardins Capital Markets, Chinese gov’t statistics
Abacus Mining and Exploration Corporation | TSXV:AME | www.amemining.com 25
Copper Fundamentals
Shanghai copper inventories
China continues to increase its monthly net imports of copper prior to consumption to meet growing domestic demand
The Shanghai warehouse is one of two
primary inventory depots in China for
storing refined copper
Desjardins Capital Markets, Chinese gov’t statistics