MAR2016TSX // MND

1

Quality Control and AssuranceQuality control and assurance programs are implemented in line with the standards of National Instrument 43-101.

The exploration programs at Costerfield and Bjorkdal are supervised by Chris Gregory (Member, Australian Institute of Geoscientists, VP of

Operational Geology for Mandalay and a “Qualified Person” as defined under National Instrument 43-101. Mr. Gregory regularly visits Costerfield

and Bjorkdal, and supervises the collection and interpretation of scientific and technical information contained in this presentation.

The exploration programs at the Cerro Bayo and Challacollo projects are supervised by Scott Manske, Chief Cordilleran Geologist of Mandalay

Resources, and an Oregon registered Professional Geologist. A “Qualified Person” as defined by NI 43-101, he has reviewed and approved the

technical and scientific information on these projects contained in the presentation.

Dr. Mark Sander (Member: AusIMM), President of Mandalay, has visited the Costerfield, Cerro Bayo, Challacollo, and Björkdal and has

supervised the preparation of this presentation.

All currency references in US$ unless otherwiseindicated

Forward-looking StatementsThis presentation contains "forward-looking statements" within the meaning of applicable securities laws, including statements relating to life of

mine production plans, exploration plans and the growth and strategy of Mandalay. Actual results and developments may differ materially from

those contemplated by these statements depending on, among other things: exploration results or production results not meeting management’s

expectations; capital, production and operating cost results not meeting current plans; and changes in commodity prices and general market and

economic conditions. The factors identified above are not intended to represent a complete list of the factors that could affect Mandalay. A

description of additional risks that could result in actual results and developments differing from those contemplated by forward looking statements

in this news release can be found under the heading “Risk Factors” in Mandalay’s annual information form dated March 31, 2015 and in its final

prospectus dated September 2, 2014, copies of which are available under Mandalay's profile at www.sedar.com. Although Mandalay has attempted

to identify important factors that could cause actual actions, events or results to differ materially from those described in forward- looking

statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no

assurance that forward-looking statements 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 forward-lookingstatements.

2

Profitable & Dividend-Paying (4.8% yield)*

We create exceptional shareholder value through the acquisition of undervalued assets that can rapidly

become cash generative, self-fund exploration, establish and maintain high operating margins and return

cash to shareholders within a planned period of time. Mandalay is committed to operating safely and in an

environmentally responsible manner, while developing a high level of community and employee

engagement

WE ARE SUCCESSFUL WHEN:

Our employees live and work safely and experience the personal

satisfaction that comes with high performance and recognition

The communities in which we operate value our presence

Our environmental impact is minimized and causes no permanent

harm

We have a large, diversified set of customers who are delighted with

and compete for our products

Our shareholders realize a superior total return on their investment

and support our corporate values.

Our values are visibly demonstrated by strong local management, at

the point of impact with or stakeholders, and co-ordinated across the

Company for maximum effect

Mandalay: A Values-Based & Value-Focused Company

* Current annualized dividend yield based on $0.88 share price (Feb. 26, 2016)3

2009

• Costerfield,Australia

• Gold &Antimony

2010

• Cerro Bayo, Chile

• Silver & Gold

2013

• Challacollo,Chile

• Silver & Gold

2014

• Björkdal, Sweden

• Gold

Delivering Consistent Value

TIMELINE

1. The Company defines EBITDA as earnings before interest, taxes and non cash charges/ (income). EBITDA should not be considered by an investor as

an alternative to net income or cash flow as determined in accordance with IFRS.

2015 Quarterly

Financial

Measures

Revenue,

EBITDA(1) &

Cash from

Operations

Revenue

EBITDA

Cash from

Operations

4

1. Adjusted for reinvested dividends. Assumes investment in Mandalay made as part of private placement announced on 24-Sep-09 to fund acquisition of Costerfield and accounts for warrant exchange offer of 0.47 shares per warrant. End date as at Feb. 18, 2016. 2. Peer Index: Argonaut, Dundee PM, Kirkland, Lake Shore, OceanaGold, Perseus, Primero, Timmins. 3. Gold Seniors: Agnico Eagle, AngloGold, Barrick, Goldcorp, Gold Fields, Kinross, Newcrest, Newmont, Polyus, Yamana.

Mandalay Shareholders Realize a Superior Total Return on their Investment

$0

$2,000,000

$4,000,000

$6,000,000

$8,000,000

$10,000,000

$12,000,000

$14,000,000

2010 2011 2012 2013 2014 2015

Dividends Paid (USD)**

6% of revenues (dividend contribution)

50%

100%

150%

200%

250%

300%

Q3

2009

Q1

2010

Q3

2010

Q1

2011

Q3

2011

Q1

2012

Q3

2012

Q1

2013

Q3

2013

Q1

2014

Q3

2014

Q1

2015

Q3

2015

Mandalay Cumulative Returns9.5% Annual Compounded Rate of ReturnGoldSilver

Cumulative Total Return (% Value Change)*

*Q3 2010 to Q4 2015, includes all dividends paid. Source: MetalPrices.com for metal spot prices Index: September 30, 2009 = 100. Mandalay share price: $0.64.

Graph updated quarterly, prices as at the last trading day of each respective quarter.

**Annual cash dividend paid quarterly, based on 6% of the Company’s trailing quarter’s gross revenue and the future cash requirements of the Company

0

2

4

6

8

10

12

14

16

18

20

$0

$20,000

$40,000

$60,000

$80,000

$100,000

Volu

me (

mill

ions)

Invest

ment Valu

e

Mandalay(1) Peer Index(2) Gold Senior(3)

Total Return vs. Peers and Seniors

A $10,000 investment on September 24, 2009 would be worth:• Mandalay: $56,255• Peer Index: $9,165• Gold Seniors: $3,881

5

5

Land package 12,747 hectares

Ownership 100%

Number of Employees(1) 145 direct, 65 contractors: 210 total

2015 Production 44,039 oz Au

2016E Production 50,000 – 55,000 oz Au

P&P Reserves(2) 7.0 Mt @ 1.85 g/t Au

Current throughput 3,500 tpd

Plant recoveries (2015) Au: 88%

2016 Planned Exploration Budget $3 million

1. As at year-end 2014, filed in Company’s Annual Information Form

2. Please see notes to Reserves on Company website

Björkdal Gold Mine: Overview

6

Björkdal Mineral Reserves and Resources

Björkdal Reserves Tonnage (t) Au Grade (g/t) Au (cont. oz)

Proven - - -

Probable7,012,000 1.85 418,000

Total7,012,000 1.85 418,000

Björkdal Resources Tonnage (t) Au Grade (g/t) Au (cont. oz)

Measured - - -

Indicated7,524,000 2.47 598,000

Measured + Indicated7,524,000 2.47 598,000

Inferred1,552,000 1.86 93,000

Source: Björkdal – Roscoe Postle Associates, Effective December 31, 2015, please refer to Mandalay Resources’ press release dated Feb. 29, 2016

7

Björkdal Gold District – 2016 Exploration

2 KM

Pit 2

8

Björkdal Mine: MI&I Resources

P&P Reserves

Open Pit

Underground

Mine

Target

StorhedenIntercepts under

tailings

NylundsPotential open pit –

infill drilling 2016 RönnbergetHistoric and current

drilling with high-

grade intercepts

No granodiorite – all rocks are metasomatised volcanic and sedimentary rocks No thrust – contacts are stratigraphic and/or metasomatic

Two main sets of qtz veins – mine developed along visually prominent but lower grade set

No gold in wallrock

Bigger system – gold in veins 1- 5 km from pit

Geology at Björkdal

•

•

•

•

•Grandodiorite

Marble

• Significant gold inwallrock

9

Geology Today (Q1 2016):

Geology at Acquisition (Q3 2014):

Björkdal Geology and Mining Transformation

10

Improved knowledge:

• Fundamental geology of district and mine

• Understanding gold distribution in the vein system

Plus new operating practices:

• Commitment to exploration - (US$3.0 million in 2016)

• Detailed drill core logging and sampling

• Detailed face mapping and chip sampling every blast; discard low-grade on-vein advances

and detailed stope design, leaving behind low-grade segments

• Commitment to in-mine drilling (both POD and extensional)

• Local assay lab under construction – LeachWell process (large samples so more accurate;

high capacity and fast turnaround)

• Commitment to test programs to confirm/measure improvements

• Geology informing mining decisions (small cross-discipline teams)

Leading to:

• More selective and geologically-controlled extraction supported by improved resource

modelling

• Increased reserves

• Improved grades from underground and open pit

• An improved, deliverable economic mine plan – with real-time grade control

• Production of more ounces of gold from existing capacity at lower cost/oz

11

NYLUNDS

Björkdal 2015 Drill Results

NYLUNDS

Detailed Gold Distribution in Test Drilling Area

• Two dominant gold-bearing

vein directions 070 and 090

(mine-grid), or 040 and 060(True North)

• 090 veins seem relatively

continuous however, the

grade within is not

• Grade decreases with

increasing lode width

(Au endowment is equal

between thick and thin veins)

Observations:

Grade increases at vein intersections

Grade is not continuous along either vein orientation

A’

A

30

°

12

Detailed Au Distribution: In Sulfidic Veins of 090 Strike

Milky Quartz – Low-grade, especially when

wide – 070° trend veining. Averaging below

1g/t. These wide, milky 070trending veins were the focus of previous

operators

Sulfidic Quartz – Sulphide-rich veins

(pyrrhotite+pyrite), ± actinolite and/or biotite.

Variable grade but usually likely to contain 5+

g/t (in test area). Strike 090°, sub-vertical dip.

Can cause intense alteration/bleaching onwall-

rock (albite and chlorite, minor calc-silicate)

Mixed veins – Overprinting of sulfidic

quartz over milky quartz. Suggest the later sulfidic veins are responsible for thegrade within 070° striking veins (that are most often solely composed of milky quartz)

milky qtz – low Au

sulfidic qtz – high Au milky qtz – low Au

vein contact

12Note: these vein orientations are measured against Mine Grid North, which is 330 Magnetic North

Grade Control Improvements at Björkdal

Current Step: In first 3 weeks of on-vein selectivity, sample

set totals 12,890 t @ 2.37 g/t Au. Historically, entire

tonnage would be sent to plant.

With new selectivity, tonnage would be:

9,154 t above >0.7 @ 3.18 g/t Au sent to mill

2,239 t @ 0.49 g/t Au stockpiled

1,497 t @ 0.23 g/t, sent to waste

Next step: Implement selective mining for stoping ore

14

?

15 m levels

20 m levels

5 X 5

3.5 X 3.5

On Vein Selectivity

Reducing Level Spacing

Closer levels (15 m vs old 20 m) will reduce exits of

subvertical veins out of stopes

Will take time to clear 18 mo inventory at old geometry

Reducing Drift Size

Now that Au hosted in vein walls

disproved, smaller drifts on the

right mineralized veins will reduce

dilution

Next Step: Reduce drift size from

the old 5 m to 3.5 m

Increasing On-Vein Selectivity

2015 chip sampling in the

drive shown suggested 1/3 of

mined material is high-grade

(Coloured).1/3 is marginal

(Greyed) and 1/3 is waste.

Open Pit Grade Improvement by BMM Technology

Insert Blast Movement Monitoring balls

in extra blast holes in high grade zones

Location of balls after blast used to locate and

selectively load displaced ore zones

Expected 0.1-0.2 g/t improvement in mill head

grade (from 0.8-1.1 g/t)

15

Björkdal Processing Improvements

16

Completed:

Sampling survey on milling and gravity gold circuits to identify

improvement opportunities

Laboratory flotation recovery study on effect of fineness of grind,

% solids, and residence time – key for decision-making on

possible future flotation circuit expansion

2016 Planned Improvements:

Milling/Flotation material flow stability survey to identify areas

where automation can be implemented to improve recovery

Introduction of high chrome grinding media for increased wear

resistance, grinding media cost saving and improved pulp

chemistry for improved flotation recovery

Flotation circuit and ancillary equipment expansion study to

determine OPEX and CAPEX for a planned flotation circuit

expansion to improve flotation recovery and concentrate grade

Pilot tests to investigate the improvement of coarse, fine, and

ultra-fine particle gold recovery in the flotation circuit

Ore sorting at BjörkdalStockpiled Mixed Low-Grade Material

Sorted Waste – no veins Sorted Ore – with veins

Bulk Test Start Grade End Grade Times Upgraded Waste Rejection Gold Retained

g/t Au g/t Au (%) (%)

Underground Ore 1.93 2.97 1.54 43.0 87.0

Stockpile Ore 0.81 1.11 1.37 30.0 96.0

Pilot studies confirm that:

• Au is contained in fragments of

white quartz vein material, not in

black wallrock material

• Can optically sort out 40+% of

black rock and only lose a few %

of gold recovery

Potential to upgrade low-grade

material or even high-grade material

to increase mill head grade,

producing more gold from existing mill

capacity

Onsite pilot plant scheduled for Q2,

2016

17

2016 and Beyond

18

Build on an already efficient low cost/t operation

Grow oz Au and lower cost/oz Au by:

• Improving head grades out of underground and open pit mine with minimal increase

in cost/t

• Ore sorting

• Improving recovery

Grow reserves and mine life by:

• Improved fundamental geologic concepts

• Self-funded exploration drilling

MAR2016TSX // MND

For more information, please contact:

Greg DiTomaso

Director, Investor Relations

Tel: 647.260.1566

Email: g.ditomaso@mandalayresources.com

Company Website: www.mandalayresources.com

Twitter: @MandalayAuAg