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Federation Mining
5 Year Strategic Vision
Mark Le MessurierManaging [email protected]+61 467 493 830
2
5 Year Vision
Totally Self Funding
Private or Public
Company
3+ Operating Au or Au/Cu
mines
1-2 Pipeline development
assets
Material exploration
budget
Targeting market
valuation of US$1b+
All US$ throughout presentation
3
Company Structure
Advisory
Board
Federation Mining
Management Team
(Sydney)
Federation Mining Advisory Board
Jim Askew
Others TBA
• Mining engineer and executive with 35 years of
experience in hard rock base metal and precious metal
mining
• Founding COO of Evolution Mining Ltd from 2011 – 2017
where he established and operated multiple modern
mining operations and had an unblemished record of
delivering to production and cost guidance
• Strong focus on driving operational excellence, and
improving safety while continuing to deliver growth and
extend mine life
• Based in Sydney, Australia
• Holds 50% of current FED shares on issue
Management Team
• Governance professional with strong record of safety and
environment leadership for major organisations Evolution
Mining, Jacobs, and MMG
• Group General Manager – HSE & Risk at Evolution Mining
2012 – 2020
• Superior performance in government &
stakeholder management for Evolution in demanding
jurisdictions
• Established robust management systems and reporting for
safety and environment, and a visible and influential leader
• Masters qualified in business and risk management
• Based in Sydney, Australia
Mark Le MessurierManaging Director
4
Simon DelanderVice President - Sustainability
Executive Organisational Chart
5
Mark Le MessurierManaging Director
Executive Assistant
CFO
(Future Role)
Accounting
Tax/Audit
Company Secretary
IT/Data
Reporting
Legal
VP – Sustainability
Simon Delander
GM Blackwater
Nigel Slonker
VP - Corp Development
(Future Role)
Technical Services
Operational HR
Operations
Projects
Investor Relations
M&A
Resource Growth
Environment & Community
Safety & Human Resources
Permitting
Government Relations
6
Environment, Social and Governance (ESG)
Sustainability -
Management and
Board come from
Operating and
Board roles where
ESG and
sustainability are
embedded in the
culture
Values -
FED will
consolidate these
same values and
strive to be a role
model amongst
peers
Environment -
Strong skill set
within company
with experience in
managing assets
in demanding
jurisdictions
Safety & People –
Establish the
leadership and
controls to ensure
protection of people
from our local
communities
Governance –
Build trust with
government and
stakeholders and
ensure support for
continuing and
future operations
Funding
Equity
NZ Gov’t Debt/Eq
Purchase Blackwater ownership and
associated royalty
7
Annual Business Plan (Years 1 – 3)
Y1
Asset
Acquisition
Operating Mine
Development Project
Y3
Project
Development
Progress Blackwater
into final
construction
8
Annual Business Plan (Years 4 – 5)
Y4 Y5
Strategic Options
IPO
Asset(s) sale
Remain private
Three mines CF >US$100m/yr
Generate Returns
Blackwater cashflow @ $1350 Au
US$35m per annum
Acquire another operating mine
Establish Exploration Division
Geographic Focus
Priority Jurisdictions
• Australasia
• North America
Commodity
Priority Commodities
• Au
• Au/Cu
• Cu
Ideal Asset Attributes
• Poor portfolio fit
• Low capital investment
• Declining reserve
• Low margin
• Potential Resource & Exploration Upside
• Clear Operational Improvement Opportunities
Asset Economic Metrics
• +15% Return on Capital Employed
• IRR >15%
• Focus on margin
• Aim for > 8 yearasset life
M&A Target Profile
9
Located 20km south of Reefton on the west coast of New Zealand’s South Island
High grade (23g/t Au), underground, gold mine that produced approximately 740koz from 1908 – 1951
Inferred Mineral Resource (JORC 2012) of 0.9Mt grading 23g/t gold for 700koz
Mining Permit and Resource Consents approved
Option to purchase Blackwater in 2024 from OceanaGold for US$28m in FED shares or cash at FED election
Production ~70,000ozpa for 14 years
Estimated AISC of $590 – $650/oz and generates ~$35m FCF p.a at $1,350/oz
Project Overview
10
Westport
BLACKWATER
Nelson
GOLDEN
BAY
NEW
ZEALAND
Greymouth
Blackwater Mine
Strengths
Strong history of performance by Owners
High quality permitted project Blackwater
Ability to complete complex transactions
Small and experienced head office team
Strong support from NZ Government
Weaknesses
Perceived risk Blackwater Project
Limited cash reserves
Ability to acquire substantial operations
Opportunities
Projects and Operations underperforming
Large companies rationalizing assets
Establishing high margin and consistent operations
Establish new gold operation in New Zealand to create 50 direct jobs
Recruit local owner operator workforce
Threats
Competition for gold assets
OGC Agreement timeline
M&A Board Indecision (Sellers)
Community Activism
Federation
Mining
11
SWOT
Strategy
• Work to strengths, utilize experience
• Identify segments of opportunity within gold space
Build Support
• Clear strategy with stakeholder engagement
• Funding for quality projects and assets
Delivery
• Resource, project management, operational performance
• Deliver to strategic and project plan consistently and over the long term
12
Federation Mining – Culture
13
Budget – (July 2020 to December 2022)
$-
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$-
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
2020 2021 2022
Operating and Corporate Expenditures
Operating expenditures Corporate expenditures PGF Debt/Equity AustralianSuper Equity
Appendix – Blackwater Project
Location
Blackwater Mine
15
Westport
Reefton
BLACKWATER
Nelson
GOLDEN
BAYBLACKWATER
NEW
ZEALAND
Greymouth
Westport
Reefton
BLACKWATER
Nelson
GOLDEN BAY
REEFTON
NEW
ZEALAND
Greymouth
Opportunities to grow the current resource
Blackwater Resource
16
Resource Estimate 2014:
0.9 Mt@ 23 g/t: 0.7 Moz
Resource Upside:
0.8 Mt @ 23 g/t: 0.6 Moz
900m
Previously
Mined
3
4
1
2
1200m potential strike length
based on mining above2
Northern down dip extent
200koz3
Open at depth4
Unmined reef left on 16
and 17 levels when shaft
collapsed in 1951
1
Full mining records to 1951
(mine closure)5
5
New Blackwater
• Maximise productivity and safety, and utilise modern
narrow vein mining equipment
• Proposed mining method uphole bench stoping
• Preferred & safer alternative to airleg mining
Applying modern techniques to a successful historic mine
Mining at Blackwater
17
Ore driving
Long hole drilling
Stope Bogging
STOPED AND PASTE FILLED AREA
PASTE
Explosives Magazine
Boxcut excavation for twin portals
Waste rock dump and wetlands
Site Works 2020
18
Road, bridge and powerline completion
Office, workshop, changerooms
POWER LINE INSTALLATION AND PORTAL ACCESS
Site Works
19
POWERLINE STRINGING
BOX CUT ACCESS ROAD
Development of 3.3km underground twin decline’sfrom private land to the base of historic workings
Blackwater Development Strategy (Phase 2)
Establishment of drill chambers and drives, completion of drill program and completion of feasibility studies to
underpin a Decision to Mine
20
Exploration Permit
Mining Permit
Decline
MP
EP
Mining Permit approved December
2018
Environmental License and Resource
Consents granted
Blackwater Grade Comparison
21
0
5
10
15
20
25
30
35
Thu
nd
erb
ox
Fras
ers
Hem
lo
Kar
ari
Plu
ton
ic
Jun
dee
Fro
gs L
egs
Po
rger
a
Def
lect
or
Cra
cow
Shan
no
n
Gra
nit
es
Mo
un
t C
arlt
on
Wai
hi
Med
usa
Viv
ien
Dai
sy M
ilan
o
Nic
ho
lso
n
Gw
alia
Bla
ckw
ater
Go
sow
on
g
Po
go
Bu
lyan
hu
lu
Mie
kle
Turq
uo
ise
Rid
ge
Fost
ervi
lle
Underground Mined Grade g/t
• Six holes intersected high-grade mineralisation and confirmed the deposit continues at depth
• All holes intersected gold mineralisation
• Gold intersected 650m below the base of historical workings
• Drill results included:
• WA21A : 0.5m at 23.3g/t Au
• WA22D : 1.0m at 85.2g/t Au
• WA11A : 0.5m at 59.7g/t Au
• WA25A : 0.5m at 134.0g/t Au
• WA25 : 0.3m at 62.4g/t Au
COMPLETED BY OCEANAGOLD 2011 -2013
Blackwater Drilling Results
22
500m
0m
-500m
-1000m
Birthday Reef Projection Resource Estimate (Updated 2013)
Historical Production:
1.6Mt @14.6g/t for 740,000 oz
WA11 & WA11A
WA21A
WA22C & WA22D
WA25
Comprehensive production and geology records provide confidence in the inferred resource
700m
700mNEW BLACKWATER MINE
MINED 1908 - 1951
23
$-
$5,000,000
$10,000,000
$15,000,000
$20,000,000
$25,000,000
$30,000,000
$35,000,000
$40,000,000
$45,000,000
3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 1Q23 2Q23
TOTAL COSTS including W/C Cumulative Total Costs without Reserve Drilling
Decision to Mine
Completion of Mine Access
FED plus Blackwater Development Cost
0
100
200
300
400
500
600
700
800
900
0
20
40
60
80
100
2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037
Blackwater Production and AISC Profile
Blackwater Production AISC
kozpa $/Oz
24
-100
-50
0
50
100
150
200
250
300
350
400
450
500
550
2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032 2033 2034 2035 2036 2037
Blackwater Project Cashflow Profile
Free Cash Flow Cash Balance
$M
25