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U3O8 Corp. Investee – TSX: UWE OTCQX: UWEFF SSE: UWE | www.u3o8corp.com | www.samsilica.com

March 31, 2015

Frac sand developments for the

Argentinean shale oil/gas market

Richard Spencer, CEO, South American Silica Corp.

Forward-Looking Statements

& Disclaimer

2

Certain statements and concepts contained herein constitute forward-looking statements that involve substantial known and unknown risks and uncertainties. These forward-looking statements are subject to numerous risks and uncertainties, certain of which are beyond the control of South American Silica Corp. (“SAS”), including, but not limited to, the impact of general economic conditions, industry conditions, geopolitical risks, volatility of commodity prices, risks associated with the uncertainty of exploration results and estimates and that a resource will be achieved on exploration projects, that the Carina property will be developed as anticipated and frac sand potential is realized, that resource size estimates, production and timing of development will be achieved on any target area, currency fluctuations, the uncertainty of obtaining additional financing and exploration risk, and dependence upon regulatory approvals. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. Potential size estimates are conceptual in nature. There has been insufficient exploration to define a resource on the specified targets. It is uncertain if further exploration will result in resources being delineated on those targets. These forward-looking statements are made as of the date hereof and SAS. assumes no obligation to update or revise them to reflect new events or circumstances.

Comparisons of SAS’ properties and exploration targets with other frac sand projects are conceptual in nature, and have not been independently verified by SAS and information regarding these peer deposits are drawn from publicly available information. Information on SAS and its projects are available on the company’s web site at www.samsilicacorp.com.

Industry and peer information has been drawn from publicly available sources and have not been independently verified by SAS.

www.samsilica.com | www.u3o8corp.com

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Outline

3

Strategic importance of the Vaca Muerta to Argentina

Potential for Argentina to become a regional energy powerhouse

Sustained, increasing production from the Vaca Muerta

Argentina getting it’s fiscal house in order

Subsidizing the oil production below price-specific thresholds

2015 presidential election

What is the Vaca Muerta?

Short-term market growth potential & required proppant quality

Logistics in Argentina – infrastructure developed over 100 years of

conventional oil & gas production

Conclusions & Opportunities


4 Sources: SIPG - AIPG

Vaca Muerta:

Strategic Importance to Argentina: could replicate USA shale oil & gas boom

Vaca Muerta set to emulate USA oil & gas from shale success

Vaca Muerta

at this stage

– declining crude production

being reversed by shale oil

Weekly US Crude Oil Production Jan. 1983 to

Nov. 2014

(Ba

rre

ls p

er

da

y –

millio

ns

)


Crude Oil

Production

19

70

19

80

19

90

20

00

20

10

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

50,000

1-J

ul-

10

1-N

ov

-10

1-M

ar-

11

1-J

ul-

11

1-N

ov

-11

1-M

ar-

12

1-J

ul-

12

1-N

ov

-12

1-M

ar-

13

1-J

ul-

13

1-N

ov

-13

1-M

ar-

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1-J

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14

1-N

ov

-14

1-M

ar-

15

Oil

pro

du

cti

on

(b

oep

d)

Vaca Muerta production

5

Vaca Muerta: Fundamental Strategic Imprortance to Argentina


*Vaca Muerta Shale in Argentina; Eagle Ford & Bakken

Shale in the USA

Sources: WSJ, IEA

OPEC Budget Breakeven Costs

compsred with Shale Production Cost Argentina’s oil imports $7B/year;

Foreign currency reserves $34B;

20% of total foreign currency

reserves spent on oil imports per

year

Vaca Muerta production cost ~$58/bbl –

drive to reduce costs

90% of Argentina’s oil, 71% of its gas,

from Patagonia - economic driver for

semi-desert region in which there are

few economic alternatives

Argentina needs the Vaca Muerta

oil production

Vaca Muerta:

Strategic Importance to Argentina: – Oil production in economically “challenged” area

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Vaca Muesrta is in an economically

stressed area

Permitting – “farm” sizes are

typically 25,000 acres

Vaca Muerta:

Strategic Importance to Argentina: – Could drive Argentine Economy for Decades

7

75

48

32

27

26

18

13

13

9

9

Russia

USA

China

Argentina

Libya

Australia

Venezuela

Mexico

Pakistan

Canada

1,161

1,115

802

707

573

545

437

390

285

245

USA

China

Argentina

Algeria

Canada

Mexico

Australia

South Africa

Russia

Brazil

Shale Oil Rankings by Country Technically Recoverable Shale Oil Resources

(billions of barrels)

Shale Gas Rankings by Country Technically Recoverable Shale Gas

(trillions of cubic feet)

Source: US DOE Source: US DOE


Vaca Muerta:

Strategic Importance to Argentina: – The infrastructure is already in place


Export pipelines to

Chile

Export pipelines to

Chile

Oil production started from

the Nuequen Basin in 1918;

Extensive infrastructure;

Support & service industries

based in local cities;

Export pipelines to Chile:

Imports 97% of its oil;

Imports 77% of its gas;

A consistently strong

economy;

Strong & consistent

demand for fuel

Vaca Muerta:

Strategic Importance to Argentina: It’s getting it’s house in order


May 2012: Nationalized 51% Repsol ownership of YPF;

$200B - $300B required to develop the Vaca Muerta;

Reversal of policy:

December 2012: 1st new deal with foreign

oil company (Pan American Energy (a BP subsidiary)):

Followed by JV’s with Exxon, Chevron-Mobil, Dow, Total,

Wintershal, China National Oil, Petronas, Petrobras, BP, among others;

2014, April: Repsol accepted compensation for YPF (US$5B);

2014: $15B foreign investment in the Vaca Muerta;

2014: May: Settled with Paris Club of Lenders – opened up French capital market;

2014, July: Selective default because Argentina could not settle with bond holdouts;

2014, July: $11B currency swap with China;

2015, March: US Chamber of Commerce president says US companies will invest

$20B/y in Vaca Muerta

2015, April: Obama administration supports $2B Argentine loan from World Bank – 1st

such support since 2011.

0

10,000

20,000

30,000

40,000

50,000

1-J

ul-

10

1-J

an

-11

1-J

ul-

11

1-J

an

-12

1-J

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12

1-J

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-13

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-14

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-15

Oil p

rod

ucti

on

(b

oep

d)

Argentina: A bad reputation


Economic challenges:

High inflation rate –

expected to be 21% in

2015, currently 18%;

Foreign currency

restrictions;

Sovereign debt default;

Economic positives:

Debt-to-GDP not as bad as

it is perceived to be;

Oil producers are being

subsidized;

Vaca Muerta development seen

as economic driver;

October 2015 elections –

candidates have pro-business

platforms

Japan

Singap

ore

USA

Be

lgium

France

UK

Gre

ece

Italy

Po

rtugal

Ge

rman

y

Arge

ntin

a

2014 Debt-to-GDP Ratios

Vaca Muerta:

Strategic Importance to Argentina: Stimulus for oil producers


Subsidy of up to $6/bl to prevent drop in output due to lower international oil prices:

$3/lb to companies that maintain or increase output relative to 2014;

$2/lb to exporters for oil sold abroad - $3/lb for exporters that maintain or

increase exports from 2014 levels;

Subsidies apply while:

34°API Medanito prices are <$84/bl (including the subsidy);

24°API Escalante prices are <$70/bl. Most of Escalante-grade is exported – local

refineries can’t handle the heavy crude.

Reduced royalties:

While Brent is <$79/bl, export duties decreased on a sliding scale to 1% from 13%

Argentina:

A bad reputation - but stocks are doing “OK”


Up ~60% in 2014

Up 32% so far in 2015

Argentine Election:

Leading Contenders:


Presidential election: October, 2015

The job: ..”leading a country mired in default, hemmed in by

litigating hedge funds and ravaged by economic stagnation

and double-digit inflation”. Bloomberg

Current poll

Scioli 32.2+/-2.5%

Macri 29.9%+/-2.5%

Massa 13.6%+/-2.5%

Argentine Election:

Scioli:


58

Governor of Buenos Aires province (38% of national population), same political party

as current Pres. Kirchner

Family owned electrical appliance business

Former world speedboat champion

Vice President under Nestor Kirchner for 4 years

Political platform – gradual change:

Would not devalue the Peso

Would not settle with “holdout” bond holders related with Argentina’s selective

default in mid-2014. Indications: he would settle for 70% of the $1.6B awarded to

the “holdouts”

Track record in Buenos Aires province that accounts for ~1/2 Argentina’s GDP

Changed tax code

Province went to budget surplus in 2013, 2014

Legislate to protect savings so as to attract $200B held offshore by Argentineans

Argentine Election:

Macri:


56

Mayor of Buenos Aires city (35% of country’s population)

Civil engineer

Family construction company, credit analyst at Citibank, president of Boca

Juniors football club (12 years) – club won 16 tropies under his leadership

Entered politics in 2005, elected mayor of Buenos Aires in 2007, re-elected

in 2011

Political platform: “Agent of change”:

End currency controls

End import restrictions & export tariffs to entice foreign investment &

offest capital outflows

Would settle with “holdout” bond holders related with Argentina’s

selective default in mid-2014

Vaca Muerta Shale Gas and Shale

Oil Prospective Areas,

Neuquen Basin


100-800m

25-450m Vaca Muerta

Los Molles

Agrio

Comparison of Vaca Muerta

with Shales in the US.


Source YFP Presentation, 2013

Vaca Muerta Shale Oil

Vaca Muerta compared

with shale plays in the US


Source: Credit Suisse Report, 2013

Based on YPF, SPE, WoodMackenzie, UG Harts Reports

Depth Comparison

VM thickness = high proportion of

vertical wells

Small footprint = infrastructure is

concentrated, and mostly already in

place because of 100 years of

conventional production

Requires high K-value proppant

Thickness

Area Comparison

Argentina:

Other Prospective Areas,

San Jorge Basin


Los Molles

D-129: 100-2,000m

D-129 Formation: mainly gas-prone, deep

20

Vaca Muerta: Rough estimate of Supply/Demand

for Proppant and Frac Sand

• Estimated total proppant

requirement in 2017 ~ 800kT

• ~50% (~400kT) of requirement

is for frac sand (oportunity 1)

• ~50% is for ceramic proppants,

but a 9 or 10K (good quality)

frac sand is very likely to

substitute for some of the

ceramic proppant requirement,

increasing the potential market

share for sands of exceptional

quality.

Need for very high quality frac

sand


0

100

200

300

400

500

600

700

800

900

2015 2016 2017

De

man

d (

kT)

Vaca Muerta - proppant supply/demand

Frac sandproduction (kT)

Total proppantdemand (kT)

Total frac sanddemand (kT)

Op

ort

un

ity 2

Oportunity 1

Local Frac Sand: 560mi by road from the Vaca Muerta

Moderate quality

21

• Frac sand ~93% of bulk sand

• Mainly divided between 20/40 &

40/70 grain sizes


Characteristic API*

Requirem’t Original Test Results

Sample 14528

Results

Conform

to API

Sample # 146 147 148 GEL 1101

Fraction 20/40 30/50 40/70 20/40 40/70

% of sand in that fraction 42% 73% 52% 45% 48% ~93%

Sphericity 0.6 0.61 0.63 0.57 0.6 0.6 Meet

Roundness 0.6 0.44 0.44 0.38 0.8 0.7 Exceed

Acid

consumption

2% 1.7% 2% 2.5% Meet /

marginal

failure 3% 2.1% 3.9%

Turbidity 250 FTU 102 78 166 193 140 Exceed

Crush test API Requirement 14% @

4K

10% @

4K

8% @

5K

14% @

4K

8% @

5K

4Kpsi 8.8% 3% 5.3% Exceed

5Kpsi 6.4% Exceed

6Kpsi 9.4% 9% Meet

8Kpsi 7.2% Meet

K Value 8K 5K 6K

Local Frac Sand

*API (American Petroleum Institute) specifications for frac sand

Vaca Muerta:

Current & proposed infrastructure


YPF’s

Caning frac

sand plant

Vaca

Muerta

Existing road

YPF’s

planned

Anelo

frac sand

plant

Existing road

Puerto Madryn

Bahia Blanca

5-8K

sand

deposit

San Antonio

Defunct rail

Operating

rail system

• Infrastructure is

challenging

• By road from port -

300mi

• Proposed rail unlikely

to be built

• Existing narrow-

gauge rail could be

upgraded

Vaca Muerta: In-country logistics & transport cost guidance


Palmira

Rio Grande

San Antonio

Puerto Madryn

Bahia Blanca

Vaca Muerta

San Jorge

Brazil

Uruguay

Ch

ile

Estimated Port Costs:

• Brazil - Rio Grande Port:

US$5.24/ tonne

• Uruguay – Palmira Port:

US$7/tonne

• Argentina: Bahia Blanca Port:

US$28/tonne

Sea freight (US$/tonne):

• Rio Grande port to Bahia Blanca:

US$20/t (container);

• Puerto Madryn to Bahia Blanca:

US$12/t (bulk)

Comodoro Rivadavia

Uruguay & Brazil sands:


Good quality

Full grain-size range – tailor product to each

client’s requirements

Safety – silica dust is carcinogenic

hydromining/dredging and initial wet-screening

– no dust!

250mi from deepwater ports

Conclusion: Competitive advantages


5-8K frac sands are available locally (20/40, 30/50, 40/70#) – moderate

quality

Opportunity:

Argentina needs (and wants) oil production – fracking accepted

Vaca Muerta & especially San Jorge basin (gas), needs higher K sands

Logistics are problematic for supply from local source:

Road transport is most viable option (900km / 560mi);

“Planned” rail unlikely to be built;

Sea freight and east-to-west transport by existing rail / road

network is attractive option. Opens the door for imported sand;

Health effects of dust – dredging is an attractive alternative that is

likely to be more socially acceptable