CNSX: TV

Transcription

1 CNSX: TV March 2010

2 DISCLAIMER Certain statements contained in this document, including, without limitation, those concerning the economic outlook for the mining industry, expectations regarding metal prices and production, the completion and commencement of commercial operations of certain of Trevali Resources Corp. (TRC) projects, and its liquidity and capital resources and expenditure, contain certain forward looking statements regarding TRC s economic performance and financial condition. Although TRC believes that the expectations reflected in such forward looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, results could differ materially from those set out in the forwardlooking statements as a result of, among other factors, changes in economic and market conditions, success of business initiatives, changes in the regulatory environment and other government actions, fluctuations in metal prices and exchange rates, and business and operational risk management. TRC undertakes no obligation to update publicly or release any revisions to these forward looking statements to reflect events or circumstances after the date of the annual report. All subsequent written or oral forward looking statements attributable to TRC or any person acting on its behalf are qualified by the cautionary statements herein.

3 1. Overview and Corporate Structure 2. Santander Project contents 3. Community Relations 4. Tingo Hydroelectric Station 5. Investment Rationale A member of the Cardero Group of Companies

4 OVERVIEW Silver Lead Zinc PRODUCTION targeted for 2010 from the Santander Project located 215km by road from Lima in Peru s Central Mineral Belt Estimated mine life based on 2009 Resource Estimate of approximately 10 years with estimated annual production of approximately million lbs. zinc, 20 million lbs. lead and 800,000 1M ozs. silver Strategic partnership with Glencore International AG providing 2000tpd plant, contract mining and manpower in exchange for LOM concentrate offtake agreement mitigates both financial and technical risks Trevali retains full ownership in Santander project and can acquire ownership of Glencore s processing plant through a modest toll charge Overview and Corporate Structure

5 OVERVIEW (continued) CAPEX modest due to existing infrastructure and Glencore providing 2,000 tpd processing plant and contract mining fleet OPEX expected to be lower quartile significant silver/lead credits Very significant exploration potential to expand silver lead zinc resource Tingo hydroelectric power generating facility low cost, renewable power supply surplus capacity can provide significant future revenue stream or sufficient power for a 4,000tpd operation Evaluating options to maximize value from silver production and surplus power generation from the wholly owned Tingo hydroelectric facility Full TSX listing application submitted to be followed by Lima senior board listing Overview and Corporate Structure

6 CAPITAL STRUCTURE Shares Issued: 52,868,790 Fully Diluted: 66,389,877 Number Expiry Price Warrants 339,119 Dec 2010 $1.20 Warrants 1,089,625 May 2011 $1.30 Warrants 735,294 Oct 2012 $1.00 Warrants 6,070,170 Dec 2012 $1.15 Options 300,000 Apr 2010 $2.00 Options 355,000 Jan 2011 $0.72 Options 220,000 May 2011 $1.05 Options 2,800,000 Dec 2012 $1.00 Options 1,611,879 Dec 2012 $0.95 Management/Insiders: Approx. 10% Peru Group: Approx. 10% Funds/Institutions: Approx. 35% Listings CNSX*: TV Frankfurt: 4TI Pinksheets: TREVF *Full TSX listing application submitted MARKET CAPITALIZATION: ~CDN$80M Overview and Corporate Structure

7 TREVALI MANAGEMENT Dr. Mark Cruise, President & CEO A carbonate hosted base metal deposit specialist. Project experience from grassroots exploration through resource definition to permitting and production in Europe and the America s on behalf of Pasminco Exploration, Anglo American & the Cardero Group. Part of the technical team that defined, permitted and put the 22Mt underground Lisheen Zinc Lead Mine into production (Anglo American). Carlos Ballon, Chairman A mining engineer (Colorado School of Mines) who owned and operated the Santander Mine from 1985 to Previous VP South America for Corriente Resources and Director of Thiess South America (Australia s largest contract miner) managing major engineering works at Tintaya and Yanacocha. Associated with the Cardero Group since Overview and Corporate Structure

8 1. Overview and Corporate Structure 2. Santander Project contents 3. Community Relations 4. Tingo Hydroelectric Station 5. Investment Rationale A member of the Cardero Group of Companies

9 SANTANDER PROJECT LOCATION 44 sq. km property in the world class Central Peruvian Polymetallic Belt globally the No. 1 Silver, No. 2 Zinc & No. 4 Lead Producing District 215 km from Lima by road government upgrading all access routes Wholly owned Tingo run of river hydroelectric generating station 17 km from mine site Fully supported 200 man camp currently being expanded to 350 man capacity to support mine construction and operation Santander Project

10 : Production from Santander Pipe approx. 8Mt to produce Zn, Pb Ag and Cu concentrates Mining ceases at 480m depth in mineralization due to adverse metal prices and underlying hyper inflation in Peru Mid 2007: Trevali recognizes significant exploration potential for new mineral bodies acquires property Dec 2007: Geophysical (magnetics) anomalies supported by historic data and recon mapping triggers exploration drill program numerous anomalies significantly larger than surface expression of mineralization EXPLORATION Historic drilling suggests Mineralization extends min. 200m Schematic Santander Pipe 500m remains open Santander Project

11 Early high grade intercepts initiate 20,000m Magistral exploration/ resource definition drill program of the Magistral ore bodies: DDH SAN % Zn, 3.66% Pb, 90g/t Ag & 0.12% Cu Parallel 1000+m drill program delineates zinc resource in historic tailings. EXPLORATION May 2009 Golder initial Resource Est. May 2009: Trevali & Glencore International form partnership to develop Santander Project production anticipated in late Oct 2009 present: Ongoing resource expansion and mine development Massive sulphide Magistral Sur Santander Project

12 GLENCORE AGREEMENT Trevali will maintain its full control and ownership of the Santander project and Tingo hydroelectric generating station Glencore will provide and operate a 2,000 tpd processing and concentrate plant, and provide its operational expertise on a contractor toll basis from mining through to concentrate production Trevali can acquire the plant contributed by Glencore on a toll basis (approx $1 1.50/tonne) Glencore is providing Trevali a US$2 million convertible financing Trevali has secured a long term concentrate off take sales agreement whereby Glencore will buy 100% of the Santander project area life ofmine production at benchmark terms Santander Project

13 MINERALIZATION & DEPOSITS Puajanca Discovery Magistral North, Central and South Deposits resource expansion progress updated NI estimate anticipated in early Q Mineralization, defined to approx. 350m depth and remains open in multiple directions. Magistral Deposits Santander Tailings contain 100Mlbs zinc (indicated resource) that can be reprocessed. Puajanca South Zone fourth sulphide body discovered to date. High level in the system silver lead rich mineralization. Drilling underway. Santander Pipe Exploration continues to explore large land package (44km 2 ), using a multidisciplinary approach with proven exploration models for controls on mineralization. Two prospective mineral fairways recognized to date: 3km long Santander Pipe Puajanca Zone 14km long Magistral structural trend Santander Project

14 MAGISTRAL DEPOSITS All zones open to east (MN Hole SAN-098: 107.4g/t Ag, 9.92% Pb, 10.31% Zn & 0.49% Cu from 38m) North Looking east-southeast All zones outcrop Central South Potential Eastern Zones Depth of Mine Plan 350 meters 110.6g/t Ag, 2.14% Pb, 7.62% Zn & 0.28% Cu 62.8g/t Ag, 4.74% Pb, 4.18% Zn 5.28% Zn All zones open to depth Santander Project

15 2009 RESOURCES (Golder Associates) Contained Tonnes % Zn % Pb g/t Ag Zn (mil lbs.) Pb (mil lbs.) Ag (mil ozs.) Indicated Resource Total Indicated 5,298, % 1.27% 38g/t Total Inferred 2,244, % 0.50% 18g/t Santander Tailings: Indicated Resource 1,656, % Resources in 3 Magistral deposits all open Approximate discovery cost of <0.5 cent per lb Zn Pb Current exploration has intersected some of the highest grade and thickest mineralization to date anticipate increased tonnes and headgrade: NORTH metres at 118 g/t (3.4 oz/t) silver, 4.86% lead, 7.46% zinc CENTRAL metres at 71.1 g/t (2 oz/t) silver, 0.8% lead, 8.2% zinc SOUTH metres at 10% zinc Resource update planned for early Q Santander Project

16 INTERNAL MINE DEVELOPMENT STUDY Internal Mine Development Study in mid 2009 resulted in a positive production decision Planned initial open pit production from Magistral North & South transitioning to UG development from all three Magistral deposits (price assumptions of $0.65/lb Zn, $0.60/lb Pb and $14/oz Ag) Deposits amenable to low cost bulk mining methods sub level stoping Anticipated to be within lower quartile of cash cost curve due to existing infrastructure and silver/lead credits Excellent exploration potential for discovery of additional resources: Eastern and depth extensions to Magistral deposits Puajanca Zone El Toro Zone Geophysical targets Santander Project

17 GLENCORE MINE MODEL Santander Project

18 METALLURGY Coarse grained mineralogy provides good recoveries to produce clean concentrates 90% Lead recovery at 40% concentrate grade with oz/t silver 85 90% Zinc recovery at 50% concentrate grade 80 85% Silver recovery (to lead concentrates) Good potential for production expansion Santander Project

19 EXPLORATION SIGNIFICANT UPSIDE POTENTIAL 62.8g/t Ag, 4.74% Pb & 4.18% Zn 110.6g/t Ag, 2.14% Pb & 7.62% Zn 10% Zn 8.14% Zn Santander Project

20 Puajanca Discovery GEOPHYSICAL TARGETS AT SANTANDER Strong correlation of magnetic and electrical anomalies with sulphide mineralization. Magistral Deposits Santander Pipe Santander Mill Santander Project

21 1. Overview and Corporate Structure 2. Santander Project contents 3. Community Relations 4. Tingo Hydroelectric Station 5. Investment Rationale A member of the Cardero Group of Companies

22 SANTANDER COMMUNITIES & PERMITTING Local communities on board and highly supportive: Proactive community consultation and dedicated Community Relations team; communities have signed off on all permits All required surface land rights obtained Tailings permitted Water rights permitted Mine Plan submitted permit pending Detailed Processing Plant engineering underway basis for final Plant permit Glencore committed to commence construction late March early April with Plant commissioning approx. October November 2010 Community Relations

23 1. Overview and Corporate Structure 2. Santander Project contents 3. Community Relations 4. Tingo Hydroelectric Station 5. Investment Rationale A member of the Cardero Group of Companies

24 TINGO HYDROELECTRIC GENERATING STATION The Tingo run of river hydroelectric generating station is situated 17 km west, downvalley, from the Santander mine site and has operated since 1958 generating up to 1.6MW of electricity partly servicing the power needs at the Santander mine. US$15 million financing rights agreement with Interbank of Peru to fund increase of generating capacity from current 1.6MW to approximately 10MW, upgrade the existing transmission line and extend the line to connect to the Peruvian National Energy Grid allowing for sale of excess power and cash flow to Trevali. Conservative independent model suggests an NPV 12 of US$10 million and after tax IRR of 20% with cashflow of US$5 million per annum. Life of project minimum 50 years (indefinite). Tingo Hydroelectric Station

25 1. Overview and Corporate Structure 2. Santander Project contents 3. Community Relations 4. Tingo Hydroelectric Station 5. Investment Rationale A member of the Cardero Group of Companies

26 TREVALI KEY TO THE DISTRICT GLENCORE Iskaycruz Business Unit MILPO VOTORANTIM N. Santander P. Nuevo TREVALI Tingo Power Station TREVALI Santander Mill VOLCAN Alpamarca Mine Investment Rationale

27 TREVALI GOING FORWARD Increase market value with ongoing exploration & development. Trevali Renewable Energy Inc. offers significant additional upside. Short Term Value Drivers: Production and cash flow targeted for 2010 Major strategic partner Glencore (world s largest metal trader) Highly leveraged for predicted Zn and Pb deficits in late Listings applications on major exchanges Toronto & Lima Proven team resource expansion programs currently underway Exposure to silver market opportunities Medium Term Value Drivers: Potential for increased capacity (4,000 tpd) and improved efficiencies District Consolidation disciplined approach to acquisitions Examine further hydroelectric growth opportunities Investment Rationale

28 Trevali Resources Corp West Georgia Street Vancouver, BC, Canada, V6E 4A2 Phone: Fax: Contact: Steve Stakiw, Manager Corporate Communications