Big picture - Why invest in Orosur Mining Inc
Orosur Mining Inc Snapshot
Strive for profitable operations and efficient return based exploration efforts
Our aim is to be free cash flow positive, through a disciplined approach to cost management, diligent and well planned production planning and a constant review of areas of improvement.
Despite significant recent gold price volatility Orosur has remained free cash flow positive in 2014 with operating cash costs of US$792 per ounce – a significant improvement year over year.
A return based approach to exploration has been adopted and Orosur strives to deliver additional reserves and resources through considered and focussed exploration efforts. In FY 2014, this resulted in the addition of ~75Koz of additional reserves.
Orosur has also significantly strengthened its senior operational and corporate teams, making new hires with proven expertise. This is expected to allow the Company to progress swiftly with its on-going efficiency improvement initiatives and stated focus on organic and external growth.
Strong Asset Base and Growth
Orosur has a positive of exploration and development track record. The Company’s Arenal Deeeps underground mine (the first of its kind in Uruguay) was completed on time and on budget, and has both exceeded our initial production forecasts, grade mined, but also had over 50Koz of additional reserves added through focussed and cost efficient exploration.
Through focused exploration efforts, we aim to advance exploration and develop additional projects in due course.
Further strengthening our organic growth assets in Chile and Uruguay, Orosur successfully completed the acquisition of Waymar Resources in July 2014. The addition of the high grade Anzá gold project located in the Middle Cauca belt of Colombia is viewed as a positive strategic fit for Orosur and exploration work will shortly commence.
Given the right strategic fit and commercial terms, Orosur remains open to additional external growth opportunities.
Production : San Gregorio
Orosur contols over 570,000 hectares in Uruguay and ~65,000 hectares of mining and exploration tenements in the San Gregorio vicinity
The mine historically produced through a series of open pits, and in 2011 commenced development of Uruguay’s first underground gold mine, the presently producing Arenal Deeps mine. Project infrastructure, access, power and communications are good with access by paved road, grid and cellular connection and a local workforce in Minas de Corrales, a town approximately 5km from the mine.
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Exploration and Development
OMI's wholly owned Chilean subsidiary. Fortune Valley Resources Inc., signed an earn-in agreement in September 2009, on the Anillo Project, with Chilean state entity, Corporación Nacional del Cobre de Chile (“CODELCO”), giving OMI the right to earn-in to a 65% interest in the Project in return for completing i) US$3 million of staged exploration expenditures before September, 2013 (since completed), and ii) the completion of a feasibility report by September 2015. OMI has spent US$4.3 million to date.
In November 2014, OMI announced the execution of a no cost extension of its farm-in contract at its Anillo Project with Codelco until January 2020 with a further option to extend for an additional 2 years to 2022. The September 2015 deadline has now been extended with Codelco until January 2020, which may also be extended a further 2 years to January 2022 with a discovery and the definition of a mineral resource by 2020.
In November 2014, OMI announced the execution of a non-binding letter of intent with Chile to Asset Chile Exploración Minera Fondo de Inversión Privado to option up to a 40% share in its interest in Anillo by Asset Chile spending up to approximately US$3.5 million in three phases with the intention of making a discovery and delineating a resource at Anillo.
Anillo is located within the north-south trending epithermal Au-Ag deposits of Paleocene age in the Central Depression of the northern of Chile.
The property is located in the Antofagasta Region, within the Central Depression of the north of Chile and at an average altitude of 1,900 meters above sea level. The El Peñon mine operated by Yamana Gold Inc. is located 15 km to the southwest. A paved road leading to Antofagasta to the northwest is located 20 km north, which connects Antofagsta to the Escondida mine to east. The 2004 El Peñon measured, indicated and inferred mineral resource was 8.4 Mt at 14 g/t Au and 234 g/t Ag (7), including the bonanza grade Quebrada Colorada vein, representing more than half of the gold resource reported for the belt.
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Summary and Location
- Multiple high grade zones in a wide low-grade envelope and favourable topography with pipeline of drill ready targets
- Drilling to date favourable and encountered significant gold and zinc mineralisation
- Best intercepts to date include 15 m of 40 g/t Au (DDH MAP-48) and 41 m of 14 g/t Au (DDH MAP-38).
- Access by paved road to the town of Anzá and a 17 km gravel road operable year-round.
- Historically secure location. A gypsum mine has been in operation since 1991.
- Excellent infrastructure, with power grid, abundant water and mine facilities on site.
- Elevation ranges from 700 m to 2,000 m above sea level.
- Environmental permit in place to mine underground and open-pit.
In June 2010, Waymar Resources, acquired by Orosur in July 2014, entered into an option agreement to acquire a 100% interest in the Anzá Project consisting of ~231 km² of mineral rights.
In June 2013, the option was exercised and Waymar acquired a 100% interest in the Anzá project.
- US$3.8mm cash payments
- Issuance of 3.8mm Waymar shares (~1.4mm Orosur shares)
- Exploration expenditures of US$4.0mm
- Multiple phases of alteration, brecciation and mineralization.
- Multiple mineralised zones hosted preferentially in mudstones, chert and breccias; minor in volcanic units.
- Pyrite, sphalerite, chalcopyrite, and gold +/-galena, bornite, native S.
- Anhydrite/gypsum, quartz veining and stockwork, chalcedony, carbonate veinlets.
- Structurally controlled > 2.5 km long, 200 m wide zone of Au (+/-Ag, Zn, Cu). Variable mineralization and alteration styles. Evidence of “telescoping” (different mineralization styles expected to be vertically zoned but occurring overprinted upon each other).
- Drilling to date supports significant zinc grades coinciding with high grade gold.
A fortuitous discovery of massive sulfide lens led to an initial volcanic massive sulphide (“VMS”) model; however, the initial 3,000 meters of phase 1 drilling which began in 2011 did not confirm VMS style mineralization but led to discovery of a new deposit., The mineralization is structurally controlled, with disseminated to semi-massive sulfides, irregular veins, stringers and, hydrothermal breccias. were more than 2 km long, 200 m wide zones of Au (+/‐ Ag, Zn, Cu) showing variable mineralization and alteration styles. An uncertain genetic model in virgin territory with few boundaries on geometry indicates a potential for continued discoveries, with mapped porphyry targets to the north and west, and a postulated porphyry source at shallow depth
Exploration Activity and Strategy to date
17,408m of core drilling undertaken (53 holes) since first optioning the Project
Drill spacing averaging 50m. Average depths of drill holes of 300m.
In excess of 2.5 km of mineralization identified by drilling along the Aragón fault. The deposit is open to the north, south and down-dip.
Four high-grade gold zones discovered through step-out drilling.
Systematic soil, stream, surface and underground sampling programs
2,867 km helicopter magnetic and radiometric survey completed, covering approximately 260 km²
Structural evaluation using Radar images over the entire area of the land package
1:2000 scale geological mapping of areas of interest covering approximately 1,350 ha of the Anzá property
Induced polarization (“IP”), resistivity, magnetometry and topographic survey of 30 line-kilometres in a central portion of the Anzá property
Hollistic re-interpretation and in depth analysis of exploration data suite
Planning, budgeting and initiation of next step out drilling programme – including further delineation of high grade gold zones
Continued advancement of work at targets and work on base metals mineralisation
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|Tonnage Kt||Grade g/t Au||Gold oz Au|
|Tonnage Kt||Grade g/t Au||Gold oz Au|
Non Executive Director, Chairman
John joined the Company in July, 2013. He has 30 years of experience in international oil and gas industry management. He spent 11 years with Arthur Andersen, where he was a Corporate Tax Partner, specialising in international oil and gas taxation. He was Chairman of the UK Oil Industry Accounting Committee. He was an Executive Director of Enterprise Oil plc, Chief Executive of Hardy Oil and Gas plc. and he was appointed a Non-Executive director and chairman of the audit committee of Seeboard plc. at the time of privatisation. He is currently a Non-Executive Director and Chairman of the Audit committee of Pantheon Resources plc. and Executive Chairman of the Consilience Energy Advisory Group Ltd.
CEO and Director
Ignacio is the CEO of Orosur Mining since March 2013. He had joined the Company in September 2008 as Finance Director. He has a 25-years international experience, prior to Orosur, mostly working as international staff for the Royal Dutch Shell group, in different functions in Finance and New Business Development, working and living in several countries in Europe and South America. Among others, he was CFO of the multi-billion Shell oil and gas businesses in Denmark and Germany, in charge of the New Business Development in Argentina for oil and gas and in several roles in Head offices both in London and in the Hague (Holland). He holds a Master Degree in Business Administration and a Master Degree in Law, both from the University of Deusto in Spain. Ignacio is President of the Chamber of Mines of Uruguay since 2009.
Roger is a Mining Engineer with over 40 years of experience in the mining industry. He is currently a Non Executive Director of Condor Gold, EMED Mining and Alexander Mining. Previous positions held include Assistant Director and the Senior Mining Engineer at N M Rothschild (London) in the Mining and Metals project finance team; Director, Vice-President and General Manager of Minorco/AngloGold subsidiaries in Argentina; Operations Director of Greenwich Resources plc, London; Production Manager for Blue Circle Industries in Chile; and various production management roles in Gold Fields of South Africa. Roger is a graduate of the Camborne School of Mines with a Master of Science degree in Mineral Production Management from Imperial College. He is a Chartered Engineer, a European Engineer and a Member of the Institute of Materials, Minerals and Mining.
Horng Dih Lee
Non Executive Director
Mr. Lee joined the company in July 2014. He is currently the Chief Financial Officer and Corporate Secretary of Eastern Platinum Ltd. (TSX:ELR). Mr. Lee obtained his Chartered Accountant designation with Deloitte & Touche and holds an MBA from the University of British Columbia. He has more than 25 years of experience in finance, accounting, treasury and administration in public mining companies. Prior to joining Eastern Platinum, he held senior financial positions with Northern Orion Resources Inc. (formerly TSX listed), Ivanhoe Mines Ltd. (TSX:IVN) and Diamond Fields Resources Inc.
COO & Executive Director
Jorge has over 30 years’ experience working as a geologist and senior manager for South American mining companies, including time spent as General Manager of Operations for Orosur between and with Barrick Gold from 2008 to December 2012, ultimately as General Manager of Operations for Barrick’s Pascua-Lama project, and before that at Barrick’s Zaldívar mine. Prior to that, Jorge had served in various roles including General Manager of Compañía Minera Maricunga, Superintendent of Mines at Compañía Minera Zaldívar, production geologist for Codelco at the Chuquicamata mine, and as an exploration geologist for Renison Goldfields in Australia. Jorge is a former Director of Starmine Ltda and has an MBA from Universidad Católica del Norte.
CEO and Director
COO and Executive Director
Alejandra joined the Company in July 2008, having previously held the role of senior auditor at Ernst & Young (2005-2008). Alejandra holds an MBA from the Universidad de la República in Uruguay and has experience in finance, accounting, treasury and reporting.
Vice President, Planning & Corporate Development
Ryan has worked in the mining sector for over 10 years across a broad range of roles including investment banking, investor relations, corporate advisory, corporate development and operations. He has previously held management roles with private and public companies in the natural resources sector. Prior to that, Ryan was a Director, Equity & Debt Capital Markets at Canaccord Genuity. During his time with Canaccord he advised on approximately US$7.5 billion worth of transactions, including financings, M&A, corporate advisory and debt & commodity related finance.
General Manager, San Gregorio Operations
Fernando has over 25 year experience in the mining sector across a broad range of positions. He has worked in Orosur for 20 years, developing a strong team and a successful management track record at minesite. Fernando has been a key component in projects including the San Gregorio open pit gold mine, Arenal open pit gold mine, Arenal underground gold mine and Corrales River diversion.
Exploration Manager - Uruguay
Jerónimo is a geologist with 10 years of experience, predominantly as a mine geologist. He has led gold and base metal production projects, both open pit and underground, in Argentina and Uruguay. Jerónimo’s team in Uruguay are responsible for both operational and exploration activities, including ore control, brownfield and greenfield exploration activities. Jerónimo has experience in mineral exploration, resource modeling and production of numerous deposits and mines. Jerónimo holds a degree in Geology from La Plata National University.
Joaquín L. Sarroca
Joaquín commenced working for Orosur in May 2014. Joaquín earned his Master of Laws in International Business Law (LLM), from Queen Mary University of London and is also a Uruguayan-qualified lawyer (Universidad de la República). He has over 10 years of legal experience at recognized law firms in both Uruguay and London where he advised on commercial litigation, corporate governance, business law and contracts to international and local corporations from different industries, including energy and mining.
Héctor M. López
Administration and Budget Manager
Héctor has worked in the mining sector for over 12 years across a broad range of roles including, finance, accounting, treasury, budgeting and new business development. Héctor is from Minas de Corrales, the closest town to the Company’s San Gregorio mine and joined Orosur in 2004. Prior to that, Hector worked for Rea Gold, the Company which first developed the San Gregorio mine. Hector possesses a deep knowledge and understanding of the mine and local area.
Capital Structure Summary (As at 3 April, 2017):
|Basic Shares Outstanding||100,846,403|
|Fully Diluted Shares Outstanding||108,144,496|
Major Shareholdings: (As at 17 March, 2017)
|TD Bank Financial Group||12,159,091||12.06%|
|WH Ireland Group plc||3,234,665||3.21%|
|Fidelity Mgt & Research||3,229,000||3.20%|
|Hargreaves Lansdown PLC||3,159,698||3.13%|
|Hargreave Hale Ltd||3,154,000||3.13%|
Director Holdings: (As at 3 April, 2017)
|Investor||Shares||% Holding||Stock Options||Strike (C$)|
|John Walmsley||140,350||0.14%||1,007,439||$0.105 - $0.277|
|Roger Davey||23,500||0.02%||610,442||$0.105 - $0.277|
|Ignacio Salazar||723,000||0.72%||2,024,544||$0.105 - $0.277|
|H.D. Lee||64,386||0.06%||500,000||$0.105 - $0.235|
Chief Executive Officer
Tel: +1 778-373-0100
Apoquindo N° 5583 of. 31
Las Condes, Santiago
Echevarriarza 3535, Of. 1512
Tel: + 598 2623 0661
Fax: + 598 2577 0181
Planning and Corporate
Tel: +1 604 655 7796
NOMINATED ADVISOR (NOMAD) AND BROKER
Cantor Fitzgerald Europe
One Churchill Place, Level 20, Canary Wharf
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Telephone: +44 (0) 20 7894 7000
Contacts: Stewart Dickson / Jeremy Stephenson
200 Aldersgate | Aldersgate Street
London EC1A 4HD
Telephone: +44 (0) 20 3727 1000
Contacts: Ben Brewerton / Oliver Winters / Sara Powell
TRANSFER AGENT, REGISTRAR AND DIVIDEND DISPERSING AGENT (CANADA)
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REGISTRY FOR DEPOSITORY INTERESTS (U.K.)
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